Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Health Catalyst Reports Fourth Quarter and Year End 2022 Results By: Health Catalyst, Inc. via GlobeNewswire February 28, 2023 at 16:03 PM EST SOUTH JORDAN, Utah, Feb. 28, 2023 (GLOBE NEWSWIRE) -- Health Catalyst, Inc. ("Health Catalyst," Nasdaq: HCAT), a leading provider of data and analytics technology and services to healthcare organizations, today reported financial results for the quarter and year ended December 31, 2022. “In the fourth quarter of 2022, I am pleased to share that we achieved strong performance across our business, including exceeding the mid-point of our quarterly guidance for both revenue and Adjusted EBITDA. For the full year 2022, I am also excited to share that our Adjusted EBITDA outperformed the mid-point of the original full year guidance we provided entering 2022, demonstrating continued operating leverage in our business despite lower annual revenue growth for 2022 as compared to our initial guidance for 2022.” said Dan Burton, CEO of Health Catalyst. “Additionally, I am honored to announce that Matthew Kolb, Executive Vice President and Chief Operating Officer of Carle Health, will be joining the Health Catalyst Board of Directors, effective July 1, 2023. Matt is deeply committed to Health Catalyst’s and Carle Health’s shared mission of data-informed healthcare improvement, and he has been an extraordinary leader throughout his career in enabling massive improvements in the healthcare ecosystem. Additionally, Carle Health has made the decision to deepen its long-term investment in Health Catalyst with a meaningful purchase on the open market of Health Catalyst’s common stock. We welcome them as a deeply mission-aligned long-term-oriented owner in the company. Consistent with my own personal decisions to purchase Health Catalyst shares on the open market over the past several months, which we estimate places me among Health Catalyst’s twenty largest shareholders, I am grateful to add a like-minded, deeply mission-focused and long-term oriented fellow shareholder to our company’s ownership group.” Financial Highlights for the Three and Twelve Months Ended December 31, 2022 Key Financial Metrics Three Months Ended December 31, Year over Year Change Twelve Months Ended December 31, Year over Year Change 2022 2021 2022 2021 GAAP Financial Data:(in thousands, except percentages) (in thousands, except percentages) Technology revenue$44,664 $40,088 11% $176,288 $147,718 19%Professional services revenue$24,498 $24,628 (1)% $99,948 $94,208 6%Total revenue$69,162 $64,716 7% $276,236 $241,926 14%Loss from operations$(36,745) $(44,765) 18% $(140,005) $(143,650) 3%Net loss$(35,782) $(48,992) 27% $(137,403) $(153,210) 10%Non-GAAP Financial Data:(1) Adjusted Technology Gross Profit$30,725 $27,951 10% $122,284 $102,326 20%Adjusted Technology Gross Margin 69% 70% 69% 69% Adjusted Professional Services Gross Profit$4,325 $5,745 (25)% $23,565 $25,544 (8)%Adjusted Professional Services Gross Margin 18% 23% 24% 27% Total Adjusted Gross Profit$35,050 $33,696 4% $145,849 $127,870 14%Total Adjusted Gross Margin 51% 52% 53% 53% Adjusted EBITDA$(603) $(6,278) 90% $(2,487) $(11,248) 78% ________________________ (1) These measures are not calculated in accordance with generally accepted accounting principles in the United States (GAAP). See the accompanying "Non-GAAP Financial Measures" section below for more information about these financial measures, including the limitations of such measures, and for a reconciliation of each measure to the most directly comparable measure calculated in accordance with GAAP. Other Key Metrics As of December 31, 2022 2021 2020 DOS Subscription Clients98 90 74 Year Ended December 31, 2022 2021 2020 Dollar-based Retention Rate100% 112% 102% The financial strain imposed by COVID-19 on a number of our clients led to a meaningfully lower professional services dollar-based retention in 2020 compared to prior years due to discounts provided to support our clients through the financial strain related to the initial outbreak. We did not provide similar discounts during 2021 and saw improvement in our professional services Dollar-based Retention Rate compared to 2020. However, 2022 proved to be a more challenging year than anticipated as a result of the inflationary macroeconomic environment and the meaningful financial strain that our health system end market faced, which contributed to a lower Dollar-based Retention Rate compared to 2021. Financial Outlook Health Catalyst provides forward-looking guidance on total revenue, a GAAP measure, and Adjusted EBITDA, a non-GAAP measure. For the first quarter of 2023, we expect: Total revenue between $70.3 million and $72.3 million, and Adjusted EBITDA between $1.0 million and $2.5 million For the full year of 2023, we expect: Total revenue between $290 million and $295 million, and Adjusted EBITDA between $9.0 million and $11.0 million We have not reconciled guidance for Adjusted EBITDA to net loss, the most directly comparable GAAP measure, and have not provided forward-looking guidance for net loss, because there are items that may impact net loss, including stock-based compensation, that are not within our control or cannot be reasonably forecasted. Quarterly Conference Call Details The company will host a conference call to review the results today, Tuesday, February 28, 2023 at 5:00 p.m. E.T. The conference call can be accessed by dialing (800) 343-5172 for U.S. participants, or (785) 424-1699 for international participants, and referencing conference ID “HCAT Q422.” A live audio webcast will be available online at https://ir.healthcatalyst.com/. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days. About Health Catalyst Health Catalyst is a leading provider of data and analytics technology and services to healthcare organizations committed to being the catalyst for massive, measurable, data-informed healthcare improvement. Its clients leverage the cloud-based data platform — powered by data from more than 100 million patient records and encompassing trillions of facts—as well as its analytics software and professional services expertise to make data-informed decisions and realize measurable clinical, financial, and operational improvements. Health Catalyst envisions a future in which all healthcare decisions are data informed. Available Information Our investors and others should note that we announce material information to the public about our company, products and services, and other matters related to our company through a variety of means, including our website (https://www.healthcatalyst.com/), our investor relations website (https://ir.healthcatalyst.com/), press releases, SEC filings, public conference calls, and social media, including our and our CEO's social media accounts, in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligations under Regulation FD. Forward-Looking Statements This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding our future growth and our financial outlook for Q1 and fiscal year 2023. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) changes in laws and regulations applicable to our business model; (ii) changes in market or industry conditions, regulatory environment, and receptivity to our technology and services; (iii) results of litigation or a security incident; (iv) the loss of one or more key clients or partners; (v) the impact of the challenging macroeconomic environment (including high inflationary and/or high interest rate environments) or public health emergencies, such as the COVID-19 pandemic, on our business and results of operations; and (vi) changes to our abilities to recruit and retain qualified team members. For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports, including, but not limited to the Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2022 that was filed with the SEC on November 8, 2022 and the Annual Report on Form 10-K for the year ended December 31, 2022 expected to be filed with the SEC on or about February 28, 2023. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update or revise this information unless required by law. Condensed Consolidated Balance Sheets(in thousands, except share and per share data, unaudited) As of December 31, 2022 2021 Assets Current assets: Cash and cash equivalents$116,312 $193,227 Short-term investments 247,178 251,754 Accounts receivable, net 47,970 48,801 Prepaid expenses and other assets 16,335 14,609 Total current assets 427,795 508,391 Property and equipment, net 25,928 23,316 Operating lease right-of-use assets 16,658 21,133 Intangible assets, net 92,189 104,788 Goodwill 185,982 169,972 Other assets 3,734 4,496 Total assets$752,286 $832,096 Liabilities and stockholders’ equity Current liabilities: Accounts payable$4,424 $4,693 Accrued liabilities 19,691 23,725 Deferred revenue 54,961 56,632 Operating lease liabilities 3,434 3,425 Contingent consideration liabilities — 4,576 Total current liabilities 82,510 93,051 Long-term debt, net of current portion 226,523 180,942 Deferred revenue, net of current portion 105 929 Operating lease liabilities, net of current portion 18,017 20,244 Contingent consideration liabilities, net of current portion — 14,719 Other liabilities 121 113 Total liabilities 327,276 309,998 Commitments and contingencies Stockholders’ equity: Preferred stock, $0.001 par value per share and additional paid-in capital; 25,000,000 shares authorized and no shares issued and outstanding as of December 31, 2022 and 2021 — — Common stock, $0.001 par value per share, and additional paid-in capital; 500,000,000 shares authorized as of December 31, 2022 and 2021; 55,261,922 and 52,622,080 shares issued and outstanding as of December 31, 2022 and 2021, respectively 1,424,681 1,401,025 Accumulated deficit (999,023) (878,860)Accumulated other comprehensive loss (648) (67)Total stockholders’ equity 425,010 522,098 Total liabilities and stockholders’ equity$752,286 $832,096 Condensed Consolidated Statements of Operations(in thousands, except per share data, unaudited) Three Months EndedDecember 31, Twelve Months EndedDecember 31, 2022 2021 2022 2021 Revenue: Technology$44,664 $40,088 $176,288 $147,718 Professional services 24,498 24,628 99,948 94,208 Total revenue 69,162 64,716 276,236 241,926 Cost of revenue, excluding depreciation and amortization: Technology(1)(2)(3) 14,747 12,750 56,642 47,516 Professional services(1)(2)(3) 23,359 21,127 86,407 76,838 Total cost of revenue, excluding depreciation and amortization 38,106 33,877 143,049 124,354 Operating expenses: Sales and marketing(1)(2)(3) 20,373 21,863 87,514 75,027 Research and development(1)(2)(3) 19,614 17,479 75,680 62,733 General and administrative(1)(2)(3)(4) 16,150 25,338 61,701 85,934 Depreciation and amortization 11,664 10,924 48,297 37,528 Total operating expenses 67,801 75,604 273,192 261,222 Loss from operations (36,745) (44,765) (140,005) (143,650)Loss on extinguishment of debt — — — — Interest and other expense, net 1,022 (4,376) (1,678) (16,458)Loss before income taxes (35,723) (49,141) (141,683) (160,108)Income tax provision (benefit)(2) 59 (149) (4,280) (6,898)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Net loss per share, basic$(0.66) $(0.94) $(2.56) $(3.23)Net loss per share, diluted$(0.66) $(0.94) $(2.63) $(3.23)Weighted-average shares outstanding used in calculating net loss per share, basic 54,496 52,117 53,722 47,495 Weighted-average shares outstanding used in calculating net loss per share, diluted 54,496 52,117 54,080 47,495 _______________(1) Includes stock-based compensation expense as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Stock-Based Compensation Expense:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$495 $582 $2,058 $2,063Professional services 2,148 2,181 8,230 8,047Sales and marketing 7,157 5,850 28,082 22,698Research and development 3,295 2,770 12,938 10,213General and administrative 5,653 5,038 20,796 22,124Total$18,748 $16,421 $72,104 $65,145 (2) Includes acquisition-related costs, net as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 Acquisition-related costs, net:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$84 $31 $351 $61 Professional services 146 63 655 127 Sales and marketing 337 296 1,894 592 Research and development 687 446 3,045 901 General and administrative 452 10,306 (1,051) 26,248 Income tax benefit — (314) (4,533) (7,142)Total$1,706 $10,828 $361 $20,787 (3) Includes restructuring costs, as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Restructuring costs:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$229 $— $229 $—Professional services 892 — 1,139 —Sales and marketing 1,464 — 3,023 —Research and development 1,153 — 3,410 —General and administrative 188 — 624 —Total$3,926 $— $8,425 $— (4) Includes non-recurring lease-related charges, as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Non-recurring lease-related charges(in thousands) (in thousands)General and administrative$98 $— $3,798 $1,800 Condensed Consolidated Statements of Cash Flows(in thousands, unaudited) Year Ended December 31, 2022 2021 Cash flows from operating activities Net loss$(137,403) $(153,210)Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 72,104 65,145 Depreciation and amortization 48,297 37,528 Change in fair value of contingent consideration liabilities (4,668) 20,036 Amortization of debt discount and issuance costs 1,500 11,948 Non-cash operating lease expense 3,231 3,585 Impairment of long-lived assets 5,023 1,800 Investment discount and premium (accretion) amortization (2,236) 1,202 Provision for expected credit losses 691 499 Deferred tax benefit (4,523) (7,134)Payment of acquisition-related contingent consideration (3,234) (9,085)Other (145) (53)Change in operating assets and liabilities: Accounts receivable 788 102 Prepaid expenses and other assets (478) (4,442)Accounts payable, accrued liabilities, and other liabilities (4,702) 5,202 Deferred revenue (5,997) 7,637 Operating lease liabilities (3,518) (3,883)Net cash used in operating activities (35,270) (23,123)Cash flows from investing activities Purchase of short-term investments (308,961) (261,363)Proceeds from the sale and maturity of short-term investments 315,171 186,893 Acquisition of businesses, net of cash acquired (27,846) (46,763)Purchases of property and equipment (2,167) (10,450)Capitalization of internal use software (12,987) (6,644)Purchase of intangible assets (2,260) (1,373)Proceeds from the sale of property and equipment 29 22 Net cash used in investing activities (39,021) (139,678)Cash flows from financing activities Proceeds from exercise of stock options 3,969 20,350 Proceeds from employee stock purchase plan 3,153 4,844 Payments of acquisition-related consideration (1,342) (6,290)Repurchase of common stock (8,393) — Proceeds from public offerings, net of discounts, commissions, and offering costs — 245,180 Net cash (used in) provided by financing activities (2,613) 264,084 Effect of exchange rate changes on cash and cash equivalents (11) (10)Net (decrease) increase in cash and cash equivalents (76,915) 101,273 Cash and cash equivalents at beginning of period 193,227 91,954 Cash and cash equivalents at end of period$116,312 $193,227 Non-GAAP Financial Measures To supplement our financial information presented in accordance with GAAP, we believe certain non-GAAP measures, including Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, Adjusted Net Loss, and Adjusted Net Loss per share, basic and diluted, are useful in evaluating our operating performance. For example, we exclude stock-based compensation expense because it is non-cash in nature and excluding this expense provides meaningful supplemental information regarding our operational performance and allows investors the ability to make more meaningful comparisons between our operating results and those of other companies. We use this non-GAAP financial information to evaluate our ongoing operations, as a component in determining employee bonus compensation, and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business. Adjusted Gross Profit and Adjusted Gross Margin Adjusted Gross Profit is a non-GAAP financial measure that we define as revenue less cost of revenue, excluding depreciation and amortization, adding back stock-based compensation, acquisition-related costs, net, and restructuring costs as applicable. We define Adjusted Gross Margin as our Adjusted Gross Profit divided by our revenue. We believe Adjusted Gross Profit and Adjusted Gross Margin are useful to investors as they eliminate the impact of certain non-cash expenses and allow a direct comparison of these measures between periods without the impact of non-cash expenses and certain other non-recurring operating expenses. The following is a reconciliation of revenue, the most directly comparable GAAP financial measure, to Adjusted Gross Profit, for the three and twelve months ended December 31, 2022 and 2021: Three Months Ended December 31, 2022 (in thousands, except percentages) Technology Professional Services TotalRevenue$44,664 $24,498 $69,162 Cost of revenue, excluding depreciation and amortization (14,747) (23,359) (38,106)Gross profit, excluding depreciation and amortization 29,917 1,139 31,056 Add: Stock-based compensation 495 2,148 2,643 Acquisition-related costs, net(1) 84 146 230 Restructuring costs(2) 229 892 1,121 Adjusted Gross Profit$30,725 $4,325 $35,050 Gross margin, excluding depreciation and amortization 67% 5% 45%Adjusted Gross Margin 69% 18% 51% ___________________ (1) Acquisition-related costs, net include deferred retention expenses following the ARMUS, KPI Ninja, and Twistle acquisitions.(2) Restructuring costs include severance and other team member costs from workforce reductions. Three Months Ended December 31, 2021 (in thousands, except percentages) Technology Professional Services TotalRevenue$40,088 $24,628 $64,716 Cost of revenue, excluding depreciation and amortization (12,750) (21,127) (33,877)Gross profit, excluding depreciation and amortization 27,338 3,501 30,839 Add: Stock-based compensation 582 2,181 2,763 Acquisition-related costs, net(1) 31 63 94 Adjusted Gross Profit$27,951 $5,745 $33,696 Gross margin, excluding depreciation and amortization 68% 14% 48%Adjusted Gross Margin 70% 23% 52% ___________________(1) Acquisition-related costs, net include deferred retention expenses following the acquisition of Twistle. Twelve Months Ended December 31, 2022 (in thousands, except percentages) Technology Professional Services TotalRevenue$176,288 $99,948 $276,236 Cost of revenue, excluding depreciation and amortization (56,642) (86,407) (143,049)Gross profit, excluding depreciation and amortization 119,646 13,541 133,187 Add: Stock-based compensation 2,058 8,230 10,288 Acquisition-related costs, net(1) 351 655 1,006 Restructuring costs(2) 229 1,139 1,368 Adjusted Gross Profit$122,284 $23,565 $145,849 Gross margin, excluding depreciation and amortization 68% 14% 48%Adjusted Gross Margin 69% 24% 53% ___________________(1) Acquisition-related costs, net include deferred retention expenses following the ARMUS, KPI Ninja, and Twistle acquisitions.(2) Restructuring costs include severance and other team member costs from workforce reductions. Twelve Months Ended December 31, 2021 (in thousands, except percentages) Technology ProfessionalServices TotalRevenue$147,718 $94,208 $241,926 Cost of revenue, excluding depreciation and amortization (47,516) (76,838) (124,354)Gross profit, excluding depreciation and amortization 100,202 17,370 117,572 Add: Stock-based compensation 2,063 8,047 10,110 Acquisition-related costs, net(1) 61 127 188 Adjusted Gross Profit$102,326 $25,544 $127,870 Gross margin, excluding depreciation and amortization 68% 18% 49%Adjusted Gross Margin 69% 27% 53% __________________ (1) Acquisition-related costs, net includes deferred retention expenses following the acquisition of Twistle. Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net loss adjusted for (i) interest and other (income) expense, net, (ii) income tax provision (benefit), (iii) depreciation and amortization, (iv) stock-based compensation, (v) acquisition-related costs, net, including the fair change in value of contingent consideration liabilities for potential earn-out payments, (vi) restructuring costs, and (vii) non-recurring lease-related charges. We view acquisition-related expenses when applicable, such as transaction costs and changes in the fair value of contingent consideration liabilities that are directly related to business combinations as costs that are unpredictable, dependent upon factors outside of our control, and are not necessarily reflective of operational performance during a period. We believe Adjusted EBITDA provides investors with useful information on period-to-period performance as evaluated by management and a comparison with our past financial performance and is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. The following is a reconciliation of our net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA, for the three and twelve months ended December 31, 2022 and 2021: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 (in thousands) (in thousands)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Add: Interest and other (income) expense, net (1,022) 4,376 1,678 16,458 Income tax provision (benefit) 59 (149) (4,280) (6,898)Depreciation and amortization 11,664 10,924 48,297 37,528 Stock-based compensation 18,748 16,421 72,104 65,145 Acquisition-related costs, net(1) 1,706 11,142 4,894 27,929 Restructuring cost(2) 3,926 — 8,425 — Non-recurring lease-related charges(3) 98 — 3,798 1,800 Adjusted EBITDA$(603) $(6,278) $(2,487) $(11,248) __________________(1) Acquisition-related costs, net includes third-party fees associated with due diligence, deferred retention expenses, post-acquisition restructuring costs incurred as part of business combinations, and changes in fair value of contingent consideration liabilities for potential earn-out payments. For additional details refer to Notes 1, 2, and 7 in our consolidated financial statements.(2) Restructuring costs include severance and other team member costs from workforce reductions, impairment of discontinued capitalized software projects, and other miscellaneous charges. For additional details, refer to Note 11 in our consolidated financial statements.(3) Includes the lease-related impairment charge for the subleased portion of our corporate headquarters. For additional details refer to Note 9 in our consolidated financial statements. Adjusted Net Loss and Adjusted Net Loss Per Share Adjusted Net Loss is a non-GAAP financial measure that we define as net loss adjusted for (i) stock-based compensation, (ii) amortization of acquired intangibles, (iii) acquisition-related costs, net, including the deferred tax valuation allowance release from acquisitions, (iv) restructuring costs, (v) non-recurring lease-related charges, and (vi) non-cash interest expense related to our convertible senior notes. We believe Adjusted Net Loss provides investors with useful information on period-to-period performance as evaluated by management and comparison with our past financial performance and is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 Numerator:(in thousands, except share and per share amounts)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Add: Stock-based compensation 18,748 16,421 72,104 65,145 Amortization of acquired intangibles 8,464 8,924 37,188 32,016 Acquisition-related costs, net(1) 1,706 10,828 361 20,787 Restructuring costs(2) 3,926 — 8,425 — Non-recurring lease-related charges(3) 98 — 3,798 1,800 Non-cash interest expense related to convertible senior notes 376 3,105 1,500 11,948 Adjusted Net Loss$(2,464) $(9,714) $(14,027) $(21,514)Denominator: Weighted-average number of shares used in calculating net loss per share, basic and diluted 54,496,128 52,116,604 53,721,702 47,494,768 Adjusted net loss per share, basic and diluted$(0.05) $(0.19) $(0.26) $(0.45) ______________(1) Acquisition-related costs, net includes third-party fees associated with due diligence, deferred retention expenses, post-acquisition restructuring costs incurred as part of business combinations, changes in fair value of contingent consideration liabilities for potential earn-out payments, and the deferred tax valuation allowance release from acquisitions. For additional details refer to Notes 1, 2, 7, and 15 in our consolidated financial statements.(2) Restructuring costs include severance and other team member costs from workforce reductions, impairment of discontinued capitalized software projects, and other miscellaneous charges. For additional details, refer to Note 11 in our consolidated financial statements.(3) Includes the lease-related impairment charge for the subleased portion of our corporate headquarters. For additional details refer to Note 9 in our consolidated financial statements. Health Catalyst Investor Relations Contact:Adam BrownSenior Vice President, Investor Relations and FP&A+1 (855)-309-6800ir@healthcatalyst.com Health Catalyst Media Contact:Tarah Neujahr BryanChief Marketing Officermedia@healthcatalyst.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Health Catalyst Reports Fourth Quarter and Year End 2022 Results By: Health Catalyst, Inc. via GlobeNewswire February 28, 2023 at 16:03 PM EST SOUTH JORDAN, Utah, Feb. 28, 2023 (GLOBE NEWSWIRE) -- Health Catalyst, Inc. ("Health Catalyst," Nasdaq: HCAT), a leading provider of data and analytics technology and services to healthcare organizations, today reported financial results for the quarter and year ended December 31, 2022. “In the fourth quarter of 2022, I am pleased to share that we achieved strong performance across our business, including exceeding the mid-point of our quarterly guidance for both revenue and Adjusted EBITDA. For the full year 2022, I am also excited to share that our Adjusted EBITDA outperformed the mid-point of the original full year guidance we provided entering 2022, demonstrating continued operating leverage in our business despite lower annual revenue growth for 2022 as compared to our initial guidance for 2022.” said Dan Burton, CEO of Health Catalyst. “Additionally, I am honored to announce that Matthew Kolb, Executive Vice President and Chief Operating Officer of Carle Health, will be joining the Health Catalyst Board of Directors, effective July 1, 2023. Matt is deeply committed to Health Catalyst’s and Carle Health’s shared mission of data-informed healthcare improvement, and he has been an extraordinary leader throughout his career in enabling massive improvements in the healthcare ecosystem. Additionally, Carle Health has made the decision to deepen its long-term investment in Health Catalyst with a meaningful purchase on the open market of Health Catalyst’s common stock. We welcome them as a deeply mission-aligned long-term-oriented owner in the company. Consistent with my own personal decisions to purchase Health Catalyst shares on the open market over the past several months, which we estimate places me among Health Catalyst’s twenty largest shareholders, I am grateful to add a like-minded, deeply mission-focused and long-term oriented fellow shareholder to our company’s ownership group.” Financial Highlights for the Three and Twelve Months Ended December 31, 2022 Key Financial Metrics Three Months Ended December 31, Year over Year Change Twelve Months Ended December 31, Year over Year Change 2022 2021 2022 2021 GAAP Financial Data:(in thousands, except percentages) (in thousands, except percentages) Technology revenue$44,664 $40,088 11% $176,288 $147,718 19%Professional services revenue$24,498 $24,628 (1)% $99,948 $94,208 6%Total revenue$69,162 $64,716 7% $276,236 $241,926 14%Loss from operations$(36,745) $(44,765) 18% $(140,005) $(143,650) 3%Net loss$(35,782) $(48,992) 27% $(137,403) $(153,210) 10%Non-GAAP Financial Data:(1) Adjusted Technology Gross Profit$30,725 $27,951 10% $122,284 $102,326 20%Adjusted Technology Gross Margin 69% 70% 69% 69% Adjusted Professional Services Gross Profit$4,325 $5,745 (25)% $23,565 $25,544 (8)%Adjusted Professional Services Gross Margin 18% 23% 24% 27% Total Adjusted Gross Profit$35,050 $33,696 4% $145,849 $127,870 14%Total Adjusted Gross Margin 51% 52% 53% 53% Adjusted EBITDA$(603) $(6,278) 90% $(2,487) $(11,248) 78% ________________________ (1) These measures are not calculated in accordance with generally accepted accounting principles in the United States (GAAP). See the accompanying "Non-GAAP Financial Measures" section below for more information about these financial measures, including the limitations of such measures, and for a reconciliation of each measure to the most directly comparable measure calculated in accordance with GAAP. Other Key Metrics As of December 31, 2022 2021 2020 DOS Subscription Clients98 90 74 Year Ended December 31, 2022 2021 2020 Dollar-based Retention Rate100% 112% 102% The financial strain imposed by COVID-19 on a number of our clients led to a meaningfully lower professional services dollar-based retention in 2020 compared to prior years due to discounts provided to support our clients through the financial strain related to the initial outbreak. We did not provide similar discounts during 2021 and saw improvement in our professional services Dollar-based Retention Rate compared to 2020. However, 2022 proved to be a more challenging year than anticipated as a result of the inflationary macroeconomic environment and the meaningful financial strain that our health system end market faced, which contributed to a lower Dollar-based Retention Rate compared to 2021. Financial Outlook Health Catalyst provides forward-looking guidance on total revenue, a GAAP measure, and Adjusted EBITDA, a non-GAAP measure. For the first quarter of 2023, we expect: Total revenue between $70.3 million and $72.3 million, and Adjusted EBITDA between $1.0 million and $2.5 million For the full year of 2023, we expect: Total revenue between $290 million and $295 million, and Adjusted EBITDA between $9.0 million and $11.0 million We have not reconciled guidance for Adjusted EBITDA to net loss, the most directly comparable GAAP measure, and have not provided forward-looking guidance for net loss, because there are items that may impact net loss, including stock-based compensation, that are not within our control or cannot be reasonably forecasted. Quarterly Conference Call Details The company will host a conference call to review the results today, Tuesday, February 28, 2023 at 5:00 p.m. E.T. The conference call can be accessed by dialing (800) 343-5172 for U.S. participants, or (785) 424-1699 for international participants, and referencing conference ID “HCAT Q422.” A live audio webcast will be available online at https://ir.healthcatalyst.com/. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days. About Health Catalyst Health Catalyst is a leading provider of data and analytics technology and services to healthcare organizations committed to being the catalyst for massive, measurable, data-informed healthcare improvement. Its clients leverage the cloud-based data platform — powered by data from more than 100 million patient records and encompassing trillions of facts—as well as its analytics software and professional services expertise to make data-informed decisions and realize measurable clinical, financial, and operational improvements. Health Catalyst envisions a future in which all healthcare decisions are data informed. Available Information Our investors and others should note that we announce material information to the public about our company, products and services, and other matters related to our company through a variety of means, including our website (https://www.healthcatalyst.com/), our investor relations website (https://ir.healthcatalyst.com/), press releases, SEC filings, public conference calls, and social media, including our and our CEO's social media accounts, in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligations under Regulation FD. Forward-Looking Statements This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding our future growth and our financial outlook for Q1 and fiscal year 2023. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) changes in laws and regulations applicable to our business model; (ii) changes in market or industry conditions, regulatory environment, and receptivity to our technology and services; (iii) results of litigation or a security incident; (iv) the loss of one or more key clients or partners; (v) the impact of the challenging macroeconomic environment (including high inflationary and/or high interest rate environments) or public health emergencies, such as the COVID-19 pandemic, on our business and results of operations; and (vi) changes to our abilities to recruit and retain qualified team members. For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports, including, but not limited to the Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2022 that was filed with the SEC on November 8, 2022 and the Annual Report on Form 10-K for the year ended December 31, 2022 expected to be filed with the SEC on or about February 28, 2023. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update or revise this information unless required by law. Condensed Consolidated Balance Sheets(in thousands, except share and per share data, unaudited) As of December 31, 2022 2021 Assets Current assets: Cash and cash equivalents$116,312 $193,227 Short-term investments 247,178 251,754 Accounts receivable, net 47,970 48,801 Prepaid expenses and other assets 16,335 14,609 Total current assets 427,795 508,391 Property and equipment, net 25,928 23,316 Operating lease right-of-use assets 16,658 21,133 Intangible assets, net 92,189 104,788 Goodwill 185,982 169,972 Other assets 3,734 4,496 Total assets$752,286 $832,096 Liabilities and stockholders’ equity Current liabilities: Accounts payable$4,424 $4,693 Accrued liabilities 19,691 23,725 Deferred revenue 54,961 56,632 Operating lease liabilities 3,434 3,425 Contingent consideration liabilities — 4,576 Total current liabilities 82,510 93,051 Long-term debt, net of current portion 226,523 180,942 Deferred revenue, net of current portion 105 929 Operating lease liabilities, net of current portion 18,017 20,244 Contingent consideration liabilities, net of current portion — 14,719 Other liabilities 121 113 Total liabilities 327,276 309,998 Commitments and contingencies Stockholders’ equity: Preferred stock, $0.001 par value per share and additional paid-in capital; 25,000,000 shares authorized and no shares issued and outstanding as of December 31, 2022 and 2021 — — Common stock, $0.001 par value per share, and additional paid-in capital; 500,000,000 shares authorized as of December 31, 2022 and 2021; 55,261,922 and 52,622,080 shares issued and outstanding as of December 31, 2022 and 2021, respectively 1,424,681 1,401,025 Accumulated deficit (999,023) (878,860)Accumulated other comprehensive loss (648) (67)Total stockholders’ equity 425,010 522,098 Total liabilities and stockholders’ equity$752,286 $832,096 Condensed Consolidated Statements of Operations(in thousands, except per share data, unaudited) Three Months EndedDecember 31, Twelve Months EndedDecember 31, 2022 2021 2022 2021 Revenue: Technology$44,664 $40,088 $176,288 $147,718 Professional services 24,498 24,628 99,948 94,208 Total revenue 69,162 64,716 276,236 241,926 Cost of revenue, excluding depreciation and amortization: Technology(1)(2)(3) 14,747 12,750 56,642 47,516 Professional services(1)(2)(3) 23,359 21,127 86,407 76,838 Total cost of revenue, excluding depreciation and amortization 38,106 33,877 143,049 124,354 Operating expenses: Sales and marketing(1)(2)(3) 20,373 21,863 87,514 75,027 Research and development(1)(2)(3) 19,614 17,479 75,680 62,733 General and administrative(1)(2)(3)(4) 16,150 25,338 61,701 85,934 Depreciation and amortization 11,664 10,924 48,297 37,528 Total operating expenses 67,801 75,604 273,192 261,222 Loss from operations (36,745) (44,765) (140,005) (143,650)Loss on extinguishment of debt — — — — Interest and other expense, net 1,022 (4,376) (1,678) (16,458)Loss before income taxes (35,723) (49,141) (141,683) (160,108)Income tax provision (benefit)(2) 59 (149) (4,280) (6,898)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Net loss per share, basic$(0.66) $(0.94) $(2.56) $(3.23)Net loss per share, diluted$(0.66) $(0.94) $(2.63) $(3.23)Weighted-average shares outstanding used in calculating net loss per share, basic 54,496 52,117 53,722 47,495 Weighted-average shares outstanding used in calculating net loss per share, diluted 54,496 52,117 54,080 47,495 _______________(1) Includes stock-based compensation expense as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Stock-Based Compensation Expense:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$495 $582 $2,058 $2,063Professional services 2,148 2,181 8,230 8,047Sales and marketing 7,157 5,850 28,082 22,698Research and development 3,295 2,770 12,938 10,213General and administrative 5,653 5,038 20,796 22,124Total$18,748 $16,421 $72,104 $65,145 (2) Includes acquisition-related costs, net as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 Acquisition-related costs, net:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$84 $31 $351 $61 Professional services 146 63 655 127 Sales and marketing 337 296 1,894 592 Research and development 687 446 3,045 901 General and administrative 452 10,306 (1,051) 26,248 Income tax benefit — (314) (4,533) (7,142)Total$1,706 $10,828 $361 $20,787 (3) Includes restructuring costs, as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Restructuring costs:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$229 $— $229 $—Professional services 892 — 1,139 —Sales and marketing 1,464 — 3,023 —Research and development 1,153 — 3,410 —General and administrative 188 — 624 —Total$3,926 $— $8,425 $— (4) Includes non-recurring lease-related charges, as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Non-recurring lease-related charges(in thousands) (in thousands)General and administrative$98 $— $3,798 $1,800 Condensed Consolidated Statements of Cash Flows(in thousands, unaudited) Year Ended December 31, 2022 2021 Cash flows from operating activities Net loss$(137,403) $(153,210)Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 72,104 65,145 Depreciation and amortization 48,297 37,528 Change in fair value of contingent consideration liabilities (4,668) 20,036 Amortization of debt discount and issuance costs 1,500 11,948 Non-cash operating lease expense 3,231 3,585 Impairment of long-lived assets 5,023 1,800 Investment discount and premium (accretion) amortization (2,236) 1,202 Provision for expected credit losses 691 499 Deferred tax benefit (4,523) (7,134)Payment of acquisition-related contingent consideration (3,234) (9,085)Other (145) (53)Change in operating assets and liabilities: Accounts receivable 788 102 Prepaid expenses and other assets (478) (4,442)Accounts payable, accrued liabilities, and other liabilities (4,702) 5,202 Deferred revenue (5,997) 7,637 Operating lease liabilities (3,518) (3,883)Net cash used in operating activities (35,270) (23,123)Cash flows from investing activities Purchase of short-term investments (308,961) (261,363)Proceeds from the sale and maturity of short-term investments 315,171 186,893 Acquisition of businesses, net of cash acquired (27,846) (46,763)Purchases of property and equipment (2,167) (10,450)Capitalization of internal use software (12,987) (6,644)Purchase of intangible assets (2,260) (1,373)Proceeds from the sale of property and equipment 29 22 Net cash used in investing activities (39,021) (139,678)Cash flows from financing activities Proceeds from exercise of stock options 3,969 20,350 Proceeds from employee stock purchase plan 3,153 4,844 Payments of acquisition-related consideration (1,342) (6,290)Repurchase of common stock (8,393) — Proceeds from public offerings, net of discounts, commissions, and offering costs — 245,180 Net cash (used in) provided by financing activities (2,613) 264,084 Effect of exchange rate changes on cash and cash equivalents (11) (10)Net (decrease) increase in cash and cash equivalents (76,915) 101,273 Cash and cash equivalents at beginning of period 193,227 91,954 Cash and cash equivalents at end of period$116,312 $193,227 Non-GAAP Financial Measures To supplement our financial information presented in accordance with GAAP, we believe certain non-GAAP measures, including Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, Adjusted Net Loss, and Adjusted Net Loss per share, basic and diluted, are useful in evaluating our operating performance. For example, we exclude stock-based compensation expense because it is non-cash in nature and excluding this expense provides meaningful supplemental information regarding our operational performance and allows investors the ability to make more meaningful comparisons between our operating results and those of other companies. We use this non-GAAP financial information to evaluate our ongoing operations, as a component in determining employee bonus compensation, and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business. Adjusted Gross Profit and Adjusted Gross Margin Adjusted Gross Profit is a non-GAAP financial measure that we define as revenue less cost of revenue, excluding depreciation and amortization, adding back stock-based compensation, acquisition-related costs, net, and restructuring costs as applicable. We define Adjusted Gross Margin as our Adjusted Gross Profit divided by our revenue. We believe Adjusted Gross Profit and Adjusted Gross Margin are useful to investors as they eliminate the impact of certain non-cash expenses and allow a direct comparison of these measures between periods without the impact of non-cash expenses and certain other non-recurring operating expenses. The following is a reconciliation of revenue, the most directly comparable GAAP financial measure, to Adjusted Gross Profit, for the three and twelve months ended December 31, 2022 and 2021: Three Months Ended December 31, 2022 (in thousands, except percentages) Technology Professional Services TotalRevenue$44,664 $24,498 $69,162 Cost of revenue, excluding depreciation and amortization (14,747) (23,359) (38,106)Gross profit, excluding depreciation and amortization 29,917 1,139 31,056 Add: Stock-based compensation 495 2,148 2,643 Acquisition-related costs, net(1) 84 146 230 Restructuring costs(2) 229 892 1,121 Adjusted Gross Profit$30,725 $4,325 $35,050 Gross margin, excluding depreciation and amortization 67% 5% 45%Adjusted Gross Margin 69% 18% 51% ___________________ (1) Acquisition-related costs, net include deferred retention expenses following the ARMUS, KPI Ninja, and Twistle acquisitions.(2) Restructuring costs include severance and other team member costs from workforce reductions. Three Months Ended December 31, 2021 (in thousands, except percentages) Technology Professional Services TotalRevenue$40,088 $24,628 $64,716 Cost of revenue, excluding depreciation and amortization (12,750) (21,127) (33,877)Gross profit, excluding depreciation and amortization 27,338 3,501 30,839 Add: Stock-based compensation 582 2,181 2,763 Acquisition-related costs, net(1) 31 63 94 Adjusted Gross Profit$27,951 $5,745 $33,696 Gross margin, excluding depreciation and amortization 68% 14% 48%Adjusted Gross Margin 70% 23% 52% ___________________(1) Acquisition-related costs, net include deferred retention expenses following the acquisition of Twistle. Twelve Months Ended December 31, 2022 (in thousands, except percentages) Technology Professional Services TotalRevenue$176,288 $99,948 $276,236 Cost of revenue, excluding depreciation and amortization (56,642) (86,407) (143,049)Gross profit, excluding depreciation and amortization 119,646 13,541 133,187 Add: Stock-based compensation 2,058 8,230 10,288 Acquisition-related costs, net(1) 351 655 1,006 Restructuring costs(2) 229 1,139 1,368 Adjusted Gross Profit$122,284 $23,565 $145,849 Gross margin, excluding depreciation and amortization 68% 14% 48%Adjusted Gross Margin 69% 24% 53% ___________________(1) Acquisition-related costs, net include deferred retention expenses following the ARMUS, KPI Ninja, and Twistle acquisitions.(2) Restructuring costs include severance and other team member costs from workforce reductions. Twelve Months Ended December 31, 2021 (in thousands, except percentages) Technology ProfessionalServices TotalRevenue$147,718 $94,208 $241,926 Cost of revenue, excluding depreciation and amortization (47,516) (76,838) (124,354)Gross profit, excluding depreciation and amortization 100,202 17,370 117,572 Add: Stock-based compensation 2,063 8,047 10,110 Acquisition-related costs, net(1) 61 127 188 Adjusted Gross Profit$102,326 $25,544 $127,870 Gross margin, excluding depreciation and amortization 68% 18% 49%Adjusted Gross Margin 69% 27% 53% __________________ (1) Acquisition-related costs, net includes deferred retention expenses following the acquisition of Twistle. Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net loss adjusted for (i) interest and other (income) expense, net, (ii) income tax provision (benefit), (iii) depreciation and amortization, (iv) stock-based compensation, (v) acquisition-related costs, net, including the fair change in value of contingent consideration liabilities for potential earn-out payments, (vi) restructuring costs, and (vii) non-recurring lease-related charges. We view acquisition-related expenses when applicable, such as transaction costs and changes in the fair value of contingent consideration liabilities that are directly related to business combinations as costs that are unpredictable, dependent upon factors outside of our control, and are not necessarily reflective of operational performance during a period. We believe Adjusted EBITDA provides investors with useful information on period-to-period performance as evaluated by management and a comparison with our past financial performance and is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. The following is a reconciliation of our net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA, for the three and twelve months ended December 31, 2022 and 2021: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 (in thousands) (in thousands)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Add: Interest and other (income) expense, net (1,022) 4,376 1,678 16,458 Income tax provision (benefit) 59 (149) (4,280) (6,898)Depreciation and amortization 11,664 10,924 48,297 37,528 Stock-based compensation 18,748 16,421 72,104 65,145 Acquisition-related costs, net(1) 1,706 11,142 4,894 27,929 Restructuring cost(2) 3,926 — 8,425 — Non-recurring lease-related charges(3) 98 — 3,798 1,800 Adjusted EBITDA$(603) $(6,278) $(2,487) $(11,248) __________________(1) Acquisition-related costs, net includes third-party fees associated with due diligence, deferred retention expenses, post-acquisition restructuring costs incurred as part of business combinations, and changes in fair value of contingent consideration liabilities for potential earn-out payments. For additional details refer to Notes 1, 2, and 7 in our consolidated financial statements.(2) Restructuring costs include severance and other team member costs from workforce reductions, impairment of discontinued capitalized software projects, and other miscellaneous charges. For additional details, refer to Note 11 in our consolidated financial statements.(3) Includes the lease-related impairment charge for the subleased portion of our corporate headquarters. For additional details refer to Note 9 in our consolidated financial statements. Adjusted Net Loss and Adjusted Net Loss Per Share Adjusted Net Loss is a non-GAAP financial measure that we define as net loss adjusted for (i) stock-based compensation, (ii) amortization of acquired intangibles, (iii) acquisition-related costs, net, including the deferred tax valuation allowance release from acquisitions, (iv) restructuring costs, (v) non-recurring lease-related charges, and (vi) non-cash interest expense related to our convertible senior notes. We believe Adjusted Net Loss provides investors with useful information on period-to-period performance as evaluated by management and comparison with our past financial performance and is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 Numerator:(in thousands, except share and per share amounts)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Add: Stock-based compensation 18,748 16,421 72,104 65,145 Amortization of acquired intangibles 8,464 8,924 37,188 32,016 Acquisition-related costs, net(1) 1,706 10,828 361 20,787 Restructuring costs(2) 3,926 — 8,425 — Non-recurring lease-related charges(3) 98 — 3,798 1,800 Non-cash interest expense related to convertible senior notes 376 3,105 1,500 11,948 Adjusted Net Loss$(2,464) $(9,714) $(14,027) $(21,514)Denominator: Weighted-average number of shares used in calculating net loss per share, basic and diluted 54,496,128 52,116,604 53,721,702 47,494,768 Adjusted net loss per share, basic and diluted$(0.05) $(0.19) $(0.26) $(0.45) ______________(1) Acquisition-related costs, net includes third-party fees associated with due diligence, deferred retention expenses, post-acquisition restructuring costs incurred as part of business combinations, changes in fair value of contingent consideration liabilities for potential earn-out payments, and the deferred tax valuation allowance release from acquisitions. For additional details refer to Notes 1, 2, 7, and 15 in our consolidated financial statements.(2) Restructuring costs include severance and other team member costs from workforce reductions, impairment of discontinued capitalized software projects, and other miscellaneous charges. For additional details, refer to Note 11 in our consolidated financial statements.(3) Includes the lease-related impairment charge for the subleased portion of our corporate headquarters. For additional details refer to Note 9 in our consolidated financial statements. Health Catalyst Investor Relations Contact:Adam BrownSenior Vice President, Investor Relations and FP&A+1 (855)-309-6800ir@healthcatalyst.com Health Catalyst Media Contact:Tarah Neujahr BryanChief Marketing Officermedia@healthcatalyst.com
SOUTH JORDAN, Utah, Feb. 28, 2023 (GLOBE NEWSWIRE) -- Health Catalyst, Inc. ("Health Catalyst," Nasdaq: HCAT), a leading provider of data and analytics technology and services to healthcare organizations, today reported financial results for the quarter and year ended December 31, 2022. “In the fourth quarter of 2022, I am pleased to share that we achieved strong performance across our business, including exceeding the mid-point of our quarterly guidance for both revenue and Adjusted EBITDA. For the full year 2022, I am also excited to share that our Adjusted EBITDA outperformed the mid-point of the original full year guidance we provided entering 2022, demonstrating continued operating leverage in our business despite lower annual revenue growth for 2022 as compared to our initial guidance for 2022.” said Dan Burton, CEO of Health Catalyst. “Additionally, I am honored to announce that Matthew Kolb, Executive Vice President and Chief Operating Officer of Carle Health, will be joining the Health Catalyst Board of Directors, effective July 1, 2023. Matt is deeply committed to Health Catalyst’s and Carle Health’s shared mission of data-informed healthcare improvement, and he has been an extraordinary leader throughout his career in enabling massive improvements in the healthcare ecosystem. Additionally, Carle Health has made the decision to deepen its long-term investment in Health Catalyst with a meaningful purchase on the open market of Health Catalyst’s common stock. We welcome them as a deeply mission-aligned long-term-oriented owner in the company. Consistent with my own personal decisions to purchase Health Catalyst shares on the open market over the past several months, which we estimate places me among Health Catalyst’s twenty largest shareholders, I am grateful to add a like-minded, deeply mission-focused and long-term oriented fellow shareholder to our company’s ownership group.” Financial Highlights for the Three and Twelve Months Ended December 31, 2022 Key Financial Metrics Three Months Ended December 31, Year over Year Change Twelve Months Ended December 31, Year over Year Change 2022 2021 2022 2021 GAAP Financial Data:(in thousands, except percentages) (in thousands, except percentages) Technology revenue$44,664 $40,088 11% $176,288 $147,718 19%Professional services revenue$24,498 $24,628 (1)% $99,948 $94,208 6%Total revenue$69,162 $64,716 7% $276,236 $241,926 14%Loss from operations$(36,745) $(44,765) 18% $(140,005) $(143,650) 3%Net loss$(35,782) $(48,992) 27% $(137,403) $(153,210) 10%Non-GAAP Financial Data:(1) Adjusted Technology Gross Profit$30,725 $27,951 10% $122,284 $102,326 20%Adjusted Technology Gross Margin 69% 70% 69% 69% Adjusted Professional Services Gross Profit$4,325 $5,745 (25)% $23,565 $25,544 (8)%Adjusted Professional Services Gross Margin 18% 23% 24% 27% Total Adjusted Gross Profit$35,050 $33,696 4% $145,849 $127,870 14%Total Adjusted Gross Margin 51% 52% 53% 53% Adjusted EBITDA$(603) $(6,278) 90% $(2,487) $(11,248) 78% ________________________ (1) These measures are not calculated in accordance with generally accepted accounting principles in the United States (GAAP). See the accompanying "Non-GAAP Financial Measures" section below for more information about these financial measures, including the limitations of such measures, and for a reconciliation of each measure to the most directly comparable measure calculated in accordance with GAAP. Other Key Metrics As of December 31, 2022 2021 2020 DOS Subscription Clients98 90 74 Year Ended December 31, 2022 2021 2020 Dollar-based Retention Rate100% 112% 102% The financial strain imposed by COVID-19 on a number of our clients led to a meaningfully lower professional services dollar-based retention in 2020 compared to prior years due to discounts provided to support our clients through the financial strain related to the initial outbreak. We did not provide similar discounts during 2021 and saw improvement in our professional services Dollar-based Retention Rate compared to 2020. However, 2022 proved to be a more challenging year than anticipated as a result of the inflationary macroeconomic environment and the meaningful financial strain that our health system end market faced, which contributed to a lower Dollar-based Retention Rate compared to 2021. Financial Outlook Health Catalyst provides forward-looking guidance on total revenue, a GAAP measure, and Adjusted EBITDA, a non-GAAP measure. For the first quarter of 2023, we expect: Total revenue between $70.3 million and $72.3 million, and Adjusted EBITDA between $1.0 million and $2.5 million For the full year of 2023, we expect: Total revenue between $290 million and $295 million, and Adjusted EBITDA between $9.0 million and $11.0 million We have not reconciled guidance for Adjusted EBITDA to net loss, the most directly comparable GAAP measure, and have not provided forward-looking guidance for net loss, because there are items that may impact net loss, including stock-based compensation, that are not within our control or cannot be reasonably forecasted. Quarterly Conference Call Details The company will host a conference call to review the results today, Tuesday, February 28, 2023 at 5:00 p.m. E.T. The conference call can be accessed by dialing (800) 343-5172 for U.S. participants, or (785) 424-1699 for international participants, and referencing conference ID “HCAT Q422.” A live audio webcast will be available online at https://ir.healthcatalyst.com/. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days. About Health Catalyst Health Catalyst is a leading provider of data and analytics technology and services to healthcare organizations committed to being the catalyst for massive, measurable, data-informed healthcare improvement. Its clients leverage the cloud-based data platform — powered by data from more than 100 million patient records and encompassing trillions of facts—as well as its analytics software and professional services expertise to make data-informed decisions and realize measurable clinical, financial, and operational improvements. Health Catalyst envisions a future in which all healthcare decisions are data informed. Available Information Our investors and others should note that we announce material information to the public about our company, products and services, and other matters related to our company through a variety of means, including our website (https://www.healthcatalyst.com/), our investor relations website (https://ir.healthcatalyst.com/), press releases, SEC filings, public conference calls, and social media, including our and our CEO's social media accounts, in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligations under Regulation FD. Forward-Looking Statements This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding our future growth and our financial outlook for Q1 and fiscal year 2023. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (i) changes in laws and regulations applicable to our business model; (ii) changes in market or industry conditions, regulatory environment, and receptivity to our technology and services; (iii) results of litigation or a security incident; (iv) the loss of one or more key clients or partners; (v) the impact of the challenging macroeconomic environment (including high inflationary and/or high interest rate environments) or public health emergencies, such as the COVID-19 pandemic, on our business and results of operations; and (vi) changes to our abilities to recruit and retain qualified team members. For a detailed discussion of the risk factors that could affect our actual results, please refer to the risk factors identified in our SEC reports, including, but not limited to the Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2022 that was filed with the SEC on November 8, 2022 and the Annual Report on Form 10-K for the year ended December 31, 2022 expected to be filed with the SEC on or about February 28, 2023. All information provided in this release and in the attachments is as of the date hereof, and we undertake no duty to update or revise this information unless required by law. Condensed Consolidated Balance Sheets(in thousands, except share and per share data, unaudited) As of December 31, 2022 2021 Assets Current assets: Cash and cash equivalents$116,312 $193,227 Short-term investments 247,178 251,754 Accounts receivable, net 47,970 48,801 Prepaid expenses and other assets 16,335 14,609 Total current assets 427,795 508,391 Property and equipment, net 25,928 23,316 Operating lease right-of-use assets 16,658 21,133 Intangible assets, net 92,189 104,788 Goodwill 185,982 169,972 Other assets 3,734 4,496 Total assets$752,286 $832,096 Liabilities and stockholders’ equity Current liabilities: Accounts payable$4,424 $4,693 Accrued liabilities 19,691 23,725 Deferred revenue 54,961 56,632 Operating lease liabilities 3,434 3,425 Contingent consideration liabilities — 4,576 Total current liabilities 82,510 93,051 Long-term debt, net of current portion 226,523 180,942 Deferred revenue, net of current portion 105 929 Operating lease liabilities, net of current portion 18,017 20,244 Contingent consideration liabilities, net of current portion — 14,719 Other liabilities 121 113 Total liabilities 327,276 309,998 Commitments and contingencies Stockholders’ equity: Preferred stock, $0.001 par value per share and additional paid-in capital; 25,000,000 shares authorized and no shares issued and outstanding as of December 31, 2022 and 2021 — — Common stock, $0.001 par value per share, and additional paid-in capital; 500,000,000 shares authorized as of December 31, 2022 and 2021; 55,261,922 and 52,622,080 shares issued and outstanding as of December 31, 2022 and 2021, respectively 1,424,681 1,401,025 Accumulated deficit (999,023) (878,860)Accumulated other comprehensive loss (648) (67)Total stockholders’ equity 425,010 522,098 Total liabilities and stockholders’ equity$752,286 $832,096 Condensed Consolidated Statements of Operations(in thousands, except per share data, unaudited) Three Months EndedDecember 31, Twelve Months EndedDecember 31, 2022 2021 2022 2021 Revenue: Technology$44,664 $40,088 $176,288 $147,718 Professional services 24,498 24,628 99,948 94,208 Total revenue 69,162 64,716 276,236 241,926 Cost of revenue, excluding depreciation and amortization: Technology(1)(2)(3) 14,747 12,750 56,642 47,516 Professional services(1)(2)(3) 23,359 21,127 86,407 76,838 Total cost of revenue, excluding depreciation and amortization 38,106 33,877 143,049 124,354 Operating expenses: Sales and marketing(1)(2)(3) 20,373 21,863 87,514 75,027 Research and development(1)(2)(3) 19,614 17,479 75,680 62,733 General and administrative(1)(2)(3)(4) 16,150 25,338 61,701 85,934 Depreciation and amortization 11,664 10,924 48,297 37,528 Total operating expenses 67,801 75,604 273,192 261,222 Loss from operations (36,745) (44,765) (140,005) (143,650)Loss on extinguishment of debt — — — — Interest and other expense, net 1,022 (4,376) (1,678) (16,458)Loss before income taxes (35,723) (49,141) (141,683) (160,108)Income tax provision (benefit)(2) 59 (149) (4,280) (6,898)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Net loss per share, basic$(0.66) $(0.94) $(2.56) $(3.23)Net loss per share, diluted$(0.66) $(0.94) $(2.63) $(3.23)Weighted-average shares outstanding used in calculating net loss per share, basic 54,496 52,117 53,722 47,495 Weighted-average shares outstanding used in calculating net loss per share, diluted 54,496 52,117 54,080 47,495 _______________(1) Includes stock-based compensation expense as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Stock-Based Compensation Expense:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$495 $582 $2,058 $2,063Professional services 2,148 2,181 8,230 8,047Sales and marketing 7,157 5,850 28,082 22,698Research and development 3,295 2,770 12,938 10,213General and administrative 5,653 5,038 20,796 22,124Total$18,748 $16,421 $72,104 $65,145 (2) Includes acquisition-related costs, net as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 Acquisition-related costs, net:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$84 $31 $351 $61 Professional services 146 63 655 127 Sales and marketing 337 296 1,894 592 Research and development 687 446 3,045 901 General and administrative 452 10,306 (1,051) 26,248 Income tax benefit — (314) (4,533) (7,142)Total$1,706 $10,828 $361 $20,787 (3) Includes restructuring costs, as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Restructuring costs:(in thousands) (in thousands)Cost of revenue, excluding depreciation and amortization: Technology$229 $— $229 $—Professional services 892 — 1,139 —Sales and marketing 1,464 — 3,023 —Research and development 1,153 — 3,410 —General and administrative 188 — 624 —Total$3,926 $— $8,425 $— (4) Includes non-recurring lease-related charges, as follows: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021Non-recurring lease-related charges(in thousands) (in thousands)General and administrative$98 $— $3,798 $1,800 Condensed Consolidated Statements of Cash Flows(in thousands, unaudited) Year Ended December 31, 2022 2021 Cash flows from operating activities Net loss$(137,403) $(153,210)Adjustments to reconcile net loss to net cash used in operating activities: Stock-based compensation expense 72,104 65,145 Depreciation and amortization 48,297 37,528 Change in fair value of contingent consideration liabilities (4,668) 20,036 Amortization of debt discount and issuance costs 1,500 11,948 Non-cash operating lease expense 3,231 3,585 Impairment of long-lived assets 5,023 1,800 Investment discount and premium (accretion) amortization (2,236) 1,202 Provision for expected credit losses 691 499 Deferred tax benefit (4,523) (7,134)Payment of acquisition-related contingent consideration (3,234) (9,085)Other (145) (53)Change in operating assets and liabilities: Accounts receivable 788 102 Prepaid expenses and other assets (478) (4,442)Accounts payable, accrued liabilities, and other liabilities (4,702) 5,202 Deferred revenue (5,997) 7,637 Operating lease liabilities (3,518) (3,883)Net cash used in operating activities (35,270) (23,123)Cash flows from investing activities Purchase of short-term investments (308,961) (261,363)Proceeds from the sale and maturity of short-term investments 315,171 186,893 Acquisition of businesses, net of cash acquired (27,846) (46,763)Purchases of property and equipment (2,167) (10,450)Capitalization of internal use software (12,987) (6,644)Purchase of intangible assets (2,260) (1,373)Proceeds from the sale of property and equipment 29 22 Net cash used in investing activities (39,021) (139,678)Cash flows from financing activities Proceeds from exercise of stock options 3,969 20,350 Proceeds from employee stock purchase plan 3,153 4,844 Payments of acquisition-related consideration (1,342) (6,290)Repurchase of common stock (8,393) — Proceeds from public offerings, net of discounts, commissions, and offering costs — 245,180 Net cash (used in) provided by financing activities (2,613) 264,084 Effect of exchange rate changes on cash and cash equivalents (11) (10)Net (decrease) increase in cash and cash equivalents (76,915) 101,273 Cash and cash equivalents at beginning of period 193,227 91,954 Cash and cash equivalents at end of period$116,312 $193,227 Non-GAAP Financial Measures To supplement our financial information presented in accordance with GAAP, we believe certain non-GAAP measures, including Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, Adjusted Net Loss, and Adjusted Net Loss per share, basic and diluted, are useful in evaluating our operating performance. For example, we exclude stock-based compensation expense because it is non-cash in nature and excluding this expense provides meaningful supplemental information regarding our operational performance and allows investors the ability to make more meaningful comparisons between our operating results and those of other companies. We use this non-GAAP financial information to evaluate our ongoing operations, as a component in determining employee bonus compensation, and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business. Adjusted Gross Profit and Adjusted Gross Margin Adjusted Gross Profit is a non-GAAP financial measure that we define as revenue less cost of revenue, excluding depreciation and amortization, adding back stock-based compensation, acquisition-related costs, net, and restructuring costs as applicable. We define Adjusted Gross Margin as our Adjusted Gross Profit divided by our revenue. We believe Adjusted Gross Profit and Adjusted Gross Margin are useful to investors as they eliminate the impact of certain non-cash expenses and allow a direct comparison of these measures between periods without the impact of non-cash expenses and certain other non-recurring operating expenses. The following is a reconciliation of revenue, the most directly comparable GAAP financial measure, to Adjusted Gross Profit, for the three and twelve months ended December 31, 2022 and 2021: Three Months Ended December 31, 2022 (in thousands, except percentages) Technology Professional Services TotalRevenue$44,664 $24,498 $69,162 Cost of revenue, excluding depreciation and amortization (14,747) (23,359) (38,106)Gross profit, excluding depreciation and amortization 29,917 1,139 31,056 Add: Stock-based compensation 495 2,148 2,643 Acquisition-related costs, net(1) 84 146 230 Restructuring costs(2) 229 892 1,121 Adjusted Gross Profit$30,725 $4,325 $35,050 Gross margin, excluding depreciation and amortization 67% 5% 45%Adjusted Gross Margin 69% 18% 51% ___________________ (1) Acquisition-related costs, net include deferred retention expenses following the ARMUS, KPI Ninja, and Twistle acquisitions.(2) Restructuring costs include severance and other team member costs from workforce reductions. Three Months Ended December 31, 2021 (in thousands, except percentages) Technology Professional Services TotalRevenue$40,088 $24,628 $64,716 Cost of revenue, excluding depreciation and amortization (12,750) (21,127) (33,877)Gross profit, excluding depreciation and amortization 27,338 3,501 30,839 Add: Stock-based compensation 582 2,181 2,763 Acquisition-related costs, net(1) 31 63 94 Adjusted Gross Profit$27,951 $5,745 $33,696 Gross margin, excluding depreciation and amortization 68% 14% 48%Adjusted Gross Margin 70% 23% 52% ___________________(1) Acquisition-related costs, net include deferred retention expenses following the acquisition of Twistle. Twelve Months Ended December 31, 2022 (in thousands, except percentages) Technology Professional Services TotalRevenue$176,288 $99,948 $276,236 Cost of revenue, excluding depreciation and amortization (56,642) (86,407) (143,049)Gross profit, excluding depreciation and amortization 119,646 13,541 133,187 Add: Stock-based compensation 2,058 8,230 10,288 Acquisition-related costs, net(1) 351 655 1,006 Restructuring costs(2) 229 1,139 1,368 Adjusted Gross Profit$122,284 $23,565 $145,849 Gross margin, excluding depreciation and amortization 68% 14% 48%Adjusted Gross Margin 69% 24% 53% ___________________(1) Acquisition-related costs, net include deferred retention expenses following the ARMUS, KPI Ninja, and Twistle acquisitions.(2) Restructuring costs include severance and other team member costs from workforce reductions. Twelve Months Ended December 31, 2021 (in thousands, except percentages) Technology ProfessionalServices TotalRevenue$147,718 $94,208 $241,926 Cost of revenue, excluding depreciation and amortization (47,516) (76,838) (124,354)Gross profit, excluding depreciation and amortization 100,202 17,370 117,572 Add: Stock-based compensation 2,063 8,047 10,110 Acquisition-related costs, net(1) 61 127 188 Adjusted Gross Profit$102,326 $25,544 $127,870 Gross margin, excluding depreciation and amortization 68% 18% 49%Adjusted Gross Margin 69% 27% 53% __________________ (1) Acquisition-related costs, net includes deferred retention expenses following the acquisition of Twistle. Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net loss adjusted for (i) interest and other (income) expense, net, (ii) income tax provision (benefit), (iii) depreciation and amortization, (iv) stock-based compensation, (v) acquisition-related costs, net, including the fair change in value of contingent consideration liabilities for potential earn-out payments, (vi) restructuring costs, and (vii) non-recurring lease-related charges. We view acquisition-related expenses when applicable, such as transaction costs and changes in the fair value of contingent consideration liabilities that are directly related to business combinations as costs that are unpredictable, dependent upon factors outside of our control, and are not necessarily reflective of operational performance during a period. We believe Adjusted EBITDA provides investors with useful information on period-to-period performance as evaluated by management and a comparison with our past financial performance and is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. The following is a reconciliation of our net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA, for the three and twelve months ended December 31, 2022 and 2021: Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 (in thousands) (in thousands)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Add: Interest and other (income) expense, net (1,022) 4,376 1,678 16,458 Income tax provision (benefit) 59 (149) (4,280) (6,898)Depreciation and amortization 11,664 10,924 48,297 37,528 Stock-based compensation 18,748 16,421 72,104 65,145 Acquisition-related costs, net(1) 1,706 11,142 4,894 27,929 Restructuring cost(2) 3,926 — 8,425 — Non-recurring lease-related charges(3) 98 — 3,798 1,800 Adjusted EBITDA$(603) $(6,278) $(2,487) $(11,248) __________________(1) Acquisition-related costs, net includes third-party fees associated with due diligence, deferred retention expenses, post-acquisition restructuring costs incurred as part of business combinations, and changes in fair value of contingent consideration liabilities for potential earn-out payments. For additional details refer to Notes 1, 2, and 7 in our consolidated financial statements.(2) Restructuring costs include severance and other team member costs from workforce reductions, impairment of discontinued capitalized software projects, and other miscellaneous charges. For additional details, refer to Note 11 in our consolidated financial statements.(3) Includes the lease-related impairment charge for the subleased portion of our corporate headquarters. For additional details refer to Note 9 in our consolidated financial statements. Adjusted Net Loss and Adjusted Net Loss Per Share Adjusted Net Loss is a non-GAAP financial measure that we define as net loss adjusted for (i) stock-based compensation, (ii) amortization of acquired intangibles, (iii) acquisition-related costs, net, including the deferred tax valuation allowance release from acquisitions, (iv) restructuring costs, (v) non-recurring lease-related charges, and (vi) non-cash interest expense related to our convertible senior notes. We believe Adjusted Net Loss provides investors with useful information on period-to-period performance as evaluated by management and comparison with our past financial performance and is useful in evaluating our operating performance compared to that of other companies in our industry, as this metric generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. Three Months Ended December 31, Twelve Months Ended December 31, 2022 2021 2022 2021 Numerator:(in thousands, except share and per share amounts)Net loss$(35,782) $(48,992) $(137,403) $(153,210)Add: Stock-based compensation 18,748 16,421 72,104 65,145 Amortization of acquired intangibles 8,464 8,924 37,188 32,016 Acquisition-related costs, net(1) 1,706 10,828 361 20,787 Restructuring costs(2) 3,926 — 8,425 — Non-recurring lease-related charges(3) 98 — 3,798 1,800 Non-cash interest expense related to convertible senior notes 376 3,105 1,500 11,948 Adjusted Net Loss$(2,464) $(9,714) $(14,027) $(21,514)Denominator: Weighted-average number of shares used in calculating net loss per share, basic and diluted 54,496,128 52,116,604 53,721,702 47,494,768 Adjusted net loss per share, basic and diluted$(0.05) $(0.19) $(0.26) $(0.45) ______________(1) Acquisition-related costs, net includes third-party fees associated with due diligence, deferred retention expenses, post-acquisition restructuring costs incurred as part of business combinations, changes in fair value of contingent consideration liabilities for potential earn-out payments, and the deferred tax valuation allowance release from acquisitions. For additional details refer to Notes 1, 2, 7, and 15 in our consolidated financial statements.(2) Restructuring costs include severance and other team member costs from workforce reductions, impairment of discontinued capitalized software projects, and other miscellaneous charges. For additional details, refer to Note 11 in our consolidated financial statements.(3) Includes the lease-related impairment charge for the subleased portion of our corporate headquarters. For additional details refer to Note 9 in our consolidated financial statements. Health Catalyst Investor Relations Contact:Adam BrownSenior Vice President, Investor Relations and FP&A+1 (855)-309-6800ir@healthcatalyst.com Health Catalyst Media Contact:Tarah Neujahr BryanChief Marketing Officermedia@healthcatalyst.com
