NRC Health Announces First Quarter 2026 Results

Published: 2026-04-28 16:01:04 ET NRC

First quarter TRCV* increased 13% year-over-year to $152.1 million Cash flow from operations increased 8% year-over-year to $7.2 million

Published on 04/28/2026 at 04:01 pm EDT

NRC Health (NASDAQ: NRC), a leader in healthcare experience improvement solutions, today announced results for the first quarter 2026.

"We delivered a strong start to 2026, with record Total Recurring Contract Value and our first quarter of year-over-year revenue growth since 2023, reflecting the tangible momentum building across our business,” said Trent Green, CEO of NRC Health. “The signing of the largest deal in our 45-year history is a powerful validation of our strategy and the differentiated value we deliver to health systems navigating an increasingly complex environment. Our new sales and customer retention both reached multi-year highs this quarter, underscoring the trust our customers place in us. As we look ahead, we remain committed to evolving from a measurement partner to a true outcomes driver, helping healthcare organizations turn Human Understanding into measurable, repeatable improvement."

First Quarter 2026 Highlights

* These financial measures are defined below under the headings “Non-GAAP Financial Measures” and “Total Recurring Contract Value.” Reconciliations of the non-GAAP measures to their most closely comparable GAAP measures are included in the tables in this release.

Dividend Declaration

The Company’s Board of Directors on April 15, 2026, declared a quarterly cash dividend of $0.16 per share. The dividend will be payable on Friday, July 10, 2026, to shareholders of record as of the close of business on Friday, June 26, 2026.

Earnings Call Information

The company will be hosting a conference call to discuss the financial results on Tuesday, April 28, 2026, at 4:30 p.m. ET. A live webcast and replay of the call will be available on the NRC Health Investor Relations website at nrchealth.com/investor-relations.

About NRC Health

For more than 45 years, NRC Health (NASDAQ: NRC) has led the charge to humanize healthcare and support organizations in their understanding of each unique individual. NRC Health’s commitment to Human Understanding® helps leading healthcare systems get to know the patients, families, consumers, employees, and communities they serve on a human level. Guided by its uniquely empathic heritage, human-centered approach, unmatched national market research, and emphasis on consumer preferences, NRC Health is transforming the healthcare experience, creating strong outcomes across the healthcare journey. For more information, email [email protected], or visit www.nrchealth.com.

Total Recurring Contract Value

Total Recurring Contract Value, or TRCV, is viewed by management as a leading indicator of our future revenue trends. It represents the total annualized contract value under customer contracts that are in effect or contractually committed as of the most recent quarter-end, based on contractual pricing and term provisions, and expected to be in force over the subsequent 12 months. TRCV is an operating metric and is not a measure of revenue recognized under U.S. GAAP.

Non-GAAP Financial Measures

In addition to consolidated GAAP financial measures, NRC Health reviews various non-GAAP financial measures that management believes to be important in the evaluation of its operating results and performance, including “Adjusted Net Income,” “Adjusted Earnings per Share,” “Adjusted EBITDA,” “Adjusted EBITDA Margin,” “Free Cash Flow,” and “Free Cash Flow Margin.” Reconciliations of GAAP to non-GAAP financial information are provided later in this release.

NRC Health believes Adjusted Net Income, Adjusted Earnings per Share, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, and Free Cash Flow Margin are helpful supplemental measures to assist management and investors in evaluating the Company’s operating results as (i) they exclude certain items that are unusual in nature or whose fluctuation from period to period do not necessarily correspond to changes in the operations of NRC Health’s business, and (ii) the exclusion of non-cash stock compensation is useful for investors applying certain valuation metrics and is consistent with the leverage ratio for our credit facility. Adjusted Net Income represents net income adjusted to add back certain management bonuses and non-cash stock compensation and the related tax. Adjusted EBITDA represents net income before interest, taxes, depreciation, amortization, certain management bonuses, and non-cash stock compensation items. Adjusted EBITDA Margin represents Adjusted EBITDA divided by our revenue.

NRC Health considers Free Cash Flow to be a measure that provides useful information to management and investors about our liquidity. Free Cash Flow does not represent residual cash flow available for discretionary expenditures. We define Free Cash Flow as net cash provided by operating activities less capital expenditures. Free Cash Flow Margin represents Free Cash Flow divided by our revenue.

There is no comprehensive, authoritative guidance for the presentation of such non-GAAP information, which is only meant to supplement GAAP results by providing additional information that management utilizes to assess performance.

Forward-Looking Statements

This press release contains certain statements that may be considered forward-looking statements 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, and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms or phrases such as “believes,” “expect,” “focus,” “potential,” “will,” derivations thereof, and similar terms and phrases. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements, including those risks and uncertainties as set forth in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2025, and various disclosures in our press releases, stockholder reports, and other filings with the Securities and Exchange Commission. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.

NRC HEALTH

Condensed Consolidated Statements of Income

(In thousands except per share data, unaudited)

Three months ended March 31,

2026

2025

Revenue

34,803

33,551

Operating expenses:

Direct

13,646

13,057

Selling, general, and administrative

13,419

10,356

Depreciation and amortization

2,169

1,542

Total operating expenses

29,234

24,955

Operating income

5,569

8,596

Other income (expense):

Interest income

Interest expense

(1,255

)

(899

)

Other, net

Total other expense

(1,190

)

(873

)

Income before income taxes

4,379

7,723

Provision for income taxes

1,157

1,936

Net income

3,222

5,787

Earnings per share of common stock:

Basic

0.14

0.25

Diluted

0.14

0.25

Weighted average shares and share equivalents outstanding:

Basic

21,799

22,972

Diluted

21,911

22,974

NRC HEALTH

Condensed Consolidated Balance Sheets

(Dollars in thousands except share amounts and par value)

March 31, 2026

December 31, 2025

(unaudited)

Assets

Current assets:

Cash and cash equivalents

2,547

4,139

Accounts receivable, net

10,833

11,108

Other current assets

6,604

4,962

Total current assets

19,984

20,209

Property and equipment, net

40,305

40,474

Goodwill

66,152

Other, net

8,118

8,043

Total assets

134,559

134,878

Liabilities and Shareholders’ Equity

Current liabilities:

Current portion of notes payable, net of unamortized debt issuance costs

4,015

4,014

Accounts payable and accrued expenses

4,809

4,066

Accrued wages and bonuses

6,603

7,218

Deferred revenue

17,192

16,201

Dividends payable

3,606

3,625

Other current liabilities

2,245

1,496

Total current liabilities

38,470

36,620

Notes payable, net of current portion and unamortized debt issuance costs

74,017

75,021

Other non-current liabilities

8,577

9,247

Total liabilities

121,064

120,888

Shareholders’ equity:

Preferred stock, $0.01 par value, authorized 2,000,000 shares, none issued

Common stock, $0.001 par value; authorized 110,000,000 shares, issued 31,975,649 in 2026 and 31,966,504 in 2025, outstanding 22,536,696 in 2026 and 22,637,252 in 2025

Additional paid-in capital

185,627

183,880

Retained earnings (accumulated deficit)

(17,682

)

(17,298

)

Treasury stock

(154,482

)

(152,624

)

Total shareholders’ equity

13,495

13,990

Total liabilities and shareholders’ equity

134,559

134,878

NRC HEALTH

Condensed Consolidated Statements of Cash Flows

(In thousands, unaudited)

Three months ended

March 31,

2026

2025

Cash flows from operating activities:

Net income

3,222

5,787

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

2,169

1,542

Deferred income tax expense

(36

)

1,860

Reserve for uncertain tax positions

(56

)

Non-cash share-based compensation expense

1,608

171

Change in fair value of contingent consideration

Loss on extinguishment of debt

Amortization of debt issuance costs

Net changes in assets and liabilities:

Trade accounts receivable

275

(272

)

Prepaid expenses and other current and long-term assets

(1,627

)

(2,419

)

Deferred contract costs, net

(625

)

Operating lease assets and liabilities, net

(30

)

(26

)

Accounts payable

942

627

Accrued expenses, wages, and bonuses

(889

)

(472

)

Income taxes receivable and payable

1,265

(80

)

Deferred revenue

935

(285

)

Net cash provided by operating activities

7,180

6,646

Cash flows from investing activities:

Capital expenditures

(1,834

)

(2,986

)

Net cash used in investing activities

(1,834

)

(2,986

)

Cash flows from financing activities:

Borrowings on notes payable

27,738

Payments on notes payable

(1,030

)

(28,724

)

Borrowings on revolving loan

2,500

8,000

Payments on revolving loan

(2,500

)

(4,503

)

Payment of debt issuance costs

(62

)

Payments on finance lease obligations

)

Proceeds from the exercise of share-based awards

139

132

Payment of acquisition contingent consideration

(484

)

(280

)

Repurchase of shares for treasury

(1,935

)

(4,920

)

Payment of dividends on common stock

(3,625

)

(2,770

)

Net cash used in financing activities

(6,938

)

(5,391

)

Change in cash and cash equivalents

(1,592

)

(1,731

)

Cash and cash equivalents at beginning of period

4,139

4,233

Cash and cash equivalents at end of period

2,547

2,502

NRC HEALTH

Reconciliation of GAAP to Non-GAAP Financial Measures

(In thousands, except per share data, unaudited)

Adjusted Net Income and Adjusted Earnings per Share

Three months ended March 31,

2026

2025

Net income

3,222

5,787

Add back:

Non-cash stock compensation

1,608

171

Tax on stock compensation

(262

)

(43

)

Adjusted net income

4,568

5,915

Weighted average shares and share equivalents outstanding, diluted

21,911

22,974

Adjusted earnings per share, diluted

0.21

0.26

Adjusted EBITDA and Adjusted EBITDA Margin

Three months ended March 31,

2026

2025

Net income

3,222

5,787

Add back:

Depreciation and amortization

2,169

1,542

Interest expense

1,255

899

Income taxes

1,157

1,936

Non-cash stock compensation

1,608

171

Adjusted EBITDA

9,411

10,335

Adjusted EBITDA margin

27.0

30.8

Free Cash Flow and Free Cash Flow Margin

Three months ended March 31,

2026

2025

Net cash provided by operating activities

7,180

6,646

Less:

Capital expenditures

1,834

2,986

Free cash flow

5,346

3,660

Free cash flow margin

15.4

10.9

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