AI-extracted from the 10-Q filed 2026-08-06 — Q2 2026 (quarter ended June 30, 2026). Every figure is machine-verified against the filing text on SEC EDGAR.
HealthStream Q2 revenue grew 12.5% to $83.7M, with operating income surging 41.4% to $8.3M, driven by subscription services strength and recent acquisitions.
Biggest Revenue Drivers
Subscription services$79.986M+11% YoY
Growth from existing portfolio solutions offset by legacy application reductions; acquisitions contributed $3.1M
Professional services$3.746M+53% YoY
Increase from services engagements coupled with contribution from acquired businesses
Biggest Revenue Drivers
Total revenue: $83.7M+12.5% YoY
Subscription services$79.986M+11% YoY
Growth from existing portfolio solutions offset by legacy application reductions; acquisitions contributed $3.1M
Professional services$3.746M+53% YoY
Increase from services engagements coupled with contribution from acquired businesses
Largest Expense Items
Cost of revenues (excluding depreciation and amortization)$29.015M+10% YoY
Higher third-party software, labor, cloud hosting, and royalties expenses plus acquisition-related costs
Product development$13.581M+12% YoY
Increased labor costs and expenses from Virsys12 and MissionCare acquisitions
Sales and marketing$13.503M+14% YoY
Increased sales commissions and acquisition-related expenses
Depreciation and amortization$11.275M+4% YoY
Increased amortization from capitalized software and acquired intangibles from Virsys12 and MissionCare
Margins: Operating margin improved to 9.9% in Q2 2026 from 7.9% in Q2 2025, driven by stronger revenue growth outpacing operating expense growth. Gross margin (excluding D&A) remained flat at 65% as cost of revenues scaled proportionally with revenue.
Watch Items from the Filing
Cybersecurity incident detected July 2026 involving unauthorized access to corporate servers; approximately 65 credentialing customers affected, with 3 files containing protected health information exposed. Investigation ongoing; company expects no material adverse impact.
Macroeconomic headwinds in healthcare: federal budget reconciliation in July 2025 cut Medicaid spending; ACA subsidies expired Dec 2025; company acknowledges potential negative impact on customer demand for non-mandatory products.
Revolving credit facility expires October 6, 2026; company must renew, amend, or replace the $50M facility before maturity with no assurance on availability or terms.
FLSA collective action lawsuit filed May 27, 2026 by employee claiming misclassification of Solution Executive sales roles; matter in early discovery stage with inability to estimate potential loss range.
Deferred revenue of $92.983M as of June 30, 2026 represents strong backlog; company expects to recognize 40% within 12 months and 85% within 36 months of future obligations.
AI-extracted and verified against SEC EDGAR filing text. Not investment advice.
About HEALTHSTREAM INC (HSTM): stock profile, AI score and financials
HEALTHSTREAM INC (HSTM) stock profile, AI quality score, and SEC EDGAR financial data, a Technology sector company. 13F Pro's AI-powered ranking engine scores HSTM at 55.3/100 on a composite quality score built from its SEC filings, placing it at rank #1,253 of 2,925 stocks — the top half of the AI-ranked universe. HSTM scores in the top quartile across earnings quality (82.6), free cash flow (75.7). Areas of concern include revenue scale (30.7), which score below median versus the broader universe. Shareholder dilution risk is elevated at 34.1/100, reflecting ongoing share issuance or stock-based compensation. Based on the latest XBRL financial filings (Q2 2026), HEALTHSTREAM INC reports quarterly revenue of $83.7M, net income of $6.7M, an operating margin of 9.9%. Top institutional holders of HSTM by reported 13-F value include BlackRock, DIMENSIONAL FUND ADVISORS, Copeland Capital Management, based on the most recent SEC filings. HSTM trades on the Nasdaq exchange and files with the SEC under CIK 1095565. 13F Pro's AI research platform runs 10 specialized AI analysts — value, growth, momentum, macro, and activist specialists — that debate HSTM daily and publish AI-generated analysis with cited SEC sources. The platform aggregates historical XBRL financial facts, 10-Q and 10-K filings, insider Form 4 transactions, and institutional 13-F holdings for HEALTHSTREAM INC directly from SEC EDGAR.