Summary
Health Catalyst closed fiscal 2024 with fourth-quarter revenue of $79.6 million, up 6% from the prior-year quarter. Full-year revenue reached $306.6 million, up 4%. The company continued to shrink its losses. Fourth-quarter operating loss was $17.5 million, narrowed from $32.8 million a year earlier. Net loss for the quarter was $20.7 million, narrowed from $30.3 million. For the full year, operating loss was $69.8 million, narrowed from $126.9 million, and net loss was $69.5 million, narrowed from $118.1 million. Full-year diluted EPS was -$1.15, improved from -$2.09. Operating margin for the quarter was -22.0%, up 21.7 percentage points from the prior-year quarter. Full-year operating margin was -22.8%, up 20.1 percentage points. On a non-GAAP basis, fourth-quarter Adjusted EBITDA was $7.9 million, up 485% from $1.4 million. Full-year Adjusted EBITDA was $26.1 million, up 137% from $11.0 million. Adjusted Gross Margin was 47% for the quarter and 49% for the full year.
Operational metrics showed mixed momentum. Platform Clients totaled 130 as of December 31, 2024, up from 109 a year earlier. The company added 21 net new Platform Clients in 2024, up 91%. Average ARR and non-recurring revenue for those new clients landed toward the low end of the historical $400,000 to $1,000,000 range. The legacy Dollar-based Retention Rate was 100%, while the updated Tech + TEMS rate was 102%. App Clients exceeded 900. Health Catalyst also completed several acquisitions. It closed Upfront Healthcare on January 22, 2025, for $41.5 million in cash and $32.1 million in stock, plus an earn-out of up to $33.4 million. Intraprise Health was acquired on November 8, 2024, for $44.9 million. Lumeon and Carevive were acquired for $39.8 million and $22.1 million, respectively. Management decided to exit the pilot Ambulatory Operations TEMS offering by mid-2025, which represents about $9 million of annual services revenue. Recent client wins included Signature Healthcare, Valleywise, and a Life Sciences Payer.
Guidance points to continued growth. For the first quarter of 2025, Health Catalyst expects Adjusted EBITDA of approximately $4 million. For the full year 2025, the company guides to Adjusted EBITDA of approximately $41 million, which is raised by $2 million. The company also targets a 2025 Dollar-based Retention Rate of approximately 103% and about 40 net new Platform Clients, up 90%. Health Catalyst added 6 Platform Clients thus far in 2025 and anticipates about 10 net new Platform Client additions by the end of the first quarter. The 2025 Tech BU Adjusted EBITDA target is approximately $40 million, also raised by $2 million.
Cash flow and backlog metrics improved. Fourth-quarter operating cash flow was -$3.5 million, up from -$19.0 million in the prior-year quarter. Full-year operating cash flow was $14.6 million, up from -$33.1 million. Capital expenditures were $0.4 million in the quarter, up 62%, and $1.6 million for the full year, up 30.7%. Deferred revenue stood at $53.5 million, down 4.1% from the prior-year quarter. Remaining performance obligations were $277.4 million, up 4.9%. Risks remain. The health system end market has faced financial strain from high inflation and high interest rates, though operating margins improved in 2024. The migration to Health Catalyst Ignite is expected to finish in mid-2026 and will create a near-term headwind for technology segment costs. A greater mix of TEMS work is expected to weigh on Adjusted Gross Margin. Integration costs from recent acquisitions and expected flat to declining revenue from Medicity clients add further uncertainty. The company also cites risks from changes in laws and regulations, market conditions, litigation or a security incident, loss of key clients or partners, and challenges in recruiting and retaining team members.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2024 | Q3 FY2024 | QoQ | Q4 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $79.6M | $76.4M | +4.3% | $75.1M | +6.0% |
| Research & development | $15.0M | $14.2M | +5.7% | $20.3M | -26.1% |
| Sales & marketing | $11.2M | $11.3M | -0.9% | $17.3M | -34.9% |
| General & administrative | $15.7M | $12.2M | +28.4% | $15.4M | +1.6% |
| Total operating expenses | $52.2M | $47.7M | +9.4% | $63.3M | -17.5% |
| Operating income (loss) | -$17.5M | -$13.7M | -27.9% | -$32.8M | +46.6% |
| Operating margin | -22.0% | -17.9% | -4.1 pp | -43.7% | +21.7 pp |
| Net income (loss) | -$20.7M | -$14.7M | -40.4% | -$30.3M | +31.8% |
| Net margin | -26.0% | -19.3% | -6.7 pp | -40.4% | +14.4 pp |
| Diluted EPS | -$0.34 | -$0.24 | -$0.10 | -$0.54 | +$0.20 |
Risks
Increasing reliance on AI and generative AI, machine learning, and automated decision-making technologies exposes the company to development and deployment challenges, regulatory uncertainty, third-party AI dependency, and potential liability from false or hallucinatory outputs. New state laws such as Colorado's Artificial Intelligence Act and Utah's Artificial Intelligence Policy Act add compliance costs and uncertainty.
Recent macroeconomic challenges including high inflation, high interest rates, new tariffs, and a tight labor market continue to pressure health system budgets and client spending. MD&A notes health system operating margins improved in 2024 relative to 2022 and 2023, but financial strain has continued to pressure budgets and may reduce demand or delay client purchases.
The sales cycle for a new Platform Client is estimated at approximately one year and in some cases has exceeded two years. The company experienced lengthening sales cycles in 2022 and 2023, and TEMS sales cycles can be more difficult to predict and at times longer than the typical sales cycle.
The healthcare analytics market is intensely competitive, with competitors including Epic Systems, Oracle Health, Optum Analytics, and IBM. Pricing pressures and client or vendor consolidation could reduce revenue, profitability, or market share.
Migration of Platform Clients from DOS to Health Catalyst Ignite may cause client dissatisfaction, non-renewals, and higher cost of technology revenue. Adjusted Technology Gross Margin decreased from 68% for the year ended Dec 31, 2023 to 66% for the year ended Dec 31, 2024, and the company expects it to fluctuate and potentially decline near term, with migrations anticipated to complete in mid-2026.
Existing clients may not renew, may renew at lower fee levels, or may decline to purchase additional technology and services. In 2024 some clients shifted spend from recurring FTE subscriptions to non-recurring project-based work, which is less predictable and pressured non-TEMS professional services Dollar-based Retention Rate.
The three largest clients comprised 5.5%, 4.4%, and 3.9% of 2024 revenue, or 13.8% in aggregate, up from 12.6% in 2023. The loss, termination, or renegotiation of any largest client contract could adversely affect results of operations.
The 2023 Restructuring Plan reduced the global workforce by approximately 10% in Q4 2023 and Q1 2024. The 2025 Restructuring Plan authorized on Jan 25, 2025 reduced the global workforce by approximately 4% in Q1 2025, primarily in R&D and professional services, and benefits may be less than expected or disrupt operations.
Recent acquisitions including Upfront in Jan 2025, Intraprise in Nov 2024, Lumeon in Aug 2024, and Carevive in May 2024 create integration costs, duplicative costs, and potential dilution. Acquired businesses such as Medicity have generated lower retention and are expected to have declining revenue in the foreseeable future.
Professional services mix is expected to include more TEMS, which have minimal initial services gross margins that gradually increase over time. Total Adjusted Gross Margin remained constant at 49% for the years ended Dec 31, 2023 and 2024, but the company expects total Adjusted Gross Margin to fluctuate and decline near term due to anticipated growth in professional services including TEMS.
SaaS KPIs
All quarters →Adjusted EBITDA
Adjusted Gross Margin
App Clients
Adjusted Gross Profit
Summary, forecast, risks and KPIs are extracted from Health Catalyst, Inc.'s SEC filings for Q4 FY2024 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 1, 2026.