HealthStream (HSTM) Q2 2025 earnings summary

Executive summary

• Achieved record quarterly revenue of $74.4 million in Q2 2025, up 4% year-over-year, with operating income up 33.4% to $5.9 million and net income up 29.3% to $5.4 million; diluted EPS increased to $0.18 from $0.14.

• Adjusted EBITDA grew 11.3% to $17.6 million in Q2 2025.

• Board authorized a $25 million share repurchase, with $18.1 million completed in Q2 and the remainder in July, completing the program.

• Quarterly dividend increased by 10.7% to $0.031 per share, declared for August 2025.

• Sublease of office space commenced in April 2025, generating $0.7 million in Q2 sublease income and expected to provide $1.6 million in H2 2025 and $3.2 million annually thereafter.

Financial highlights

• Q2 2025 revenues: $74.4 million (+4% YoY); six months: $147.9 million (+2.5% YoY); FY 2024 revenues: $291.6 million.

• Q2 2025 net income: $5.4 million (+29% YoY); six months: $9.7 million (+3% YoY).

• Adjusted EBITDA Q2 2025: $17.6 million (+11.3% YoY); six months: $33.8 million (+3% YoY); FY 2024 adjusted EBITDA: $66.8 million.

• Gross margin for Q2 2025: 64.5–65% ($48.0 million on $74.4 million revenue).

• Cash, cash equivalents, and marketable securities totaled $90.6 million at June 30, 2025; no outstanding debt.

Outlook and guidance

• Full-year 2025 revenue guidance: $297.5–$303.5 million.

• Net income expected between $19.5–$22.4 million; adjusted EBITDA guidance $68.5–$72.5 million; capital expenditures projected at $31–$34 million.

• 39% of $618 million in remaining performance obligations to be recognized in the next 12 months.

• Guidance excludes impacts from potential acquisitions, dispositions, or asset impairments.

• Sufficient liquidity is anticipated for working capital, product development, dividends, and share repurchases for at least the next 12 months.