What does Health Catalyst do and what are its main business segments?

Did Health Catalyst beat or miss consensus estimates last quarter?

What guidance did Health Catalyst's management provide for the next earnings period?

What were the key takeaways from Health Catalyst’s earnings call?

What factors drove the changes in Health Catalyst's revenue and profit?

What is the revenue and EPS growth rate for Health Catalyst year over year?

What is Health Catalyst's gross profit margin?

What is the market's earnings forecast for Health Catalyst next quarter?

- **Revenue Beat**: Q3 2025, with Ignite migration flexibility and app layer growth.
- **AI and cost management solutions**: 2026 strategy and Microsoft partnership.
- **EBITDA growth**: 2026 focus on cost management and app layer growth.
- **Migration flexibility and new platform clients**.
- **2026 planning**.


**【CEO Summary Section】**
- Q3 2025 total revenue: $76.3 million (flat YoY), with Technology segment revenue up 7% YoY to $52.1 million.
- Adjusted EBITDA: $12 million (64% YoY growth), exceeding guidance of $10.5 million.
- 2025 bookings expectations: ~30 net new platform clients, with average booking size toward lower end of $300,000-$700,000 range.
- Dollar-based retention rate: low 90s for 2025, driven by Ignite migration headwinds.
- 2026 revenue growth expected to be a few percentage points lower than 2025, reflecting macroeconomic challenges and strategic focus on profitability.

**【CFO Financial Commentary】
- Q4 2025 guidance: Total revenue $73.5 million, adjusted EBITDA $13.4 million.
- Gross margin: Technology gross margin up 330 bps YoY, offsetting DOS migration costs.
- Operating expenses: Q4 2025 expected to decline $2-$3 million YoY, with India operations and AI integration driving efficiency.
- Client demand: App layer growth offsetting DOS migration headwinds, with 2026 focus on cost management solutions.

**【Q&A Highlights】
- Ignite migration flexibility: 2/3 of clients to migrate by end-2025, with DOS retention improvement.
- Tech revenue: Q4 2025 expected to decline 2-3%, with app layer growth.
- 2026: EBITDA growth 2025, with Q4 earnings call for 2026 strategy.
- Microsoft partnership and migration flexibility to improve retention.
- 2026 planning: EBITDA growth and Microsoft relationship.


Health Catalyst, Inc. (HCAT) Q3 2025 Earnings Call Transcript

- **Q2 Beat & Guidance**: $80.7M revenue (+6% YoY), $9.3M EBITDA (record high), despite revising 2025 revenue to $310M due to Medicaid cuts.
- **Ignite Migration Impact**: Clients saving 20%+ via Ignite, reducing spend and lowering retention rate to 93%.
- **Profitability Focus**: $40M+ cost savings from restructuring, targeting 20%+ EBITDA margin by Q4 2025.
- **Application Growth**: Tech revenue up 11% YoY, applications +20% YoY, driving margin expansion.
- **Leadership Transition**: CEO to retire in 2026, prioritizing near-term profitability over long-term targets.

**【CEO Summary Section】**
- **Q2 2025 Results**: Revenue of $80.7M (+6% YoY), adjusted EBITDA of $9.3M (highest in company history), outperforming guidance.
- **Revised Guidance**: Full-year 2025 revenue revised to $310M (down from $330M) due to $1T Medicaid cuts, but maintaining EBITDA guidance of $41M.
- **Key Drivers**: 
  - 50% of revenue growth impacted by clients migrating to Ignite (20%+ cost savings), reducing spend.
  - Dollar-based retention rate lowered to low 90s (from mid-90s) due to macroeconomic uncertainty.
  - 30% reduction in unprofitable Professional Services contracts, adding 3pts to EBITDA margin.
- **Restructuring**: 9% workforce reduction, $40M+ annualized cost savings, aiming for 20%+ EBITDA margin by Q4 2025.
- **Leadership Transition**: CEO to retire in June 2026, focusing on near-term profitability.

**【COO Ignite Migration Update】**
- 20%+ cost savings from Ignite migrations causing near-term revenue headwinds, but enabling cross-sell opportunities.
- Migration completion expected by mid-2026, positioning for future growth.

**【CFO Financial Review】**
- **Q2 2025 Financials**: 
  - Technology revenue: $52.9M (+11% YoY), driven by applications (+20% YoY).
  - Professional Services: $27.8M (-1% YoY), gross margin improved to 18%.
  - Adjusted gross margin: 50% (down 30bps YoY).
- **Q3 2025 Guidance**: 
  - Revenue: $75M, EBITDA: $10.5M (44% YoY growth).
  - Full-year EBITDA: $41M (20% margin), with Q4 run rate of $15M (annualized $60M).
- **Margins**: Technology gross margin to improve in H2, services margin to reach 20% by Q4.

**【Q&A Highlights】**
- **Life Sciences Delay**: Carevive bookings delayed due to research funding cuts, excluded from 2025 guidance.
- **Topline Growth**: 2026 expected to be low-single-digit due to macro headwinds, but applications (+20% YoY) and Ignite migration tailwind.
- **EBITDA Expansion**: 20%+ EBITDA margin achievable in 2025, with further leverage in R&D through India expansion.
- **Client Pipeline**: 100+ new platform opportunities in H2, 80% tech-driven with minimal services.
- **Macro Impact**: Medicaid cuts causing conservatism in not-for-profit clients, but early Q3 momentum suggests recovery potential.

Health Catalyst, Inc. (HCAT) Q2 2025 Earnings Call Transcript

- **Revenue growth accelerates**: Q1 2025 total revenue $79.4M (+6% YoY), Tech revenue $51.5M (+10% YoY).
- **Ignite adoption surges**: 10 net new platform clients in Q1 (2/3 from existing app clients), 40 expected for 2025.
- **Profitability improves**: Tech gross margin 67% (vs. 60% for DOS), 80-20 Tech/services mix vs. 50-50 for DOS.
- **Share buyback**: $5M repurchased in Q1, no near-term M&A.
- **Guidance exceeded**: Q1 EBITDA $6.3M vs. guidance of $4M.
- **Margins expand**: OpEx as % of revenue 41% (vs. 47% YoY), stock comp to decline 200bps YoY.
- **Risks managed**: 103% retention target accounts for 2-3% Ignite pricing headwind.
- **Migration on track**: 2/3 Ignite migrations complete by end-2025, ~90% by mid-2026.


**【CEO Summary Section】**
- Q1 2025 total revenue of $79.4 million, up 6% YoY, with Tech revenue growing 10% YoY to $51.5 million.
- 10 net new Ignite platform clients added in Q1, 2/3 from existing app clients, with average ARR/non-recurring revenue of ~$500,000.
- Ignite's 70% gross margin vs. DOS's 60%, with 80-20 Tech/services mix vs. DOS's 50-50 mix.
- 40 net new platform clients expected for 2025, aiming to be halfway to goal by end of Q2.
- Ignite Spark launched for mid-market, with healthcare.ai on Microsoft Azure marketplace.
- $5 million share repurchase in Q1, no near-term M&A plans.

**【CFO Financial Commentary】**
- Q1 2025 adjusted EBITDA of $6.3 million, exceeding guidance of $4 million.
- Tech gross margin 67%, up 260bps QoQ due to lower costs; Services gross margin 16%, up 240bps QoQ from RIF.
- Q2 2025 revenue expected $80.5 million, adjusted EBITDA $8 million.
- Full-year 2025 guidance: $335 million total revenue, $220 million Tech revenue, $41 million EBITDA.
- Operating expenses as % of revenue down to 41% in Q1 vs. 47% YoY.
- Stock-based compensation to decline 200bps YoY, targeting mid-single digits by 2026.

**【Q&A Highlights】**
- Ignite's modular, lower-cost model (entry price ~$300k vs. DOS $1.5M) shortens sales cycles and improves cross-sell success (2-3x conversion rate vs. cold calls).
- 2/3 of Q1 net new clients migrated from DOS, with 1/3 new clients; implementation timelines ~3 months.
- Health Information Exchange delays pushing $17M of Q2 Services revenue to H2.
- Upfront acquisition contributing minor Q1 EBITDA headwind, expected to turn positive in H2.
- 103% dollar-based retention target includes 2-3% headwind from Ignite pricing flexibility, offset by app cross-sell.
- 2/3 Ignite migrations complete by end-2025, ~90% by mid-2026.


Health Catalyst (HCAT)-7 May 25-2025 Q1 Earnings call transcript

- **Record Growth**: 2024 total revenue $307M (+137%), tech segment $195M (+13% 2025 guidance). 
- **Ignite Momentum**: 21 new platform clients 2024, 40 target 2025. Cross-sell pipeline: 900+ app clients with 1-2 apps adopted. 
- **Profitability Boost**: 2025 adj EBITDA $41M (+$2M from acquisitions), tech gross margin to improve post-2026 Ignite migration. 
- **Strategic Shifts**: Exit $9M unprofitable TEMS pilots, focus on high-margin apps, India expansion. 
- **Cash Strong**: $392M cash, free cash flow $15M 2024. Repay $230M debt Q2 2025.

**【CEO Summary Section】**
- Full year 2024 total revenue: $307 million (137% YoY growth), adjusted EBITDA: $26 million (137% YoY growth). Technology segment revenue: $195 million (13% YoY growth in 2025 guidance). 
- Strategic wins: 21 net new platform clients in 2024 (Q4: 6 additions), 1,000+ total clients (900+ app clients). 2025 target: 40 net new platform clients at $300k-$700k ARR. 
- Ignite migration: 102% dollar-based retention (2024), 103% 2025 guidance. Cross-sell opportunity: 900+ app clients with average 1-2 apps adopted. 
- 2025 outlook: Tech revenue $220 million (13% YoY), adjusted EBITDA $41 million (+$2M from acquisition synergies). 
- Key initiatives: Exit unprofitable TEMS pilots ($9M annual rev impact), focus on high-margin apps, India expansion (10%+ team). 

**【COO Ignite Migration Update】**
- Ignite adoption: Cheaper, faster, modular than DOS (half price point). 10%+ clients migrated, full migration by mid-2026. 
- Impact: Near-term headwinds (2025 tech gross margin flat vs 2024), long-term benefits (better retention, app expansion). 
- Client feedback: IHCI saved $28.3M via Ignite-enabled care strategies. 

**【CFO Financial Highlights】**
- Q4 2024: Total revenue $80M (6% YoY), tech $52M (10% YoY). Full year: Tech $195M (4% YoY), adj EBITDA $26M. 
- Margins: Adj gross margin 47% (Q4), tech 65% (down 200bps vs Q4 2023). Adj EBITDA margin 3.8% (Q4), 8.5% full year. 
- 2025 guidance: Revenue $335M, tech $220M, adj EBITDA $41M. Q1 2025: Revenue $79M, adj EBITDA $4M. 
- Cash: $392M (Q4 2024), free cash flow $15M (2024). Repay $230M convertible notes in Q2 2025. 

**【Q&A Key Takeaways】**
- Platform growth: 2025 net new clients +100% vs 2024, driven by Ignite's lower price point and cross-sell to 900+ app clients. 
- Pricing: Ignite has modest escalators (low/mid-single digits), consumption-based model. 
- Retention: 103% 2025 guidance accounts for Ignite migration headwinds, 100%+ possible post-2026. 
- M&A: Focused on integrating 2024 acquisitions (Upfront, Carevive), no new deals planned. 
- HAS 2025: $1-1.5M cost, focused on existing clients. 
- Risk: TEMS pilot exit, slower app adoption during migration, macro uncertainty.

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