10-Q · April 29, 2026
Waystar's Q1 2026 results exhibit a strong performance with revenue of $313.9 million, marking a 22.4% increase year-over-year. Net income surged by 47.9% to $43.3 million, driven by rising subscription revenues, which…
Earnings analysis · 10-Q
WAY earnings analysis
Filed July 29, 2026 · Our reading of the company's report
The latest report
Waystar delivered an 18.1% year-over-year revenue increase to $319.674 million, driven principally by 34.5% subscription-revenue growth, while GAAP EPS increased from $0.18 to $0.21. Profitability improved materially…
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Waystar delivered an 18.1% year-over-year revenue increase to $319.674 million, driven principally by 34.5% subscription-revenue growth, while GAAP EPS increased from $0.18 to $0.21. Profitability improved materially versus last year—gross margin reached 69.4% and adjusted EBITDA margin 42.8%—but operating margin declined sequentially to 23.8% amid stepped-up R&D, G&A and an impairment. The principal new filing-specific concern is the June cybersecurity incident, although management says it involved fewer than 1% of clients, did not affect production systems, and is not currently expected to be materially adverse.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.21
What stood out
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Revenue growth remained high-teens
Q2 revenue was $319.674 million, up $49.020 million (18.1%) from $270.654 million a year earlier and about $5.7 million above the $313.874 million generated in Q1 2026. Six-month revenue increased 20.2% to $633.548 million.
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Earnings increased year over year
GAAP net income rose 27.0% to $40.867 million from $32.184 million, and diluted EPS was $0.21 versus $0.18 a year ago. Non-GAAP diluted EPS was $0.43, up from $0.36 in the prior-year quarter.
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Subscription and provider solutions led growth
Subscription revenue increased $45.179 million, or 34.5%, to $176.287 million, accounting for most of the $49.020 million total revenue increase. Provider-solution revenue grew 22.9% to $231.804 million, while patient-payments revenue rose 7.2% to $87.870 million.
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Gross margin and adjusted EBITDA expanded
Gross margin expanded to 69.4% from 67.8% a year ago as cost of revenue rose 12.2%, below 18.1% revenue growth. Adjusted EBITDA grew 21.5% to $136.725 million and its margin improved 120 basis points to 42.8%.
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Retention and large-client count remained strong
Customer monetization and enterprise-client depth progressed: net revenue retention was 108.3%, and clients generating more than $100,000 of trailing-12-month revenue increased to 1,453 from 1,268 a year ago.
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Cash generation supported buybacks
The company generated $144.324 million of operating cash flow in the first six months and began deploying its $200 million repurchase authorization, buying 659,061 shares at an average $19.24 price; $187.32 million remained available at June 30.
What to watch
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Cybersecurity incident introduces liability risk
The sole material risk-factor update describes an early-June 2026 cybersecurity incident involving unauthorized acquisition of testing source-code copies and four inactive-data files. The affected data included PHI/PII tied to fewer than 1% of Waystar clients, and the company recorded $1.618 million of related costs in Q2; ultimate remediation, legal, reputational and insurance outcomes remain uncertain.
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Sequential operating-margin compression
Operating margin was 23.8%, down 180 basis points from 25.6% in Q1 2026 and slightly below 24.0% a year ago. R&D expense rose 40.4% to $17.723 million, G&A rose 24.6% to $36.378 million, and G&A included a $1.990 million office/lease impairment.
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Net revenue retention moderated
Net revenue retention declined to 108.3% from 114.6% a year earlier. Management notes both periods include benefits from elevated win rates and faster implementations following a competitor cybersecurity incident, which may limit comparability and normalization risk remains.
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Operating cash flow declined and investment rose
Six-month operating cash flow fell $16.685 million, or 10.4%, to $144.324 million despite higher profit, while investing cash usage rose to $182.082 million from $61.718 million. The filing does not disclose a free-cash-flow figure or a separately quantified capex amount in the provided text.
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Leverage and floating-rate exposure remain
Interest expense including related-party interest increased 7.6% to $19.646 million in Q2, principally from incremental First Lien Credit Facility borrowing for Iodine. A 100-basis-point rate change would affect six-month interest expense by approximately $7.4 million.
Management's outlook
The 10-Q does not provide a quantitative revenue or EPS outlook; management’s formal FY2026 guidance was provided separately in the earnings release. MD&A states that existing unrestricted cash, expected operating cash flow and additional borrowings are expected to fund requirements for at least the next 12 months and beyond.
Earlier filings 2
10-K · February 17, 2026
Waystar positions itself as a data- and AI-driven leader in healthcare payments with scale advantages (over 30,000 clients and processing 7.5 billion transactions) and a large addressable market (TAM $20.0 billion in…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.