Phreesia Inc (NYSE:PHR) Swings to Profit, Raises Outlook on AccessOne Deal

Phreesia Posts Profitable Quarter, Raises Outlook After AccessOne Deal

Healthcare technology company Phreesia Inc (NYSE:PHR) reported financial results for its fiscal third quarter that highlighted a significant swing to profitability and an improved financial outlook, bolstered by a recent strategic acquisition. The market's initial reaction, however, appeared muted, with shares trading slightly lower in after-hours activity.

Earnings and Revenue Versus Estimates

For the quarter ended October 31, 2025, Phreesia reported a clear beat on bottom-line profitability, though it narrowly missed top-line revenue expectations.

• Revenue: The company posted total revenue of $120.3 million, representing a 13% year-over-year increase. This figure came in just below the analyst consensus estimate of approximately $121.3 million.
• Earnings Per Share (EPS): The standout figure was a net income of $4.3 million, or $0.07 per diluted share. This marks a substantial reversal from a net loss of $14.4 million in the same quarter last year. On a non-GAAP basis, the company reported an EPS of $0.10, significantly surpassing the analyst estimate of $0.0006.

The transition to GAAP profitability was driven by strong operating leverage, with operating expenses declining year-over-year despite revenue growth. Key profitability metrics showed dramatic improvement:

• Adjusted EBITDA surged to $29.1 million from $9.8 million a year ago.
• Net cash from operations increased to $15.5 million, and free cash flow was $8.8 million.

Updated Guidance and Strategic Acquisition

Management provided updated guidance for the current fiscal year 2026 and introduced its initial outlook for fiscal 2027, both of which were raised to include contributions from the recently closed acquisition of AccessOne, a provider of patient financing solutions.

• Fiscal 2026 Outlook: Revenue guidance was tightened to a range of $479-$481 million (from $472-$482 million), and Adjusted EBITDA guidance was raised to $99-$101 million (from $87-$92 million). The company expects approximately 4,515 Average Healthcare Services Clients (AHSCs).
• Fiscal 2027 Outlook: For the first time, Phreesia introduced fiscal 2027 revenue guidance of $545-$559 million, implying 14-16% growth over the midpoint of the updated 2026 outlook. Adjusted EBITDA is projected to be between $125-$135 million.

The acquisition of AccessOne, completed on November 12 for approximately $160 million, is central to this optimistic outlook. The deal expands Phreesia's financial offerings for healthcare providers and is expected to contribute roughly 6.5% to total revenue in fiscal 2027.

Market Reaction and Context

Following the earnings release, Phreesia's stock traded down approximately 1.6% in after-market activity. This tepid response suggests investors may have been anticipating the strong profitability beat, or are adopting a wait-and-see approach regarding the integration of the AccessOne acquisition. The stock's performance over recent weeks has been relatively flat.

Key Takeaways from the Quarter

The quarter underscores several positive developments for Phreesia:

• Path to Sustained Profitability: The company has demonstrated an ability to translate revenue growth into bottom-line results, moving decisively from losses to net income.
• Expanding Product Ecosystem: The AccessOne acquisition strategically broadens Phreesia's platform beyond patient intake and engagement into the patient financing space, creating a more comprehensive revenue cycle solution for providers.
• Confident Long-Term View: The introduction of fiscal 2027 guidance, with expectations for mid-teens revenue growth and continued margin expansion, signals management's confidence in the underlying business trajectory and the synergies from its acquisition strategy.

For a detailed breakdown of future quarterly estimates and historical earnings performance for Phreesia, you can review the data here.

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