Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $76.3 million, flat year-over-year, exceeding guidance [7][15] - Adjusted EBITDA for Q3 2025 was $12 million, up 64% compared to Q3 2024, and exceeding guidance of approximately $10.5 million [17][18] - Adjusted gross margin increased to 53%, up approximately 510 basis points year-over-year [7][16] Business Line Data and Key Metrics Changes - Technology segment revenue was $52.1 million, representing a 7% year-over-year growth driven by recurring revenue from new and acquired clients [7][15] - Professional services revenue for Q3 2025 was $24.3 million, a 12% decline compared to Q3 2024, primarily due to exiting less profitable contracts [15][16] Market Data and Key Metrics Changes - The company anticipates approximately 30 net new platform client additions for 2025, with dollar-based retention expected to be in the low 90% [8][13] - The market remains dynamic, with ongoing financial and workforce pressures impacting client operations [10][11] Company Strategy and Development Direction - The company is focused on solutions with proven ROI, emphasizing cost control and operational efficiency to meet client needs [10][11] - There is a commitment to enhancing the Ignite data and analytics platform while providing flexibility for clients to remain on the DOS platform longer if needed [11][12] - The company does not anticipate pursuing additional acquisitions in the near to medium term, focusing instead on driving growth and profitability from existing capabilities [14][15] Management's Comments on Operating Environment and Future Outlook - Management expects revenue performance in 2026 to be a few points lower than in 2025, influenced by dollar-based retention rates and lower net new client counts [13][14] - The company is optimistic about improving adjusted EBITDA in 2026 through strategic focus and cost management [14][21] - Management highlighted the importance of meeting clients where they are, especially regarding the Ignite migration, to improve client experience and retention [12][26] Other Important Information - The company ended Q3 2025 with $92 million in cash and equivalents, down from $392 million at year-end 2024 [17] - Adjusted total operating expenses were $28.1 million, representing 37% of revenue, an improvement from 38% in Q3 2024 [16][17] Q&A Session Summary Question: What is driving the longer timeline for Ignite migration? - Management noted that some clients prefer to stay on DOS due to its current value, and the company is providing flexibility to meet client needs [24][25] Question: How does the sequential decline in tech revenue relate to dollar-based retention? - Management explained that the decline is influenced by DOS to Ignite migration headwinds and the growth in the apps layer, with a mix of moving parts affecting revenue [30][31] Question: What is the value of one-time revenues and the outlook for positive revenue growth? - Management indicated that one-time revenues are becoming more common in professional services, and they expect a robust pipeline to support growth, potentially mid-2026 or later [36][38] Question: How does the company plan to manage costs and expand in 2026? - Management emphasized targeted investments in areas with high client demand, such as cost management and ambulatory performance solutions, while also leveraging AI capabilities [81][82] Question: What is the growth rate in Ignite customers versus DOS customers? - Management acknowledged that Ignite is a more efficient platform and expects growth in the apps layer, while also providing flexibility for clients to remain on DOS longer if needed [64][66]

Financial Performance - Total revenue for Q3 2025 was $76.323 million, slightly down from $76.353 million in Q3 2024, representing a decrease of 0.04%[24] - Net loss for Q3 2025 was $22.229 million, compared to a net loss of $14.726 million in Q3 2024, reflecting an increase in losses of 50.8%[24] - The company reported a loss from operations of $17.509 million for Q3 2025, compared to a loss of $13.687 million in Q3 2024, an increase of 28.5%[24] - For the nine months ended September 30, 2025, Health Catalyst reported a net loss of $86,949,000, compared to a net loss of $48,829,000 for the same period in 2024, indicating an increase in losses of approximately 78%[36] - Pro forma net loss for the three months ended September 30, 2025, was $24.1 million, compared to a loss of $17.5 million for the same period in 2024[112] - Pro forma net loss for the nine months ended September 30, 2025, was $92.8 million, compared to a loss of $58.3 million for the same period in 2024[112] - The company incurred a net loss of $22.2 million for the three months ended September 30, 2025, compared to a net loss of $14.7 million for the same period in 2024, indicating a worsening financial performance[168] Revenue Breakdown - Technology revenue increased to $52.051 million in Q3 2025 from $48.653 million in Q3 2024, a growth of 4.3%[24] - Total revenue for the three months ended September 30, 2025, was $76.3 million, with recurring technology revenue at $52.1 million[123] - For the three months ended September 30, 2025, the Technology segment generated revenue of $52.1 million, up from $48.7 million in the same period of 2024, while the Professional Services segment revenue decreased to $24.3 million from $27.7 million[212] Assets and Liabilities - Total assets decreased to $587.128 million as of September 30, 2025, down from $858.929 million as of December 31, 2024, a decline of 31.5%[19] - Current liabilities decreased to $87.893 million as of September 30, 2025, from $325.850 million as of December 31, 2024, a reduction of 73.0%[19] - Cash and cash equivalents decreased to $40.305 million as of September 30, 2025, from $249.645 million as of December 31, 2024, a decline of 83.8%[19] - Total stockholders' equity decreased to $331.923 million as of September 30, 2025, down from $365.207 million as of December 31, 2024, a decline of 9.1%[20] - The company’s accumulated deficit increased to $(1,273.621) million as of September 30, 2025, from $(1,186.672) million as of December 31, 2024, an increase of 7.3%[20] Cash Flow and Investments - Cash flows from operating activities resulted in a net cash used of $9,181,000 for the nine months ended September 30, 2025, compared to net cash provided of $18,086,000 in 2024[36] - The company generated $149,448,000 from the sale and maturity of short-term investments during the nine months ended September 30, 2025, down from $206,488,000 in 2024, reflecting a decrease of approximately 28%[36] - Health Catalyst's net cash provided by investing activities was $35,184,000 for the nine months ended September 30, 2025, compared to $89,847,000 in 2024, a decline of about 61%[37] - Cash and cash equivalents at the end of the period were $40,305,000 as of September 30, 2025, a decrease from $328,327,000 at the end of September 2024, representing a decline of approximately 88%[37] Acquisitions and Goodwill - Health Catalyst acquired Upfront Healthcare Services for a total consideration of $80.0 million, which includes $41.1 million in cash and $31.6 million in stock[106] - The acquisition of Upfront resulted in the recognition of $52.9 million in goodwill, which is not deductible for income tax purposes[108] - Health Catalyst also acquired Intraprise Health for $44.9 million, consisting of $25.4 million in cash and $19.5 million in stock[114] - The acquisition of Intraprise resulted in $29.6 million in goodwill, with $21.5 million of it being deductible for income tax purposes[115] - Health Catalyst acquired Lumeon Ltd. for a total consideration of $39.8 million, including $36.2 million in cash and $2.9 million in stock[117] - The acquisition of Carevive Systems, Inc. was completed for $22.1 million, consisting of $18.6 million in cash and $2.6 million in stock[119] - Goodwill from the Lumeon acquisition was recorded at $24.4 million, fully allocated to the technology reporting unit[118] - A goodwill impairment charge of $28.8 million was recorded during the nine months ended September 30, 2025, due to declines in stock price and revenue forecasts[127] Stock-Based Compensation - Health Catalyst's stock-based compensation expense decreased to $22,905,000 for the nine months ended September 30, 2025, from $29,316,000 in 2024, a reduction of about 22%[36] - Total stock-based compensation for the three months ended September 30, 2025, was $7.039 million, a decrease of 26% compared to $9.512 million for the same period in 2024[174] - For the nine months ended September 30, 2025, total stock-based compensation was $22.905 million, down 22% from $29.316 million in 2024[174] - The total grant date fair value of RSUs vested during the nine months ended September 30, 2025, was $19.1 million, compared to $26.1 million in 2024[176] Debt and Financing - As of September 30, 2025, total principal outstanding debt is $161.2 million, down from $392.4 million as of December 31, 2024, reflecting a significant reduction in debt levels[151] - The company has a credit agreement providing a five-year term loan facility of up to $225 million, with an initial term loan of $125 million fully funded on July 16, 2024[153] - The contractual maturity of debt includes $155.9 million due in 2029, with total debt maturities amounting to $161.2 million as of September 30, 2025[152] - The company reported a net cash used in financing activities of $235,348,000 for the nine months ended September 30, 2025, compared to net cash provided of $114,056,000 in 2024, indicating a significant shift in financing activities[37] Restructuring and Workforce - The August 2025 Restructuring Plan resulted in a reduction of the global workforce, primarily incurring costs related to severance and other team member expenses[214] - Severance and other restructuring costs incurred amounted to $4,772,000[216] - Cash payments made during the restructuring process totaled $3,913,000[216] - The balance of restructuring liabilities as of September 30, 2025, stands at $859,000[216]

Financial Performance - Total revenue for Q3 2025 was $76.3 million, slightly down from $76.4 million in Q3 2024, representing a year-over-year change of 0%[4] - Gross profit increased to $30.0 million in Q3 2025, up 8% from $27.8 million in Q3 2024, resulting in a gross margin of 39%[4] - Adjusted EBITDA for Q3 2025 was $12.0 million, a significant increase of 64% compared to $7.3 million in Q3 2024[4] - The net loss for Q3 2025 was $22.2 million, which is a 51% increase from a net loss of $14.7 million in Q3 2024[4] - For Q4 2025, the company expects total revenue of approximately $73.5 million and Adjusted EBITDA of approximately $13.4 million[6] - For the full year 2025, total revenue is projected to be approximately $310 million, with Adjusted EBITDA expected to reach approximately $41 million[6] - The net loss for the nine months ended September 30, 2025, was $86,949,000, compared to a net loss of $48,829,000 for the same period in 2024, indicating an increase in losses of 78%[20] - Net loss for the three months ended September 30, 2025, was $22,229,000, compared to a net loss of $14,726,000 for the same period in 2024, representing a 51.0% increase in losses[31] Cash and Assets - Cash and cash equivalents as of September 30, 2025, were $40.3 million, a decrease from $249.6 million as of December 31, 2024[14] - Total assets decreased to $587.1 million as of September 30, 2025, down from $858.9 million as of December 31, 2024[14] - Cash flows from operating activities for the nine months ended September 30, 2025, resulted in a net cash used of $9,181,000, compared to net cash provided of $18,086,000 for the same period in 2024[20] - Cash and cash equivalents at the end of the period on September 30, 2025, were $40,305,000, down from $328,327,000 at the end of the same period in 2024, representing a decrease of 87%[20] Profitability Metrics - The company reported an increase in Adjusted Gross Profit to $40.1 million in Q3 2025, up 11% from $36.3 million in Q3 2024[4] - Adjusted Gross Profit for the three months ended September 30, 2025, was $40,133,000, with an Adjusted Gross Margin of 53%, compared to $36,289,000 and 48% for the same period in 2024[26] - Adjusted Net Income for Q3 2025 was $4,306,000, compared to $4,431,000 in Q3 2024, a decrease of 2.8%[34] - Adjusted Net Income per share for Q3 2025 was $0.06, slightly down from $0.07 in Q3 2024[34] Operating Expenses - Total operating expenses for Q3 2025 were $55,325,000, compared to $47,727,000 in Q3 2024, reflecting a 15.5% increase[32] - Adjusted Operating Expenses for Q3 2025 were $28,133,000, slightly down from $28,994,000 in Q3 2024, showing a decrease of 3.0%[32] - Stock-based compensation for Q3 2025 was $7,039,000, down from $9,512,000 in Q3 2024, a reduction of 26.0%[34] Special Charges - Acquisition-related costs for the three months ended September 30, 2025, totaled $(1,816,000), compared to $1,487,000 for the same period in 2024[17] - Restructuring costs for the three months ended September 30, 2025, amounted to $4,772,000, compared to no restructuring costs in the same period in 2024[18] - Non-recurring lease-related charges for the three months ended September 30, 2025, were $6,900,000, compared to $2,200,000 for the same period in 2024[18] Guidance and Strategy - The company continues to focus on high-impact solutions with proven ROI, reaffirming its full-year 2025 guidance[3]

Core Insights - Health Catalyst reported total revenue of $76.3 million for Q3 2025, slightly down from $76.4 million in Q3 2024, but achieved an Adjusted EBITDA of $12.0 million, a 64% increase year-over-year [2][3][4] Financial Performance - Total revenue for the three months ended September 30, 2025, was $76,323,000, compared to $76,353,000 in the same period of 2024, reflecting a negligible change of —% [3] - Gross profit increased to $29,979,000, up 8% from $27,758,000 in Q3 2024, resulting in a gross margin of 39% compared to 36% a year earlier [3] - The company reported a net loss of $22,229,000 for Q3 2025, which is a 51% increase from the net loss of $14,726,000 in Q3 2024 [3] - Adjusted Gross Profit for Q3 2025 was $40,133,000, an 11% increase from $36,289,000 in Q3 2024, with an Adjusted Gross Margin of 53% compared to 48% in the prior year [3][22] - Adjusted EBITDA for Q3 2025 was $12,000,000, significantly higher than $7,295,000 in Q3 2024 [3][33] Financial Outlook - The company reaffirmed its full-year 2025 guidance, expecting total revenue of approximately $310 million and Adjusted EBITDA of approximately $41 million [4][5] Company Overview - Health Catalyst is a leading provider of data and analytics technology and services for healthcare organizations, with over 1,100 clients globally [7] - The company focuses on high-impact solutions that demonstrate proven ROI, aiming to drive sustained value for clients and shareholders [2][7]

Core Insights - Health Catalyst is set to report its earnings results after market hours, with analysts expecting a revenue decline of 1.8% year on year to $75.01 million, contrasting with a 3.5% increase in the same quarter last year [2] - The company reported revenues of $80.72 million last quarter, marking a 6.3% year-on-year increase, but missed full-year revenue guidance expectations significantly [1][3] - Health Catalyst has generally met or exceeded Wall Street's revenue estimates, missing them only once in the past two years, with an average outperformance of 0.6% [3] Revenue Expectations - Analysts anticipate a revenue decline for the upcoming quarter, with adjusted earnings expected at $0.07 per share [2] - The company’s full-year revenue guidance has significantly missed analysts' expectations, indicating potential challenges ahead [1] Peer Comparison - In the data analytics segment, peers like Strategy and Palantir Technologies have reported strong revenue growth, with Strategy achieving 10.9% year-on-year growth and Palantir reporting a 62.8% increase [4] - The performance of these peers may provide insights into market expectations for Health Catalyst's upcoming results [4] Market Sentiment - Investors in the data analytics sector have shown steady hands, with share prices remaining flat over the past month; however, Health Catalyst's stock has increased by 6.8% during this period [5] - The average analyst price target for Health Catalyst is $4.33, significantly higher than its current share price of $2.83, indicating potential upside [5]

Core Insights - Health Catalyst (HCAT) is expected to report quarterly earnings of $0.05 per share, reflecting a year-over-year decline of 28.6% [1] - Revenue projections stand at $75.08 million, indicating a decrease of 1.7% compared to the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, suggesting analysts have reevaluated their initial estimates [1][2] Revenue Estimates - Analysts predict 'Revenue- Professional services' will reach $23.08 million, a decline of 16.7% from the prior-year quarter [4] - 'Revenue- Technology' is estimated at $52.00 million, showing a year-over-year increase of 6.9% [4] Profit Estimates - The average prediction for 'Adjusted Gross Profit- Professional Services' is $4.45 million, down from $4.72 million reported in the same quarter last year [5] - The consensus estimate for 'Adjusted Gross Profit- Technology' is $34.90 million, compared to $31.57 million reported in the same quarter last year [5] Stock Performance - Health Catalyst shares have increased by 7% over the past month, outperforming the Zacks S&P 500 composite, which rose by 1.3% [5] - The company holds a Zacks Rank 3 (Hold), indicating it is expected to closely follow overall market performance in the near term [5]

Core Insights - Health Catalyst, Inc. will release its third quarter 2025 operating results on November 10, 2025, after market close [1] - A conference call to discuss the results will take place at 5:00 pm ET on the same day [1] Company Overview - Health Catalyst is a leading provider of data and analytics technology and services aimed at improving healthcare outcomes [3] - The company serves over 1,100 organizations globally, utilizing its cloud-based technology ecosystem, Health Catalyst Ignite™, and AI-enabled data solutions [3] - Health Catalyst has a proven track record of delivering billions of dollars in measurable results, focusing on transforming complex healthcare data into actionable insights [3]

Core Insights - Health Catalyst, Inc. has announced a new partnership with CyncHealth Nebraska to enhance the accuracy and security of Continuity of Care Documents (CCDs) [1][2] - The partnership aims to improve the efficiency of health data exchange through Health Catalyst's Ninja Universe technology, which is designed to streamline the parsing and sharing of CCDs [2][3] - This collaboration is expected to enhance patient outcomes by ensuring standardized and secure transmission of health information across various healthcare providers [4] Company Overview - Health Catalyst is a leading provider of data and analytics technology and services, focusing on measurable improvements in clinical, financial, and operational aspects of healthcare [6] - The company serves over 1,000 organizations globally, leveraging its cloud-based technology ecosystem and AI-enabled solutions to drive significant outcomes across hundreds of millions of patient records [6] - Health Catalyst has a proven track record of delivering billions of dollars in measurable results, positioning itself as a catalyst for data-informed healthcare improvement [6] CyncHealth Overview - CyncHealth is a nonprofit organization that operates as a health data utility, connecting over 5 million lives and 1,100 facilities across Nebraska and Iowa [5] - The organization focuses on interoperability, enabling healthcare providers to access comprehensive patient data to improve care coordination and patient outcomes [5] - CyncHealth emphasizes continuous improvement in its services to enhance the participant experience and support clinicians in making informed decisions [4]

Financial Data and Key Metrics Changes - The company has adjusted its net dollar retention expectations from 103% to 93% due to pricing pressure and client behavior changes during the Egnyte migration [15][19][22] - The average sales benchmark (ASB) has shifted to the lower end of the range, now between $300,000 and $700,000, primarily due to tighter scoping rather than lower gross margins, which remain strong at over 80% [27][29] Business Line Data and Key Metrics Changes - The company has added 22 new platform clients since the beginning of the year, bringing the total to 152 platform clients [23] - The focus for cross-selling is on adjacent applications, particularly in the finance category, which offers clear near-term ROI for clients [31][32] Market Data and Key Metrics Changes - Many clients are currently using the 2026 budgeting cycle to reassess their needs and strategies in light of recent Medicaid cuts and funding changes [20] - The company is experiencing a stronger start to Q3 compared to typical quiet quarters, indicating potential recovery in client engagement [18] Company Strategy and Development Direction - The company is focusing on leveraging its existing client relationships to roll out AI capabilities without requiring new contracts, capitalizing on its incumbency advantage [52] - There is a strategic shift towards tech-led solutions, with a goal to increase the proportion of revenue from technology services compared to professional services [42] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that the current macro environment is challenging, particularly for not-for-profit health systems, which are slower to adapt to significant funding cuts [16] - The company expects the headwind to dollar-based retention to be a near-term issue, with a return to over 100% retention anticipated by 2027 [26][22] Other Important Information - The company has identified over $40 million in savings from a recent restructuring, which will positively impact EBITDA in the upcoming quarters [49][54] - There is no anticipated further M&A activity in the near to mid-term, as the company focuses on digesting recent acquisitions and maximizing cross-sell opportunities [58] Q&A Session Summary Question: What is the impact of the Egnyte migration on dollar-based retention? - Management explained that the migration has led to a reduction in dollar-based retention due to clients opting for immediate savings rather than cross-selling opportunities [15][19] Question: How is the company addressing the tighter scoping in sales? - The company noted that while scoping is tighter, it has maintained good gross margins and is still signing meaningful business [29][30] Question: What is the company's strategy regarding professional services? - Management clarified that while they are reducing reliance on professional services, they still see value in providing deep domain expertise where necessary [39][42] Question: How is AI influencing the company's operations? - The company is increasingly using AI in R&D, which is expected to provide significant operating leverage and improve efficiency [48][49] Question: What are the capital strategy priorities moving forward? - The focus is on achieving meaningful free cash flow in 2026, with plans for share repurchase and debt repayment as primary uses of capital [57][58]

Core Insights - Health Catalyst, Inc. announced the winners of the 2025 Catalyst Awards, recognizing healthcare organizations leading in data-driven transformation [1][2] - The awards were presented at the Health Catalyst Analytics Summit, highlighting the importance of data and analytics in addressing critical healthcare challenges [2] Award Winners - **Care Quality Excellence Winner**: Lifepoint Health was recognized for saving over 700 patient lives through improved care processes, reducing blood transfusions by 1,200, and allowing patients to spend an additional 24,000 days at home [3] - **Financial Transformation Winner**: Temple University Health System utilized activity-based costing to enhance revenue and quality, generating millions in revenue through improved service line charge capture [4] - **Quality Performance & Measures Excellence Winner**: Revere Medical achieved a 56% increase in depression screening and improved glycemic control for 7,000 diabetes patients, generating millions in shared savings [5] - **Organizational Transformation Winner**: INTEGRIS Health implemented a data-informed operating system, resulting in $2.7 million in cost savings from avoided readmissions and $30 million in labor cost savings [6][7] - **Population Health Impact Winner**: Innovative Healthcare Collaborative of Indiana achieved a $28.3 million cost reduction and improved patient outcomes, including 307 fewer readmissions within 30 days of discharge [8] Evaluation Process - Over 200 client-driven improvements were evaluated by Health Catalyst's judging panel, focusing on measurable outcomes and impactful stories [9] - Nominations included metrics on challenges addressed, interventions, and their impact on patients and organizational performance [9] Company Overview - Health Catalyst is a leading provider of data and analytics technology, serving over 1,000 organizations globally and driving measurable improvements across healthcare [10]