View Filing Data

Cover Page - shares	3 Months Ended
Cover Page - shares	Mar. 31, 2020	Apr. 30, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2020
Document Transition Report	false
Entity File Number	001-38993
Entity Registrant Name	HEALTH CATALYST, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	45-3337483
Entity Address, Address Line One	3165 Millrock Drive #400
Entity Address, City or Town	Salt Lake City
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84121
City Area Code	801
Local Phone Number	708-6800
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	HCAT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		38,008,474
Entity Central Index Key	0001636422
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($)
$ in Thousands

Mar. 31, 2020

Dec. 31, 2019

Current assets:

Cash and cash equivalents

$ 60,965

$ 18,032

Short-term investments

143,595

210,245

Accounts receivable, net

^[1]

35,367

27,570

Deferred costs

493

937

Prepaid expenses and other assets

9,439

7,455

Total current assets

249,859

264,239

Property and equipment, net

3,943

4,295

Intangible assets, net

31,753

25,535

Operating lease right-of-use assets

3,105

3,787

Goodwill

18,419

3,694

Other assets

1,678

810

Total assets

308,757

302,360

Current liabilities:

Accounts payable

2,736

3,622

Accrued liabilities

6,830

8,944

^[1]

3,107

2,192

Deferred revenue

^[1]

35,454

30,653

Operating lease liabilities

2,301

2,806

Total current liabilities

50,428

48,217

Long-term debt

48,485

48,200

^[1]

1,860

Deferred revenue, net of current portion

1,356

1,459

Operating lease liabilities, net of current portion

1,375

1,654

Contingent consideration liability

2,666

Other liabilities

326

Total liabilities

104,636

101,716

Commitments and contingencies (Note 14)

Stockholders’ equity:

Preferred stock, $0.001 par value per share; 25,000,000 shares authorized as of March 31, 2020 and December 31, 2019; no shares issued and outstanding as of March 31, 2020 and December 31, 2019

Common stock, $0.001 par value per share; 500,000,000 shares authorized as of March 31, 2020 and December 31, 2019; 37,838,276 and 36,678,854 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively

Additional paid-in capital

832,167

811,049

Accumulated deficit

(628,123)

(610,514)

Accumulated other comprehensive income

Total stockholders’ equity

204,121

200,644

Total liabilities and stockholders’ equity

$ 308,757

$ 302,360

[1]	Includes amounts attributable to related party transactions. See Note 16 for further details.

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value (in USD per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	25,000,000	25,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in USD per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, shares issued (in shares)	37,838,276	36,678,854
Common stock, shares outstanding (in shares)	37,838,276	36,678,854

Condensed Consolidated Statements of Operations - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2020

Mar. 31, 2019

Revenue:

Revenue

^[1]

$ 45,116

$ 35,213

Cost of revenue, excluding depreciation and amortization:

Total cost of revenue, excluding depreciation and amortization

24,068

17,326

Operating expenses:

Sales and marketing

13,487

10,473

Research and development

13,088

10,022

General and administrative

9,701

6,174

Depreciation and amortization

2,877

2,312

Total operating expenses

39,153

28,981

Loss from operations

(18,105)

(11,094)

Loss on extinguishment of debt

(1,670)

Interest and other expense, net

(621)

(945)

Net loss before income taxes

(18,726)

(13,709)

Income tax (benefit) provision

(1,236)

Net loss

(17,490)

(13,720)

Less: accretion of redeemable convertible preferred stock

64,015

Net loss attributable to common stockholders

$ (17,490)

$ (77,735)

Net loss per share attributable to common stockholders, basic and diluted (in USD per share)

$ (0.47)

$ (16.21)

Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted (in shares)

37,108,998

4,795,195

Technology

Revenue:

Revenue

^[1]

$ 24,699

$ 20,148

Cost of revenue, excluding depreciation and amortization:

Total cost of revenue, excluding depreciation and amortization

7,906

6,752

Professional services

Revenue:

Revenue

^[1]

20,417

15,065

Cost of revenue, excluding depreciation and amortization:

Total cost of revenue, excluding depreciation and amortization

$ 16,162

$ 10,574

[1]	Includes amounts attributable to related party transactions. See Note 16 for further details.

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Statement of Comprehensive Income [Abstract]
Net Loss	$ (17,490)	$ (13,720)
Other comprehensive income (loss):
Change in unrealized gain (loss) on investments	(3)	3
Change in foreign currency translation adjustment	(30)	0
Comprehensive loss	$ (17,523)	$ (13,717)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands	Total	Impact of adopting the current expected credit loss standard	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Deficit Impact of adopting the current expected credit loss standard	Accumulated Other Comprehensive Income
Beginning balance (in shares) at Dec. 31, 2018	22,713,694
Beginning balance at Dec. 31, 2018	$ 409,845
Preferred Stock
Issuance of Series F redeemable convertible preferred stock, net of issuance costs of $115 (in shares)	437,787
Issuance of Series F redeemable convertible preferred stock, net of issuance costs of $115	$ 12,073
Accretion of redeemable convertible preferred stock	$ 64,015
Ending balance (in shares) at Mar. 31, 2019	23,151,481
Ending balance at Mar. 31, 2019	$ 485,933
Beginning balance (in shares) at Dec. 31, 2018			4,779,356
Beginning balance at Dec. 31, 2018	(374,768)		$ 5	$ 0	$ (374,772)		$ (1)
Common Stock
Exercise of stock options (in shares)			94,558
Exercise of stock options	808			808
Stock-based compensation	1,656			1,656
Accretion of redeemable convertible preferred stock	(64,015)			(2,464)	(61,551)
Net Loss	(13,720)				(13,720)
Other comprehensive income (loss)	3						3
Ending balance (in shares) at Mar. 31, 2019			4,873,914
Ending balance at Mar. 31, 2019	$ (450,036)		$ 5	0	(450,043)		2
Beginning balance (in shares) at Dec. 31, 2019	0
Beginning balance at Dec. 31, 2019	$ 0
Ending balance (in shares) at Mar. 31, 2020	0
Ending balance at Mar. 31, 2020	$ 0
Beginning balance (in shares) at Dec. 31, 2019	36,731,632		36,678,854
Beginning balance at Dec. 31, 2019	$ 200,644	$ (119)	$ 37	811,049	(610,514)	$ (119)	72
Common Stock
Exercise of stock options (in shares)	1,048,760		1,048,760
Exercise of stock options	$ 9,046		$ 1	9,045
Stock-based compensation	8,741			8,741
Issuance of common stock for acquisition consideration (in shares)			110,662
Issuance of common stock for acquisition consideration	3,332			3,332
Accretion of redeemable convertible preferred stock	0
Net Loss	(17,490)				(17,490)
Other comprehensive income (loss)	$ (33)						(33)
Ending balance (in shares) at Mar. 31, 2020	37,838,276		37,838,276
Ending balance at Mar. 31, 2020	$ 204,121		$ 38	$ 832,167	$ (628,123)		$ 39

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($)
Issuance costs	$ 182
Shares of redeemable convertible preferred stock
Issuance costs	$ 115

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flows from operating activities
Net loss	$ (17,490)	$ (13,720)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	2,877	2,312
Loss on extinguishment of debt	0	1,670
Amortization of debt discount and issuance costs	285	144
Investment discount and premium amortization	(6)	(83)
Gain on sale of property and equipment	(2)	(11)
Stock-based compensation expense	8,741	1,656
Deferred tax benefit	(1,280)	0
Change in fair value of contingent consideration liability	(359)	0
Other	(2)	0
Change in operating assets and liabilities:
Accounts receivable, net	(7,284)	(557)
Deferred costs	444	(109)
Prepaid expenses and other assets	(2,244)	(185)
Operating lease right-of-use assets	682	130
Accounts payable, accrued liabilities, and other liabilities	(4,283)	(382)
Deferred revenue	3,936	4,012
Operating lease liabilities	(784)	(101)
Net cash used in operating activities	(16,769)	(5,224)
Cash flows from investing activities
Purchases of property and equipment	(506)	(689)
Proceeds from the sale of property and equipment	6	14
Purchase of short-term investments	0	(30,726)
Proceeds from the sale and maturity of short-term investments	66,653	3,147
Purchase of intangible assets	(758)	(402)
Acquisition of business, net of cash acquired	(15,249)	0
Net cash provided by (used in) investing activities	50,146	(28,656)
Cash flows from financing activities
Proceeds from the issuance of redeemable convertible preferred stock, net of issuance costs	0	12,073
Proceeds from exercise of stock options	9,046	808
Proceeds from employee stock purchase plan	1,289	0
Payment of SVB line of credit and mezzanine loan	0	(21,821)
Proceeds from credit facilities, net of debt issuance costs	0	47,169
Payments of acquisition-related consideration	(748)	(390)
Payments of deferred offering costs	0	(182)
Net cash provided by financing activities	9,587	37,657
Effect of exchange rate changes	(31)	0
Net increase in cash and cash equivalents	42,933	3,777
Cash and cash equivalents at beginning of period	18,032	28,431
Cash and cash equivalents at end of period	60,965	32,208
Supplemental disclosures of non-cash investing and financing information
Redeemable convertible preferred stock accretion	0	64,015
Deferred offering costs included in accounts payable and accrued liabilities	427	1,066
Purchase of intangible assets included in accounts payable and accrued liabilities	132	1,114
Purchase of property and equipment included in accounts payable and accrued liabilities	77	20
Supplemental disclosures of cash flow information related to leases
Cash paid for operating lease liabilities in operating cash flows	843	778
Operating lease right-of-use assets obtained in exchange for operating lease obligations	$ 0	$ 581

Description of Business and Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Description of Business and Summary of Significant Accounting Policies

Nature of operations

Health Catalyst, Inc. (Health Catalyst) was incorporated under the laws of Delaware in September 2011. We are a leading provider of data and analytics technology and services to healthcare organizations. Our Solution comprises a cloud-based data platform, analytics software, and professional services expertise. Our customers, which are primarily healthcare providers, use our Solution to manage their data, derive analytical insights to operate their organization, and produce measurable clinical, financial, and operational improvements.

Basis of presentation

Our accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) and the applicable regulations of the U.S. Securities and Exchange Commission (SEC) regarding interim financial reporting. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted. Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the related notes thereto as of and for the year ended December 31, 2019 included in our Annual Report on Form 10-K.

Interim Unaudited Condensed Consolidated Financial Statements

Our accompanying interim condensed consolidated balance sheet as of March 31, 2020, the interim condensed consolidated statements of operations for the three months ended March 31, 2020 and 2019, our interim condensed consolidated statements of redeemable convertible preferred stock and stockholders' equity (deficit) for the three months ended March 31, 2020 and 2019, and our interim condensed consolidated statements of cash flows for the three months ended March 31, 2020 and 2019 are unaudited. Our condensed consolidated balance sheet as of December 31, 2019 was derived from audited financial statements, but does not include all disclosures required by GAAP. Our interim unaudited condensed consolidated financial statements have been prepared on a basis consistent with our annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company's financial position, its operations and cash flows for the periods presented. The historical results are not necessarily indicative of future results, and the results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the full year or any other period.

Initial Public Offering

On July 29, 2019, we closed our initial public offering of common stock (IPO) in which we issued and sold 8,050,000 shares (inclusive of the underwriters’ over-allotment option to purchase 1,050,000 shares, which was exercised on July 25, 2019) of common stock at $26.00 per share. We received net proceeds of $194.6 million after deducting underwriting discounts and commissions and before deducting offering costs of $4.6 million. Upon the closing of our IPO, all shares of our outstanding redeemable convertible preferred stock converted into 23,151,481 shares of common stock on a one-for-one basis.

Stock Split

On July 10, 2019, we effected a 1-for-2 reverse stock split of our capital stock. We have adjusted all references to share and per share amounts in the accompanying condensed consolidated financial statements and notes to reflect the reverse stock split.

Principles of consolidation

Our condensed consolidated financial statements include the accounts of Health Catalyst and its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated.

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates, including those related to revenue recognition, provisions for expected credit losses, useful lives of property and equipment, capitalization and estimated useful life of internal-use software and other intangible assets, fair value of financial instruments, deferred tax assets, stock-based compensation, contingent consideration, and tax uncertainties. Actual results could differ from those estimates.

Segment reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision maker (the CODM) in assessing performance and making decisions regarding resource allocation. We operate our business in two operating segments that also represent our reportable segments. Our segments are (1) technology and (2) professional services. The CODM uses Adjusted Gross Profit (defined as revenue less cost of revenue that excludes depreciation, amortization, stock-based compensation expense, and certain other operating expenses) as the measure of our profit.

Net loss per share

Basic net loss per share is calculated by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding. Net loss attributable to common stockholders is computed as net loss less accretion of redeemable convertible preferred stock. Diluted net loss per share attributable to common stockholders is calculated by giving effect to all potentially dilutive common stock equivalents outstanding for the period. For purposes of this calculation, stock options, restricted stock units (RSUs), and purchase rights committed under the employee stock purchase plan are considered to be common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as the effect is antidilutive.

Prior to our IPO, we computed basic and diluted net loss per share in conformity with the two-class method required for participating securities. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to holders of common stock. Redeemable convertible preferred stock and common stock were considered participating securities for purposes of this calculation. However, the two-class method did not impact the net loss per common share attributable to common stockholders as we were in a loss position for each of the periods presented and the redeemable convertible preferred stockholders did not have a contractual obligation to participate in losses.

Revenue recognition

We recognize revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606). We derive our revenues primarily from technology subscriptions and professional services. We determine revenue recognition by applying the following steps:

•Identification of the contract, or contracts, with a customer;

•Identification of the performance obligations in the contract;

•Determination of the transaction price;

•Allocation of the transaction price to the performance obligations in the contract; and

•Recognition of revenue when, or as, we satisfy the performance obligation.

We recognize revenue net of any taxes collected from customers and subsequently remitted to governmental authorities.

Technology revenue

Technology revenue primarily consists of subscription fees charged to customers for access to use our technology. We provide customers access to our technology through either an all-access or limited-access, modular subscription. The majority of our subscription arrangements are cloud-based and do not provide customers the right to take possession of the technology or contain a significant penalty if the customer were to take possession of the technology. Revenue from cloud-based subscriptions is recognized ratably over the contract term beginning on the date that the service is made available to the customer. Most of our subscription contracts have up to a three-year term, of which the vast majority are terminable after one year upon 90 days’ notice.

Subscriptions that allow the customer to take software on-premise without significant penalty are treated as time-based licenses. These arrangements generally include access to technology, access to unspecified future products, and maintenance and support. Revenue for upfront access to our technology library is recognized at a point in time when the technology is made available to the customer. Revenue for access to unspecified future products included in time-based license subscriptions is recognized ratably over the contract term beginning on the date that the access is made available to the customer.

We also have certain perpetual license arrangements. Revenue from these arrangements is recognized at a point in time upon delivery of the software.

Technology revenue also includes maintenance and support revenue which generally includes bug fixes, updates, and support services. Revenue related to maintenance and support is recognized over the contract term beginning on the date that the service is made available to the customer.

Professional services revenue

Professional services revenue primarily includes data and analytics services, domain expertise services, outsourcing services, and implementation services. Professional services arrangements typically include a fee for making full-time equivalent (FTE) services available to our customers on a monthly basis. FTE services generally consist of a blend of analytic engineers, analysts, and data scientists based on the domain expertise needed to best serve our customer. Professional services are typically considered distinct from the technology offerings and revenue is generally recognized as the service is provided using the “right to invoice” practical expedient.

Contracts with multiple performance obligations

Many of our contracts include multiple performance obligations. We account for performance obligations separately if they are capable of being distinct within the context of the contract. In these circumstances, the transaction price is allocated to separate performance obligations on a relative standalone selling price basis.

We determine standalone selling prices based on the observable price a good or service is sold for separately when available. In cases where standalone selling prices are not directly observable, based on information available, we utilize the expected cost plus a margin, adjusted market assessment, or residual estimation method. We consider all information available including our overall pricing objectives, market conditions, and other factors, which may include customer demographics and the types of users.

Standalone selling prices are not directly observable for our all-access and limited-access technology arrangements, which are composed of cloud-based subscriptions, time-based licenses, and perpetual licenses. For these technology arrangements, we use the residual estimation method due to a limited number of standalone transactions and/or prices that are highly variable.

Variable consideration

We have also entered into at-risk and shared savings arrangements with certain customers whereby we receive variable consideration based on the achievement of measurable improvements which may include cost savings or performance against metrics. For these arrangements, we estimate revenue using the most likely amount that we will receive. Estimates are based on our historical experience and best judgment at the time to the extent it is probable that a significant reversal of revenue recognized will not occur. Due to the nature of our arrangements, certain estimates may be constrained until the uncertainty is further resolved.

Contract balances

Contract assets resulting from services performed prior to invoicing customers are recorded as unbilled accounts receivable and are presented on our condensed consolidated balance sheets in aggregate with accounts receivable. Unbilled accounts receivable generally become billable at contractually specified dates or upon the attainment of contractually defined milestones. As of March 31, 2020 and December 31, 2019, the unbilled accounts receivable included in accounts receivable on our condensed consolidated balance sheets was $2.3 million and $2.9 million, respectively.

We record contract liabilities as deferred revenue when cash payments are received or due in advance of performance. Deferred revenue primarily relates to the advance consideration received from the customer. As of March 31, 2020 and December 31, 2019, the total of current and non-current deferred revenue on our condensed consolidated balance sheets was $36.8 million and $32.1 million, respectively.

Cost of revenue, excluding depreciation and amortization

Cost of technology revenue primarily consists of costs associated with hosting and supporting our technology, including third-party cloud computing and hosting costs, contractor costs, and salary and related personnel costs for our cloud services and support teams. Cost of professional services revenue primarily consists of salary and related personnel costs, travel-related costs, and independent contractor costs. Cost of revenue excludes costs related to depreciation and amortization.

We defer certain costs to fulfill a contract when the costs are expected to be recovered, are directly related to in-process contracts and enhance resources that will be used in satisfying performance obligations in the future. These deferred fulfillment costs primarily consist of employee compensation incurred as part of the implementation of new contracts. As of March 31, 2020 and December 31, 2019, we had deferred contract fulfillment costs of $0.5 million and $0.9 million, respectively.

Cash and cash equivalents

We consider all highly liquid investments purchased with a remaining maturity of three months or less at the time of acquisition to be cash equivalents.

Short-term investments

Our investment policy limits investments to highly-rated instruments that mature in less than 12 months. We classify our short-term investments as available for sale.

Accounts receivable

Accounts receivable are non-interest bearing and are recorded at the original invoiced amount less an allowance for doubtful accounts based on the probability of future collections. We adopted ASU 2016-13 effective January 1, 2020. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates, which results in earlier recognition of credit losses. The allowance for doubtful accounts is based on our estimate of expected credit losses for outstanding trade accounts receivables. We determine expected credit losses based on historical write-off experience, an analysis of the aging of outstanding receivables, customer payment patterns, the establishment of specific reserves for customers in an adverse financial condition, and our expectations of changes in macro-economic conditions, including the current COVID-19 pandemic, that may impact the collectability of outstanding receivables. We reassess the adequacy of the allowance for doubtful accounts each reporting period. As of March 31, 2020 and December 31, 2019, we had an allowance for doubtful accounts of $0.6 million and $0.4 million, respectively.

Property and equipment

Property and equipment are stated at historical cost less accumulated depreciation. Repairs and maintenance costs that do not extend the useful life or improve the related assets are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful life of each asset category is as follows:


Computer equipment			2-3 years
Furniture and fixtures			3 years
Leasehold improvements			Lesser of lease term or estimated useful life
Computer software			2-3 years
Capitalized internal-use software costs			3 years

When there are indicators of potential impairment, we evaluate the recoverability of the carrying values by comparing the carrying amount of the applicable asset group to the estimated undiscounted future cash flows expected to be generated by the asset group over the remaining life of the primary long-lived asset in that group plus any residual value. If the carrying amount of the asset group exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized based on the amount by which the carrying value of the long-lived assets exceeds the fair value of those assets. We did not incur any long-lived impairment charges for the three months ended March 31, 2020 and 2019.

Intangible assets

Intangible assets include developed technologies, customer relationships, customer contracts, and trademarks that were acquired in business combinations and asset acquisitions. Intangible assets also include the purchase of third-party computer software. The intangible assets are amortized using the straight-line method over the assets’ estimated useful lives. The estimated useful life of each asset category is as follows:


Developed technologies			2-10 years
Customer relationships and contracts			6 years
Computer software licenses			2-5 years
Trademarks			2 years

Goodwill

We record goodwill as the difference between the aggregate consideration paid for a business combination and the fair value of the identifiable net tangible and intangible assets acquired. Goodwill is assessed for impairment annually or more frequently if indicators of impairment are present or circumstances suggest that impairment may exist. As of January 1, 2020, we adopted ASU 2017-04, which simplifies the goodwill impairment test by eliminating the second step from the goodwill impairment test. The first step of the goodwill impairment test compares the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, the goodwill of the reporting unit is not considered impaired. If the carrying amount of the reporting unit exceeds its fair value, we would recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. There was no impairment of goodwill for the three months ended March 31, 2020 and 2019.

Business combinations

We account for an acquisition as a business combination if we obtain control of a business. Assets and liabilities acquired in a business combination generally are recorded at fair value and any associated acquisition costs are expensed as incurred in general and administrative expenses.

Advertising costs

All advertising costs are expensed as incurred. We recorded advertising costs of $0.6 million and $0.6 million for the three months ended March 31, 2020 and 2019, respectively.

Development costs and internal-use software

For technology products that are developed to be sold externally, we determined that technological feasibility is reached shortly before the products are ready for general release. Any costs associated with software development between the time technological feasibility is reached and general release are inconsequential. We capitalize certain development costs incurred in connection with our internal-use software. These capitalized costs are primarily related to the software platforms that are hosted by us and accessed by our customers on a subscription basis. Costs incurred in the preliminary stages of development are expensed as incurred as research and development costs. Once an application has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use.

We also capitalize costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Capitalized costs are recorded as part of property and equipment. Maintenance and training costs are expensed as incurred. Internal-use software is amortized on a straight-line basis over its estimated useful life.

Stock-based compensation

Stock-based awards, including stock options and RSUs, are measured and recognized in our condensed consolidated financial statements based on the fair value of the award on the grant date. For awards subject to performance conditions, we record expense when the performance condition becomes probable. We record forfeitures of stock-based awards as the actual forfeitures occur.

We estimate the fair value of stock option awards on the grant date using the Black-Scholes option pricing model. We have issued two types of employee stock-based awards, standard and two-tier. Our standard stock-based awards vest solely on a service-based condition. For these awards, we recognize stock-based compensation expense on a straight-line basis over the vesting period. Two-tier employee stock-based awards, contain both a service-based condition and performance condition, defined as the earlier of (i) an acquisition or change in control of the company or (ii) upon the occurrence of an initial public offering by the Company. A change in control event and effective registration event are not deemed probable until consummated; accordingly, no expense is recorded related to two-tier stock-based awards until the performance condition becomes probable of occurring. Awards that contain both service-based and performance conditions are recognized using the accelerated attribution method once the performance condition is probable of occurring. The service-based condition is generally a service period of four years.

Stock-based compensation expense related to purchase rights issued under the 2019 Health Catalyst Employee Stock Purchase Plan (ESPP) is based on the Black-Scholes option-pricing model fair value of the estimated number of awards as of the beginning of the offering period. Stock-based compensation expense is recognized using the straight-line method over the offering period.

The compensation expense for non-employees is recognized, without changes in the fair value of the award, in the same period and in the same manner as though we had paid cash for the services, which is typically the vesting period of the respective award.

Income taxes

Deferred income tax balances are accounted for using the asset and liability method and reflect the effects of temporary differences between the financial reporting and tax bases of our assets and liabilities using enacted tax rates expected to apply when taxes are actually paid or recovered. In addition, deferred tax assets and liabilities are recorded for net operating loss (NOL) and credit carryforwards.

A valuation allowance is provided against deferred tax assets unless it is more likely than not that they will be realized based on all available positive and negative evidence. Such evidence includes, but is not limited to, recent cumulative earnings or losses, expectations of future taxable income by taxing jurisdiction, and the carry-forward periods available for the utilization of deferred tax assets.

We use a two-step approach to recognize and measure uncertain income tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained upon audit. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. We do not accrue interest and penalties related to unrecognized tax benefits within the provision for income taxes because we have NOLs. Significant judgment is required to evaluate uncertain tax positions.

Although we believe that we have adequately reserved for our uncertain tax positions, we can provide no assurance that the final tax outcome of these matters will not be materially different. We evaluate our uncertain tax positions on a regular basis and evaluations are based on a number of factors, including changes in facts and circumstances, changes in tax law, such as the Tax Cuts and Jobs Act of 2017, correspondence with tax authorities during the course of an audit, and effective settlement of audit issues.

To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on our financial condition and results of operations.

Fair value of financial instruments

The carrying amounts reported in our condensed consolidated balance sheets for cash, receivables, accounts payable, and current accrued expenses approximate fair values because of the immediate or short-term maturity of these financial instruments. The carrying value of acquisition-related consideration payable, operating lease liabilities, and long-term debt approximate fair value based on interest rates available for debt with similar terms at March 31, 2020 and December 31, 2019. Money market funds and short-term investments are measured at fair value on a recurring basis. Our contingent consideration liability is measured at fair value on a recurring basis based primarily on significant inputs not observable in the market.

Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

•Level 1- Quoted prices in active markets for identical assets or liabilities.

•Level 2- Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•Level 3- Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

All of our financial instruments are valued using quoted prices in active markets or based on other observable inputs. For Level 2 securities, we use a third-party pricing service which provides documentation on an ongoing basis that includes, among other things, pricing information with respect to reference data, methodology, inputs summarized by asset class, pricing application, and corroborative information. Our contingent consideration liability is categorized as a Level 3 fair value measurement because we estimate projections during the earn out period utilizing various potential pay-out scenarios.

Leases

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (ROU) assets, operating lease liabilities, and operating lease liabilities, net of current portion in our condensed consolidated balance sheets. We have adopted the short-term lease recognition exemption policy. All of our leasing commitments are classified either as operating leases or otherwise qualify as short-term leases with lease terms of 12 months or less.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As our lease contracts do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date to determine the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease executory costs. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise the applicable option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

We do not have lease agreements that contain non-lease components, which generally would be accounted for separately.

Accounting pronouncements adopted

Goodwill impairment

In January 2017, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2017-04, Intangibles-Goodwill and Other - Simplifying the Test for Goodwill Impairment (Topic 350), that simplifies how an entity is required to test goodwill for impairment by eliminating the second step of the impairment test. The first step measures a goodwill impairment loss by comparing the fair value of a reporting unit to the carrying amount. If the carrying amount of the reporting unit exceeds its fair value, the carrying amount of goodwill is reduced by the excess reporting unit carrying amount up to the carrying amount of the goodwill. We adopted ASU 2017-04 as of January 1, 2020. The guidance applies to our reporting requirements in performing goodwill impairment testing; however, the adoption of this guidance did not have an impact on our condensed consolidated financial statements and related disclosures.

Fair value measurements

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates certain disclosure requirements for fair value measurements for all entities, requires public entities to disclose certain new information prospectively, including the ranges used to develop significant unobservable inputs for Level 3 fair value measurements, and modifies some disclosure requirements. We adopted ASU 2018-13 as of January 1, 2020. The adoption of this standard did not have a material impact on our condensed consolidated financial statements and related disclosures.

Credit losses

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326), which required the measurement and recognition of expected credit losses for certain financial instruments, which includes our accounts receivable and available-for-sale debt securities. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates, which results in earlier recognition of credit losses. We adopted ASU 2016-13 effective January 1, 2020. The adoption of the standard did not have a material impact on our condensed consolidated financial statements. The adoption adjustment was recorded to accumulated deficit, as seen in our condensed consolidated statements of redeemable convertible preferred stock and stockholders’ equity.

Implementation Costs Incurred in a Cloud Computing Arrangement

In August 2018, the FASB issued ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs in a cloud computing arrangement service contract with the requirements for capitalizing implementation costs incurred for an internal-use software license. We prospectively adopted ASU 2018-15 effective January 1, 2020. The adoption of this standard did not have a material impact on our condensed consolidated financial statements and related disclosures.

Recent accounting pronouncements not yet adopted

Accounting for income taxes

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes, eliminates certain exceptions within Topic 740, and clarifies certain aspects of the current guidance to promote consistency among reporting entities. The new standard is effective for fiscal years beginning after December 15, 2021. Most amendments within the standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. We are currently evaluating the impacts of the provisions of this standard on our condensed consolidated financial statements and related disclosures.

Reference rate reform

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The update provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) contract modifications on financial reporting, caused by reference rate reform. ASU 2020-04 is effective for all entities as of March 12, 2020 through December 31, 2022. We are still evaluating the impact, but do not expect the adoption of the standard to have a material impact on our condensed consolidated financial statements and related disclosures.

Business Combinations

3 Months Ended

Mar. 31, 2020

Business Combinations [Abstract]

Business Combinations

On February 21, 2020, we acquired Able Health, Inc. (Able Health), a leading software-as-a-service provider of quality and regulatory measurement tracking and reporting to healthcare providers and risk-bearing entities, in a transaction accounted for as a business combination. The acquisition consideration transferred was $21.5 million and was comprised of net cash consideration of $15.2 million, Health Catalyst common shares with a fair value of $3.3 million, and contingent consideration based on achievement of Able Health specified incremental customer billings for the year ending December 31, 2020, with an initial fair value of $3.0 million. The acquisition consideration is subject to certain working capital escrow adjustments. The purchase resulted in Health Catalyst acquiring 100% ownership in Able Health. We believe this acquisition will strengthen Health Catalyst’s Quality and Regulatory Measures capabilities.

An additional 179,392 shares of our common stock subject to restriction agreements, or restricted shares, were issued pursuant to the terms of the acquisition agreement and 60,000 restricted stock units were issued in connection with the acquisition agreement. The value of these restricted shares and restricted stock units will be recognized as post-combination stock-based compensation expense over their respective vesting terms. The vesting of the restricted shares is subject to one year of continuous service by the applicable team members and shall vest on the one-year anniversary of the acquisition closing date and the service-based condition for the restricted stock units issued pursuant to the terms of the acquisition agreement is satisfied over two years with a 50% cliff vesting period of one year and ratable quarterly vesting thereafter. Refer to Note 12 for additional details related to our stock-based compensation.

The fair value measurement of contingent consideration that may be payable to Able Health’s former stockholders and the measurement of the acquired Able Health assets and assumed liabilities are determined based on estimates and assumptions that are judgmental in nature, including the timing and amount of projected future cash flows and market-participant discount rates reflecting risks inherent in the future cash flows. Given the recent nature of the Able Health acquisition closing date and the March 31, 2020 reporting date, such measurements are preliminary and subject to measurement period adjustments under GAAP, as we complete our analysis of information that is available or obtainable as of the acquisition date that impacts the fair value and other acquisition date recognition and measurement purchase price allocation amounts.

The following table summarizes the acquisition-date fair value of consideration transferred and the identifiable assets purchased and liabilities assumed as part of our acquisition of Able Health (in thousands):


Assets acquired:
Accounts receivable	$	633
Prepaid expenses and other assets	57
Developed technologies	7,500
Customer relationships	600
Trademarks	100
Total assets acquired	8,890
Less liabilities assumed:
Accounts payable and other current liabilities	91
Deferred revenue	762
Net deferred tax liabilities	1,280
Total liabilities assumed	2,133
Total assets acquired, net	6,757
Goodwill	14,725
Total consideration transferred, net of cash acquired	$	21,482

The acquired intangible assets were valued utilizing either an income approach or a cost approach as deemed most applicable, and include customer relationships, developed technology, and trademarks that will be amortized on a straight-line basis over their estimated useful lives of six years, three years, and two years, respectively. The resulting goodwill from the Able Health acquisition was fully allocated to the technology reporting unit and is not deductible for income tax purposes. We expensed $0.9 million of acquisition transaction costs as incurred that are included in general and administrative expense in our condensed consolidated statements of operations.

Pro forma financial information has not been presented for this acquisition as the impact to our condensed consolidated financial statements was not material.

The amount of revenue attributable to the acquired business of Able Health that has been included in our condensed consolidated statement of operations subsequent to the February 21, 2020 acquisition date through March 31, 2020 is $0.4 million. Income (loss) information for Able Health after the acquisition date through March 31, 2020 is not presented as the Able Health business was integrated into our operations immediately following the acquisition and is impracticable to quantify.

Revenue

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Revenue

Disaggregation of revenue

The following table represents Health Catalyst’s revenue disaggregated by type of arrangement (in thousands):


	Three Months Ended March 31,
	2020		2019
Recurring technology	$	24,699	$	20,148
Professional services	20,417		15,065
Total revenue	$	45,116	$	35,213

For the three months ended March 31, 2020 and 2019, 99.9% and 100%, respectively, of revenue was related to contracts with customers located in the United States.Deferred Revenue and Performance Obligations

Deferred revenue includes advance customer payments and billings in excess of revenue recognized. For the three months ended March 31, 2020 and 2019, 33% and 36%, respectively, of the revenue recognized was included in deferred revenue at the beginning of the period.

Transaction price allocated to the remaining performance obligations

Most of our technology and professional services contracts have up to a three-year term, of which the vast majority are terminable after one year upon 90 days’ notice. For arrangements that do not allow the customer to cancel within one year or less, we expect to recognize $49.9 million of revenue on unsatisfied performance obligations as of March 31, 2020. We expect to recognize approximately 85% of the remaining performance obligations over the next 24 months, with the balance recognized thereafter.

Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

We operate our business in two operating segments that also represent our reporting units. Our reporting units are organized based on our technology and professional services. We have not incurred any goodwill impairment charges.

Goodwill by reporting unit is as follows (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Technology	$	17,637	$	2,912
Professional services	782		782
Total goodwill	$	18,419	$	3,694

As of March 31, 2020, intangible assets consisted of the following (in thousands):


	Gross		Accumulated Amortization		Net
Developed technologies	$	43,629	$	(17,922)	$	25,707
Customer relationships and contracts	4,764		(2,964)		1,800
Computer software licenses	7,283		(3,141)		4,142
Trademarks	200		(96)		104
Total intangible assets	$	55,876	$	(24,123)	$	31,753

As of December 31, 2019, intangible assets consisted of the following (in thousands):


	Gross		Accumulated Amortization		Net
Developed technologies	$	36,129	$	(16,548)	$	19,581
Customer relationships and contracts	4,164		(2,773)		1,391
Computer software licenses	7,114		(2,576)		4,538
Trademarks	100		(75)		25
Total intangible assets	$	47,507	$	(21,972)	$	25,535

The increase in goodwill and intangible assets is primarily due to our acquisition of Able Health. Intangible assets are amortized using the straight-line method over the estimated useful lives. Amortization expense of acquired intangible assets was $2.2 million and $1.5 million for the three months ended March 31, 2020, and 2019, respectively. Amortization expense for intangible assets is included in depreciation and amortization in our condensed consolidated statements of operations.

Property and Equipment

3 Months Ended

Mar. 31, 2020

Property, Plant and Equipment [Abstract]

Property and equipment

Property and Equipment

Property and equipment consisted of the following (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Computer equipment	$	8,108	$	7,951
Leasehold improvements	2,309		2,234
Furniture and fixtures	1,031		1,030
Capitalized internal-use software costs	1,944		1,866
Computer software	972		972
Capital lease equipment	37		37
Total property and equipment	14,401		14,090
Less: accumulated depreciation	(10,458)		(9,795)
Property and equipment, net	$	3,943	$	4,295

Our long-lived assets are located in the United States. Depreciation expense totaled $0.7 million and $0.8 million for the three months ended March 31, 2020 and 2019, respectively. Depreciation expense includes amortization of assets recorded under a capital lease and the amortization of capitalized internal-use software costs.

Short-term Investments

3 Months Ended

Mar. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Short-term Investments

Our investment policy limits investments to highly-rated instruments that mature in less than 12 months. We classify our short-term investments as available for sale. Available-for-sale securities are recorded on our condensed consolidated balance sheets at fair market value and any unrealized gains or losses are reported as part of other comprehensive loss on our condensed consolidated statements of comprehensive loss. We determine realized gains or losses on the sales of investments through the specific identification method and record such gains or losses as part of interest and other expense, net on our condensed consolidated statements of operations. We did not have realized gains or losses on investments during the three months ended March 31, 2020 and 2019. We measure the fair value of investments on a recurring basis.

Accrued interest receivables related to our available-for-sale securities of $0.6 million and $0.9 million as of March 31, 2020 and December 31, 2019 were included within prepaid expenses and other assets on our condensed consolidated balance sheets.

The following table summarizes, by major security type, our cash equivalents and short-term investments that are measured at fair value on a recurring basis (in thousands) as of March 31, 2020:


	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash equivalents		Short-term Investments
Money market funds	$	58,487	$	—	$	—	$	58,487	$	58,487	$	—
U.S. Treasury notes	34,098		232		—		34,330		—		34,330
Commercial paper	11,727		—		—		11,727		—		11,727
Corporate bonds	57,605		—		(140)		57,465		—		57,465
Asset-backed securities	40,094		—		(21)		40,073		—		40,073
Total	$	202,011	$	232	$	(161)	$	202,082	$	58,487	$	143,595

The following table summarizes, by major security type, our cash equivalents and short-term investments that are measured at fair value on a recurring basis (in thousands) as of December 31, 2019:


	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash equivalents		Short-term Investments
Money market funds	$	17,175	$	—	$	—	$	17,175	$	17,175	$	—
US treasury notes	58,130		34		—		58,164		—		58,164
Commercial paper	46,973		—		—		46,973		—		46,973
Corporate bonds	64,978		27		(5)		65,000		—		65,000
Asset-backed securities	40,090		18		—		40,108		—		40,108
Total	$	227,346	$	79	$	(5)	$	227,420	$	17,175	$	210,245

On a quarterly basis we evaluate unrealized losses on our available-for-sale debt securities and the related accrued interest receivables to determine whether a decline in the fair value below the amortized cost basis is due to credit-related factors or noncredit-related factors. We do not intend to sell investments that are in an unrealized loss position and it is not likely that we will be required to sell any investments before recovery of their amortized cost basis. As of March 31, 2020 and December 31, 2019, there were no material unrealized losses due to credit-related factors.

Fair Value of Financial Instruments

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 were as follows (in thousands):


	March 31, 2020
	Level 1		Level 2		Level 3		Total
Money market funds	$	58,487	$	—	$	—	$	58,487
U.S. Treasury notes	34,330		—		—		34,330
Commercial paper	—		11,727		—		11,727
Corporate bonds	—		57,465		—		57,465
Asset-backed securities	—		40,073		—		40,073
Contingent consideration	—		—		(2,666)		(2,666)
Total	$	92,817	$	109,265	$	(2,666)	$	199,416

Assets measured at fair value on a recurring basis as of December 31, 2019 were as follows (in thousands):


	December 31, 2019
	Level 1		Level 2		Level 3		Total
Money market funds	$	17,175	$	—	$	—	$	17,175
U.S. Treasury notes	58,164		—		—		58,164
Commercial paper	—		46,973		—		46,973
Corporate bonds	—		65,000		—		65,000
Asset-backed securities	$	—	$	40,108	$	—	$	40,108
Total	$	75,339	$	152,081	$	—	$	227,420

As of December 31, 2019, there were no liabilities measured at fair value on a recurring basis. There were no transfers between Level 1 and Level 2 during the three months ended March 31, 2020 and 2019.

The Able Health acquisition consideration includes an estimate for contingent consideration of up to 145,036 shares of our common stock that will be issued if certain incremental billing targets for Able Health are met during an earn-out period that ends on December 31, 2020. The resulting contingent consideration liability is categorized as a Level 3 fair value measurement because we estimate projections during the earn-out period utilizing various potential pay-out scenarios. For the contingent consideration liability, we value the expected contingent consideration and the corresponding liability using the Monte Carlo method based on estimates of potential pay-out scenarios. Probabilities were applied to each potential scenario and the resulting values were discounted using a rate that considers weighted average cost of capital as well as a specific risk premium associated with the riskiness of the earn-out itself, the related projections, and volatility in the fair value of our common stock. The contingent consideration liability is classified as a component of non-current liabilities in our consolidated balance sheets as the contingent consideration will be settled in shares of our common stock. Changes to the contingent consideration liability are reflected as part of general and administrative expense in our consolidated statements of operations. Changes to the unobservable inputs could have a material impact on our condensed consolidated financial statements.

The following table sets forth a summary of the changes in the estimated fair value of the contingent consideration liability, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands):


	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Balance at December 31, 2019	$	—
Contingent consideration liability from Able Health acquisition (see note 2)	3,025
Change in fair value of contingent consideration liability	(359)
Balance at March 31, 2020	$	2,666

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Accrued liabilities

3 Months Ended

Mar. 31, 2020

Payables and Accruals [Abstract]

Accrued liabilities

As of March 31, 2020 and December 31, 2019, accrued liabilities consisted of the following (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Accrued compensation and benefit expenses	$	3,806	$	4,278
Other accrued expenses	3,024		4,666
Total accrued liabilities	$	6,830	$	8,944

Credit Facilities

3 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

Credit Facilities

As of March 31, 2020, our term credit facilities consisted of the following, excluding unamortized debt discount and issue costs of $1.5 million (in thousands):


	Balance		Remaining Capacity		Interest Rate	Basis Rate
OrbiMed term loan	$	50,000	$	30,000	10.00%	Higher of LIBOR plus 7.5% and 10.0%
SVB revolving line of credit	—		5,000		3.75%	Prime plus 0.50%
Total credit facilities	50,000		$	35,000
Less: Current portion of credit facilities	—
Credit facilities, less current portion	$	50,000

As of December 31, 2019, our term credit facilities consisted of the following, excluding unamortized debt discount and issue costs of $1.8 million (in thousands):


	Balance		Remaining Capacity		Interest Rate	Basis Rate
OrbiMed term loan	$	50,000	$	30,000	10.00%	Higher of LIBOR plus 7.5% and 10.0%
SVB revolving line of credit	—		5,000		5.25%	Prime plus 0.50%
Total credit facilities	50,000		$	35,000
Less: Current portion of credit facilities	—
Credit facilities, less current portion	$	50,000

OrbiMed term loan

On February 6, 2019, we entered into a debt financing agreement with OrbiMed Royalty Opportunities II, LP (OrbiMed) where we obtained an $80.0 million senior term loan commitment, with $50.0 million available and up to an additional $30.0 million contingently available on or prior to March 31, 2020 (the Delayed Draw Commitment). We paid $2.4 million in fees related to the establishment of the OrbiMed term loan and incurred $0.3 million in debt issuance costs. The Delayed Draw Commitment is contingent upon our achievement of minimum levels of technology revenues ranging from technology revenues for the latest 12 months of at least $60.0 million to borrow up to $10.0 million, to a minimum of $80.0 million in technology revenues to borrow between $25.0 million and $30.0 million.

The contractual interest rate of the OrbiMed term loan is the higher of LIBOR plus 7.5% and 10.0%. Interest payments are required at the end of each month and monthly installment payments on principal begin in February 2023 and will be based on the then outstanding principal balance divided by 12. The maturity date of the OrbiMed term loan is February 6, 2024. Upon the payment of all or any portion of the principal amount on the OrbiMed term loan, we are required to pay an exit fee of 5% of the principal amount paid. This exit fee is being accreted as interest expense over the contractual term of the loan. If we elect to prepay portions of the principal balance prior to the 48-month anniversary of the closing date we would be required to pay a repayment premium ranging from 1% to 12% of the principal balance prepaid depending on the period in which the prepayment is made.

Amounts borrowed under the OrbiMed term loan are secured by a first priority security interest in substantially all of our assets other than intellectual property. In the event of default, OrbiMed may accelerate amounts outstanding, terminate the credit facility, and foreclose on the collateral. The agreement also includes a financial covenant requiring the achievement of minimum trailing twelve-month revenue amounts as well as certain other financial and non-financial covenants. We were in compliance with these covenants under the terms of the OrbiMed term loan as of March 31, 2020.

SVB revolving line of credit

In June 2016, we signed a Loan and Security Agreement with Silicon Valley Bank (SVB) which established a revolving line of credit based on a formula amount. On February 6, 2019, we amended the Loan and Security Agreement with SVB which reduced the revolving line of credit to a current maximum of $5.0 million with an obligation to maintain a minimum of $5.0 million cash or cash equivalents on deposit with SVB to maintain the assurance of future credit availability. The line may be increased to $10.0 million upon request and approval by SVB. The maturity date of the revolving line of credit was amended to be February 6, 2021.

Stockholders’ Equity (Deficit)	3 Months Ended
Stockholders’ Equity (Deficit)	Mar. 31, 2020
Equity [Abstract]
Stockholders’ Equity (Deficit)	Stockholders’ Equity (Deficit) Amendment and Restatement of Certificate of Incorporation In connection with the IPO, the certificate of incorporation of Health Catalyst was amended and restated to, among other things, provide for the (i) authorization of 500,000,000 shares of common stock with a par value of $0.001 per share; (ii) authorization of 25,000,000 shares of undesignated preferred stock that may be issued from time to time; and (iii) establishment of a classified board of directors, divided into three classes, each of whose members will serve for staggered three-year terms. Preferred Stock Our board of directors has the authority, without further action by our stockholders, to issue up to 25,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, and privileges thereof, including voting rights. As of March 31, 2020 and December 31, 2019, no shares of this preferred stock were issued and outstanding. Common stock We had 500,000,000 shares of $0.001 par value common stock authorized, of which 37,838,276 and 36,731,632 shares were legally issued and outstanding as of March 31, 2020 and December 31, 2019, respectively. The shares legally issued and outstanding as of December 31, 2019 included 52,778 shares issued to former employees with notes determined to be substantively nonrecourse and, as such, for accounting purposes were not considered to be outstanding shares of common stock. These notes were repaid in full by the former employees during the three months ended March 31, 2020, and the shares issued are included in the outstanding shares of common stock for accounting purposes as of March 31, 2020. Each share of common stock has the right to one vote on all matters submitted to a vote of stockholders. The holders of common stock are also entitled to receive dividends whenever funds are legally available and when declared by the board of directors, subject to prior rights of holders of all classes of stock outstanding having priority rights as to dividends. No dividends have been declared or paid on our common stock through March 31, 2020.

Net Loss Per Share

3 Months Ended

Mar. 31, 2020

Earnings Per Share [Abstract]

Net Loss Per Share

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share amounts):


	Three Months Ended March 31,
	2020		2019
Numerator:
Net loss attributable to common stockholders	$	(17,490)	$	(77,735)
Denominator:
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted	37,108,998		4,795,195
Net loss per share attributable to common stockholders, basic and diluted	$	(0.47)	$	(16.21)

During the three months ended March 31, 2020 and 2019, we incurred net losses and, therefore, the effect of our stock options, restricted stock units, purchase rights committed or shares issued under our employee stock purchase plan, restricted shares, common stock warrants, and redeemable convertible preferred stock (as converted) were not included in the calculation of diluted net loss per share attributable to common stockholders as the effect would be anti-dilutive. The following table contains share totals with a potentially dilutive impact:


	As of March 31,
	2020	2019
Redeemable convertible preferred stock	—	23,151,481
Common stock options	6,640,662	8,185,942
Restricted stock units	2,145,968	—
Employee stock purchase plan	87,107	—
Restricted shares	179,392	—
Common stock warrants	—	255,336
Total potentially dilutive securities	9,053,129	31,592,759

Stock-Based Compensation

3 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock-based Compensation

Stock-Based Compensation

In 2011, our board of directors adopted the Health Catalyst, Inc. 2011 Stock Incentive Plan (2011 Plan), which provided for the direct award, sale of shares, and granting of RSUs and options for our common stock to our directors, team members, or consultants. In connection with our IPO, our board of directors adopted the 2019 Stock Option and Incentive Plan (2019 Plan). The 2019 Plan provides flexibility to our compensation committee to use various equity-based incentive awards as compensation tools to motivate our workforce, including the grant of incentive and nonstatutory stock options, restricted and unrestricted stock, RSUs, and stock appreciation rights to our directors, team members, or consultants.

We have initially reserved 2,756,607 shares of our common stock (2,500,000 under the 2019 Plan and 256,607 shares under the 2011 Plan that were available immediately prior to the IPO registration date). The 2019 Plan provides that the number of shares reserved available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2020, by 5% of the outstanding number of shares of our common stock on the immediately preceding December 31, or such lesser number of shares as determined by our compensation committee. As of January 1, 2020, there were an additional 1,836,581 shares reserved for issuance under the 2019 Plan.

As of March 31, 2020 and December 31, 2019, there were 13,109,459 and 11,272,878 shares authorized for grant, respectively, and 2,662,138 and 2,309,370 shares available for grant, respectively, under the 2019 Plan and 2011 Plan (collectively the ‘Stock Incentive Plan’).

All options were granted with an exercise price determined by the board of directors that was equal to the estimated fair value of our common stock at the date of grant, based on the information known on the date of grant. Subject to certain exceptions defined in the Stock Incentive Plan related to an employee’s termination, options generally expire on the tenth anniversary of the applicable grant date.

We have issued two types of employee stock-based awards, standard and two-tier. Our standard stock-based awards vest solely on a service-based condition. For these awards, we recognize stock-based compensation based on the grant date fair value of the awards and recognize that cost using the straight-line method over the requisite service period of the award. Two-tier employee stock-based awards contain both a service-based condition and performance condition, defined as the earlier of (i) an acquisition or change in control of the company or (ii) upon the occurrence of our initial public offering. A change in control event and effective registration event are not deemed probable until consummated; accordingly, no expense is recorded related to two-tier stock-based awards until the performance condition becomes probable of occurring. Awards which contain both service-based and performance conditions are recognized using the accelerated attribution method once the performance condition is probable of occurring. The service-based condition is generally a service period of four years. Upon closing our IPO, we recorded cumulative share-based compensation expense using the accumulated attribution method for two-tier employee stock-based awards for which the service condition had been satisfied at that date.

The fair value of options, which vest in accordance with service schedules, is estimated on the date of grant using the Black-Scholes option pricing model. Prior to our IPO, the absence of an active market for our common stock required us to estimate the fair value of our common stock for purposes of granting stock-based awards, including stock options and RSUs, and for determining stock-based compensation expense for the periods presented. We obtained contemporaneous third-party valuations to assist in determining the estimated fair value of our common stock. These contemporaneous third-party valuations used the methodologies, approaches, and assumptions consistent with the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. Expected volatilities are based on historical volatilities of comparable companies when our own historical volatility is not available for a sufficient time period. The expected term of the options is based on the simplified method outlined in the SEC Staff accounting guidance, under which we estimate the term as the average of the option’s contractual term and the option’s weighted average vesting period. The risk-free rate represents the yield on U.S. Treasury bonds with maturity equal to the expected term of the granted option. We account for forfeitures as they occur. All standard stock-based awards outstanding at March 31, 2020 and December 31, 2019 are expected to vest according to their specific schedules.

The measurement date for non-employee awards is the date of grant. The compensation expense for non-employees is recognized, without changes in the fair value of the award, in the same period and in the same manner as though we had paid cash for the services, which is typically the vesting period of the respective award.

The following two tables summarize our total stock-based compensation expense by award type and where the stock-based compensation expense was recorded in our consolidated statements of operations (in thousands):


	Three Months Ended March 31,
	2020		2019
Options	$	2,542	$	1,656
Restricted stock units	5,117		—
Employee stock purchase plan	492		—
Restricted shares	590		—
Total stock-based compensation	$	8,741	$	1,656


	Three Months Ended March 31,
	2020		2019
Cost of revenue	$	992	$	181
Sales and marketing	3,182		783
Research and development	1,882		222
General and administrative	2,685		470
Total stock-based compensation	$	8,741	$	1,656

Stock Options

There were no stock options granted during the three months ended March 31, 2020. The fair value of our prior year option grants was estimated at the grant date using the Black-Scholes option-pricing model based on the following weighted average assumptions:


			Three Months Ended March 31,
			2019
Expected volatility			44.5%
Expected term (in years)			6.3
Risk-free interest rate			2.5%
Expected dividends			—

A summary of the share option activity under the 2019 Plan for the three months ended March 31, 2020, is as follows:


	Time-Based Option Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years	Aggregate Intrinsic Value
Outstanding at January 1, 2020	7,847,716	$	10.67
Options exercised	(1,048,760)	8.63
Options cancelled/forfeited	(158,294)	11.40
Outstanding at March 31, 2020	6,640,662	$	10.98	7.3	$	107,935,288
Vested and expected to vest as of March 31, 2020	6,640,662	$	10.98	7.3	$	107,935,288
Vested and exercisable as of March 31, 2020	3,762,413	$	9.91	6.4	$	65,160,129

The aggregate intrinsic value of stock options exercised was $35.2 million for the three months ended March 31, 2020. The total grant-date fair value of stock options vested during the three months ended March 31, 2020 was $4.2 million. As of March 31, 2020, approximately $13.3 million of unrecognized compensation expense related to our stock options is expected to be recognized over a remaining weighted-average period of 2.2 years.

The options exercised for accounting purposes during the three months ended March 31, 2020 include 52,778 of shares issued to former employees with notes determined to be substantively nonrecourse, which were repaid in full during the period.

Restricted Stock Units

The service-based condition for RSUs is generally satisfied over four years with a 25% cliff vesting period of one year and ratable quarterly vesting thereafter. The following table sets forth the outstanding RSUs and related activity for the three months ended March 31, 2020:


	Restricted Stock Units	Weighted Average Grant Date Fair Value
Unvested and outstanding at January 1, 2020	503,861	$	37.57
RSUs granted	1,655,232	33.61
RSUs forfeited	(13,125)	36.12
Unvested and outstanding at March 31, 2020	2,145,968	$	34.52

As of March 31, 2020, we had $66.9 million of unrecognized stock-based compensation expense related to outstanding RSUs expected to be recognized over a remaining weighted-average period of 3.5 years.

Employee Stock Purchase Plan

In connection with our IPO in July 2019, our board of directors adopted the ESPP and a total of 750,000 shares of common stock were initially reserved for issuance under the ESPP. The number of shares of common stock available for issuance under the ESPP will be increased on the first day of each calendar year beginning January 1, 2020 and each year thereafter until the ESPP terminates. The number of shares of common stock reserved and available for issuance under the ESPP shall be cumulatively increased by the least of (i) 750,000 shares, (ii) one percent of the number of shares of common stock issued and outstanding on the immediately preceding December 31, and (iii) such lesser number of shares of common stock as determined by the ESPP Administrator. As of January 1, 2020, there were an additional 367,316 shares reserved for issuance under the ESPP.

The ESPP generally provides for six-month offering periods, the exception being the first offering period. The offering periods generally start on the first trading day after June 30 and December 31 of each year.

The ESPP permits participants to elect to purchase shares of common stock through fixed percentage contributions from eligible compensation during each offering period, not to exceed 15% of the eligible compensation a participant receives during an offering period or accrue at a rate which exceeds $25,000 of the fair value of the stock (determined on the option grant date(s)) for each calendar year. A participant may purchase the lowest of (a) a number of shares of common stock determined by dividing such participant’s accumulated payroll deductions on the exercise date by the option price, (b) 2,500 shares; or (c) such other lesser maximum number of shares as shall have been established by the Administrator in advance of the offering period. Amounts deducted and accumulated by the participant will be used to purchase shares of common stock at the end of each offering period. The purchase price of the shares will be 85% of the lower of the fair value of common stock on the first trading day of each offering period or on the purchase date, except for the first offering period, for which the purchase price will be 85% of the lower of (i) the IPO price or (ii) the fair value of common stock on the purchase date.

Participants may end their participation at any time during an offering period and will be paid their accumulated contributions that have not been used to purchase shares of common stock. Participation ends automatically upon termination of employment.

The fair value of the purchase right for the ESPP option is estimated on the date of grant using the Black-Scholes model with the following assumptions for the current offering period:


			Three Months Ended March 31,
			2020
Expected volatility			54.9%
Expected term (in months)			6
Risk-free interest rate			1.6%
Expected dividends			—

As of March 31, 2020, a total of 87,107 shares were issuable to employees based on ESPP contribution elections and unrecognized ESPP compensation cost was $0.4 million, which is expected to be recognized over the remaining portion of the current offering period during the three months ending June 30, 2020. As of March 31, 2020, 982,550 shares are available for future issuance under the ESPP.

Restricted Shares

As part of the Able Health acquisition that closed on February 21, 2020, 179,392 shares of our common stock were issued pursuant to the terms of the acquisition agreement and are a stock-based compensation arrangement subject to a restriction agreement. The vesting of those shares is subject to one year of continuous service by the applicable team members and shall vest on the one-year anniversary of the acquisition closing date.

As of March 31, 2020, we had $4.8 million of unrecognized stock-based compensation expense related to outstanding restricted shares expected to be recognized over a weighted average period of 0.8 years.

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The tax provision for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, we update our estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, we make a cumulative adjustment in such period. The quarterly tax provision and the estimate of our annual effective tax rate are subject to variation due to several factors, including variability in our loss before income taxes, the mix of jurisdictions to which such income or loss relates, changes in how we conduct business, and tax law developments. For the three months ended March 31, 2020 and 2019, our estimated effective tax rate was 6.6% and (0.1)%, respectively. The variations between our estimated effective tax rate and the U.S. statutory rate are primarily due to our full valuation allowance. We consider all available evidence to evaluate the recovery of deferred tax assets, including historical levels of income, legislative developments, and risks associated with estimates of future taxable income. We have provided a full valuation allowance for our net deferred tax assets as of March 31, 2020 and December 31, 2019, due to the uncertainty surrounding the future realization of such assets and the cumulative losses we have generated. The income tax benefit of $1.2 million recorded for the three months ended March 31, 2020, is primarily related to the discrete deferred tax benefit attributable to the release of a portion of the valuation allowance during the quarter. The release of valuation allowance is attributable to the acquisition of Able Health, which resulted in deferred tax liabilities that, upon acquisition, allowed us to recognize certain deferred tax assets of $1.3 million that had previously been offset by a valuation allowance. We recognize tax benefits from uncertain tax positions when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. We believe that we have provided adequate reserves for income tax uncertainties in all open tax years. We do not anticipate material changes in the total amount of our unrecognized tax benefits within 12 months of the reporting date. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (CARES) Act was enacted and signed into U.S. law to provide economic relief to individuals and businesses facing economic hardship as a result of the COVID-19 pandemic. Changes in tax laws or rates are accounted for in the period of enactment. We are continuing to analyze these legislative developments and believe that the income tax provisions of the CARES Act do not have a significant impact on our current taxes, deferred taxes, or uncertain tax positions.

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Lease commitments We lease office space and certain equipment under operating leases that expire between 2020 and 2031. The terms of the leases provide for rental payments on a graduated scale, options to renew the leases (one to five years), landlord incentives or allowances, and periods of free rent. During the three months ended March 31, 2020, we entered into a lease for office space in South Jordan, Utah, that will become our new company headquarters. This new lease for office space is intended to replace our current headquarters in Salt Lake City, Utah, the lease for which expires December 31, 2020. This new lease has not yet commenced, but will require future lease payments of approximately $31.7 million with a non-cancelable lease term of 11 years, excluding renewal options, that are not yet recorded on our condensed consolidated balance sheets. Lease payments will be required beginning January 1, 2021, however, we expect the accounting lease commencement date for this initial portion of the lease financial reporting purposes to begin in the second or third quarter of 2020. According to the terms of this new lease agreement, our leased square footage will expand between 2022 and 2023 resulting in approximately $2.8 million of additional required future lease payments. We shall have the right to sublease all, or a portion, of this leased office space provided that certain terms and conditions are met. Litigation Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties, and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. We are involved in legal proceedings from time to time that arise in the normal course of business. As of March 31, 2020 and December 31, 2019, there were no significant outstanding claims against us.

Deferred Revenue and Performance Obligations

3 Months Ended

Mar. 31, 2020

Revenue Recognition and Deferred Revenue [Abstract]

Deferred Revenue and Performance Obligations

Revenue

Disaggregation of revenue

The following table represents Health Catalyst’s revenue disaggregated by type of arrangement (in thousands):


	Three Months Ended March 31,
	2020		2019
Recurring technology	$	24,699	$	20,148
Professional services	20,417		15,065
Total revenue	$	45,116	$	35,213

Transaction price allocated to the remaining performance obligations

Related Parties	3 Months Ended
Related Parties	Mar. 31, 2020
Related Party Transactions [Abstract]
Related Parties	Related Parties We have entered into arrangements with a customer where a member of the customer’s management is currently a member of our board of directors. An executive of a Partners HealthCare affiliate has served on our board of directors since January 2018. We recognized revenue from this related party of $0.7 million and $0.7 million for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020 and December 31, 2019, we had receivables from this related party of $0.4 million and $0.6 million, respectively, and deferred revenue with this related party of $0.3 million and $0.5 million, respectively. As of March 31, 2020 and December 31, 2019, we also had acquisition-related consideration payable to this related party for a prior year asset acquisition. This asset acquisition occurred prior to this entity becoming a related party. The acquisition-related consideration payable to this related party was $1.2 million and $1.2 million as of March 31, 2020 and December 31, 2019, respectively. We have also entered into revenue arrangements with customers that are also our investors. None of these customers hold a significant amount of ownership in our equity interests.

Segments

3 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Segments

We operate our business in two operating segments that also represent our reportable segments. Our business is organized based on our technology offerings and professional services. Accordingly, our segments are:

•Technology - Our technology segment (Technology) includes our data platform, analytics applications and support services. Technology generates revenues primarily from contracts that are cloud-based subscription arrangements, time-based license arrangements, and maintenance and support fees; and

•Professional Services - Our professional services segment (Professional Services) is generally the combination of data and analytics, domain expertise, outsourcing, and implementation services to deliver expertise to our customers to more fully configure and utilize the benefits of our Technology offerings.

Revenues and cost of revenues generally are directly attributed to our segments. All segment revenues are from our external customers. Asset and other balance sheet information at the segment level is not reported to our Chief Operating Decision Maker.

Segment revenue and Adjusted Gross Profit for the three months ended March 31, 2020 and 2019 were as follows (in thousands):


	Three Months Ended March 31,
	2020		2019
Revenue
Technology	$	24,699	$	20,148
Professional Services	20,417		15,065
Total	$	45,116	$	35,213


	Three Months Ended March 31,
	2020		2019
Adjusted Gross Profit
Technology	$	16,969	$	13,429
Professional Services	5,071		4,747
Total reportable segments Adjusted Gross Profit	22,040		18,176
Less Adjusted Gross Profit reconciling items:
Stock-based compensation	(992)		(181)
Post-acquisition restructuring costs⁽¹⁾	—		(108)
Less other reconciling items:
Sales and marketing	(13,487)		(10,473)
Research and development	(13,088)		(10,022)
General and administrative	(9,701)		(6,174)
Depreciation and amortization	(2,877)		(2,312)
Debt extinguishment costs	—		(1,670)
Interest and other expense, net	(621)		(945)
Net loss before income taxes	$	(18,726)	$	(13,709)

____________________

(1)Post-acquisition restructuring costs included in the Adjusted Gross Profit reconciliation above relate to severance charges following the acquisition of Medicity.

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2020
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events Convertible Senior Notes On April 14, 2020, we issued $230.0 million in aggregate principal amount of 2.50% Convertible Senior Notes due 2025 (the Notes), in a private placement to qualified institutional buyers exempt from registration under the Securities Act (the Note Offering). The net proceeds from the issuance of the Notes were approximately $222.5 million, after deducting the initial purchasers’ discounts and estimated issuance costs. The Notes are governed by an indenture (the Indenture) between us, as the issuer, and U.S. Bank National Association, as trustee. The Notes are our senior, unsecured obligations and will accrue interest payable semiannually in arrears on April 15 and October 15 of each year, beginning on October 15, 2020, at a rate of 2.50% per year. The Notes will mature on April 15, 2025, unless earlier converted, redeemed, or repurchased. The Indenture does not contain any financial or operating covenants or restrictions on the payments of dividends, the incurrence of indebtedness, or the issuance or repurchase of securities by us or any of our subsidiaries. We may not redeem the notes prior to April 20, 2023. On or after April 20, 2023, we may redeem, for cash, all or portion of the notes, at our option, if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which we provide notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the notes. A holder may convert all or any portion of its Notes at its option, subject to certain conditions and during certain periods, into cash, shares of our common stock or a combination of cash and shares of our common stock, with the form of consideration determined at our election. Note holders will have the right to require us to repurchase all or a portion of their notes at 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date, upon the occurrence of certain events. The conversion rate is initially 32.6797 shares of our common stock per $1,000 principal amount of Notes (which is equivalent to an initial conversion price of approximately $30.60 per share of our common stock). Given the recent timing of the closing of the Notes, we have not yet finalized the accounting, including the estimated fair value of the separate liability and equity components. Capped Calls On April 8, 2020, concurrently with the pricing of the Notes, we entered into privately negotiated capped call transactions (Base Capped Calls) with certain option counterparties. In addition, in connection with the initial purchasers’ exercise in full of their option to purchase additional Notes, on April 9, 2020, we entered into additional capped call transactions (the Additional Capped Calls, and, together with the Base Capped Calls, the Capped Calls) with each of the option counterparties. We used approximately $21.6 million of the net proceeds from the Note Offering to pay the cost of the Capped Calls. The Capped Calls have initial cap prices of $42.00 per share, subject to certain adjustments. The Capped Calls are expected generally to reduce the potential dilution to our common stock upon any conversion of Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to the cap price. The Capped Calls are separate transactions that we entered into with the option counterparties, and are not part of the terms of the Notes. As the Capped Call transactions are considered indexed to our own stock and are considered equity classified, they will be recorded in stockholders’ equity and will not be accounted for as derivatives. The cost incurred in connection with the Capped Calls will be recorded as a reduction to additional paid-in capital on our condensed consolidated balance sheets. Extinguishment of OrbiMed term loan In addition, on April 14, 2020, we used $57.0 million of proceeds from the Note Offering to prepay in full all outstanding indebtedness, including prepayment penalties, under our Credit Agreement (the Credit Agreement) with OrbiMed, dated February 6, 2019, as amended, and terminate the Credit Agreement, which had provided us with a term loan of up to $80.0 million due on February 6, 2024, at an interest rate of the higher of LIBOR plus 7.5% and 10.0%. We currently estimate that there will be a loss on debt extinguishment of approximately $8.5 million recorded during the three months ended June 30, 2020, including approximately $1.5 unamortized debt discounts and issuance costs related to the OrbiMed term loan and $7.0 million of repayment fees. Extinguishment of SVB revolving line of credit On April 8, 2020, we entered into a Pay-Off Letter Agreement with SVB, pursuant to which we paid to SVB immaterial termination costs, representing all amounts due and owing under the Amended and Restated Loan and Security Agreement (the Loan Agreement), dated as of October 6, 2017, with SVB, in exchange for, among other things, (i) full discharge of all of our obligations under the Loan Agreement; and (ii) release of security interests and other liens granted to or held by SVB as a security for our obligations.

Description of Business and Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Basis of presentation

Principles of consolidation

Our condensed consolidated financial statements include the accounts of Health Catalyst and its wholly-owned subsidiaries. Intercompany balances and transactions have been eliminated.

•Identification of the contract, or contracts, with a customer;

•Identification of the performance obligations in the contract;

•Determination of the transaction price;

•Allocation of the transaction price to the performance obligations in the contract; and

•Recognition of revenue when, or as, we satisfy the performance obligation.

We recognize revenue net of any taxes collected from customers and subsequently remitted to governmental authorities.

Technology revenue

We also have certain perpetual license arrangements. Revenue from these arrangements is recognized at a point in time upon delivery of the software.

Professional services revenue

Contracts with multiple performance obligations

Variable consideration

Contract balances

Cost of revenue, excluding depreciation and amortization

Cash and cash equivalents

We consider all highly liquid investments purchased with a remaining maturity of three months or less at the time of acquisition to be cash equivalents.

Short-term investments

Short-term investmentsOur investment policy limits investments to highly-rated instruments that mature in less than 12 months. We classify our short-term investments as available for sale.

Accounts receivable

Accounts receivableAccounts receivable are non-interest bearing and are recorded at the original invoiced amount less an allowance for doubtful accounts based on the probability of future collections. We adopted ASU 2016-13 effective January 1, 2020. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates, which results in earlier recognition of credit losses. The allowance for doubtful accounts is based on our estimate of expected credit losses for outstanding trade accounts receivables. We determine expected credit losses based on historical write-off experience, an analysis of the aging of outstanding receivables, customer payment patterns, the establishment of specific reserves for customers in an adverse financial condition, and our expectations of changes in macro-economic conditions, including the current COVID-19 pandemic, that may impact the collectability of outstanding receivables. We reassess the adequacy of the allowance for doubtful accounts each reporting period.

Property and equipment


Computer equipment			2-3 years
Furniture and fixtures			3 years
Leasehold improvements			Lesser of lease term or estimated useful life
Computer software			2-3 years
Capitalized internal-use software costs			3 years

Intangible assets


Developed technologies			2-10 years
Customer relationships and contracts			6 years
Computer software licenses			2-5 years
Trademarks			2 years

Goodwill

GoodwillWe record goodwill as the difference between the aggregate consideration paid for a business combination and the fair value of the identifiable net tangible and intangible assets acquired. Goodwill is assessed for impairment annually or more frequently if indicators of impairment are present or circumstances suggest that impairment may exist. As of January 1, 2020, we adopted ASU 2017-04, which simplifies the goodwill impairment test by eliminating the second step from the goodwill impairment test. The first step of the goodwill impairment test compares the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, the goodwill of the reporting unit is not considered impaired. If the carrying amount of the reporting unit exceeds its fair value, we would recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value.

Business combinations

Business combinationsWe account for an acquisition as a business combination if we obtain control of a business. Assets and liabilities acquired in a business combination generally are recorded at fair value and any associated acquisition costs are expensed as incurred in general and administrative expenses.

Advertising cost

Advertising costsAll advertising costs are expensed as incurred.

Development cost and internal-use software

Development costs and internal-use software

Stock-based compensation

Income taxes

Fair value of financial instruments

•Level 1- Quoted prices in active markets for identical assets or liabilities.

•Level 3- Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

Leases

We do not have lease agreements that contain non-lease components, which generally would be accounted for separately.

Accounting pronouncements

Accounting pronouncements adopted

Goodwill impairment

Fair value measurements

Credit losses

Implementation Costs Incurred in a Cloud Computing Arrangement

Recent accounting pronouncements not yet adopted

Accounting for income taxes

Reference rate reform

Description of Business and Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Schedule of property and equipment, useful life

The estimated useful life of each asset category is as follows:


Computer equipment			2-3 years
Furniture and fixtures			3 years
Leasehold improvements			Lesser of lease term or estimated useful life
Computer software			2-3 years
Capitalized internal-use software costs			3 years

Property and equipment consisted of the following (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Computer equipment	$	8,108	$	7,951
Leasehold improvements	2,309		2,234
Furniture and fixtures	1,031		1,030
Capitalized internal-use software costs	1,944		1,866
Computer software	972		972
Capital lease equipment	37		37
Total property and equipment	14,401		14,090
Less: accumulated depreciation	(10,458)		(9,795)
Property and equipment, net	$	3,943	$	4,295

Schedule of intangible asset, useful life

The estimated useful life of each asset category is as follows:


Developed technologies			2-10 years
Customer relationships and contracts			6 years
Computer software licenses			2-5 years
Trademarks			2 years

As of March 31, 2020, intangible assets consisted of the following (in thousands):


	Gross		Accumulated Amortization		Net
Developed technologies	$	43,629	$	(17,922)	$	25,707
Customer relationships and contracts	4,764		(2,964)		1,800
Computer software licenses	7,283		(3,141)		4,142
Trademarks	200		(96)		104
Total intangible assets	$	55,876	$	(24,123)	$	31,753

As of December 31, 2019, intangible assets consisted of the following (in thousands):


	Gross		Accumulated Amortization		Net
Developed technologies	$	36,129	$	(16,548)	$	19,581
Customer relationships and contracts	4,164		(2,773)		1,391
Computer software licenses	7,114		(2,576)		4,538
Trademarks	100		(75)		25
Total intangible assets	$	47,507	$	(21,972)	$	25,535

Business Combinations (Tables)

3 Months Ended

Mar. 31, 2020

Business Combinations [Abstract]

Schedule of recognized identified assets acquired and liabilities assumed


Assets acquired:
Accounts receivable	$	633
Prepaid expenses and other assets	57
Developed technologies	7,500
Customer relationships	600
Trademarks	100
Total assets acquired	8,890
Less liabilities assumed:
Accounts payable and other current liabilities	91
Deferred revenue	762
Net deferred tax liabilities	1,280
Total liabilities assumed	2,133
Total assets acquired, net	6,757
Goodwill	14,725
Total consideration transferred, net of cash acquired	$	21,482

Revenue (Tables)

3 Months Ended

Mar. 31, 2020

Revenue from Contract with Customer [Abstract]

Schedule of revenue disaggregated by type of arrangement

The following table represents Health Catalyst’s revenue disaggregated by type of arrangement (in thousands):


	Three Months Ended March 31,
	2020		2019
Recurring technology	$	24,699	$	20,148
Professional services	20,417		15,065
Total revenue	$	45,116	$	35,213

Goodwill and Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill by reporting unit

Goodwill by reporting unit is as follows (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Technology	$	17,637	$	2,912
Professional services	782		782
Total goodwill	$	18,419	$	3,694

Schedule of intangible assets

The estimated useful life of each asset category is as follows:


Developed technologies			2-10 years
Customer relationships and contracts			6 years
Computer software licenses			2-5 years
Trademarks			2 years

As of March 31, 2020, intangible assets consisted of the following (in thousands):


	Gross		Accumulated Amortization		Net
Developed technologies	$	43,629	$	(17,922)	$	25,707
Customer relationships and contracts	4,764		(2,964)		1,800
Computer software licenses	7,283		(3,141)		4,142
Trademarks	200		(96)		104
Total intangible assets	$	55,876	$	(24,123)	$	31,753

As of December 31, 2019, intangible assets consisted of the following (in thousands):


	Gross		Accumulated Amortization		Net
Developed technologies	$	36,129	$	(16,548)	$	19,581
Customer relationships and contracts	4,164		(2,773)		1,391
Computer software licenses	7,114		(2,576)		4,538
Trademarks	100		(75)		25
Total intangible assets	$	47,507	$	(21,972)	$	25,535

Property and Equipment (Tables)

3 Months Ended

Mar. 31, 2020

Property, Plant and Equipment [Abstract]

Property and equipment

The estimated useful life of each asset category is as follows:


Computer equipment			2-3 years
Furniture and fixtures			3 years
Leasehold improvements			Lesser of lease term or estimated useful life
Computer software			2-3 years
Capitalized internal-use software costs			3 years

Property and equipment consisted of the following (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Computer equipment	$	8,108	$	7,951
Leasehold improvements	2,309		2,234
Furniture and fixtures	1,031		1,030
Capitalized internal-use software costs	1,944		1,866
Computer software	972		972
Capital lease equipment	37		37
Total property and equipment	14,401		14,090
Less: accumulated depreciation	(10,458)		(9,795)
Property and equipment, net	$	3,943	$	4,295

Short-term Investments (Tables)

3 Months Ended

Mar. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Schedule of cash equivalents and short-term investments measured at fair value

The following table summarizes, by major security type, our cash equivalents and short-term investments that are measured at fair value on a recurring basis (in thousands) as of March 31, 2020:


	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash equivalents		Short-term Investments
Money market funds	$	58,487	$	—	$	—	$	58,487	$	58,487	$	—
U.S. Treasury notes	34,098		232		—		34,330		—		34,330
Commercial paper	11,727		—		—		11,727		—		11,727
Corporate bonds	57,605		—		(140)		57,465		—		57,465
Asset-backed securities	40,094		—		(21)		40,073		—		40,073
Total	$	202,011	$	232	$	(161)	$	202,082	$	58,487	$	143,595

The following table summarizes, by major security type, our cash equivalents and short-term investments that are measured at fair value on a recurring basis (in thousands) as of December 31, 2019:


	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash equivalents		Short-term Investments
Money market funds	$	17,175	$	—	$	—	$	17,175	$	17,175	$	—
US treasury notes	58,130		34		—		58,164		—		58,164
Commercial paper	46,973		—		—		46,973		—		46,973
Corporate bonds	64,978		27		(5)		65,000		—		65,000
Asset-backed securities	40,090		18		—		40,108		—		40,108
Total	$	227,346	$	79	$	(5)	$	227,420	$	17,175	$	210,245

Fair Value of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

Fair value, assets measured on recurring basis

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 were as follows (in thousands):


	March 31, 2020
	Level 1		Level 2		Level 3		Total
Money market funds	$	58,487	$	—	$	—	$	58,487
U.S. Treasury notes	34,330		—		—		34,330
Commercial paper	—		11,727		—		11,727
Corporate bonds	—		57,465		—		57,465
Asset-backed securities	—		40,073		—		40,073
Contingent consideration	—		—		(2,666)		(2,666)
Total	$	92,817	$	109,265	$	(2,666)	$	199,416

Assets measured at fair value on a recurring basis as of December 31, 2019 were as follows (in thousands):


	December 31, 2019
	Level 1		Level 2		Level 3		Total
Money market funds	$	17,175	$	—	$	—	$	17,175
U.S. Treasury notes	58,164		—		—		58,164
Commercial paper	—		46,973		—		46,973
Corporate bonds	—		65,000		—		65,000
Asset-backed securities	$	—	$	40,108	$	—	$	40,108
Total	$	75,339	$	152,081	$	—	$	227,420

Liabilities measured on recurring basis, unobservable input reconciliation


	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Balance at December 31, 2019	$	—
Contingent consideration liability from Able Health acquisition (see note 2)	3,025
Change in fair value of contingent consideration liability	(359)
Balance at March 31, 2020	$	2,666

Accrued liabilities (Tables)

3 Months Ended

Mar. 31, 2020

Payables and Accruals [Abstract]

Schedule of accrued liabilities

As of March 31, 2020 and December 31, 2019, accrued liabilities consisted of the following (in thousands):


	As of March 31,		As of December 31,
	2020		2019
Accrued compensation and benefit expenses	$	3,806	$	4,278
Other accrued expenses	3,024		4,666
Total accrued liabilities	$	6,830	$	8,944

Credit Facilities (Tables)

3 Months Ended

Mar. 31, 2020

Debt Disclosure [Abstract]

Schedule of term credit facilities

As of March 31, 2020, our term credit facilities consisted of the following, excluding unamortized debt discount and issue costs of $1.5 million (in thousands):


	Balance		Remaining Capacity		Interest Rate	Basis Rate
OrbiMed term loan	$	50,000	$	30,000	10.00%	Higher of LIBOR plus 7.5% and 10.0%
SVB revolving line of credit	—		5,000		3.75%	Prime plus 0.50%
Total credit facilities	50,000		$	35,000
Less: Current portion of credit facilities	—
Credit facilities, less current portion	$	50,000

As of December 31, 2019, our term credit facilities consisted of the following, excluding unamortized debt discount and issue costs of $1.8 million (in thousands):


	Balance		Remaining Capacity		Interest Rate	Basis Rate
OrbiMed term loan	$	50,000	$	30,000	10.00%	Higher of LIBOR plus 7.5% and 10.0%
SVB revolving line of credit	—		5,000		5.25%	Prime plus 0.50%
Total credit facilities	50,000		$	35,000
Less: Current portion of credit facilities	—
Credit facilities, less current portion	$	50,000

Net Loss Per Share (Tables)

3 Months Ended

Mar. 31, 2020

Earnings Per Share [Abstract]

Schedule of the calculation of basic and diluted net loss per share attributable to common stockholders

The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share and per share amounts):


	Three Months Ended March 31,
	2020		2019
Numerator:
Net loss attributable to common stockholders	$	(17,490)	$	(77,735)
Denominator:
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted	37,108,998		4,795,195
Net loss per share attributable to common stockholders, basic and diluted	$	(0.47)	$	(16.21)

Schedule of share totals with a potentially dilutive impact

The following table contains share totals with a potentially dilutive impact:


	As of March 31,
	2020	2019
Redeemable convertible preferred stock	—	23,151,481
Common stock options	6,640,662	8,185,942
Restricted stock units	2,145,968	—
Employee stock purchase plan	87,107	—
Restricted shares	179,392	—
Common stock warrants	—	255,336
Total potentially dilutive securities	9,053,129	31,592,759

Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Abstract]

Schedule of stock-based compensation expense


	Three Months Ended March 31,
	2020		2019
Options	$	2,542	$	1,656
Restricted stock units	5,117		—
Employee stock purchase plan	492		—
Restricted shares	590		—
Total stock-based compensation	$	8,741	$	1,656


	Three Months Ended March 31,
	2020		2019
Cost of revenue	$	992	$	181
Sales and marketing	3,182		783
Research and development	1,882		222
General and administrative	2,685		470
Total stock-based compensation	$	8,741	$	1,656

Schedule of share-based payment award, stock options, valuation assumptions

The fair value of our prior year option grants was estimated at the grant date using the Black-Scholes option-pricing model based on the following weighted average assumptions:


			Three Months Ended March 31,
			2019
Expected volatility			44.5%
Expected term (in years)			6.3
Risk-free interest rate			2.5%
Expected dividends			—

Schedule of information related to stock options

A summary of the share option activity under the 2019 Plan for the three months ended March 31, 2020, is as follows:


	Time-Based Option Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life in Years	Aggregate Intrinsic Value
Outstanding at January 1, 2020	7,847,716	$	10.67
Options exercised	(1,048,760)	8.63
Options cancelled/forfeited	(158,294)	11.40
Outstanding at March 31, 2020	6,640,662	$	10.98	7.3	$	107,935,288
Vested and expected to vest as of March 31, 2020	6,640,662	$	10.98	7.3	$	107,935,288
Vested and exercisable as of March 31, 2020	3,762,413	$	9.91	6.4	$	65,160,129

Schedule of outstanding RSUs and related activity

The following table sets forth the outstanding RSUs and related activity for the three months ended March 31, 2020:


	Restricted Stock Units	Weighted Average Grant Date Fair Value
Unvested and outstanding at January 1, 2020	503,861	$	37.57
RSUs granted	1,655,232	33.61
RSUs forfeited	(13,125)	36.12
Unvested and outstanding at March 31, 2020	2,145,968	$	34.52

Schedule of the purchase right for the ESPP option assumptions

The fair value of the purchase right for the ESPP option is estimated on the date of grant using the Black-Scholes model with the following assumptions for the current offering period:


			Three Months Ended March 31,
			2020
Expected volatility			54.9%
Expected term (in months)			6
Risk-free interest rate			1.6%
Expected dividends			—

Segments (Tables)

3 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Schedule of segment revenue

Segment revenue and Adjusted Gross Profit for the three months ended March 31, 2020 and 2019 were as follows (in thousands):


	Three Months Ended March 31,
	2020		2019
Revenue
Technology	$	24,699	$	20,148
Professional Services	20,417		15,065
Total	$	45,116	$	35,213

Schedule of segment adjusted gross profit


	Three Months Ended March 31,
	2020		2019
Adjusted Gross Profit
Technology	$	16,969	$	13,429
Professional Services	5,071		4,747
Total reportable segments Adjusted Gross Profit	22,040		18,176
Less Adjusted Gross Profit reconciling items:
Stock-based compensation	(992)		(181)
Post-acquisition restructuring costs⁽¹⁾	—		(108)
Less other reconciling items:
Sales and marketing	(13,487)		(10,473)
Research and development	(13,088)		(10,022)
General and administrative	(9,701)		(6,174)
Depreciation and amortization	(2,877)		(2,312)
Debt extinguishment costs	—		(1,670)
Interest and other expense, net	(621)		(945)
Net loss before income taxes	$	(18,726)	$	(13,709)

____________________

(1)Post-acquisition restructuring costs included in the Adjusted Gross Profit reconciliation above relate to severance charges following the acquisition of Medicity.

Description of Business and Summary of Significant Accounting Policies (Details)			3 Months Ended
	Jul. 29, 2019 USD ($) $ / shares shares	Jul. 10, 2019	Mar. 31, 2020 USD ($) segment	Mar. 31, 2019 USD ($)	Dec. 31, 2019 USD ($)
Subsidiary, Sale of Stock [Line Items]
Offering costs			$ 0	$ 182,000
Redeemable convertible preferred stock converted into shares of common stock on a one for one basis (in shares) \| shares	23,151,481
Stock split conversion ratio		0.5
Number of operating segments \| segment			2
Number of reportable segments \| segment			2
Unbilled accounts receivable			$ 2,300,000		$ 2,900,000
Deferred Revenue			36,800,000		32,100,000
Deferred contract fulfillment costs			500,000		900,000
Allowance for doubtful accounts			600,000		$ 400,000
Long lived impairment charges			0	0
Goodwill impairment			0	0
Advertising expense			$ 600,000	$ 600,000
Service period (in years)			4 years
Stock Incentive Plan \| Performance Shares
Subsidiary, Sale of Stock [Line Items]
Service period (in years)			4 years
IPO
Subsidiary, Sale of Stock [Line Items]
Common stock issued (in shares) \| shares	8,050,000
Share price (in dollars per share) \| $ / shares	$ 26.00
Net proceeds after deducting underwriting discounts and commissions and before deducting estimated offering costs	$ 194,600,000
Offering costs	$ 4,600,000
Over-Allotment option
Subsidiary, Sale of Stock [Line Items]
Common stock issued (in shares) \| shares	1,050,000

Description of Business and Summary of Significant Accounting Policies - Schedule of Property and Equipment Useful Life (Details)	3 Months Ended
	Mar. 31, 2020
Computer equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	2 years
Computer equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	3 years
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	3 years
Computer software \| Minimum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	2 years
Computer software \| Maximum
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	3 years
Capitalized internal-use software costs
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	3 years

Description of Business and Summary of Significant Accounting Policies - Schedule of Intangible Assets Useful Life (Details)	3 Months Ended
	Mar. 31, 2020
Developed technologies \| Maximum
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	10 years
Developed technologies \| Minimum
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	2 years
Customer relationships and contracts
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	6 years
Computer software licenses \| Maximum
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	5 years
Computer software licenses \| Minimum
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	2 years
Trademarks
Finite-Lived Intangible Assets [Line Items]
Estimated useful life	2 years

Business Combinations - Narrative (Details) - USD ($) $ in Thousands		3 Months Ended
	Feb. 21, 2020	Mar. 31, 2020	Mar. 31, 2019
Business Acquisition [Line Items]
Acquisition of business, net of cash acquired		$ 15,249	$ 0
Vest in year one \| Restricted shares
Business Acquisition [Line Items]
Vesting percent	100.00%
Vest in year one \| Restricted Shares Pursuant To Acquisition Agreement
Business Acquisition [Line Items]
Vesting percent	50.00%
Vest in Q1 Year 2 \| Restricted Shares Pursuant To Acquisition Agreement
Business Acquisition [Line Items]
Vesting percent	12.50%
Vest in Q2 Year 2 \| Restricted Shares Pursuant To Acquisition Agreement
Business Acquisition [Line Items]
Vesting percent	12.50%
Vest in Q3 Year 2 \| Restricted Shares Pursuant To Acquisition Agreement
Business Acquisition [Line Items]
Vesting percent	12.50%
Vest in Q4 Year 2 \| Restricted Shares Pursuant To Acquisition Agreement
Business Acquisition [Line Items]
Vesting percent	12.50%
Able Health Inc
Business Acquisition [Line Items]
Consideration	$ 21,500
Acquisition of business, net of cash acquired	15,200
Common shares issued in acquisition, at fair value	3,300
Contingent consideration	$ 3,000
Interest acquired	100.00%
Number of restricted shares issued	179,392
Acquisition transaction costs	$ 900
Revenue attributable to the acquired business		$ 400
Able Health Inc \| Restricted shares
Business Acquisition [Line Items]
RSUs granted (in shares)	60,000
Able Health Inc \| Restricted Shares Pursuant To Acquisition Agreement
Business Acquisition [Line Items]
Vesting period	2 years
Developed technologies \| Able Health Inc
Business Acquisition [Line Items]
Estimated useful life	3 years
Customer relationships \| Able Health Inc
Business Acquisition [Line Items]
Estimated useful life	6 years
Trademarks
Business Acquisition [Line Items]
Estimated useful life		2 years
Trademarks \| Able Health Inc
Business Acquisition [Line Items]
Estimated useful life	2 years

Business Combinations - Schedule of Recognized Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Feb. 21, 2020	Dec. 31, 2019
Less liabilities assumed:
Goodwill	$ 18,419		$ 3,694
Able Health Inc
Assets acquired:
Accounts receivable		$ 633
Prepaid expenses and other assets		57
Total assets acquired		8,890
Less liabilities assumed:
Accounts payable and other current liabilities		91
Deferred revenue		762
Net deferred tax liabilities		1,280
Total liabilities assumed		2,133
Total assets acquired, net		6,757
Goodwill		14,725
Total consideration transferred, net of cash acquired		21,482
Able Health Inc \| Developed technologies
Assets acquired:
Intangible assets		7,500
Able Health Inc \| Customer relationships
Assets acquired:
Intangible assets		600
Able Health Inc \| Trademarks
Assets acquired:
Intangible assets		$ 100

Revenue - Schedule of Revenue Disaggregated by Type of Arrangement (Details) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2020

Mar. 31, 2019

Disaggregation of Revenue [Line Items]

Revenue

^[1]

$ 45,116

$ 35,213

Recurring technology

Disaggregation of Revenue [Line Items]

Revenue

24,699

20,148

Professional services

Disaggregation of Revenue [Line Items]

Revenue

^[1]

$ 20,417

$ 15,065

[1]	Includes amounts attributable to related party transactions. See Note 16 for further details.

Revenue - Narrative (Details)	3 Months Ended
Revenue - Narrative (Details)	Mar. 31, 2020	Mar. 31, 2019
Geographic Concentration Risk \| Revenue from Contract with Customer Benchmark \| UNITED STATES
Disaggregation of Revenue [Line Items]
Revenue related to contracts with customers (percentage)	99.90%	100.00%

Goodwill and Intangible Assets - Narrative (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020 USD ($) segment	Mar. 31, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Number of operating segments	2
Number of reporting units	2
Amortization of intangible assets \| $	$ 2.2	$ 1.5

Goodwill and Intangible Assets - Schedule of Goodwill by Reporting Unit (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Goodwill [Line Items]
Goodwill	$ 18,419	$ 3,694
Technology
Goodwill [Line Items]
Goodwill	17,637	2,912
Professional Services
Goodwill [Line Items]
Goodwill	$ 782	$ 782

Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Gross	$ 55,876	$ 47,507
Accumulated Amortization	(24,123)	(21,972)
Net	31,753	25,535
Developed technologies
Finite-Lived Intangible Assets [Line Items]
Gross	43,629	36,129
Accumulated Amortization	(17,922)	(16,548)
Net	25,707	19,581
Customer relationships and contracts
Finite-Lived Intangible Assets [Line Items]
Gross	4,764	4,164
Accumulated Amortization	(2,964)	(2,773)
Net	1,800	1,391
Computer software licenses
Finite-Lived Intangible Assets [Line Items]
Gross	7,283	7,114
Accumulated Amortization	(3,141)	(2,576)
Net	4,142	4,538
Trademarks
Finite-Lived Intangible Assets [Line Items]
Gross	200	100
Accumulated Amortization	(96)	(75)
Net	$ 104	$ 25

Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Property and equipment	$ 14,401	$ 14,090
Less: accumulated depreciation	(10,458)	(9,795)
Property and equipment, net	3,943	4,295
Computer equipment
Property, Plant and Equipment [Line Items]
Property and equipment	8,108	7,951
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment	2,309	2,234
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment	1,031	1,030
Capitalized internal-use software costs
Property, Plant and Equipment [Line Items]
Property and equipment	1,944	1,866
Computer software
Property, Plant and Equipment [Line Items]
Property and equipment	972	972
Capital lease equipment
Property, Plant and Equipment [Line Items]
Property and equipment	$ 37	$ 37

Property and Equipment - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 0.7	$ 0.8

Short-term Investments (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]
Interest receivable	$ 600	$ 900
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	202,011	227,346
Unrealized Gains	232	79
Unrealized Losses	(161)	(5)
Fair Value	202,082	227,420
Money market funds
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	58,487	17,175
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	58,487	17,175
U.S. Treasury notes
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	34,098	58,130
Unrealized Gains	232	34
Unrealized Losses	0	0
Fair Value	34,330	58,164
Commercial paper
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	11,727	46,973
Unrealized Gains	0	0
Unrealized Losses	0	0
Fair Value	11,727	46,973
Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	57,605	64,978
Unrealized Gains	0	27
Unrealized Losses	(140)	(5)
Fair Value	57,465	65,000
Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	40,094	40,090
Unrealized Gains	0	18
Unrealized Losses	(21)	0
Fair Value	40,073	40,108
Cash equivalents
Debt Securities, Available-for-sale [Line Items]
Fair Value	58,487	17,175
Cash equivalents \| Money market funds
Debt Securities, Available-for-sale [Line Items]
Fair Value	58,487	17,175
Cash equivalents \| U.S. Treasury notes
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	0
Cash equivalents \| Commercial paper
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	0
Cash equivalents \| Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	0
Cash equivalents \| Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	0
Short-term Investments
Debt Securities, Available-for-sale [Line Items]
Fair Value	143,595	210,245
Short-term Investments \| Money market funds
Debt Securities, Available-for-sale [Line Items]
Fair Value	0	0
Short-term Investments \| U.S. Treasury notes
Debt Securities, Available-for-sale [Line Items]
Fair Value	34,330	58,164
Short-term Investments \| Commercial paper
Debt Securities, Available-for-sale [Line Items]
Fair Value	11,727	46,973
Short-term Investments \| Corporate bonds
Debt Securities, Available-for-sale [Line Items]
Fair Value	57,465	65,000
Short-term Investments \| Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Fair Value	$ 40,073	$ 40,108

Fair Value of Financial Instruments (Details) - USD ($)	Feb. 21, 2020	Mar. 31, 2020	Dec. 31, 2019
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		$ 202,082,000	$ 227,420,000
Liabilities measured at fair value on recurring basis		0
Able Health Inc
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Contingent consideration	$ (3,000,000.0)
Shares issuable, contingent consideration (in shares)	145,036
U.S. Treasury notes
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		34,330,000	58,164,000
Commercial paper
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		11,727,000	46,973,000
Corporate bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		57,465,000	65,000,000
Asset-backed securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		40,073,000	40,108,000
Fair value, recurring
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Money market funds		58,487,000	17,175,000
Total		199,416,000	227,420,000
Fair value, recurring \| Level 1
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Money market funds		58,487,000	17,175,000
Total		92,817,000	75,339,000
Fair value, recurring \| Level 2
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Money market funds		0	0
Total		109,265,000	152,081,000
Fair value, recurring \| Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Money market funds		0	0
Total		(2,666,000)	0
Fair value, recurring \| U.S. Treasury notes
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		34,330,000	58,164,000
Fair value, recurring \| U.S. Treasury notes \| Level 1
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		34,330,000	58,164,000
Fair value, recurring \| U.S. Treasury notes \| Level 2
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Fair value, recurring \| U.S. Treasury notes \| Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Fair value, recurring \| Commercial paper
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		11,727,000	46,973,000
Fair value, recurring \| Commercial paper \| Level 1
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Fair value, recurring \| Commercial paper \| Level 2
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		11,727,000	46,973,000
Fair value, recurring \| Commercial paper \| Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Fair value, recurring \| Corporate bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		57,465,000	65,000,000
Fair value, recurring \| Corporate bonds \| Level 1
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Fair value, recurring \| Corporate bonds \| Level 2
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		57,465,000	65,000,000
Fair value, recurring \| Corporate bonds \| Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Fair value, recurring \| Asset-backed securities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		40,073,000	40,108,000
Contingent consideration		(2,666,000)
Fair value, recurring \| Asset-backed securities \| Level 1
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	0
Contingent consideration		0
Fair value, recurring \| Asset-backed securities \| Level 2
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		40,073,000	40,108,000
Contingent consideration		0
Fair value, recurring \| Asset-backed securities \| Level 3
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Fair Value		0	$ 0
Contingent consideration		$ (2,666,000)

Fair Value of Financial Instruments - Schedule of Contingent Consideration (Details) - Contingent Consideration $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Balance at December 31, 2019	$ 0
Contingent consideration liability from Able Health acquisition (see note 2)	3,025
Change in fair value of contingent consideration liability	(359)
Balance at March 31, 2020	$ 2,666

Accrued liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Accrued compensation and benefit expenses	$ 3,806	$ 4,278
Other accrued expenses	3,024	4,666
Total accrued liabilities	$ 6,830	$ 8,944

Credit Facilities - Narrative (Details) - USD ($)		3 Months Ended
Credit Facilities - Narrative (Details) - USD ($)	Feb. 06, 2019	Mar. 31, 2020	Dec. 31, 2019
Line of Credit Facility [Line Items]
Debt discount and issue costs			$ 1,800,000
OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Debt discount and issue costs		$ 1,500,000
Amount borrowed	$ 80,000,000.0
Maximum borrowing capacity	50,000,000.0
Additional borrowing capacity available	30,000,000.0
Payments of financing costs	2,400,000
Debt issuance costs	300,000
Debt covenant on minimum requirement on technology revenue for 12 months to borrow 1	60,000,000.0
Debt covenant on minimum requirement on technology revenue for 12 months to borrow 2	$ 80,000,000.0
Contractual interest rate- basis spread on variable rate		10.00%
Basis Rate	10.00%
Exit fee	5.00%
Debt prepayment term	48 months
Silicon Valley Bank \| Loan and Security Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 5,000,000.0
Cash or cash equivalents on deposits	5,000,000.0
Option to increase the maximum borrowing capacity	10,000,000.0
Minimum \| OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Debt covenant borrowing capacity based on technology revenue	$ 25,000,000.0
Repayment premium (in percentage)	1.00%
Maximum \| OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Debt covenant borrowing capacity based on technology revenue	$ 10,000,000.0
Debt covenant borrowing capacity based on technology revenue	$ 30,000,000.0
Repayment premium (in percentage)	12.00%
LIBOR \| OrbiMed Royalty Opportunities II, LP \| Senior Term Loan
Line of Credit Facility [Line Items]
Contractual interest rate- basis spread on variable rate	7.50%	7.50%

Credit Facilities - Schedule of Term Credit Facilities (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Line of Credit Facility [Line Items]
Total credit facilities	$ 50,000	$ 50,000
Less: Current portion of credit facilities	0	0
Credit facilities, less current portion	50,000	50,000
Remaining Capacity	35,000	35,000
OrbiMed term loan
Line of Credit Facility [Line Items]
Total credit facilities	50,000	50,000
Remaining Capacity	$ 30,000	$ 30,000
Interest Rate	10.00%	10.00%
SVB revolving line of credit
Line of Credit Facility [Line Items]
Total credit facilities	$ 0	$ 0
Remaining Capacity	$ 5,000	$ 5,000
Interest Rate	3.75%	5.25%
LIBOR \| SVB revolving line of credit
Line of Credit Facility [Line Items]
Basis Rate	7.50%	7.50%
Prime rate \| SVB revolving line of credit
Line of Credit Facility [Line Items]
Basis Rate	0.50%	0.50%
Minimum \| SVB revolving line of credit
Line of Credit Facility [Line Items]
Basis Rate	10.00%	10.00%

Stockholders’ Equity (Deficit) - Narrative (Details) - $ / shares	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Jul. 29, 2019	Mar. 31, 2019
Stockholders' Equity Note [Abstract]
Common stock, shares authorized (in shares)	500,000,000	500,000,000	500,000,000
Common stock, par value (in USD per share)	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	25,000,000	25,000,000	25,000,000
Term of board of director member	3 years
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, shares issued (in shares)	37,838,276	36,678,854
Common stock, shares outstanding (in shares)	37,838,276	36,678,854
Shares issued to former employees with notes determined to be nonrecourse (in shares)		52,778		52,778
Shares outstanding (in shares)	37,838,276	36,731,632
Preferred stock, shares issued (in shares)	37,838,276	36,731,632

Net Loss Per Share - Schedule of the Calculation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Numerator:
Net loss attributable to common stockholders	$ (17,490)	$ (77,735)
Denominator:
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders, basic and diluted (in shares)	37,108,998	4,795,195
Net loss per share attributable to common stockholders, basic and diluted (in USD per share)	$ (0.47)	$ (16.21)

Net Loss Per Share - Schedule of Share Totals with a Potentially Dilutive Impact (Details) - shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	9,053,129	31,592,759
Redeemable convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	0	23,151,481
Common stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	6,640,662	8,185,942
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	2,145,968	0
Employee stock purchase plan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	87,107	0
Restricted shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	179,392	0
Common stock warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares with a potentially dilutive impact	0	255,336

Stock-Based Compensation - Narrative (Details) - USD ($)			1 Months Ended	3 Months Ended
	Feb. 21, 2020	Jul. 29, 2019	Jul. 31, 2019	Mar. 31, 2020	Dec. 31, 2019	Mar. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)				4 years
Shares issued to former employees with notes determined to be nonrecourse (in shares)					52,778	52,778
Able Health Inc
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of restricted shares issued	179,392
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares exercised in period				$ 35,200,000
Total grant-date fair value of stock options vested				4,200,000
Nonvested award options, unrecognized compensation expense				$ 13,300,000
Nonvested awards, period for recognition				2 years 2 months 12 days
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested awards, period for recognition				3 years 6 months
Cliff vesting period				4 years
Unrecognized stock-based compensation expense related to RSUs				$ 66,900,000
Restricted stock units \| Vest in year one
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				25.00%
Restricted stock units \| Vest in Q1 Year 2
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q2 Year 2
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q3 Year 2
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q4 Year 2
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q1 Year 3
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q2 Year 3
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q3 Year 3
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q4 Year 3
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q1 Year 4
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q2 Year 4
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q3 Year 4
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Restricted stock units \| Vest in Q4 Year 4
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent				6.25%
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized (in shares)			750,000	87,107
Percentage increase of the number of common stock shares (in percentage)			1.00%
Shares available for grant (in shares)				982,550	367,316
Unrecognized stock-based compensation expense related to RSUs				$ 400,000
ESPP share increase in period (in shares)			750,000
Employee stock purchase plan period				6 months
Maximum employee subscription rate				15.00%
Maximum purchase value during offering period				$ 25,000,000
Denominator of lowest purchase of a participant (in shares)				2,500
Purchase price of common stock (in percentage)				85.00%
Restricted shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested awards, period for recognition				9 months 18 days
Cliff vesting period	1 year
Unrecognized stock-based compensation expense related to RSUs				$ 4,800,000
Restricted shares \| Able Health Inc
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period (in years)	1 year
Restricted shares \| Vest in year one
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percent	100.00%
Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized (in shares)		2,756,607		13,109,459	11,272,878
Shares available for grant (in shares)				2,662,138	2,309,370
2011 Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of additional shares authorized (in shares)		256,607
Percentage increase of the number of common stock shares (in percentage)				5.00%
2019 Stock Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized (in shares)		2,500,000		1,836,581

Stock-Based Compensation - Effect of Stock-based Compensation Expense on Statement of Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 8,741	$ 1,656
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	992	181
Sales and marketing
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	3,182	783
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	1,882	222
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	2,685	470
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	2,542	1,656
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	5,117	0
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	492	0
Restricted shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 590	$ 0

Stock-Based Compensation - Stock Option Assumptions (Details)	3 Months Ended
	Mar. 31, 2019
Share-based Payment Arrangement [Abstract]
Expected volatility	44.50%
Expected term (in years)	6 years 3 months 18 days
Risk-free interest rate	2.50%
Expected dividends	0.00%

Stock-Based Compensation - Stock Option Activity (Details)	3 Months Ended
	Mar. 31, 2020 USD ($) $ / shares shares
Time-Based Option Shares
Outstanding at January 1, 2020 (in shares) \| shares	7,847,716
Options exercised (in shares) \| shares	(1,048,760)
Options cancelled/forfeited (in shares) \| shares	(158,294)
Outstanding at March 31, 2020 (in shares) \| shares	6,640,662
Vested and expected to vest as of March 31, 2020 \| shares	6,640,662
Vested and exercisable as of March 31, 2020 \| shares	3,762,413
Weighted Average Exercise Price
Outstanding, beginning balance (in USD per share) \| $ / shares	$ 10.67
Options exercised (in USD per share) \| $ / shares	8.63
Options cancelled/forfeited (in USD per share) \| $ / shares	11.40
Outstanding, ending balance (in USD per share) \| $ / shares	10.98
Vested and expected to vest (in USD per share) \| $ / shares	10.98
Vested and exercisable (in USD per share) \| $ / shares	$ 9.91
Option shares outstanding, Weighted Average Remaining Contractual Life in Years	7 years 3 months 18 days
Vested and expected to vest, Weighted Average Remaining Contractual Life in Years	7 years 3 months 18 days
Vested and exercisable, Weighted Average Remaining Contractual Life in Years	6 years 4 months 24 days
Option shares outstanding, Aggregate Intrinsic Value \| $	$ 107,935,288
Option shares vested and expected to vest, Aggregate Intrinsic Value \| $	107,935,288
Option shares vested and exercisable, Aggregate Intrinsic Value \| $	$ 65,160,129

Stock-Based Compensation - Restricted Stock Unit Activity (Details) - Restricted stock units	3 Months Ended
	Mar. 31, 2020 $ / shares shares
Restricted Stock Units
Unvested and outstanding, beginning balance (in shares) \| shares	503,861
RSUs granted (in shares) \| shares	1,655,232
RSUs forfeited (in shares) \| shares	(13,125)
Unvested and outstanding, ending balance (in shares) \| shares	2,145,968
Weighted Average Grant Date Fair Value
Unvested and outstanding, beginning balance, grant date fair value (in USD per share) \| $ / shares	$ 37.57
RSUs granted (in USD per share) \| $ / shares	33.61
RSUs forfeited (in USD per share) \| $ / shares	36.12
Unvested and outstanding, ending balance, grant date fair value (in USD per share) \| $ / shares	$ 34.52

Stock-Based Compensation - Schedule of the Purchase Right for the ESPP Option Assumptions (Details) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility		44.50%
Expected term (in months)		6 years 3 months 18 days
Risk-free interest rate		2.50%
Employee stock purchase plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility	54.90%
Expected term (in months)	6 months
Risk-free interest rate	1.60%
Expected dividends	$ 0

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Income Tax Disclosure [Abstract]
Effective income tax rate	6.60%	(0.10%)
Income tax (benefit) provision	$ (1,236)	$ 11
Change in valuation allowance	$ 1,300

Commitments and Contingencies (Details) $ in Millions	Mar. 31, 2020 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Future lease payments	$ 31.7
Lease term	11 years
Additional future lease payments	$ 2.8

Deferred Revenue and Performance Obligations - Remaining Performance Obligation (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-01	Mar. 31, 2020
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation (in percentage)	85.00%
Remaining performance obligation, period	1 year

Deferred Revenue and Performance Obligations - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Product Information [Line Items]
Percentage of revenue recognized was included in deferred revenue (in percentage)	33.00%	36.00%
Revenue remaining performance obligation amount	$ 49.9
Technology and professional services
Product Information [Line Items]
Service contract term	3 years
Allowed termination period	1 year
Notice required for termination	90 days

Related Parties (Details) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2020

Mar. 31, 2019

Dec. 31, 2019

Deferred revenue with related party

^[1]

$ 0

$ 1,860

Board member

Revenue recognized from related party

700

$ 700

Receivables from related party

400

600

1,200

Deferred revenue with related party

$ 300

$ 500

[1]	Includes amounts attributable to related party transactions. See Note 16 for further details.

Segments - Narrative (Details)	3 Months Ended
Segments - Narrative (Details)	Mar. 31, 2020 segment
Segment Reporting [Abstract]
Number of operating segments	2
Number of reportable segments	2

Segments - Scheduled of Segment Revenue (Details) - USD ($)
$ in Thousands

3 Months Ended

Mar. 31, 2020

Mar. 31, 2019

Segment Reporting, Revenue Reconciling Item [Line Items]

Revenue

^[1]

$ 45,116

$ 35,213

Technology

Segment Reporting, Revenue Reconciling Item [Line Items]

Revenue

24,699

20,148

Professional Services

Segment Reporting, Revenue Reconciling Item [Line Items]

Revenue

$ 20,417

$ 15,065

[1]	Includes amounts attributable to related party transactions. See Note 16 for further details.

Segments - Schedule of Segment Adjusted Gross Profit (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Less Adjusted Gross Profit reconciling items:
Stock-based compensation	$ (8,741)	$ (1,656)
Less other reconciling items:
Sales and marketing	(13,487)	(10,473)
Research and development	(13,088)	(10,022)
General and administrative	(9,701)	(6,174)
Depreciation and amortization	(2,877)	(2,312)
Debt extinguishment costs	0	(1,670)
Interest and other expense, net	(621)	(945)
Net loss before income taxes	(18,726)	(13,709)
Operating segments
Adjusted Gross Profit
Gross profit	22,040	18,176
Operating segments \| Technology
Adjusted Gross Profit
Gross profit	16,969	13,429
Operating segments \| Professional Services
Adjusted Gross Profit
Gross profit	5,071	4,747
Segment reconciling items
Less Adjusted Gross Profit reconciling items:
Stock-based compensation	(992)	(181)
Post-acquisition restructuring costs	0	(108)
Less other reconciling items:
Sales and marketing	(13,487)	(10,473)
Research and development	(13,088)	(10,022)
General and administrative	(9,701)	(6,174)
Depreciation and amortization	(2,877)	(2,312)
Debt extinguishment costs	0	(1,670)
Interest and other expense, net	$ (621)	$ (945)

Subsequent Events (Details)			3 Months Ended
Subsequent Events (Details)	Apr. 14, 2020 USD ($) day $ / shares shares	Feb. 06, 2019 USD ($)	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Apr. 30, 2020 USD ($)	Apr. 08, 2020 USD ($) $ / instrument	Dec. 31, 2019 USD ($)
Subsequent Event [Line Items]
Loss on extinguishment of debt			$ 0	$ (1,670,000)
Debt discount and issue costs							$ 1,800,000
Senior Term Loan \| OrbiMed Royalty Opportunities II, LP
Subsequent Event [Line Items]
Amount borrowed		$ 80,000,000.0
Basis Rate		10.00%
Maximum borrowing capacity		$ 50,000,000.0
Contractual interest rate- basis spread on variable rate			10.00%
Debt discount and issue costs			$ 1,500,000
Repayment fee			7.0 million
Senior Term Loan \| OrbiMed Royalty Opportunities II, LP \| LIBOR
Subsequent Event [Line Items]
Contractual interest rate- basis spread on variable rate		7.50%	7.50%
Subsequent Event \| Capped Call \| Designated as Hedging Instrument \| Cash Flow Hedging
Subsequent Event [Line Items]
Derivative amount						$ 21,600,000
Cap price (in dollars per instrument) \| $ / instrument						42.00
Subsequent Event \| Senior Term Loan \| OrbiMed Royalty Opportunities II, LP
Subsequent Event [Line Items]
Repayments of debt	$ 57,000,000.0
Loss on extinguishment of debt	$ 8,500,000
Convertible Notes Payable \| Senior Notes Due 2025 \| Subsequent Event
Subsequent Event [Line Items]
Amount borrowed					$ 230,000,000.0
Basis Rate	2.50%
Proceeds from issuance of debt	$ 222,500,000
Debt instrument, convertible, threshold percentage of stock price trigger	130.00%
Threshold trading days \| day	20
Threshold consecutive trading days \| day	30
Redemption price, percentage	100.00%
Number of shares issuable in conversion (in shares0 \| shares	32.6797
Conversion price (in dollars per share) \| $ / shares	$ 30.60