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HealthStream (HSTM) investor relations material
HealthStream Q3 2025 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Executive summary
Achieved record Q3 2025 revenue of $76.5 million, up 4.6% year-over-year, with operating income up 16.5% to $7.6 million and net income up 6.3% to $6.1 million; adjusted EBITDA reached $19.1 million, up 7.9% year-over-year, with a margin of 25%.
96–97% of revenues are subscription-based, providing predictable recurring revenue.
Closed the acquisition of Virsys12 (also referred to as Versus 12) for $11.2–$13.0 million in cash plus up to $4 million in contingent payments, expanding provider data management and payer market presence.
Launched and expanded career networks, including NurseGrid and My Clinical Exchange, targeting direct engagement with healthcare professionals and students.
Sublease of office space commenced in April 2025, generating $0.8 million in sublease income for Q3.
Financial highlights
Year-to-date revenue grew 3.2% to $224.4 million; Q3 revenues were $76.5 million, driven by a $4 million increase in subscription products.
Net income for the first nine months was $15.8 million, with EPS of $0.52 (diluted), both up from the prior year.
Professional service revenues declined by $0.6 million, or 18.6%.
Gross margin for Q3 2025 was 65.3%, down from 66.5% due to higher cloud hosting and software licensing costs.
Cash and investments at quarter-end were $92.6 million, with no debt.
Outlook and guidance
Full-year 2025 revenue guidance: $299.5–$301.5 million; net income: $20.3–$21.5 million; adjusted EBITDA: $69.5–$71.5 million; capital expenditures: $33–$34 million.
Guidance includes $900,000 revenue from Virsys12 in Q4, offset by a $3 million decline in legacy products.
Guidance midpoints unchanged, but ranges narrowed for clarity; excludes impacts from future acquisitions, investment gains/losses, or asset impairments.
Approximately $621 million in remaining performance obligations, with 39% expected to convert to revenue in 12 months.
Management expects continued investment in SaaS platform and product development.
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