Definitive Healthcare Corp. Q3 FY2025 earnings call

• Financial results: Q3 revenue was at the high end of guidance, adjusted EBITDA was above the high end of guidance. Unlevered free cash flow was strong.
• Operational progress: Total customer count held steady at ~2,400, with enterprise customer count growing to 520 (highest since Q3 2024). Focus on differentiated data with new claims data source added in Q3 and another to come. Seamless integrations: API integration with a customer led to expansion. Customer success: Improved retention efforts with an iterative customer engagement process. Innovation/digital partnerships: Launched partnership with LiveRamp, signed 8 agencies, and direct sales support showed growth with a large teaching hospital expanding its campaign.

Total revenue for Q3 2025 was $60 million, a 4% year-over-year decrease. Adjusted EBITDA was $18.9 million, representing a margin of 32%, which was $2 million above the high end of guidance. Subscription revenues were $58.2 million, down 4% year-over-year. Adjusted gross profit in the third quarter was $49.4 million, down 4% from Q3 2024, but with an adjusted gross profit margin of 82% (roughly flat from Q3 2024). The company generated approximately $51 million in unlevered free cash flow for the trailing 12 months.

• Q4 guidance: Expected revenue of $59 million to $60 million, a decrease of 4% to 5% year-over-year. Adjusted EBITDA expected to be $16 million to $17 million, with a margin of 27% to 29%.
• Full year 2025 guidance: Now expects revenue of $239 million to $240 million (5% decline year-over-year), adjusted EBITDA of $68 million to $69 million (margin 28% to 29%), adjusted net income of $34 million to $35 million.

• Macro environment uncertainties impacting renewals.
• Regulatory uncertainty affecting the business.
• Funding environment and interest rates potentially impacting customer budgets.

Q: Double-click on the competitive takeaway with the med device company, asking about common gaps and new logos.

A: Kevin Coop said it's a combination of the integrations component and the quality of the data.

Q: Question on new claims data, strategic importance and incremental lift.

A: Kevin Coop said claims data was an upsell/cross-sell, disrupted, now replacing and going above historical levels.

Q: Question on upsell vs downsell dynamic and future growth mix.

A: Casey Heller said upsell/downsell pressures are in life sciences, and future growth will be a mix of new logo generation and expansion within existing customers Q: Question on renewals in December/January and impact on 2026.

A: Kevin Coop and Casey Heller discussed the importance of December/January renewals, cRPO trends, and that Q4 to Q1 subscription revenue may step down similar to prior years