UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ________________ FORM 10-Q ________________ (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2020 Or (Address of principal executive offices, including zip code) (801) 708-6800 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File Number: 001-38993 ...

Financial Data and Key Metrics Changes - Total revenue for Q4 2019 was $43.5 million, representing a 21% growth compared to Q4 2018 [7][8] - Full year 2019 total revenue was $154.9 million, indicating a 38% annual growth [9] - Adjusted gross margin for Q4 2019 was 51.2%, up from 48.6% in Q4 2018 [8] - Full year 2019 adjusted gross margin was 52.2%, an increase of approximately 430 basis points compared to 2018 [9] - Adjusted EBITDA for Q4 2019 was a loss of $6.5 million, improving from a loss of $9.4 million in Q4 2018 [8][33] - Full year 2019 adjusted EBITDA was a loss of $27.4 million, an improvement from a loss of $38.1 million in 2018 [9][33] Business Line Data and Key Metrics Changes - Technology revenue for Q4 2019 was $22.6 million, a 20% increase year-over-year [26] - Professional services revenue for Q4 2019 was $20.9 million, a 21% increase year-over-year [26] - The Medicity business was noted as a headwind on technology revenue growth in Q4 2019 [27] Market Data and Key Metrics Changes - The company ended 2019 with 65 DOS subscription customers, having added 15 net new customers during the year [16][18] - Dollar-based retention rate for 2019 was 109%, up from 107% in 2018 [18] Company Strategy and Development Direction - The company aims to enable massive, measurable improvements for customers while maintaining high satisfaction and engagement [11] - There is a focus on digital transformation within healthcare, with a growing demand for outsourced technology-enabled services [19][20] - The acquisition of Able Health is expected to enhance quality and regulatory measures capabilities [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and outlook for 2020, with guidance for total revenue between $185 million and $188 million [37] - The company has over 90% visibility to projected 2020 revenue, which is beneficial for forecasting [55] - Management has not seen any impact from the coronavirus on the pipeline or forecast [70] Other Important Information - The company ended Q4 2019 with $228.3 million in cash and short-term investments, compared to $33.2 million at year-end 2018 [35] - Total debt as of December 31, 2019, was $48.2 million, an increase of $28 million over the end of 2018 [35] Q&A Session Summary Question: Composition of new adds in 2019 - The composition of the 15 net new DOS subscription clients was a mix of health systems and some risk-bearing entities [42][43] Question: Cadence of growth for new DOS subscription customers - The company expects a stronger performance in the second half of the year for Medicity cross-sells, with a typical sales cycle of about one year [47][48] Question: Opportunities for tuck-in acquisitions - There are many opportunities for acquisitions in the apps layer, with a robust pipeline of potential companies [49][50] Question: Upsell opportunity to existing customers - The greater than $10 million represents annual recurring revenue, indicating strong potential for similar opportunities in the future [52][53] Question: Impact of coronavirus on contracting decisions - There has been no observed impact on the pipeline or forecast due to the coronavirus [70] Question: Trends in deferred revenues - Deferred revenues can fluctuate due to the timing of new client additions and the nature of contracts [63] Question: Percentage of DOS clients on Azure - Most new clients have been transitioned to Microsoft Azure, with ongoing conversions expected to take 1-2 years [65]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K _______________ (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File Number: 001-38993 HEALTH CATALYST, INC. (Exact name of registrant as specified in its charter) ___ ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2019 was $39.4 million, representing a 20% year-over-year increase [25] - Adjusted gross margin for Q3 2019 was 54%, up from 50% in Q3 2018 [7] - Adjusted EBITDA loss for Q3 2019 was $8.4 million, an improvement from a loss of $11.3 million in Q3 2018 [31] Business Line Data and Key Metrics Changes - Technology revenue was $21.2 million, a 16% increase year-over-year [25] - Professional services revenue was $18.3 million, a 25% increase year-over-year [25] - Adjusted gross margin for technology was 68%, an increase of approximately 190 basis points year-over-year [27] Market Data and Key Metrics Changes - The company reported that over 90% of its revenue is recurring, with greater than 100% dollar-based retention [44] - The healthcare analytics summit hosted over 1,600 professionals, achieving an overall satisfaction rating of greater than 99% [12] Company Strategy and Development Direction - The company is focused on enabling measurable improvements for customers while maintaining high satisfaction [8] - There is a strong emphasis on digital transformation within healthcare, with the company positioning itself as a partner to facilitate this transition [14] - The company plans to continue investing in core markets and new markets, including Life Sciences and international expansion [42] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the robustness of the sales pipeline moving into Q4 2019 and beyond [41] - The acquisition of Medicity is seen as a headwind, but management anticipates cross-sell opportunities to materialize in 2020 [43] - The company does not expect significant impacts from the political environment on its sales efforts [71] Other Important Information - The company appointed two new board members effective January 1, 2020, enhancing its leadership team [21][22] - The company ended Q3 2019 with $241.4 million in cash and short-term investments, compared to $33.2 million at the end of 2018 [34] Q&A Session Summary Question: How to think about headwinds and tailwinds looking into 2020? - Management highlighted investments in core and new markets as tailwinds, while the Medicity acquisition represents a revenue headwind [41][43] Question: How does the start of 2020 look regarding the sales pipeline? - Management feels good about the current pipeline supporting projections for Q4 and the full year 2019 [48] Question: Feedback from this year's summit compared to previous ones? - This year's summit had the highest attendance and provided significant feedback on the need for foundational analytics support [51][52] Question: Update on professional services gross margin and hiring? - Management reported progress in hiring and maintaining a sustainable pace for the professional services team [57] Question: Thoughts on the Google-related news and competition? - Management believes that cloud companies will play a significant role in the healthcare ecosystem, but the company focuses on higher-level healthcare-specific solutions [85]

Revenue Performance - Total revenue for Q3 2019 was $39.423 million, a 20% increase from $32.868 million in Q3 2018[21] - Technology revenue reached $21.160 million, up 16% from $18.283 million year-over-year[21] - Professional services revenue increased by 25% to $18.263 million compared to $14.585 million in the same quarter last year[21] - Total revenue for the three months ended September 30, 2019, was $39.423 million, a 20% increase from $32.87 million in the same period of 2018[169] - Revenue for the Technology segment was $21.16 million for the three months ended September 30, 2019, up from $18.28 million in the same period of 2018, representing a growth of 10.1%[169] - Revenue for the Professional Services segment increased to $18.26 million for the three months ended September 30, 2019, compared to $14.59 million in 2018, reflecting a growth of 25.5%[169] - Recurring technology revenue for the nine months ended September 30, 2019, was $61.393 million, up 67.2% from $36.701 million in 2018[102] Financial Position - Cash and cash equivalents increased to $52.059 million as of September 30, 2019, from $28.431 million at the end of 2018[17] - Total assets as of September 30, 2019, were $319.969 million, significantly up from $110.975 million at the end of 2018[17] - Current liabilities increased to $53.047 million as of September 30, 2019, compared to $41.806 million at the end of 2018[17] - Total stockholders' equity as of September 30, 2019, was $206,553,000, up from $206,553,000 as of June 30, 2019, reflecting stability in equity position[28] - As of September 30, 2019, the company had cash, cash equivalents, and short-term investments totaling $241.4 million[285] Losses and Expenses - The net loss for Q3 2019 was $21.416 million, compared to a net loss of $16.876 million in Q3 2018[21] - The company reported a net loss attributable to common stockholders of $39.586 million for Q3 2019, compared to $17.390 million in Q3 2018[21] - The company reported a net loss before income taxes of $21.40 million for the three months ended September 30, 2019, compared to a net loss of $16.87 million in the same period of 2018[169] - Stock-based compensation expense increased to $13,028,000 for the nine months ended September 30, 2019, compared to $2,887,000 for the same period in 2018, indicating increased investment in employee incentives[35] - Total stock-based compensation expense for the three months ended September 30, 2019, was $9.974 million, compared to $933,000 for the same period in 2018[141] Debt and Financing - The term loan balance as of September 30, 2019, was $50 million, with a remaining capacity of $25 million[112] - The OrbiMed debt financing agreement provided an $80.0 million senior term loan commitment, with $50.0 million available and up to an additional $30.0 million contingent upon achieving minimum technology revenues of $60.0 million[116] - The contractual interest rate for the OrbiMed term loan is the higher of LIBOR plus 7.5% or 10.0%, with monthly principal payments starting in February 2023[117] Shareholder Information - The company had a weighted-average share count of 28.223 million for calculating net loss per share in Q3 2019, compared to 4.686 million in Q3 2018[21] - The total number of common shares outstanding as of September 30, 2019, was 36,472,223, an increase from 4,732,780 shares as of September 30, 2018, indicating significant equity growth[32] - Health Catalyst had 45,427,441 shares of redeemable convertible preferred stock authorized, with 22,713,694 shares issued and outstanding as of December 31, 2018[121] - Upon the closing of the IPO, the redeemable convertible preferred stock was converted into 23,151,481 shares of common stock at an IPO price of $26.00 per share, totaling $602.7 million[124] Acquisitions and Investments - The acquisition of Medicity LLC was completed for consideration valued at $2.3 million in Series E redeemable convertible preferred stock, as part of a $15 million capital raise[96] - Total assets acquired from Medicity amounted to $15.222 million, with total liabilities assumed of $12.970 million, resulting in net assets acquired of $2.252 million[98] - Revenue from the acquired business of Medicity amounted to $12.5 million from June 29, 2018, to December 31, 2018[101] Revenue Recognition and Accounting - Health Catalyst's revenue recognition follows ASC Topic 606, with a focus on technology subscriptions and professional services, ensuring compliance with accounting standards[47] - The company reported a deferred revenue of $7,601,000 for the nine months ended September 30, 2019, compared to $7,415,000 for the same period in 2018, suggesting stable revenue recognition[35] - For the three months ended September 30, 2019, 48% of the revenue recognized was included in deferred revenue at the beginning of the period, compared to 36% in 2018[162] - For the nine months ended September 30, 2019, 18% of the revenue recognized was included in deferred revenue at the beginning of the period, up from 13% in 2018[162]

Health Catalyst, Inc. (NASDAQ: HCAT) Q2 2019 Earnings Conference Call August 22, 2019 5:00 PM ET Company Participants Adam Brown - Senior Vice President of Investor Relations Dan Burton - Chief Executive Officer Patrick Nelli - Chief Financial Officer Conference Call Participants Jack Rogoff - Goldman Sachs Anne Samuel - J.P. Morgan Ryan Daniels - William Blair Sean Wieland - Piper Jaffray Susy Tibaldi - Evercore ISI Daniel Grosslight - SVB Leerink Sandy Draper - SunTrust Robinson Humphrey Operator Good day ...