SBC Medical Q3 Revenue Up 35% as Net Income Jumps 22%

SBC Medical Group Holdings Incorporated (Nasdaq: SBC) reported on 13 November 2026 third-quarter revenue of $59 million, up 35% year over year, and net income attributable to SBC Medical of $16 million, up 22%, according to the company's quarterly release. Income from operations reached $26 million, up 66%, and Adjusted EBITDA came in at $28 million, also up 66%, lifting the Adjusted EBITDA margin to 47% from 38% a year earlier.

Context — why the MSO margin story matters now

The report frames the quarter as a reacceleration after what it calls structural reforms implemented in 2025. The company's own comparison set is the year-ago quarter: 3Q25 revenue of $43 million, operating income of roughly $16 million, and Adjusted EBITDA of $17 million. The 3Q26 figures are not a rebound from a weak base alone — the nine-month totals show the same direction at a slower pace, with 9M26 revenue of $151 million versus $134 million, a 13% gain.

That gap between the quarterly and nine-month growth rates is the first thing a reader should notice. The third quarter alone contributed a disproportionate share of the year's incremental revenue, which the company attributes to service fee structure revisions announced in August 2026 and the consolidation of Waqoo.

The margin line is where the report makes its case. Net income margin fell 3 percentage points to 27%, even as Adjusted EBITDA margin expanded 9 points to 47%. Those two measures moving in opposite directions usually points to items below the operating line — the report does not break out what drove the difference, and the company did not disclose the specific reconciling items in the summary it released.

Chairman and CEO Yoshiyuki Aikawa described the quarter as showing growth and profitability "improving in tandem," and said the MSO model's two levers are expanding the clinic network and raising service fees per clinic.

Data — what the numbers show

Total revenue of $58.58 million broke down as $53.52 million from related parties and $5.06 million from other sources. Cost of revenues was $16.40 million, leaving gross profit of $42.18 million, a gross margin of 72%. Selling, general and administrative expenses of $15.76 million were the only operating expense line, producing the $26 million operating result.

Metric	3Q26	3Q25	Change
Total revenues	$59M	$43M	+35%
Net income (attributable)	$16M	$13M	+22%
Net income margin	27%	30%	-3 pt
Adjusted EBITDA	$28M	$17M	+66%
Adjusted EBITDA margin	47%	38%	+9 pt
Basic EPS	$0.15	$0.12	+25%

On the operational side, the clinic network reached 293 locations as of 30 September 2026, up 36 year over year. Patient visits over the trailing twelve months totaled 7.06 million, up 9%, and average spend per visit was $290, up 4%. The report notes the location count includes franchised SBC-branded clinics, Rize Clinic, Gorilla Clinic, AHH Clinic and JUN CLINIC, plus locations operated by OrangeTwist, in which SBC holds a minority equity interest through OT Midco Holdings, LLC.

Nine-month figures: revenue $151 million, net income $38 million, Adjusted EBITDA $66 million, basic EPS $0.37. Annualized ROE was 23% in 3Q26, flat versus 3Q25, and 19% for the nine-month period, down 3 points.

Analysis — what it means for healthcare and MSO comparables

The report's own numbers let a reader test the MSO model's arithmetic. Revenue per location works out to roughly $200,000 for the quarter across 293 sites, while the 4% growth in average spend per visit trails the 9% growth in patient visits — meaning volume, not pricing, is doing more of the work at the clinic level. The fee revisions the company credits for the quarter's acceleration are a separate lever from patient traffic.

The EBITDA-to-net-income spread is the limitation worth naming. Adjusted EBITDA is a non-GAAP measure, and the company's own disclosure warns it is not defined under U.S. GAAP and may not be comparable to similarly titled measures at other companies. A 47% Adjusted EBITDA margin alongside a 27% net income margin means roughly $12 million of the quarter's EBITDA did not reach the bottom line. The report does not reconcile the two in the summary text, so the composition of that gap — interest, tax, depreciation, amortization, or non-controlling interests — is not established by what the company disclosed.

Cash generation supports the operating picture: net cash provided by operating activities was $50 million for the nine months. The balance sheet showed $198.4 million in cash and cash equivalents at 30 September 2026, up from $163.8 million at 31 December 2025, against $34 million of bank and other borrowings and finance lease liabilities plus $10 million of operating lease liabilities, giving Net Cash of $154 million on the company's non-GAAP definition.

On positioning, the report points to capital deployment rather than buybacks or dividends: Aikawa said the company intends to direct its financial position toward "disciplined growth investment." No buyback authorization or dividend is mentioned.

Outlook — what to watch next

The company's stated next steps are specific. It is developing a proprietary local large language model infrastructure for secure medical-data use, and advancing clinic operating systems through a capital and business alliance with Atomic Software. In Longevity, it is developing an in-house DNA methylation-based test to estimate biological age, drawing on the Waqoo Group's research capabilities.

Geographically, the report names collaboration with OrangeTwist in the United States and expansion across ASEAN markets. In Japan, the company says it will keep expanding multi-brand presence in aesthetic dermatology and broaden non-aesthetic services.

The near-term catalyst is the earnings call scheduled for 13 November 2026 at 08:30 Eastern Time, with a question-and-answer session. The report gives no guidance figures for the fourth quarter or full year, so the next hard datapoint on whether the fee revisions hold is the 4Q26 release, whose date the company did not state.

Frequently Asked Questions

What does SBC Medical's 47% Adjusted EBITDA margin mean for investors?

It means the company's operating profitability improved sharply on its own non-GAAP definition, expanding 9 percentage points year over year. But Adjusted EBITDA excludes interest, taxes, depreciation and amortization, and the report notes it is not a GAAP measure and may not be comparable across companies. The 27% net income margin is the GAAP-based figure investors should weigh alongside it.

Why did SBC Medical's net income margin fall while EBITDA margin rose?

The company reported a 3 percentage point decline in net income margin to 27% alongside a 9 point rise in Adjusted EBITDA margin to 47%. The report does not itemize the reconciling items in its summary, so the exact drivers are not disclosed. Differences of that shape typically sit below the operating line, but the company did not break them out.

How large is SBC Medical's clinic network and what does it include?

As of 30 September 2026 the network had 293 locations, up 36 year over year. That count spans franchised SBC-branded clinics, Rize Clinic, Gorilla Clinic, AHH Clinic and JUN CLINIC, plus OrangeTwist locations where SBC holds a minority equity interest through OT Midco Holdings, LLC. Trailing-twelve-month patient visits were 7.06 million, up 9%.

Bottom Line

SBC Medical's third quarter showed the fee-revision lever working, but the 20-point gap between its Adjusted EBITDA and net income margins remains unreconciled in the disclosure.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.