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HealthEquity Reports First Quarter Ended April 30, 2025 Financial Results

Highlights of the first quarter include:
•Revenue of $330.8 million, an increase of 15% compared to $287.6 million in Q1 FY25.
•Net income of $53.9 million, an increase of 87% compared to $28.8 million in Q1 FY25, with non-GAAP net income of $85.8 million, an increase of 22% compared to $70.3 million in Q1 FY25.
•Net income per diluted share of $0.61, an increase of 85% compared to $0.33 in Q1 FY25, with non-GAAP net income per diluted share of $0.97, an increase of 21% compared to $0.80 in Q1 FY25.
•Adjusted EBITDA of $140.2 million, an increase of 19% compared to $117.4 million in Q1 FY25.
•9.9 million HSAs, an increase of 9% compared to Q1 FY25.
•Total HSA Assets of $31.3 billion, an increase of 15% compared to Q1 FY25.
•17.1 million Total Accounts, including both HSAs and complementary CDBs, an increase of 7% compared to Q1 FY25.
•The Company repurchased 0.7 million shares of its common stock for $60.3 million.

Draper, Utah – June 3, 2025 – HealthEquity, Inc. (NASDAQ: HQY) ("HealthEquity" or the "Company"), the nation's largest health savings account ("HSA") custodian by number of accounts, today announced financial results for its first quarter ended April 30, 2025.
"The HealthEquity team started fiscal 2026 with a strong first quarter that included record quarterly revenue, record Adjusted EBITDA, and increased guidance for the year,” said Scott Cutler, President and CEO of HealthEquity. “We enhanced our member-first secure mobile experience to strengthen the security of our members’ $31 billion of HSA Assets, increase member resources, and reduce costs. We also applaud and support the efforts of our nation’s leaders to improve and empower healthcare consumers by expanding the benefits of HSAs, as well as extending eligibility to more American families."
First quarter financial results
Revenue for the first quarter ended April 30, 2025 was $330.8 million, an increase of 15% compared to $287.6 million for the first quarter ended April 30, 2024. Revenue this quarter included: service revenue of $119.8 million, custodial revenue of $156.5 million, and interchange revenue of $54.6 million.
HealthEquity reported net income of $53.9 million, or $0.61 per diluted share, and non-GAAP net income of $85.8 million, or $0.97 per diluted share, for the first quarter ended April 30, 2025. The Company reported net income of $28.8 million, or $0.33 per diluted share, and non-GAAP net income of $70.3 million, or $0.80 per diluted share, for the first quarter ended April 30, 2024.
Adjusted EBITDA was $140.2 million for the first quarter ended April 30, 2025, an increase of 19% compared to the first quarter ended April 30, 2024. Adjusted EBITDA was 42% of revenue, compared to 41% for the first quarter ended April 30, 2024.
Account and asset metrics
HSAs as of April 30, 2025 were 9.9 million, an increase of 9% year over year, including 770,000 HSAs with investments, an increase of 16% year over year. Total Accounts as of April 30, 2025 were 17.1 million, including 7.2 million other consumer-directed benefits ("CDBs").
Total HSA Assets as of April 30, 2025 were $31.3 billion, an increase of 15% year over year. Total HSA Assets included $17.1 billion of HSA cash and $14.2 billion of HSA investments. Client-held funds, which are deposits held on behalf of our Clients to facilitate administration of our CDBs, and from which we generate custodial revenue, were $0.9 billion as of April 30, 2025.
Stock repurchase program
The Company repurchased 0.7 million shares of its common stock for $60.3 million during the first quarter ended April 30, 2025. As of April 30, 2025, $117.5 million of common stock remained authorized for repurchase under the Company's stock repurchase program.


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Business outlook
For the fiscal year ending January 31, 2026, management expects revenues of $1.285 billion to $1.305 billion. Its outlook for net income is between $173 million and $188 million, resulting in net income of $1.96 to $2.13 per diluted share. Its outlook for non-GAAP net income, calculated using the method described below, is between $320 million and $335 million, resulting in non-GAAP net income per diluted share of $3.61 to $3.78 (based on an estimated 89 million diluted weighted-average shares outstanding). Management expects Adjusted EBITDA of $530 million to $550 million.
See “Non-GAAP financial information” below for definitions of our Adjusted EBITDA and non-GAAP net income. A reconciliation of the non-GAAP financial measures used throughout this release to the most comparable GAAP financial measures is included with the financial tables at the end of this release.
Conference call
HealthEquity management will host a conference call at 4:30 pm (Eastern Time) on Tuesday, June 3, 2025 to discuss the fiscal 2026 first quarter financial results. The conference call will be accessible by dialing 1-833-630-1956, or 1-412-317-1837 for international callers, and referencing conference ID "HealthEquity." A live audio webcast of the call will be available on the investor relations section of our website at http://ir.healthequity.com.
Non-GAAP financial information
To supplement our financial information presented on a GAAP basis, we disclose non-GAAP financial measures, including Adjusted EBITDA, non-GAAP net income, and non-GAAP net income per diluted share.
•Adjusted EBITDA is earnings before interest, taxes, depreciation and amortization, amortization of acquired intangible assets, stock-based compensation expense, merger integration expenses, acquisition costs, gains and losses on equity securities, amortization of incremental costs to obtain a contract, costs associated with unused office space, and certain other non-operating items.
•Non-GAAP net income is calculated by adding back to GAAP net income before income taxes the following items: amortization of acquired intangible assets, stock-based compensation expense, merger integration expenses, acquisition costs, gains and losses on equity securities, costs associated with unused office space, and losses on extinguishment of debt, and subtracting a non-GAAP tax provision using a normalized non-GAAP tax rate.
•Non-GAAP net income per diluted share is calculated by dividing non-GAAP net income by diluted weighted-average shares outstanding.
Non-GAAP financial measures should be considered in addition to results prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, GAAP results. We believe that these non-GAAP financial measures provide useful information to management and investors regarding certain financial and business trends relating to the Company's financial condition and results of operations. The Company cautions investors that non-GAAP financial information, by its nature, departs from GAAP; accordingly, its use can make it difficult to compare current results with results from other reporting periods and with the results of other companies. In addition, while amortization of acquired intangible assets is being excluded from non-GAAP net income, the revenue generated from those acquired intangible assets is not excluded. Whenever we use these non-GAAP financial measures, we provide a reconciliation of the applicable non-GAAP financial measure to the most closely applicable GAAP financial measure. Investors are encouraged to review the related GAAP financial measures and the reconciliation of the non-GAAP financial measures to their most directly comparable GAAP financial measure as detailed in the tables below.
About HealthEquity
HealthEquity and its subsidiaries administer HSAs and other consumer-directed benefits for more than 17 million accounts in partnership with employers, benefits advisors, and health and retirement plan providers who share our mission to save and improve lives by empowering healthcare consumers. For more information, visit www.healthequity.com.
Forward-looking statements
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding our industry, business strategy, plans, goals and expectations concerning our markets and market position, product expansion, future operations, expenses and other results of operations, revenue, margins, profitability, acquisition synergies, future efficiencies, tax rates, capital expenditures, liquidity and capital resources and other financial and operating information.
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When used in this discussion, the words “may,” “believes,” “intends,” “seeks,” “aims,” “anticipates,” “plans,” “estimates,” “expects,” “should,” “assumes,” “continues,” “could,” “will,” “future” and the negative of these or similar terms and phrases are intended to identify forward-looking statements in this press release.
Forward-looking statements reflect our current expectations regarding future events, results or outcomes. These expectations may or may not be realized. Although we believe the expectations reflected in the forward-looking statements are reasonable, we can give you no assurance these expectations will prove to be correct. Some of these expectations may be based upon assumptions, data or judgments that prove to be incorrect. Actual events, results and outcomes may differ materially from our expectations due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others, risks related to the following:
•our ability to adequately place and safeguard our custodial assets, or the failure of any of our depository or insurance company partners;
•our ability to compete effectively in a rapidly evolving healthcare and benefits administration industry;
•our dependence on the continued availability and benefits of tax-advantaged HSAs and other CDBs;
•risks relating to our recent CEO transition;
•the impact of increased fraudulent account activity involving our member accounts or our third-party service providers on our reputation and financial results;
•our ability to successfully identify, acquire and integrate additional portfolio purchases or acquisition targets;
•the significant competition we face and may face in the future, including from those with greater resources than us;
•our reliance on the availability and performance of our technology and communications systems;
•recent and potential future cybersecurity breaches of our technology and communications systems and other data interruptions, including resulting costs and liabilities, reputational damage and loss of business;
•the current uncertain healthcare environment, including changes in healthcare programs and expenditures and related regulations;
•potential regulatory changes and changes in the enforcement environment under the new U.S. administration;
•our ability to comply with current and future privacy, healthcare, tax, ERISA, investment adviser and other laws applicable to our business;
•our reliance on partners and third-party vendors for distribution and important services;
•our ability to develop and implement updated features for our technology platforms and communications systems; and
•our reliance on our management team and key team members.
For a detailed discussion of these and other risk factors, please refer to the risks detailed in our filings with the Securities and Exchange Commission, including, without limitation, our Annual Report on Form 10-K for the fiscal year ended January 31, 2025 and subsequent periodic and current reports. Past performance is not necessarily indicative of future results. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.
Investor Relations Contact
Richard Putnam
801-727-1000
rputnam@healthequity.com
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HealthEquity, Inc. and subsidiaries
Condensed consolidated balance sheets
(in thousands, except par value)April 30, 2025January 31, 2025
(unaudited)
Assets
Current assets
Cash and cash equivalents$287,894 $295,948 
Accounts receivable, net of allowance for doubtful accounts of $1,041 and $2,070 as of April 30, 2025 and January 31, 2025, respectively
116,256 118,006 
Prepaid expenses and other current assets68,646 63,795 
Total current assets472,796 477,749 
Property and equipment, net3,173 3,239 
Operating lease right-of-use assets41,446 43,185 
Intangible assets, net1,179,430 1,204,658 
Goodwill1,648,145 1,648,145 
Other assets71,283 71,574 
Total assets$3,416,273 $3,448,550 
Liabilities and stockholders’ equity
Current liabilities
Accounts payable$13,496 $14,361 
Accrued compensation24,433 69,330 
Accrued liabilities68,444 62,631 
Operating lease liabilities9,969 10,001 
Total current liabilities116,342 156,323 
Long-term liabilities
Long-term debt, net of issuance costs1,056,566 1,056,301 
Operating lease liabilities, non-current40,223 42,219 
Other long-term liabilities22,178 22,962 
Deferred tax liability57,158 55,834 
Total long-term liabilities1,176,125 1,177,316 
Total liabilities1,292,467 1,333,639 
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.0001 par value, 100,000 shares authorized, no shares issued and outstanding as of April 30, 2025 and January 31, 2025, respectively
— — 
Common stock, $0.0001 par value, 900,000 shares authorized, 86,714 and 86,536 shares issued and outstanding as of April 30, 2025 and January 31, 2025, respectively
9 9 
Additional paid-in capital1,905,444 1,905,628 
Accumulated earnings218,353 209,274 
Total stockholders’ equity2,123,806 2,114,911 
Total liabilities and stockholders’ equity$3,416,273 $3,448,550 

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HealthEquity, Inc. and subsidiaries
Condensed consolidated statements of operations and comprehensive income (unaudited)
Three months ended April 30,
(in thousands, except per share data)20252024
Revenue
Service revenue$119,784 $118,214 
Custodial revenue156,455 121,644 
Interchange revenue54,605 47,739 
Total revenue330,844 287,597 
Cost of revenue
Service costs88,005 82,347 
Custodial costs10,747 9,057 
Interchange costs7,781 9,055 
Total cost of revenue106,533 100,459 
Gross profit224,311 187,138 
Operating expenses
Sales and marketing25,984 23,494 
Technology and development61,436 56,090 
General and administrative25,536 38,236 
Amortization of acquired intangible assets27,002 25,545 
Merger integration1,275 2,143 
Total operating expenses141,233 145,508 
Income from operations83,078 41,630 
Other expense
Interest expense(14,858)(11,795)
Other income, net2,733 3,404 
Total other expense(12,125)(8,391)
Income before income taxes70,953 33,239 
Income tax provision17,038 4,426 
Net income and comprehensive income$53,915 $28,813 
Net income per share:
Basic$0.62 $0.33 
Diluted$0.61 $0.33 
Weighted-average number of shares used in computing net income per share:
Basic86,655 86,472 
Diluted88,415 88,324 

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HealthEquity, Inc. and subsidiaries
Condensed consolidated statements of cash flows (unaudited)
Three months ended April 30,
(in thousands)20252024
Cash flows from operating activities:
Net income$53,915 $28,813 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization38,741 38,938 
Stock-based compensation14,336 32,020 
Amortization of debt discount and issuance costs265 703 
Deferred taxes1,324 (5,388)
Changes in operating assets and liabilities:
Accounts receivable, net1,750 (1,325)
Other assets(5,702)(227)
Operating lease right-of-use assets1,649 1,741 
Accrued compensation(42,210)(25,757)
Accounts payable, accrued liabilities, and other current liabilities3,422 (2,347)
Operating lease liabilities, non-current(1,968)(1,745)
Other long-term liabilities(784)3 
Net cash provided by operating activities64,738 65,429 
Cash flows from investing activities:
Purchases of software and capitalized software development costs(16,057)(13,106)
Purchases of property and equipment(86)(721)
Acquisitions of HSA portfolios— (256,123)
Net cash used in investing activities(16,143)(269,950)
Cash flows from financing activities:
Repurchases of common stock(59,065)— 
Proceeds from long-term debt— 50,000 
Settlement of client-held funds obligation, net1,451 (546)
Proceeds from exercise of common stock options965 2,317 
Net cash provided by (used in) financing activities(56,649)51,771 
Decrease in cash and cash equivalents(8,054)(152,750)
Beginning cash and cash equivalents295,948 403,979 
Ending cash and cash equivalents$287,894 $251,229 

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HealthEquity, Inc. and subsidiaries
Condensed consolidated statements of cash flows (unaudited) (continued)
Three months ended April 30,
(in thousands)20252024
Supplemental cash flow data:
Interest expense paid in cash$20,809 $18,850 
Income tax payments (refunds), net(46)277 
Supplemental disclosures of non-cash investing and financing activities:
Purchases of software and capitalized software development costs included in accounts payable, accrued liabilities, or accrued compensation2,774 2,404 
Purchases of property and equipment included in accounts payable or accrued liabilities546 32 
Repurchases of common stock included in accrued liabilities2,000 — 
Exercise of common stock options receivable— 42 
Stock-based compensation expense (unaudited)
Total stock-based compensation expense included in the condensed consolidated statements of operations and comprehensive income is as follows:
Three months ended April 30,
(in thousands)20252024
Cost of revenue$3,387 $4,525 
Sales and marketing4,870 4,323 
Technology and development5,920 5,940 
General and administrative159 17,232 
Total stock-based compensation expense$14,336 $32,020 
Total Accounts (unaudited)
(in thousands, except percentages)April 30, 2025April 30, 2024% ChangeJanuary 31, 2025
HSAs9,886 9,097 9 %9,889 
New HSAs from sales - Quarter-to-date150 194 (23)%471 
New HSAs from sales - Year-to-date150 194 (23)%1,040 
New HSAs from acquisitions - Year-to-date— 400 *616 
HSAs with investments770 665 16 %753 
CDBs7,174 6,913 4 %7,144 
Total Accounts17,060 16,010 7 %17,033 
Average Total Accounts - Quarter-to-date17,122 15,919 8 %16,677 
Average Total Accounts - Year-to-date17,122 15,919 8 %16,302 
*Not meaningful
HSA Assets (unaudited)
(in millions, except percentages)April 30, 2025April 30, 2024% ChangeJanuary 31, 2025
HSA cash$17,066 $15,850 8 %$17,435 
HSA investments14,205 11,427 24 %14,676 
Total HSA Assets31,271 27,277 15 %32,111 
Average daily HSA cash - Quarter-to-date17,281 15,388 12 %16,634 
Average daily HSA cash - Year-to-date17,281 15,388 12 %16,206 
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The following table summarizes the amount of HSA cash held by our depository partners and insurance company partners that is expected to reprice by fiscal year and the respective average annualized yield currently earned on that HSA cash as of April 30, 2025:
Year ending January 31, (in billions, except percentages)HSA cash expected to repriceAverage annualized yield
Remainder of 2026$1.7 2.4 %
20274.0 1.9 %
20282.2 4.0 %
20291.5 3.7 %
Thereafter7.0 4.4 %
Total (1)$16.4 3.5 %
(1)Excludes $0.7 billion of HSA cash held in floating-rate contracts as of April 30, 2025.
Client-held funds (unaudited)
(in millions, except percentages)April 30, 2025April 30, 2024% ChangeJanuary 31, 2025
Client-held funds$925 $858 8 %$896 
Average daily Client-held funds - Quarter-to-date902 840 7 %798 
Average daily Client-held funds - Year-to-date902 840 7 %817 
Reconciliation of net income to Adjusted EBITDA (unaudited)
Three months ended April 30,
(in thousands)20252024
Net income$53,915 $28,813 
Interest income(2,733)(3,881)
Interest expense14,858 11,795 
Income tax provision17,038 4,426 
Depreciation and amortization11,739 13,393 
Amortization of acquired intangible assets27,002 25,545 
Stock-based compensation expense14,336 32,020 
Merger integration expenses1,275 2,143 
Amortization of incremental costs to obtain a contract1,926 1,632 
Costs associated with unused office space852 790 
Other— 759 
Adjusted EBITDA$140,208 $117,435 
Net income as a percentage of revenue (unaudited)
Three months ended April 30,
(in thousands, except percentages)20252024$ Change% Change
Net income$53,915 $28,813 $25,102 87 %
As a percentage of revenue16 %10 %
Adjusted EBITDA as a percentage of revenue (unaudited)
Three months ended April 30,
(in thousands, except percentages)20252024$ Change% Change
Adjusted EBITDA$140,208 $117,435 $22,773 19 %
As a percentage of revenue42 %41 %
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Reconciliation of net income outlook to Adjusted EBITDA outlook (unaudited)
Outlook for the year ending
(in millions)January 31, 2026
Net income$173 - 188
Interest income(9)
Interest expense58
Income tax provision58 - 63
Depreciation and amortization47
Amortization of acquired intangible assets108
Stock-based compensation expense77
Merger integration expenses7
Amortization of incremental costs to obtain a contract8
Costs associated with unused office space3
Adjusted EBITDA$530 - 550
Reconciliation of net income to non-GAAP net income (unaudited)
Three months ended April 30,
(in thousands, except per share data)20252024
Net income$53,915 $28,813 
Income tax provision17,038 4,426 
Income before income taxes - GAAP70,953 33,239 
Non-GAAP adjustments:
Amortization of acquired intangible assets27,002 25,545 
Stock-based compensation expense14,336 32,020 
Merger integration expenses1,275 2,143 
Costs associated with unused office space852 790 
Total adjustments to income before income taxes - GAAP43,465 60,498 
Income before income taxes - Non-GAAP114,418 93,737 
Income tax provision - Non-GAAP (1)28,604 23,434 
Non-GAAP net income85,814 70,303 
Diluted weighted-average shares88,415 88,324 
GAAP net income per diluted share$0.61 $0.33 
Non-GAAP net income per diluted share$0.97 $0.80 
(1)The Company utilizes a normalized non-GAAP tax rate to provide better consistency across the interim reporting periods within a given fiscal year by eliminating the effects of non-recurring and period-specific items, which can vary in size and frequency, and which are not necessarily reflective of the Company’s longer-term operations. The normalized non-GAAP tax rate applied to each period presented was 25%. The Company may adjust its non-GAAP tax rate as additional information becomes available and in conjunction with any other significant events occurring that may materially affect this rate, such as merger and acquisition activity, changes in business outlook, or other changes in expectations regarding tax regulations.

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Reconciliation of net income outlook to non-GAAP net income outlook (unaudited)
Outlook for the year ending
(in millions, except per share data)January 31, 2026
Net income$173 - 188
Income tax provision58 - 63
Income before income taxes - GAAP231 - 251
Non-GAAP adjustments:
Amortization of acquired intangible assets108
Stock-based compensation expense77
Merger integration expenses7
Costs associated with unused office space3
Total adjustments to income before income taxes - GAAP195
Income before income taxes - Non-GAAP426 - 446
Income tax provision - Non-GAAP (1)106 - 111
Non-GAAP net income$320 - 335
Diluted weighted-average shares89
GAAP net income per diluted share (2)$1.96 - 2.13
Non-GAAP net income per diluted share (2)$3.61 - 3.78
(1)The Company utilizes a normalized non-GAAP tax rate to provide better consistency across the interim reporting periods within a given fiscal year by eliminating the effects of non-recurring and period-specific items, which can vary in size and frequency, and which are not necessarily reflective of the Company’s longer-term operations. The normalized non-GAAP tax rate applied to each period presented was 25%. The Company may adjust its non-GAAP tax rate as additional information becomes available and in conjunction with any other significant events occurring that may materially affect this rate, such as merger and acquisition activity, changes in business outlook, or other changes in expectations regarding tax regulations.
(2)GAAP and non-GAAP net income per diluted share may not calculate due to rounding.

Certain terms
TermDefinition
HSAHealth Savings Account, which is a financial account through which consumers spend and save long-term for healthcare on a tax-advantaged basis.
CDBConsumer-directed benefits offered by employers, including flexible spending and health reimbursement arrangements (“FSAs” and “HRAs”), Consolidated Omnibus Budget Reconciliation Act (“COBRA”) administration, commuter and other benefits.
HSA memberConsumers with HSAs that we serve.
Total HSA Assets
HSA members’ custodial cash assets held by our federally insured depository partners and our insurance company partners. Total HSA Assets also includes HSA members' investments held by our custodial investment fund partner.
ClientOur employer clients.
Total AccountsThe sum of HSAs and CDBs on our platforms.
Client-held fundsDeposits held on behalf of our Clients to facilitate administration of our CDBs.
Network PartnerOur health plan partners, benefits administrators, and retirement plan recordkeepers.
Adjusted EBITDA
Earnings before interest, taxes, depreciation and amortization, amortization of acquired intangible assets, stock-based compensation expense, merger integration expenses, acquisition costs, gains and losses on equity securities, amortization of incremental costs to obtain a contract, costs associated with unused office space, and certain other non-operating items.
Non-GAAP net income
Calculated by adding back to GAAP net income before income taxes the following items: amortization of acquired intangible assets, stock-based compensation expense, merger integration expenses, acquisition costs, gains and losses on equity securities, costs associated with unused office space, and losses on extinguishment of debt, and subtracting a non-GAAP tax provision using a normalized non-GAAP tax rate.
Non-GAAP net income per diluted shareCalculated by dividing non-GAAP net income by diluted weighted-average shares outstanding.
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