Health Catalyst Cuts Annual Revenue and Earnings Outlook

The Tip Desk · October 17, 2026 · 3 min read

Health Catalyst lowered its full-year revenue forecast to $246 million to $249 million and reported that it had completed the Vitalware sale and repaid its credit facility.

Health Catalyst, Inc. (HCAT), a healthcare intelligence company, cut its annual outlook after its revenue decline deepened for a second consecutive quarter. Revenue fell 13% year over year in the three months ended June 30, following declines of 11% in the first quarter and 6% in the final quarter of 2025. Growth in adjusted earnings also slowed across those quarters.

Second-quarter revenue of $70.49 million nevertheless exceeded the company's $68 million to $70 million forecast. Chief Executive Ben Albert described the quarter as productive and pointed to the recently completed Vitalware divestiture and full repayment of credit facility debt. Those actions followed the operating-model reset he had outlined with the first-quarter results.

Adjusted earnings before interest, taxes, depreciation and amortization totaled $9.92 million. Its year-over-year growth slowed to 6%, following increases of 46% in the first quarter and 74% in the fourth quarter of 2025. The sequence marked a narrowing of adjusted earnings growth alongside the progressively steeper revenue declines, even though the measure remained positive throughout the three quarters.

Technology remained the larger of the company's two businesses, producing revenue of $48.80 million and an adjusted gross margin of 63%. Professional services generated revenue of $21.69 million and an adjusted gross margin of 22%. Technology therefore supplied most of both revenue and adjusted gross profit, making it central to the company's current operating mix as Albert pursued the strategic reset.

At the company level, adjusted gross margin was 51%, and adjusted gross profit totaled $35.84 million. Adjusted operating expenses were $25.92 million. Those expenses excluded depreciation and amortization, stock-based compensation, acquisition-related costs, goodwill impairment and restructuring costs. The resulting adjusted earnings measure captured a different set of expenses from the company's reported net result.

Health Catalyst recorded a net loss of $40.54 million, or $0.55 a share. The quarter included a $27.05 million goodwill impairment associated with its Technology reporting unit. Impairment testing showed that the unit's fair value was below its carrying value. That charge was excluded from adjusted EBITDA, accounting for a substantial portion of the difference between the positive adjusted result and the net loss.

Restructuring costs totaled $3.71 million and were also excluded from adjusted EBITDA. Those costs included severance and other team-member costs from workforce reductions, along with legal and advisory fees related to a significant board refreshment.

Albert said the Vitalware sale and credit facility repayment improved the balance sheet and provided flexibility for measured near-term investments. He said the company was working to build around intelligence products that it believed could help health systems improve outcomes faster. His comments extended the emphasis on a more focused technology business that accompanied the first-quarter results.

The June 30 balance sheet listed cash and cash equivalents of $60.59 million and short-term investments of $42.85 million. It also still carried assets held for sale of $91.42 million and debt totaling $153.48 million. Those period-end figures were distinct from Albert's announcement that the company had recently completed the divestiture and repaid the facility.

For the full year, Health Catalyst now expects revenue of $246 million to $249 million, down from its previous $260 million to $265 million range. Its annual adjusted EBITDA forecast is $18 million to $18.5 million, replacing the earlier $30 million to $33 million outlook. Both revised ranges sit entirely below the previous forecasts.

The nearer-term outlook calls for third-quarter revenue of $55 million to $56 million and adjusted EBITDA of zero to $0.5 million. That earnings range puts the company's guidance close to break-even on its adjusted measure for the coming quarter.