Health Catalyst, Inc.

What they do

Health Catalyst provides data and analytics software and services designed to help health systems improve clinical, cost and consumer performance. The company was founded to aggregate clinical, financial and operational data into a single analytics environment and sell improvement applications on top of it. It has historically generated most of its revenue from health system clients, with the business including both recurring platform/technology fees and services tied to implementation and improvement work. Management says its products are backed by proprietary AI-driven technology and $2.8 billion in documented outcomes.

Revenue drivers

• Legacy analytics platform and DOS clients — The core installed base of health system analytics and population health clients; the company is migrating these clients to the new Health Catalyst Ignite platform, a process it flags as carrying churn and down-selling risk.
• Health Catalyst Ignite — The new platform the company is rolling out and migrating existing DOS clients onto; guidance and forward-looking language tie future revenue to the success of this migration.
• Vitalware (divested) — The company closed the Vitalware divestiture, disclosed in the August 6, 2026 8-K; the proceeds were used with the stated intent of repaying credit facility debt.
• Services and improvement offerings — Implementation, improvement and support work tied to the analytics platform; total revenue has been declining year over year, with second quarter 2026 revenue of $70.5 million down 13% from $80.7 million.

Recent performance

Second quarter 2026 total revenue was $70.5 million, down 13% from $80.7 million in the second quarter of 2025. GAAP gross margin was 40% versus 38% a year earlier, while net loss was $40.5 million, roughly flat year over year. Adjusted EBITDA was $9.9 million, up 6% from $9.3 million. Full year 2025 revenue was $311.1 million with a net loss of $178.0 million, a much wider loss than 2024's $69.5 million. Quarterly revenue has declined sequentially from $76.3 million in September 2025 to $70.5 million in June 2026.

Strategy

Management is consolidating its product set onto the Health Catalyst Ignite platform and migrating existing DOS clients to it. The company closed the Vitalware divestiture and fully repaid its credit facility debt, which management says improves the balance sheet and provides flexibility for 'measured near-term bets.' CEO Ben Albert, who took the role in February 2026 after the Upfront Healthcare acquisition, describes the focus as building an intelligence products company that helps health systems improve outcomes faster.

Risks

• Ignite migration churn — The company's own forward-looking statements warn that migrating DOS clients to Ignite could cause clients to reduce or eliminate spend, churn, or down-sell.
• Revenue decline — Total revenue fell 13% year over year in the second quarter of 2026, and third quarter guidance of $55-56 million implies a further sequential drop.
• Persistent losses — The company reported a $178.0 million net loss in 2025 and a $40.5 million net loss in the second quarter of 2026, with stock-based compensation excluded from adjusted EBITDA guidance.
• Customer concentration in health systems — The business depends on health systems, and the company cites Medicaid and research funding cuts and macro conditions as factors that could affect its clients and results.

Outlook

For the third quarter of 2026, management guided to total revenue of $55-56 million and Adjusted EBITDA of $0-0.5 million. For the full year 2026, management guided to total revenue of $246-249 million and Adjusted EBITDA of $18-18.5 million. The company did not provide forward-looking net loss guidance or reconcile Adjusted EBITDA guidance to net loss, citing items such as stock-based compensation that it cannot reasonably forecast.