#HealthEquity Reports Strong Q4 and Fiscal Year Results
HealthEquity (NASDAQ: HQY) reported higher revenue and earnings for its fourth quarter and fiscal year ended Jan. 31, 2026, and said it raised its outlook for fiscal 2027 after adding one million new health savings accounts from sales for a second straight year.
The Draper, Utah-based company said fourth-quarter revenue rose 7% to $334.6 million from $311.8 million a year earlier, while fiscal 2026 revenue increased 9% to $1.31 billion from $1.20 billion. Net income for the quarter was $49.7 million, or $0.58 per diluted share, compared with $26.4 million, or $0.30 per diluted share, in the prior-year quarter.
For the full year, net income more than doubled to $215.2 million, or $2.46 per diluted share, from $96.7 million, or $1.09 per diluted share, a year earlier. HealthEquity also reported non-GAAP net income of $349.8 million, or $4.00 per diluted share, and adjusted EBITDA of $566.0 million for the year.
The company said its fiscal 2027 guidance now calls for revenue of $1.405 billion to $1.415 billion, net income of $239 million to $246 million, and adjusted EBITDA of $618 million to $628 million. It projected non-GAAP net income of $392 million to $400 million, or $4.56 to $4.65 per diluted share, based on an estimated 86 million weighted-average shares outstanding.
#Earnings growth and margin expansion
HealthEquity’s latest quarter showed faster growth in profit than in revenue. Adjusted EBITDA for the fourth quarter rose 23% to $132.9 million from $107.8 million, while adjusted EBITDA margin expanded to 40% from 35% a year earlier. For the full year, adjusted EBITDA increased 20% to $566.0 million, with margin rising to 43% from 39%.
Revenue in fiscal 2026 came from three main categories: $485.0 million in service revenue, $636.8 million in custodial revenue, and $191.6 million in interchange revenue. In the fourth quarter, those figures were $127.1 million, $161.4 million, and $46.1 million, respectively. Custodial revenue remained the largest revenue stream in both periods.
The company also reported balance-sheet changes over the year. Cash and cash equivalents stood at $318.9 million at Jan. 31, 2026, up from $295.9 million a year earlier. Outstanding debt, net of issuance costs, fell to $957.4 million from $1.06 billion.
HealthEquity returned capital to shareholders through stock repurchases during the year. The company said it bought back 3.3 million shares for $301.7 million in fiscal 2026, including 0.9 million shares for $81.7 million in the fourth quarter. As of Jan. 31, 2026, $177.7 million remained authorized under the repurchase program.
#HSA assets and account growth
The company said it ended fiscal 2026 with 10.6 million HSAs, up 7% from a year earlier, including 832,000 HSAs with investments, up 10%. Total accounts reached 17.8 million, including 7.2 million complementary consumer-directed benefit accounts.
Total HSA assets rose 14% year over year to $36.5 billion. That total included $18.0 billion in HSA cash and $18.5 billion in HSA investments. HealthEquity also reported $1.1 billion in client-held funds used to support administration of complementary consumer-directed benefits, which the company said contribute to custodial revenue.
Management said it added one million new HSAs from sales for the second consecutive year. Chief Executive Officer Scott Cutler said in the earnings release that the company’s margin expansion reflected operating leverage and that the account growth positioned HealthEquity for further expansion.
The company also said it reduced HSA cash repricing risk by building a cumulative $2.35 billion hedge in five-year U.S. Treasury bonds at 3.92%. That measure comes as custodial revenue remains a central part of HealthEquity’s business mix, making funding levels and yield management an important part of earnings performance.
#Outlook tied to scale and execution
For fiscal 2027, HealthEquity said it expects continued growth across revenue and profit measures. The revenue outlook of $1.405 billion to $1.415 billion implies another year of expansion after fiscal 2026’s 9% increase. The company’s net income guidance of $239 million to $246 million would also extend the earnings gains it reported this year.
Still, parts of the company’s outlook depend on factors management identified elsewhere in the release, including account growth, asset levels, and the non-GAAP adjustments it uses to present profitability. HealthEquity said investors should review GAAP results alongside non-GAAP measures, noting that non-GAAP calculations exclude items such as stock-based compensation, amortization of acquired intangible assets, acquisition costs, merger integration expenses, and certain other items.
The company is scheduled to discuss the results and outlook on a conference call held at 4:30 p.m. Eastern Time on March 17, 2026.
HealthEquity administers HSAs and other consumer-directed benefits through partnerships with employers, benefits advisers, and health and retirement plan providers. The company said it now serves more than 17 million accounts across those products, with HSA asset growth and custodial revenue continuing to shape its financial results.