Healthstream Inc.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 4 May 2026: press release. Guidance figures: 9 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Revenue reached a record $81.2 million: Revenues rose 10.5% to $81.2 million from $73.5 million a year earlier, which the company described as a new quarterly revenue record. Source
• Operating income rose 71.6%: Operating income increased on higher revenue and sublease income from a sublease that commenced in the second quarter of 2025, partly offset by higher expenses. Source
• Net income and diluted EPS higher: Net income rose 36.4%, and diluted EPS was $0.20 against $0.14. Diluted weighted average shares were 29.4 million, down from 30.6 million. Source
• Adjusted EBITDA up 24.1%: Adjusted EBITDA, a non-GAAP measure that the release reconciles to net income, was $20.1 million, up from $16.2 million. Source
• Total operating costs increased: Total operating costs and expenses were $73.7 million against $69.1 million, reflecting higher expenses to support investment in the platform and enterprise applications. Source
• Cash and securities of $66.5 million: Cash, cash equivalents and marketable securities were $66.5 million at March 31, 2026. Source
• Collier promoted to COO: Michael M. Collier moved to Chief Operating Officer and Executive Vice President, having joined HealthStream in 2011 as a corporate attorney. Source

“These results reflect disciplined execution and continued momentum across our business.”

Robert A. Frist, Jr., Chief Executive Officer, HealthStream

Guidance

What changed from last quarter

• New: Michael M. Collier was promoted to Chief Operating Officer and Executive Vice President, with an expanded enterprise operations role. Source
• New: A new $10.0 million share repurchase program was authorized on March 13, 2026, under Board approval. Source
• Ended: The November 2025 $10.0 million repurchase program terminated during the first quarter, when its maximum dollar amount was expended. Source

Revenue growth and drivers

• Revenue reached a record $81.2 million: Revenues rose 10.5% to $81.2 million from $73.5 million a year earlier, which the company described as a new quarterly revenue record. Source
• Subscription revenue drove most growth: Subscription revenues rose $7.6 million, or 10.7%, while professional services revenues rose $0.1 million. Source
• Acquisitions added $3.4 million: Of the revenue growth, $3.4 million came from the Virsys12 and MissionCare Collective acquisitions, and $4.3 million came from the existing portfolio of solutions. Source

Operating income and earnings

• Operating income rose 71.6%: Operating income increased on higher revenue and sublease income from a sublease that commenced in the second quarter of 2025, partly offset by higher expenses. Source
• Net income and diluted EPS higher: Net income rose 36.4%, and diluted EPS was $0.20 against $0.14. Diluted weighted average shares were 29.4 million, down from 30.6 million. Source
• Adjusted EBITDA up 24.1%: Adjusted EBITDA, a non-GAAP measure that the release reconciles to net income, was $20.1 million, up from $16.2 million. Source
• Interest income and tax both lower or higher: Interest income fell to $0.4 million from $0.9 million, and the income tax provision rose to $1.9 million from $0.9 million. Source

“Our results give us flexibility to invest in areas that we believe will drive ongoing growth and expansion”

Robert A. Frist, Jr., Chief Executive Officer, HealthStream

Operating costs and investment

• Total operating costs increased: Total operating costs and expenses were $73.7 million against $69.1 million, reflecting higher expenses to support investment in the platform and enterprise applications. Source
• Amortization from 2025 acquisitions rose: Amortization expense rose with the fourth-quarter 2025 acquisitions, adding to operating expenses alongside labor, royalties and cloud costs. Source
• Cost of revenues and product development up: Cost of revenues rose to $27.8 million from $25.5 million, and product development rose to $13.6 million from $12.0 million. General and administrative fell to $8.0 million from $8.7 million. Source
• Depreciation and amortization higher: Depreciation and amortization rose to $11.4 million from $10.8 million, and sales and marketing expense rose to $13.0 million from $12.1 million. Source

Strategy and AI platform

• HStream platform and AI named as core: The CEO named the hStream platform and the AI elements at its core among areas the results allow the company to invest in. Source
• Career Networks named as investment area: Career Networks and enterprise application suites were named among the areas the company said it may invest in to drive growth and expansion. Source
• Executive to sponsor AI transformation: Collier is executive sponsor for the company's AI transformation, including AI readiness across operational teams and use of AI for the workforce and internal processes. Source

Deferred revenue and cash flow

• Deferred revenue rose to $106.4 million: Current deferred revenue was $106.4 million at March 31, 2026, against $88.4 million at December 31, 2025. Accounts and unbilled receivables rose to $43.4 million from $39.0 million. Source
• Operating cash flow was $27.1 million: Net cash provided by operating activities was $27.1 million in both the first quarter of 2026 and the first quarter of 2025. Source

Cash, debt and capital spending

• Cash and securities of $66.5 million: Cash, cash equivalents and marketable securities were $66.5 million at March 31, 2026. Source
• No borrowed-money debt outstanding: The company reported no outstanding indebtedness from borrowed money at the end of the quarter. Source
• Capital expenditures of $7.3 million: Capital expenditures in the first quarter were $7.3 million, against the full-year 2026 capital expenditure range shown in the guidance list. Source

Share repurchases and dividend

• Repurchased $7.5 million of stock: The company repurchased 342,345 shares for $7.5 million in the first quarter, an average of $21.91 per share, across the March 2026 and November 2025 programs. Source
• Repurchases continued into second quarter: Through April 30, 2026, the company repurchased a further 90,131 shares valued at $1.8 million under the March 2026 program. Source
• Quarterly dividend held at $0.035: The board declared a quarterly cash dividend of $0.035 per share on May 4, 2026, the same amount declared in February 2026. Source

Leadership changes

• Collier promoted to COO: Michael M. Collier moved to Chief Operating Officer and Executive Vice President, having joined HealthStream in 2011 as a corporate attorney. Source
• Collier has led many acquisitions: The release says Collier has led more than two dozen acquisitions for the company since 2011. Source

Guidance scope and reconciliation

• Guidance excludes future deals: Guidance does not include acquisitions or dispositions not yet completed, fair value changes on investments or contingent consideration, or impairments of long-lived assets. Source
• Reconciliation bridges net income to EBITDA: The guidance reconciliation runs from projected net income to adjusted EBITDA, adding back stock-based compensation and depreciation and amortization. Source
• Interest and tax lines bridged: The reconciliation also lists projected interest income, interest expense and income tax provision, each shown in thousands. Source

Coming up, as management said on 4 May 2026

• Dividend payable May 29: The $0.035 quarterly dividend is payable May 29, 2026 to holders of record on May 18, 2026. Source
• Buyback program end date: The March 2026 repurchase program ends on the earlier of September 12, 2026 or when its $10.0 million maximum is spent. Source

Figures management reported

Risks management discussed

• Demand: Full-year guidance assumes new sales and renewals and that general economic conditions do not deteriorate. Source
• Operational: Higher labor, royalty, cloud hosting and third-party software costs were cited as drivers of higher operating expenses this quarter. Source

Earlier plans management reported on

• Not stated: Management reaffirmed the full-year 2026 guidance it gave on February 23, 2026. Source
• Not stated: Management said repurchases continued in the second quarter under the March 2026 authorization. Source

Other quarters

• Q2 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.