Phreesia Announces Fourth Quarter Fiscal 2025 Results

Rhea-AI Summary

Phreesia (NYSE: PHR) reported its Q4 and fiscal 2025 results, showing continued growth and improved financial performance. Q4 total revenue reached $109.7 million, up 15% year-over-year, while the average number of healthcare services clients increased 10% to 4,341.

The company significantly reduced its net loss to $6.4 million in Q4, compared to $30.6 million in the prior year. Q4 Adjusted EBITDA improved to $16.4 million from negative $3.5 million year-over-year. Cash position remained strong at $84.2 million as of January 31, 2025.

For fiscal 2025, revenue grew 18% to $419.8 million, with net loss improving to $58.5 million from $136.9 million in fiscal 2024. The company maintains its fiscal 2026 outlook with expected revenue between $472-482 million and Adjusted EBITDA of $78-88 million, targeting approximately 4,500 healthcare services clients.

Positive

• Q4 revenue increased 15% YoY to $109.7 million
• Q4 net loss significantly improved to $6.4M from $30.6M YoY
• Q4 Adjusted EBITDA turned positive to $16.4M from -$3.5M YoY
• Healthcare services clients grew 10% YoY to 4,341
• Positive free cash flow of $9.2M in Q4, improved from -$10.9M YoY
• Strong cash position of $84.2M with no outstanding borrowings

Negative

• Healthcare services revenue per AHSC only grew 1% YoY in Q4
• Annual healthcare services revenue per AHSC declined 2% in fiscal 2025
• Cash and equivalents decreased from $87.5M to $84.2M year-over-year

Insights

Financial Analyst

Phreesia's Q4 FY2025 results reflect significant financial improvement and a continued transition toward profitability. The company reported $109.7 million in quarterly revenue (15% YoY growth) and $419.8 million for the full fiscal year (18% YoY growth), demonstrating consistent top-line expansion.

The most impressive aspect is Phreesia's dramatic turnaround in profitability metrics. Q4 net loss narrowed to $6.4 million from $30.6 million a year ago, while adjusted EBITDA swung to positive $16.4 million from negative $3.5 million. The company has also achieved positive free cash flow of $9.2 million for the quarter and $8.3 million for the full year – a remarkable improvement from the previous year's cash burn.

Phreesia's client base grew 10% YoY to 4,341 average healthcare services clients, with revenue per client increasing 5%, indicating both expansion and improved monetization. The $84.2 million cash position provides adequate runway to support growth initiatives without requiring additional financing.

The FY2026 outlook projects continued momentum with revenue of $472-482 million and adjusted EBITDA of $78-88 million, suggesting further margin expansion. This forecast, combined with the company's improving operational efficiency and new product introductions mentioned by CEO Chaim Indig, points to sustainable growth and an accelerating path toward consistent profitability.

ALL-REMOTE COMPANY/WILMINGTON, Del.--(BUSINESS WIRE)-- Phreesia, Inc. (NYSE: PHR) (“Phreesia” or the "Company") announced financial results today for the fiscal fourth quarter and fiscal year ended January 31, 2025.

"We are pleased with our solid finish to fiscal 2025 and I am excited about the new products we have introduced over the past several quarters that improve medication adherence and the overall patient and provider experience," said CEO and Co-Founder Chaim Indig.

Please visit the Phreesia investor relations website at ir.phreesia.com to view the Company's Q4 Fiscal 2025 Stakeholder Letter.

Fiscal Fourth Quarter Ended January 31, 2025 Highlights

• Total revenue was $109.7 million in the quarter, up 15% year-over-year.
• Average number of healthcare services clients ("AHSCs") was 4,341 in the quarter, up 10% year-over-year.
• Total revenue per AHSC was $25,266 in the quarter, up 5% year-over-year. See "Key Metrics" below for additional information.
• Healthcare services revenue per AHSC was $17,616 in the quarter, up 1% year-over-year. See "Key Metrics" below for additional information.
• Net loss was $6.4 million in the quarter, as compared to $30.6 million in the same period in the prior year.
• Adjusted EBITDA¹ was $16.4 million in the quarter, as compared to negative $3.5 million in the same period in the prior year.
• Net cash provided by operating activities was $16.3 million in the quarter, as compared to net cash used in operating activities of $3.1 million in the same period in the prior year.
• Free cash flow² was $9.2 million in the quarter, as compared to negative $10.9 million in the same period in the prior year.
• Cash and cash equivalents as of January 31, 2025 was $84.2 million, up $2.5 million from October 31, 2024.

Fiscal Year Ended January 31, 2025 Highlights

• Revenue was $419.8 million in fiscal 2025, up 18% year-over-year.
• AHSCs were 4,203 in fiscal 2025, up 17% year-over-year.
• Total revenue per AHSC was $99,884 in fiscal 2025, up 1% year-over-year. See "Key Metrics" below for additional information.
• Healthcare services revenue per AHSC was $70,961 in fiscal 2025, down 2% year-over-year. See "Key Metrics" below for additional information.
• Net loss was $58.5 million in fiscal 2025, as compared to $136.9 million in fiscal year 2024.
• Adjusted EBITDA¹ was $36.8 million in fiscal 2025, as compared to negative $35.4 million in fiscal 2024.
• Net cash provided by operating activities was $32.4 million in fiscal 2025, as compared to net cash used in operating activities of $32.4 million in fiscal 2024.
• Free cash flow² was $8.3 million in fiscal 2025, as compared to negative $57.5 million in fiscal 2024.
• Cash and cash equivalents as of January 31, 2025 was $84.2 million, down from $87.5 million as of January 31, 2024.

Fiscal 2026 Outlook

We are maintaining our revenue outlook for fiscal 2026. We expect revenue to be in the range of $472 million to $482 million. The revenue range provided for fiscal 2026 assumes no additional revenue from potential future acquisitions completed between now and January 31, 2026.

We are maintaining our Adjusted EBITDA outlook for fiscal 2026. We expect Adjusted EBITDA to be in the range of $78 million to $88 million. The Adjusted EBITDA range provided for fiscal 2026 assumes continued improvements in operating leverage across the Company through a focus on efficiency.

We are maintaining our expectation for AHSCs to reach approximately 4,500 in fiscal 2026. Additionally, we expect total revenue per AHSC in fiscal 2026 to increase from fiscal 2025.

We believe our $84.2 million in cash and cash equivalents as of January 31, 2025, along with cash generated in our normal operations, gives us sufficient flexibility to reach our fiscal 2026 outlook. Additionally, our available borrowing capacity under our credit facility with Capital One provides us with an additional source of capital to pursue future growth opportunities not incorporated into our fiscal 2026 outlook. As of January 31, 2025 we had no borrowings outstanding under our credit facility.

Non-GAAP³ Financial Measures

We have not reconciled our Adjusted EBITDA outlook to GAAP Net income (loss) because we do not provide an outlook for GAAP Net income (loss) due to the uncertainty and potential variability of Other (income) expense, net and (Benefit from) provision for income taxes, which are reconciling items between Adjusted EBITDA and GAAP Net income (loss). Because we cannot reasonably predict such items, a reconciliation of the non-GAAP financial measure outlook to the corresponding GAAP measure is not available without unreasonable effort. We caution, however, that such items could have a significant impact on the calculation of GAAP Net income (loss). For further information regarding the non-GAAP financial measures included in this press release, including a reconciliation of GAAP to non-GAAP financial measures and an explanation of these measures, please see “Non-GAAP financial measures” below.

Available Information

We intend to use our Company website (including our Investor Relations website) as well as our Facebook, X, LinkedIn and Instagram accounts as a means of disclosing material non-public information and for complying with our disclosure obligations under Regulation FD.

Forward-Looking Statements

This press release includes express or implied statements that are not historical facts and are considered forward-looking within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally relate to future events or our future financial or operating performance and may contain projections of our future results of operations or of our financial information or state other forward-looking information. These statements include, but are not limited to, statements regarding: our future financial and operating performance, including our revenue, operating leverage, margins, Adjusted EBITDA and cash flows; our ability to finance our plans to achieve our fiscal 2026 outlook with our current cash balance and cash generated in the normal course of business; and our outlook for fiscal 2026, including our expectations regarding revenue, Adjusted EBITDA, AHSCs and Total revenue per AHSC. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing,” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or our future operational or financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond our control, including, without limitation, risks associated with: our ability to effectively manage our growth and meet our growth objectives; our focus on the long-term and our investments in growth; the competitive environment in which we operate; our ability to comply with the covenants in our credit agreement with Capital One; changes in market conditions and receptivity to our products and services; our ability to develop and release new products and services and successful enhancements, features and modifications to our existing products and services; our ability to maintain the security and availability of our platform; the impact of cyberattacks, security incidents or breaches impacting our business; changes in laws and regulations applicable to our business model; our ability to make accurate predictions about our industry and addressable market; our ability to attract, retain and cross-sell to healthcare services clients; our ability to continue to operate effectively with a primarily remote workforce and attract and retain key talent; our ability to realize the intended benefits of our acquisitions and partnerships; and difficulties in integrating our acquisitions and investments; and other general, market, political, economic and business conditions (including from the results of the 2024 U.S. presidential and congressional elections and the warfare and/or political and economic instability in Ukraine, the Middle East or elsewhere). The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those listed or described in our filings with the Securities and Exchange Commission (“SEC”), including in our Annual Report on Form 10-K for the fiscal year ended January 31, 2025 that will be filed with the SEC following this press release. The forward-looking statements in this press release speak only as of the date on which the statements are made. We undertake no obligation to update, and expressly disclaim the obligation to update, any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.

This press release includes certain non-GAAP financial measures as defined by SEC rules. We have provided a reconciliation of those measures to the most directly comparable GAAP measures, with the exception of our Adjusted EBITDA outlook for the reasons described above.

Conference Call Information

We will hold a conference call on Wednesday March 12, 2025, at 5:00 p.m. Eastern Time to review our 2025 fiscal fourth quarter and fiscal 2025 financial results. To participate in our live conference call and webcast, please dial (800) 715-9871 (or (646) 307-1963 for international participants) using conference code number 7404611 or visit the “Events & Presentations” section of our Investor Relations website at ir.phreesia.com. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days.

About Phreesia

Phreesia is a trusted leader in patient activation, giving healthcare providers, life sciences companies and other organizations tools to help patients take a more active role in their care. Founded in 2005, Phreesia enabled approximately 170 million patient visits in 2024—1 in 7 visits across the U.S.—scale that we believe allows us to make meaningful impact. Offering patient-driven digital solutions for intake, outreach, education and more, Phreesia enhances the patient experience, drives efficiency and improves healthcare outcomes.

Phreesia, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)
	January 31, 2025				January 31, 2024
	(Unaudited)
Assets
Current:
Cash and cash equivalents	$	84,220			$	87,520
Settlement assets		29,176				28,072
Accounts receivable, net of allowance for doubtful accounts of $1,468 and $1,392 as of January 31, 2025 and 2024, respectively		73,617				64,863
Deferred contract acquisition costs		401				768
Prepaid expenses and other current assets		15,871				14,461
Total current assets		203,285				195,684
Property and equipment, net of accumulated depreciation and amortization of $84,505 and $76,859 as of January 31, 2025 and 2024, respectively		23,651				16,902
Capitalized internal-use software, net of accumulated amortization of $55,991 and $45,769 as of January 31, 2025 and 2024, respectively		52,763				46,139
Operating lease right-of-use assets		1,477				266
Deferred contract acquisition costs		583				986
Intangible assets, net of accumulated amortization of $8,407 and $4,925 as of January 31, 2025 and 2024, respectively		28,143				31,625
Goodwill		75,845				75,845
Other assets		2,668				2,879
Total Assets	$	388,415			$	370,326
Liabilities and Stockholders’ Equity
Current:
Settlement obligations	$	29,176			$	28,072
Current portion of finance lease liabilities and other debt		8,043				6,056
Current portion of operating lease liabilities		964				393
Accounts payable		5,622				8,480
Accrued expenses		37,460				37,130
Deferred revenue		32,758				24,113
Other current liabilities		—				5,875
Total current liabilities		114,023				110,119
Long-term finance lease liabilities and other debt		8,150				5,400
Operating lease liabilities, non-current		646				134
Long-term deferred revenue		119				97
Long-term deferred tax liabilities		484				270
Other long-term liabilities		185				2,857
Total Liabilities		123,607				118,877
Commitments and contingencies
Stockholders’ Equity:
Preferred stock, undesignated, $0.01 par value—20,000,000 shares authorized as of both January 31, 2025 and 2024; no shares issued or outstanding as of January 31, 2025 and 2024, respectively		—				—
Common stock, $0.01 par value—500,000,000 shares authorized as of both January 31, 2025 and 2024; 60,083,444 and 57,709,762 shares issued as of January 31, 2025 and 2024, respectively		601				577
Additional paid-in capital		1,111,274				1,039,361
Accumulated deficit		(801,496	)			(742,969	)
Accumulated other comprehensive loss		(51	)			—
Treasury stock, at cost, 1,355,169 shares as of both January 31, 2025 and 2024		(45,520	)			(45,520	)
Total Stockholders’ Equity		264,808				251,449
Total Liabilities and Stockholders’ Equity	$	388,415			$	370,326

Phreesia, Inc.
Consolidated Statements of Operations
(Unaudited)
(in thousands, except share and per share data)
	Three months ended January 31,								Fiscal Year ended January 31,
		2025				2024				2025				2024
Revenue:
Subscription and related services	$	51,793			$	45,653			$	196,510			$	165,436
Payment processing fees		24,676				23,508				101,740				94,610
Network solutions		33,212				25,844				121,563				96,253
Total revenues		109,681				95,005				419,813				356,299
Expenses:
Cost of revenue (excluding depreciation and amortization)		16,507				16,140				66,227				61,025
Payment processing expense		17,059				15,634				68,707				62,986
Sales and marketing		28,863				35,873				121,129				147,008
Research and development		29,626				29,862				117,364				112,346
General and administrative		18,415				18,821				76,597				79,926
Depreciation		3,172				4,353				14,183				17,584
Amortization		3,651				3,900				13,703				11,903
Total expenses		117,293				124,583				477,910				492,778
Operating loss		(7,612	)			(29,578	)			(58,097	)			(136,479	)
Other income, net		2,217				83				1,956				44
Loss on extinguishment of debt		—				(1,118	)			—				(1,118	)
Interest income, net		19				184				330				2,211
Total other income (expense), net		2,236				(851	)			2,286				1,137
Loss before provision for income taxes		(5,376	)			(30,429	)			(55,811	)			(135,342	)
Provision for income taxes		(1,014	)			(217	)			(2,716	)			(1,543	)
Net loss	$	(6,390	)		$	(30,646	)		$	(58,527	)		$	(136,885	)
Net loss per share attributable to common stockholders, basic and diluted(1)	$	(0.11	)		$	(0.56	)		$	(1.02	)		$	(2.51	)
Weighted-average common shares outstanding, basic and diluted		58,277,812				54,555,555				57,589,687				54,561,449
(1) Our potential dilutive securities have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted-average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same.

Phreesia, Inc.
Consolidated Statements of Comprehensive Loss
(Unaudited)
(in thousands)
	Three months ended January 31,								Fiscal Year ended January 31,
		2025				2024				2025				2024
Net loss	$	(6,390	)		$	(30,646	)		$	(58,527	)		$	(136,885	)
Other comprehensive loss, net of tax:
Change in foreign currency translation adjustments, net of tax		(46	)			—				(51	)			—
Other comprehensive loss, net of tax		(46	)			—				(51	)			—
Comprehensive loss	$	(6,436	)		$	(30,646	)		$	(58,578	)		$	(136,885	)

Phreesia, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
	Three Months Ended January 31,								Fiscal Year ended January 31,
		2025				2024				2025				2024
Operating activities:
Net loss	$	(6,390	)		$	(30,646	)		$	(58,527	)		$	(136,885	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		6,823				8,253				27,886				29,487
Stock-based compensation expense		17,162				17,864				66,975				71,613
Amortization of deferred financing costs and debt discount		62				68				236				321
Loss on extinguishment of debt		—				1,118				—				1,118
Non-cash gain on settlement		(2,345	)			—				(2,345	)			—
Cost of Phreesia hardware purchased by customers		625				387				1,873				1,619
Deferred contract acquisition costs amortization		109				201				1,815				1,056
Non-cash operating lease expense		179				218				747				702
Deferred taxes		38				47				214				228
Changes in operating assets and liabilities:
Accounts receivable		(2,254	)			(7,844	)			(8,812	)			(11,205	)
Prepaid expenses and other assets		(5,713	)			(1,448	)			(1,427	)			(2,209	)
Deferred contract acquisition costs		(280	)			—				(1,045	)			—
Accounts payable		(8,432	)			(767	)			(3,234	)			(1,993	)
Accrued expenses and other liabilities		6,384				7,665				182				14,195
Lease liabilities		(202	)			(272	)			(824	)			(1,156	)
Deferred revenue		10,490				2,078				8,667				731
Net cash provided by (used in) operating activities		16,256				(3,078	)			32,381				(32,378	)
Investing activities:
Acquisitions, net of cash acquired		—				(294	)			—				(14,573	)
Capitalized internal-use software		(4,268	)			(5,402	)			(15,380	)			(19,291	)
Purchases of property and equipment		(2,790	)			(2,462	)			(8,709	)			(5,806	)
Net cash used in investing activities		(7,058	)			(8,158	)			(24,089	)			(39,670	)
Financing activities:
Proceeds from issuance of common stock upon exercise of stock options		429				30				1,012				955
Treasury stock to satisfy tax withholdings on stock compensation awards		—				—				—				(12,176	)
Proceeds from employee stock purchase plan		475				427				2,918				3,209
Finance lease payments		(2,641	)			(1,623	)			(7,811	)			(6,779	)
Constructive financing		—				—				—				1,688
Principal payments on financing agreements		(311	)			(282	)			(1,199	)			(600	)
Debt issuance costs and loan facility fee payments		—				(1,071	)			(152	)			(1,321	)
Financing payments of acquisition-related liabilities		(4,581	)			(1,333	)			(6,254	)			(1,333	)
Debt extinguishment costs		—				(758	)			—				(758	)
Net cash used in financing activities		(6,629	)			(4,610	)			(11,486	)			(17,115	)
Effect of exchange rate changes on cash and cash equivalents		(89	)			—				(106	)			—
Net increase (decrease) in cash and cash equivalents		2,480				(15,846	)			(3,300	)			(89,163	)
Cash and cash equivalents—beginning of period		81,740				103,366				87,520				176,683
Cash and cash equivalents—end of period	$	84,220			$	87,520			$	84,220			$	87,520
Supplemental information of non-cash investing and financing information:
Right of use assets acquired in exchange for operating lease liabilities	$	—			$	52			$	1,958			$	398
Property and equipment acquisitions through finance leases	$	—			$	—			$	13,709			$	7,438
Purchase of property and equipment and capitalized software included in accounts payable and accrued liabilities	$	1,787			$	1,299			$	1,787			$	1,299
Capitalized stock-based compensation	$	356			$	392			$	1,362			$	1,415
Issuance of stock to settle liabilities for stock-based compensation	$	1,213			$	1,635			$	11,892			$	12,276
Deferred consideration liabilities payable in business combinations	$	—			$	—			$	—			$	8,732
Issuance of stock as consideration in business combinations	$	—			$	—			$	—			$	35,321
Capitalized software acquired through vendor financing	$	—			$	—			$	—			$	2,047
Cash paid for:
Interest	$	735			$	657			$	2,194			$	1,306
Income taxes	$	509			$	—			$	3,068			$	37

Non-GAAP Financial Measures

This press release and statements made during the above-referenced webcast may include certain non-GAAP financial measures as defined by SEC rules.

Adjusted EBITDA is a supplemental measure of our performance that is not required by, or presented in accordance with, GAAP. Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net income or loss or any other performance measure derived in accordance with GAAP, or as an alternative to cash flows from operating activities as a measure of our liquidity. We define Adjusted EBITDA as net income or loss before interest income, net, provision for income taxes, depreciation and amortization, and before stock-based compensation expense, loss on extinguishment of debt and other income, net.

We have provided below a reconciliation of Adjusted EBITDA to net loss, the most directly comparable GAAP financial measure. We have presented Adjusted EBITDA in this press release and our Annual Report on Form 10-K to be filed after this press release because it is a key measure used by our management and board of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short and long-term operational plans. In particular, we believe that the exclusion of the amounts eliminated in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core business. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. We have not reconciled our Adjusted EBITDA outlook to GAAP Net income (loss) because we do not provide an outlook for GAAP Net income (loss) due to the uncertainty and potential variability of Other (income) expense, net and (Benefit from) provision for income taxes, which are reconciling items between Adjusted EBITDA and GAAP Net income (loss). Because we cannot reasonably predict such items, a reconciliation of the non-GAAP financial measure outlook to the corresponding GAAP measure is not available without unreasonable effort. We caution, however, that such items could have a significant impact on the calculation of GAAP Net income (loss).

Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these limitations are as follows:

• Although depreciation and amortization expense are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements;

• Adjusted EBITDA does not reflect: (1) changes in, or cash requirements for, our working capital needs; (2) the potentially dilutive impact of non-cash stock-based compensation; (3) tax payments that may represent a reduction in cash available to us; or (4) interest income, net; and

• Other companies, including companies in our industry, may calculate Adjusted EBITDA or similarly titled measures differently, which reduces its usefulness as a comparative measure.

Because of these and other limitations, you should consider Adjusted EBITDA along with other GAAP-based financial performance measures, including various cash flow metrics, net loss, and our GAAP financial results. The following table presents a reconciliation of Adjusted EBITDA to net loss for each of the periods indicated:

Phreesia, Inc.
Adjusted EBITDA
(Unaudited)
	Three months ended January 31,								Fiscal Year ended January 31,
(in thousands)		2025				2024				2025				2024
Net loss	$	(6,390	)		$	(30,646	)		$	(58,527	)		$	(136,885	)
Interest income, net		(19	)			(184	)			(330	)			(2,211	)
Provision for income taxes		1,014				217				2,716				1,543
Depreciation and amortization		6,823				8,253				27,886				29,487
Stock-based compensation expense		17,162				17,864				66,975				71,613
Loss on extinguishment of debt		—				1,118				—				1,118
Other income, net		(2,217	)			(83	)			(1,956	)			(44	)
Adjusted EBITDA	$	16,373			$	(3,461	)		$	36,764			$	(35,379	)

We calculate Free cash flow as Net cash provided by (used in) operating activities less capitalized internal-use software development costs and purchases of property and equipment.

Additionally, Free cash flow is a supplemental measure of our performance that is not required by, or presented in accordance with, GAAP. We consider Free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by our business that can be used for strategic opportunities, including investing in our business, making strategic investments, partnerships and acquisitions and strengthening our financial position.

The following table presents a reconciliation of Free cash flow from Net cash provided by (used in) operating activities, the most directly comparable GAAP financial measure, for each of the periods indicated:

Phreesia, Inc.
Free cash flow
(Unaudited)
	Three months ended January 31,								Fiscal Year ended January 31,
(in thousands)		2025				2024				2025				2024
Net cash provided by (used in) operating activities	$	16,256			$	(3,078	)		$	32,381			$	(32,378	)
Less:
Capitalized internal-use software		(4,268	)			(5,402	)			(15,380	)			(19,291	)
Purchases of property and equipment		(2,790	)			(2,462	)			(8,709	)			(5,806	)
Free cash flow	$	9,198			$	(10,942	)		$	8,292			$	(57,475	)

Phreesia, Inc.
Reconciliation of GAAP and Adjusted Operating Expenses
(Unaudited)
	Three months ended January 31,						Fiscal Year ended January 31,
(in thousands)	2025			2024			2025			2024
GAAP operating expenses
General and administrative	$	18,415		$	18,821		$	76,597		$	79,926
Sales and marketing		28,863			35,873			121,129			147,008
Research and development		29,626			29,862			117,364			112,346
Cost of revenue (excluding depreciation and amortization)		16,507			16,140			66,227			61,025
	$	93,411		$	100,696		$	381,317		$	400,305
Stock compensation included in GAAP operating expenses
General and administrative	$	6,301		$	6,238		$	24,835		$	23,661
Sales and marketing		5,456			6,100			21,956			25,950
Research and development		4,213			4,444			15,262			17,446
Cost of revenue (excluding depreciation and amortization)		1,192			1,082			4,922			4,556
	$	17,162		$	17,864		$	66,975		$	71,613
Adjusted operating expenses
General and administrative	$	12,114		$	12,583		$	51,762		$	56,265
Sales and marketing		23,407			29,773			99,173			121,058
Research and development		25,413			25,418			102,102			94,900
Cost of revenue (excluding depreciation and amortization)		15,315			15,058			61,305			56,469
	$	76,249		$	82,832		$	314,342		$	328,692

Phreesia, Inc.
Key Metrics
(Unaudited)
	Three months ended January 31,						Fiscal Year ended January 31,
	2025			2024			2025			2024
Key Metrics:
Average number of healthcare services clients ("AHSCs")		4,341			3,962			4,203			3,601
Healthcare services revenue per AHSC	$	17,616		$	17,456		$	70,961		$	72,215
Total revenue per AHSC	$	25,266		$	23,979		$	99,884		$	98,944

The definitions of our key metrics are presented below.

• AHSCs. We define AHSCs as the average number of clients that generate subscription and related services or payment processing revenue each month during the applicable period. In cases where we act as a subcontractor providing white-label services to our partner's clients, we treat the contractual relationship as a single healthcare services client. We believe growth in AHSCs is a key indicator of the performance of our business and depends, in part, on our ability to successfully develop and market our solutions to healthcare services organizations that are not yet clients. We believe growth in AHSCs provides useful information to investors as an important indicator of expected revenue growth. In addition, growth in AHSCs informs our management of the areas of our business that will require further investment to support expected future AHSC growth. For example, as AHSCs increase, we may need to add to our customer support team and invest to maintain effectiveness and performance of our solutions for our healthcare services clients and their patients.

• Healthcare services revenue per AHSC. We define Healthcare services revenue as the sum of subscription and related services revenue and payment processing revenue. We define Healthcare services revenue per AHSC as Healthcare services revenue in a given period divided by AHSCs during that same period. We are focused on continually delivering value to our healthcare services clients. We believe that our ability to increase Healthcare services revenue per AHSC provides useful information to investors as an indicator of the long-term value of our solutions.

• Total revenue per AHSC. We define Total revenue per AHSC as Total revenue in a given period divided by AHSCs during that same period. Our healthcare services clients directly generate subscription and related services and payment processing revenue. Additionally, our relationships with healthcare services clients who subscribe to our solutions give us the opportunity to engage with life sciences companies, government entities, patient advocacy, public interest and not-for-profit and other organizations who deliver direct communication to patients through our solutions. As a result, we believe that our ability to increase Total revenue per AHSC provides useful information to investors as an indicator of the long-term value of our solutions.

Additional Information
(Unaudited)
	Three months ended January 31,								Fiscal Year ended January 31,
		2025				2024				2025				2024
Patient payment volume (in millions)	$	1,080			$	977			$	4,420			$	3,947
Payment facilitator volume percentage		82	%			82	%			81	%			82	%

• Patient payment volume. We believe that patient payment volume is an indicator of both the underlying health of our healthcare services clients’ businesses and the continuing shift of healthcare costs to patients. We measure patient payment volume as the total dollar volume of transactions between our healthcare services clients and their patients utilizing our payment platform, including via credit and debit cards that we process as a payment facilitator as well as cash and check payments and credit and debit transactions for which we act as a gateway to other payment processors.

• Payment facilitator volume percentage. We define payment facilitator volume percentage as the volume of credit and debit card patient payment volume that we process as a payment facilitator as a percentage of total patient payment volume. Payment facilitator volume is a major driver of our payment processing revenue. Our payment facilitator volume percentage could decline slightly over time should we increase our penetration of enterprise customers that are less likely to use Phreesia as a payment facilitator.

_______________________

1 Adjusted EBITDA is a non-GAAP measure. We define Adjusted EBITDA as net loss before interest income, net, provision for income taxes, depreciation and amortization, stock-based compensation expense, loss on extinguishment of debt and other income, net. See “Non-GAAP Financial Measures” for a reconciliation of Adjusted EBITDA to the closest GAAP measure.

2 Free cash flow is a non-GAAP measure. We define Free cash flow as net cash provided by (used in) operating activities less capitalized internal-use software development costs and purchases of property and equipment. See “Non-GAAP Financial Measures” for a reconciliation of Free cash flow to the closest GAAP measure.

3 GAAP is defined as generally accepted accounting principles in the United States.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250312657270/en/

Investor Relations Contact:

Balaji Gandhi

Phreesia, Inc.

investors@phreesia.com

(929) 506-4950

Media Contact:

Nicole Gist

Phreesia, Inc.

nicole.gist@phreesia.com

(407) 760-6274

Source: Phreesia, Inc.

FAQ

What was Phreesia's (PHR) revenue growth in Q4 2025?

Phreesia's Q4 2025 revenue grew 15% year-over-year to $109.7 million.

How much did Phreesia (PHR) reduce its net loss in Q4 2025?

PHR reduced its net loss to $6.4 million in Q4 2025, down from $30.6 million in Q4 2024.

What is Phreesia's (PHR) revenue guidance for fiscal 2026?

PHR expects fiscal 2026 revenue to be between $472 million and $482 million.

How many healthcare services clients does Phreesia (PHR) expect in fiscal 2026?

Phreesia expects to reach approximately 4,500 healthcare services clients in fiscal 2026.

What was Phreesia's (PHR) cash position at the end of fiscal 2025?

PHR had $84.2 million in cash and cash equivalents as of January 31, 2025.