Health Catalyst Reaffirms 2026 Outlook After Vitalware Sale

The Tip Desk · November 5, 2026 · 3 min read

Third-quarter revenue was $56.28 million as the company closed the Vitalware sale and reaffirmed full-year revenue of $246 million to $249 million.

Health Catalyst, Inc. (HCAT), a healthcare intelligence company, reported third-quarter revenue of $56.28 million, down 26% from $76.32 million a year earlier, after closing the Vitalware divestiture on July 31, 2026 and citing headwinds from the migration from DOS to Ignite.

Revenue in the June quarter was $70.49 million. President and Chief Executive Officer Simeon Kohl said the company delivered a third quarter above the high end of its revenue and Adjusted EBITDA guidance and is reaffirming its full-year outlook.

Adjusted EBITDA was $0.78 million, down 94% from $12.00 million a year earlier. Sequentially, Adjusted EBITDA fell from $9.92 million in the June quarter. Gross profit was $17.35 million and gross margin was 31%. Adjusted gross profit was $24.91 million and adjusted gross margin was 44%.

GAAP results flipped to net income of $40.50 million, or $0.53 a share diluted, from a $22.23 million loss a year earlier. The company said the net income was largely driven by a $65.9 million gain on the sale of the Vitalware business. Total consideration on the Vitalware transaction was $146.3 million, with $80.4 million of net assets disposed. On July 31, the company used net cash proceeds from the sale together with cash on hand to repay in full all outstanding obligations under its credit agreement and terminate the agreement, recognizing a $9.49 million loss on extinguishment of debt.

Technology revenue was $40.69 million. Professional services revenue was $15.60 million. Technology adjusted gross margin was 61% and professional services adjusted gross margin was 2%. Technology gross margin was 44% and professional services gross margin was negative 3%.

Kohl said the company’s immediate priority is to strengthen the foundation of the business, with a focus on retaining the clients it serves and developing a path to generating durable, profitable revenue. The company said total revenue, gross profit, gross margin, Adjusted Gross Profit, Adjusted Gross Margin, and Adjusted EBITDA decreased year-over-year primarily as a result of the Vitalware divestiture and DOS-to-Ignite migration headwinds, partially offset by cost-reduction initiatives.

As of September 30, 2026, cash and cash equivalents were $53.75 million and short-term investments were $25.25 million. Goodwill was $11.10 million. Long-term debt was zero. At December 31, 2025, goodwill was $209.07 million and long-term debt, net of current portion, was $151.62 million.

For the full year of 2026, Health Catalyst expects total revenue of $246 million to $249 million and Adjusted EBITDA of $18 million to $18.5 million. Those ranges were unchanged from the outlook issued after the second quarter. The company has not provided forward-looking guidance for net income (loss).

Kohl’s comments on the quarter’s position versus guidance and the reaffirmation of the full-year ranges sit alongside the operating contraction after Vitalware left the P&L. Management framed the next step as client retention and a path to durable, profitable revenue rather than a restatement of the 2026 revenue and Adjusted EBITDA bands.