Health Catalyst Reports 6% Revenue Growth to $79.4 Million in Q1 2025

Health Catalyst, Inc. reported its financial results for the first quarter of 2025, revealing total revenue of $79.4 million, a 6% increase from $74.7 million in the same period last year. The growth was primarily driven by new client acquisitions and revenue expansion from existing clients. However, the company also recorded a net loss of $23.7 million, compared to a net loss of $20.6 million in the prior year. The increase in losses was attributed to higher operating expenses, including costs related to recent acquisitions and restructuring efforts.

In terms of operational metrics, Health Catalyst's technology revenue accounted for 65% of total revenue, amounting to $51.5 million, while professional services revenue was $27.9 million, representing 35% of total revenue. The company experienced a slight decline in gross margin, which fell to 36% from 39% year-over-year, largely due to increased costs associated with transitioning clients to new platforms and higher personnel expenses. Adjusted EBITDA improved to $6.3 million from $3.4 million, indicating a positive trend in operational efficiency despite the overall net loss.

Strategically, Health Catalyst has been active in expanding its portfolio through acquisitions. The company completed the acquisition of Upfront Healthcare Services for $80 million in January 2025, which is expected to enhance its patient engagement capabilities. Additionally, the company has made several other acquisitions in recent years, including Intraprise Health and Carevive Systems, which are anticipated to contribute to future revenue growth. The integration of these businesses is ongoing, and the company is focused on leveraging these new capabilities to drive further expansion.

As of March 31, 2025, Health Catalyst reported cash, cash equivalents, and short-term investments totaling $342 million, providing a solid liquidity position to support its operations and growth initiatives. The company has also implemented a share repurchase program, repurchasing $5 million worth of its stock during the quarter. Looking ahead, Health Catalyst remains optimistic about its growth trajectory, particularly as it continues to enhance its technology offerings and expand its client base in a challenging macroeconomic environment. The company is closely monitoring market conditions and client needs to adapt its strategies accordingly.