(MENAFN- GlobeNewsWire - Nasdaq) First Quarter Revenue Exceeded GuidanceFRAMINGHAM, Mass., May 08, 2025 (GLOBE NEWSWIRE) -- Definitive Healthcare Corp. (“Definitive Healthcare” or the“Company”) (Nasdaq: DH), an industry leader in healthcare commercial intelligence, today announced financial results for the quarter ended March 31, 2025.
First Quarter 2025 Financial Highlights:
Revenue was $59.2 million, a decrease of 7% from $63.5 million in Q1 2024. Net Loss , inclusive of goodwill impairment charges of $176.5 million , was $(155.1) million, or (262)% of revenue, compared to $(12.7) million or (20)% of revenue in Q1 2024. Adjusted Net Income was $7.0 million, compared to $13.0 million in Q1 2024. Adjusted EBITDA was $14.7 million, or 25% of revenue, compared to $20.0 million, or 32% of revenue in Q1 2024. Cash Flow from Operations was $26.1 million in the quarter. Unlevered Free Cash Flow was $22.9 million in the quarter.
“We delivered first quarter results above the high end of our guidance for both revenue and earnings, reflecting solid new logo momentum across markets, and our continued focus on operational efficiency,” said Kevin Coop, CEO of Definitive Healthcare.“Even with rising macroeconomic uncertainty, we remain firmly on track to meet our full-year financial targets.”
Recent Business and Operating Highlights:
Customer Wins
In the first quarter, Definitive Healthcare continued to win new logos and expansion opportunities across all end-markets, by providing the data, insights and integrations that drive their critical business use cases. Customer wins for the quarter included:
A California-based medical device company, focused on continuous patient monitoring, recently selected our Carevoyance platform to equip their sales team with the insights and data they need to identify high-value targets, including ambulatory surgery centers and hospitals.
A regional health system in the Southern US recently selected our Populi platform to support new service line expansions, physician recruitment, and telemedicine growth opportunities, along with competitive intelligence and insights on technology adoption.
A leading office supply company recently returned to Definitive Healthcare after switching to a competitor in 2023. The decision was driven by our comprehensive data on hospitals, health systems, and post-acute care organizations, our robust affiliations and hierarchy insights that were critical for their enterprise sales team, and our ability to easily integrate with Salesforce.com.
As we expand our focus on digital marketing activation partnerships, we recently signed two leading healthcare advertising agencies. Both agencies are currently ramping, and we expect to see momentum continuing to build in the second half of 2025.
Business Outlook
Based on information as of May 8, 2025, the Company is issuing the following financial guidance.
Second Quarter 2025:
Revenue is expected to be in the range of $58.5 – $60.0 million. Adjusted Operating Income is expected to be in the range of $12.0 – $13.0 million. Adjusted EBITDA is expected to be in the range of $15.0 – $16.0 million, and 25 – 27% adjusted EBITDA margin. Adjusted Net Income is expected to be $6.5 – $7.5 million. Adjusted Net Income Per Diluted Share is expected to be $0.04 to $0.05 per share on approximately 147.9 million weighted-average shares outstanding.
Full Year 2025:
Revenue is expected to be in the range of $234.0 – $240.0 million, raising the bottom end of our prior range by $4.0 million. Adjusted Operating Income is expected to be in the range of $49.0 – $53.0 million. Adjusted EBITDA is expected to be in the range of $61.0 – $65.0 million, for a full-year adjusted EBITDA margin ranging from 26 – 28%. Adjusted Net Income is expected to be $30.0 – $34.0 million. Adjusted Net Income Per Diluted Share is expected to be $0.20 – $0.23 per share on approximately 148.8 million weighted-average shares outstanding.
We do not provide a quantitative reconciliation of the forward-looking non-GAAP financial measures included in this press release to the most directly comparable GAAP measures due to the high variability and difficulty in predicting certain items excluded from these non-GAAP financial measures; in particular, the effects of equity-based compensation expense, taxes and amounts under the tax receivable agreement, deferred tax assets and deferred tax liabilities, and transaction, integration, and restructuring expenses. We expect the variability of these excluded items may have a significant and potentially unpredictable impact on our future GAAP financial results.
Conference Call Information
Definitive Healthcare will host a conference call today May 8, 2025, at 5:00 p.m. (Eastern Time) to discuss the Company's full financial results and current business outlook. Participants may access the call at 1-877-358-7298 or 1-848-488-9244. Shortly after the conclusion of the call, a replay of this conference call will be available through June 7, 2025, at 1-800-645-7964 or 1-757-849-6722. The replay passcode is 1765#. A live audio webcast of the event will be available on Definitive Healthcare's Investor Relations website at .
About Definitive Healthcare
At Definitive Healthcare, our passion is to transform data, analytics and expertise into healthcare commercial intelligence. We help clients uncover the right markets, opportunities and people, so they can shape tomorrow's healthcare industry. Learn more at .
Forward-Looking Statements
This press release includes forward-looking statements that reflect our current views with respect to future events and financial performance. Such statements are provided under the“safe harbor” protection of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts, and can generally be identified by words or phrases written in the future tense and/or preceded by words such as“likely,”“will,”“should,”“may,”“anticipates,”“intends,”“plans,”“seeks,”“believes,”“estimates,”“expects,”“continues,”“assumes,”“would,”“potentially” or similar words or variations thereof, or the negative thereof, references to future periods, or by the inclusion of forecasts or projections, but these terms are not the exclusive means of identifying such statements. Examples of forward-looking statements include, but are not limited to, statements we make regarding our outlook, financial guidance, the benefits of our healthcare commercial intelligence solutions, our overall future prospects, customer behaviors and use of our solutions, the market, industry and macroeconomic environment, our plans to improve our operational and financial performance and our business, our ability to execute on our plans, customer growth, including our upsell and cross-sell opportunities, and our ability to successfully transition executive leadership.
Forward-looking statements in this press release are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, by their nature, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, our actual results may differ materially from those contemplated by the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the following: global geopolitical tension and difficult macroeconomic conditions; actual or potential changes in international, national, regional and local economic, business and financial conditions, including tariffs, sanctions, trade barriers, recessions, fluctuating inflation, high interest rates, volatility in the capital markets and related market uncertainty; our inability to acquire new customers and generate additional revenue from existing customers; our inability to generate sales of subscriptions to our platform or any decline in demand for our platform and the data we offer; the competitiveness of the market in which we operate and our ability to compete effectively; the failure to maintain and improve our platform, or develop new modules or insights for healthcare commercial intelligence; the inability to obtain and maintain accurate, comprehensive or reliable data, which could result in reduced demand for our platform; the loss of our access to our data providers; the failure to respond to advances in healthcare commercial intelligence; an inability to attract new customers and expand subscriptions of current customers; our ability to successfully transition executive leadership; the possibility that our security measures are breached or unauthorized access to data is otherwise obtained; and the risks of being required to collect sales or other related taxes for subscriptions to our platform in jurisdictions where we have not historically done so.
Additional factors or events that could cause our actual performance to differ from these forward-looking statements may emerge from time to time, and it is not possible for us to predict all of them. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, our actual financial condition, results of operations, future performance and business may vary in material respects from the performance projected in these forward-looking statements.
For additional discussion of factors that could impact our operational and financial results, refer to our Quarterly Report on Form 10-Q for the three months ended March 31, 2025 that will be filed following this earnings release, as well as our Current Reports on Form 8-K and other subsequent SEC filings, which are or will be available on the Investor Relations page of our website at and on the SEC website at
All information in this press release speaks only as of the date on which it is made. We undertake no obligation to publicly update this information, whether as a result of new information, future developments or otherwise, except as may be required by law.
Website
Definitive Healthcare intends to use its website as a distribution channel of material company information. Financial and other important information regarding the Company is routinely posted on and accessible through the Company's website at . Accordingly, you should monitor the investor relations portion of our website at in addition to following our press releases, SEC filings, and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about the Company when you enroll your email address by visiting the“Email Alerts” section of our investor relations page at .
Non-GAAP Financial Measures
We have presented supplemental non-GAAP financial measures as part of this earnings release. We believe that these supplemental non-GAAP financial measures are useful to investors because they allow for an evaluation of the Company with a focus on the performance of its core operations, including providing meaningful comparisons of financial results to historical periods and to the financial results of peer and competitor companies. Our use of these non-GAAP terms may vary from the use of similar terms by other companies in our industry and accordingly may not be comparable to similarly titled measures used by other companies and are not measures of performance calculated in accordance with GAAP. Our presentation of these non-GAAP financial measures are intended as supplemental measures of our performance that are not required by, or presented in accordance with, GAAP. These non-GAAP financial measures should not be considered as alternatives to loss from operations, net loss, earnings per share, or any other performance measures derived in accordance with GAAP or as measures of operating cash flows or liquidity. A reconciliation of GAAP to non-GAAP results has been provided in the financial statement tables included at the end of this press release. In evaluating our non-GAAP financial measures, you should be aware that in the future, we may incur expenses similar to those eliminated in these presentations.
We refer to Unlevered Free Cash Flow, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Gross Profit, Adjusted Gross Margin, Adjusted Operating Income, Adjusted Net Income and Adjusted Net Income Per Diluted Share as non-GAAP financial measures. These non-GAAP financial measures are not required by or prepared in accordance with generally accepted accounting principles in the U.S. (“GAAP”). These are supplemental financial measures of our performance and should not be considered substitutes for cash provided by (used in) operating activities, loss from operations, net (loss) income, net (loss) income margin, gross profit, gross margin, or any other measure derived in accordance with GAAP.
We define Unlevered Free Cash Flow as net cash provided by operating activities less purchases of property, equipment and other assets, plus cash interest expense, and cash payments related to transaction, integration, and restructuring related expenses, earnouts, and other non-core items. Unlevered Free Cash Flow does not represent residual cash flow available for discretionary expenditures since, among other things, we have mandatory debt service requirements.
We define EBITDA as earnings before debt-related costs, including interest expense (income), net, and loss on partial extinguishment of debt, income taxes and depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted to exclude certain items of a significant or unusual nature, including other income, net, equity-based compensation, transaction, integration, and restructuring expenses, goodwill impairments and other non-core expenses. Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of revenue. Adjusted EBITDA and Adjusted EBITDA Margin are key metrics used by management and our board of directors to assess the profitability of our operations. We believe that Adjusted EBITDA and Adjusted EBITDA Margin provide useful information to help investors to assess our operating performance because these metrics eliminate non-core and unusual items and non-cash expenses, which we do not consider indicative of ongoing operational performance. We believe that these metrics are helpful to investors in measuring the profitability of our operations on a consolidated level.
We define Adjusted Gross Profit as gross profit excluding acquisition-related amortization and equity-based compensation costs and Adjusted Gross Margin is defined as Adjusted Gross Profit as a percentage of revenue. Adjusted Gross Profit and Adjusted Gross Margin are key metrics used by management and our board of directors to assess our operations. We exclude acquisition-related depreciation and amortization expenses as they have no direct correlation to the cost of operating our business on an ongoing basis. A small portion of equity-based compensation is included in cost of revenue in accordance with GAAP but is excluded from our Adjusted Gross Profit calculations due to its non-cash nature.
We define Adjusted Operating Income as loss from operations plus acquisition related amortization, equity-based compensation, transaction, integration, and restructuring expenses, goodwill impairments and other non-core expenses.
We define Adjusted Net Income as Adjusted Operating Income less interest (expense), income net, recurring income tax (provision) benefit, foreign currency gain (loss), and tax impacts of adjustments. We define Adjusted Net Income Per Diluted Share as Adjusted Net Income divided by diluted outstanding shares.
In evaluating our non-GAAP financial measures, you should be aware that in the future we may incur expenses similar to those eliminated in these presentations.
Investor Contact:
Brian Denyeau
ICR for Definitive Healthcare
...
646-277-1251
Media Contact:
Bethany Swackhamer
...
| | |
| Definitive Healthcare Corp. | |
| Condensed Consolidated Statements of Cash Flows | |
| (in thousands; unaudited) | |
| | | | | | |
| | | Three Months Ended March 31, | |
| | | 2025 | | 2024 | |
| Cash flows provided by (used in) operating activities: | | | | | |
| Net loss | | $ | (155,093 | ) | | $ | (12,718 | ) | |
| Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | |
| Depreciation and amortization | | | 591 | | | | 554 | | |
| Amortization of intangible assets | | | 13,226 | | | | 12,130 | | |
| Amortization of deferred contract costs | | | 3,947 | | | | 3,692 | | |
| Equity-based compensation | | | 7,319 | | | | 15,582 | | |
| Amortization of debt issuance costs | | | 126 | | | | 176 | | |
| (Benefit from) provision for doubtful accounts receivable | | | (142 | ) | | | 211 | | |
| Loss on partial extinguishment of debt | | | 507 | | | | - | | |
| Non-cash restructuring charges | | | 192 | | | | - | | |
| Goodwill impairment charges | | | 176,531 | | | | - | | |
| Tax receivable agreement remeasurement | | | (20,664 | ) | | | (2,267 | ) | |
| Changes in fair value of contingent consideration | | | (690 | ) | | | 270 | | |
| Deferred income taxes | | | (11,007 | ) | | | (847 | ) | |
| Changes in operating assets and liabilities: | | | | | |
| Accounts receivable | | | 10,351 | | | | 2,999 | | |
| Prepaid expenses and other assets | | | (5,683 | ) | | | (1,399 | ) | |
| Deferred contract costs | | | (3,794 | ) | | | (2,699 | ) | |
| Contingent consideration | | | - | | | | (602 | ) | |
| Accounts payable, accrued expenses, and other liabilities | | | (8,745 | ) | | | (8,231 | ) | |
| Deferred revenue | | | 19,094 | | | | 9,738 | | |
| Net cash provided by operating activities | | | 26,066 | | | | 16,589 | | |
| Cash flows (used in) provided by investing activities: | | | | | |
| Purchases of property, equipment, and other assets | | | (7,706 | ) | | | (266 | ) | |
| Purchases of short-term investments | | | (12,000 | ) | | | (83,826 | ) | |
| Maturities of short-term investments | | | 103,251 | | | | 73,588 | | |
| Cash paid for acquisitions, net of cash acquired | | | - | | | | (13,530 | ) | |
| Net cash provided by (used in) investing activities | | | 83,545 | | | | (24,034 | ) | |
| Cash flows used in financing activities: | | | | | |
| Repayments of term loan | | | (246,250 | ) | | | (3,438 | ) | |
| Proceeds from term loan | | | 175,000 | | | | - | | |
| Payments of debt issuance costs | | | (1,660 | ) | | | - | | |
| Taxes paid related to net share settlement of equity awards | | | (1,874 | ) | | | (5,806 | ) | |
| Repurchases of Class A Common Stock | | | (21,155 | ) | | | - | | |
| Payments of contingent consideration | | | - | | | | (1,000 | ) | |
| Payments under tax receivable agreement | | | (13,767 | ) | | | (6,950 | ) | |
| Net cash used in financing activities | | | (109,706 | ) | | | (17,194 | ) | |
| Net decrease in cash and cash equivalents | | | (95 | ) | | | (24,639 | ) | |
| Effect of exchange rate changes on cash and cash equivalents | | | 816 | | | | (343 | ) | |
| Cash and cash equivalents, beginning of period | | | 105,378 | | | | 130,976 | | |
| Cash and cash equivalents, end of period | | $ | 106,099 | | | $ | 105,994 | | |
| Supplemental cash flow disclosures: | | | | | |
| Cash paid during the period for: | | | | | |
| Interest | | $ | 2,242 | | | $ | 3,642 | | |
| Income taxes | | $ | 32 | | | $ | - | | |
| Acquisitions: | | | | | |
| Net assets acquired, net of cash acquired | | $ | - | | | $ | 13,675 | | |
| Working capital adjustment receivable | | | - | | | | (145 | ) | |
| Net cash paid for acquisitions | | $ | - | | | $ | 13,530 | | |
| Supplemental disclosure of non-cash investing activities: | | | | | |
| Capital expenditures included in accounts payable and accrued expenses and other liabilities | | $ | 5,393 | | | $ | - | | |
| | | | | | |
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