Second quarter 2026
Filed Aug 6, 2026Health Catalyst reported second-quarter 2026 total revenue of $70,487 (in thousands), adjusted EBITDA of $9,919 (in thousands), and a GAAP net loss of $ (40,537) (in thousands).
Revenue declined 13% year over year and the company recorded a GAAP net loss of $ (40,537) (in thousands), including $27,047 (in thousands) of goodwill impairment. Gross margin, adjusted gross margin, and adjusted EBITDA improved year over year, while management stated that second-quarter revenue exceeded the high end of its guidance.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenueGAAP | $70,487 (in thousands) | – | (13)% |
| Gross profitGAAP | $27,856 (in thousands) | – | (8)% |
| Gross marginGAAP | 40% | – | – |
| Total cost of revenue, excluding depreciation and amortizationGAAP | $35,627 (in thousands) | – | – |
| Sales and marketing expenseGAAP | $10,360 (in thousands) | – | – |
| Research and development expenseGAAP | $11,026 (in thousands) | – | – |
| General and administrative expenseGAAP | $11,928 (in thousands) | – | – |
| Depreciation and amortizationGAAP | $10,979 (in thousands) | – | – |
| Goodwill impairmentGAAP | $27,047 (in thousands) | – | – |
| Total operating expensesGAAP | $71,340 (in thousands) | – | – |
| Loss from operationsGAAP | $ (36,480) (in thousands) | – | – |
| Interest and other expense, netGAAP | $ (3,742) (in thousands) | – | – |
| Loss before income taxesGAAP | $ (40,222) (in thousands) | – | – |
| Income tax provisionGAAP | $315 (in thousands) | – | – |
| Net lossGAAP | $ (40,537) (in thousands) | – | 1% |
| Net loss per share, basic and dilutedGAAP | $ (0.55) | – | – |
| Weighted-average shares outstanding used in calculating net loss per share, basic and dilutedGAAP | 73,960 (in thousands) | – | – |
| Adjusted Gross Profitnon-GAAP | $35,837 (in thousands) | – | (10)% |
| Adjusted Gross Marginnon-GAAP | 51% | – | – |
| Adjusted EBITDAnon-GAAP | $9,919 (in thousands) | – | 6% |
| Stock-based compensation expenseGAAP | $2,709 (in thousands) | – | – |
| Acquisition-related costs, netGAAP | $1,958 (in thousands) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| TechnologyTechnology revenue was $48,795 (in thousands), compared with $52,876 (in thousands) for the three months ended June 30, 2025. | $48,795 (in thousands) | – | – |
| Professional servicesProfessional services revenue was $21,692 (in thousands), compared with $27,845 (in thousands) for the three months ended June 30, 2025. | $21,692 (in thousands) | – | – |
Third quarter of 2026 and full year of 2026 outlook
- Revenue$55 million to $56 million for the third quarter of 2026; $246 million to $249 million for the full year of 2026
- NoteAdjusted EBITDA of $0 to $0.5 million for the third quarter of 2026
- NoteAdjusted EBITDA of $18 million to $18.5 million for the full year of 2026
What drove it
- Gross margin was 40%, compared with 38% in the prior-year period.
- Adjusted Gross Margin was 51%, compared with 50% in the prior-year period.
- Adjusted EBITDA was $9,919 (in thousands), compared with $9,344 (in thousands) in the prior-year period.
- Sales and marketing expense was $10,360 (in thousands), compared with $13,206 (in thousands) in the prior-year period.
- Research and development expense was $11,026 (in thousands), compared with $12,392 (in thousands) in the prior-year period.
- Management stated that second-quarter revenue exceeded the high end of its revenue guidance and adjusted EBITDA exceeded the midpoint of its adjusted EBITDA guidance.
Concerns
- Total revenue declined (13)% year over year.
- Technology revenue was $48,795 (in thousands), compared with $52,876 (in thousands) in the prior-year period.
- Professional services revenue was $21,692 (in thousands), compared with $27,845 (in thousands) in the prior-year period.
- The company reported a GAAP net loss of $ (40,537) (in thousands) and loss from operations of $ (36,480) (in thousands).
- Goodwill impairment was $27,047 (in thousands).
- Third-quarter 2026 total revenue guidance is $55 million to $56 million and adjusted EBITDA guidance is $0 to $0.5 million.
- The company identified risks including client churn or down-selling in connection with migration to Ignite, project-based non-recurring revenue fluctuations, and the possibility that the Vitalware divestiture may not achieve expected benefits.
What to watch
- Delivery against third-quarter 2026 total revenue guidance of $55 million to $56 million.
- Delivery against third-quarter 2026 Adjusted EBITDA guidance of $0 to $0.5 million.
- The impact of the Vitalware divestiture on the company’s business, liquidity, and financial results.
- Technology and professional services revenue trends.
- The balance-sheet effects of the stated full repayment of the credit facility debt.
Balance sheet and cash flow
- Cash and cash equivalents were $60,589 (in thousands) as of June 30, 2026, compared with $50,814 (in thousands) as of December 31, 2025.
- Short-term investments were $42,850 (in thousands) as of June 30, 2026, compared with $44,918 (in thousands) as of December 31, 2025.
- Assets held for sale were $91,424 (in thousands) as of June 30, 2026.
- Current portion of long-term debt was $1,627 (in thousands) as of June 30, 2026.
- Long-term debt, net of current portion, was $151,852 (in thousands) as of June 30, 2026.
- Total stockholders’ equity was $100,827 (in thousands) as of June 30, 2026, compared with $245,780 (in thousands) as of December 31, 2025.
- Management stated that it recently closed the Vitalware divestiture and fully repaid its credit facility debt.
Analysis
Health Catalyst’s second-quarter results showed lower revenue but improved reported gross-margin measures and adjusted EBITDA. Total revenue was $70,487 (in thousands), down (13)% from $80,721 (in thousands). Technology revenue was $48,795 (in thousands), compared with $52,876 (in thousands), while professional services revenue was $21,692 (in thousands), compared with $27,845 (in thousands). Both reported revenue lines were lower than in the prior-year quarter.
Margins improved despite the revenue decline. GAAP gross margin was 40%, compared with 38%, and Adjusted Gross Margin was 51%, compared with 50%. Adjusted EBITDA increased 6% to $9,919 (in thousands) from $9,344 (in thousands). Lower sales and marketing expense and research and development expense were reported relative to the prior-year period, while general and administrative expense increased to $11,928 (in thousands) from $8,284 (in thousands).
GAAP profitability remained pressured. The company reported loss from operations of $ (36,480) (in thousands) and net loss of $ (40,537) (in thousands), with a $27,047 (in thousands) goodwill impairment recorded during the quarter. The net loss was slightly narrower than $ (40,978) (in thousands) a year earlier, and basic and diluted net loss per share was $ (0.55), compared with $ (0.59). The company also reported $1,958 (in thousands) of acquisition-related costs, net, compared with $ (3,720) (in thousands) in the prior-year quarter.
Balance-sheet disclosures reflect $60,589 (in thousands) of cash and cash equivalents, $42,850 (in thousands) of short-term investments, $1,627 (in thousands) of current long-term debt, and $151,852 (in thousands) of long-term debt, net of current portion, as of June 30, 2026. Management subsequently stated that the Vitalware divestiture had recently closed and that the credit facility debt had been fully repaid. The June 30 balance sheet also included $91,424 (in thousands) of assets held for sale and total stockholders’ equity of $100,827 (in thousands).
Management said second-quarter revenue exceeded the high end of its guidance and adjusted EBITDA exceeded the midpoint of its guidance. The forward outlook calls for third-quarter total revenue of $55 million to $56 million and Adjusted EBITDA of $0 to $0.5 million, followed by full-year total revenue of $246 million to $249 million and Adjusted EBITDA of $18 million to $18.5 million. The central issues for the next period are execution against that lower absolute quarterly revenue range, the trajectory of technology and professional services revenue, and the realized balance-sheet and operating effects of the Vitalware divestiture.
Management, verbatim
We delivered a very productive second quarter, exceeding the high end of our revenue guidance and the midpoint of our adjusted EBITDA guidance.
Ben Albert, Chief Executive Officer of Health Catalyst
More importantly, we recently closed the Vitalware divestiture and fully repaid our credit facility debt, which significantly improves our balance sheet and provides flexibility to make measured near-term bets in the work we believe in most.
Ben Albert, Chief Executive Officer of Health Catalyst
Not in the filing
stated, not guessed- Previous-period outlook, so reported results cannot be compared with prior guidance in a structured guidance comparison.
- Operating cash flow.
- Free cash flow.
- Capital-return disclosures, including share repurchases and dividends.
- Adjusted EPS.
- Forward guidance for gross margin, operating expenses, and tax rate.
- Quarter-over-quarter comparisons for reported metrics.
- Reported year-over-year growth rates for Technology revenue and Professional services revenue.
- CFO commentary.
- A reconciliation of forward Adjusted EBITDA guidance to GAAP net loss, which the company stated it did not provide.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.