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HealthEquity Stock Gains as Q1 Earnings Top Estimates, Revenues Up Y/Y
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Key Takeaways
HQY posted Q1 FY27 adjusted EPS of $1.24 and revenues of $354.6M, beating estimates.
HQY served 10.6M HSAs ( 8% YoY) and 17.8M total accounts, including 7.2M CDBs.
HQY expanded gross margin to 72.3% and raised FY27 adjusted EPS view to $4.66-$4.73.
HealthEquity, Inc. (HQY - Free Report) reported adjusted earnings per share (EPS) of $1.24 for first-quarter fiscal 2027, surpassing the Zacks Consensus Estimate by 11.7%. The bottom line improved 28% on a year-over-year basis.
GAAP EPS in the fiscal first quarter was 82 cents, up from the year-ago quarter’s EPS of 61 cents.
Shares of HQY gained 1.04% in after-market trading following the earnings call.
HealthEquity’s Q1 Revenues in Detail
In the fiscal first quarter, the company generated revenues of $354.6 million, which beat the Zacks Consensus Estimate by 0.06%. The top line improved 7% from the prior-year quarter.
HSA Details of HQY
As of April 30, 2026, the total number of Health Savings Accounts (HSAs) for which HealthEquity served as a non-bank custodian was 10.6 million, up 8% year over year.
HealthEquity reported 909,000 HSAs with investments as of April 30, 2026, up 18% year over year. Total accounts, as of April 30, 2026, were 17.8 million. This uptick included total HSAs and 7.2 million Consumer Direct Benefits (CDBs).
Total HSA assets were $37.1 billion at the end of April 30, 2026, up 19% year over year. This included $17.5 billion of HSA cash and $19.6 billion of HSA investments. This figure compares to our fiscal first-quarter HSA cash and HSA investments projection of $17.6 billion and $17.9 billion, respectively. We had projected total HSA assets of $35.5 billion for the fiscal first quarter.
Client-held funds, which are deposits held on behalf of HealthEquity’s clients to facilitate the administration of its CDBs and from which the company generates custodial revenues, were $1.0 billion as of April 30, 2026.
Revenue Sources of HealthEquity
HealthEquity derives revenues from three sources: Service revenues, Custodial revenues and Interchange revenues.
Service revenues totaled $122.9 million in the quarter, up 2.6% year over year. This reflected a higher number of HSAs and invested HSA Assets. This figure compares favorably with our fiscal first-quarter projection of $122 million.
Custodial revenues totaled $174.3 million, up 11.4% from the year-ago period. Our projection for the fiscal first-quarter Custodial revenues was $176 million.
Interchange revenues totaled $57.4 million, up 5.1% year over year. This figure compares favorably with our fiscal first-quarter projection of $58 million.
HealthEquity, Inc. Price, Consensus and EPS Surprise
In the quarter under review, HealthEquity’s gross profit rose 14.3% year over year to $256.3 million. The gross margin expanded 450 basis points (bps) to 72.3%.
Sales and marketing expenses increased 3.3% to $26.8 million year over year, whereas technology and development expenses climbed 10.3% year over year to $67.8 million. General and administrative expenses increased 21.9% year over year to $31.1 million. Total operating expenses of $153.4 million increased 8.6% year over year.
Operating profit totaled $103 million, improving by 23.9% from the prior-year quarter. The operating margin in the quarter expanded by 390 bps to 29% compared with the prior-year quarter.
Financial Position of HQY
The company exited the first quarter of fiscal 2027 with cash and cash equivalents of $265.4 million compared with $318.9 million at the fiscal 2026-end. Total debt (net of issuance costs) at the end of first-quarter fiscal 2027 was $942.6 million compared with $957.4 million at the end of fiscal 2026.
Cumulative net cash provided by operating activities at the end of first-quarter fiscal 2027 totaled $97.5 million compared with $64.7 million a year ago.
HealthEquity’s FY27 Guidance
HealthEquity has updated its revenue and EPS projections for fiscal 2027.
For fiscal 2027, revenues are now projected to be between $1.410 billion and $1.420 billion compared with the previous guidance of $1.405 billion and $1.415 billion. The Zacks Consensus Estimate is currently pegged at $1.41 billion.
Adjusted EPS is now expected to be in the range of $4.66-$4.73 compared with the previous guidance of $4.56-$4.65. The Zacks Consensus Estimate currently stands at $4.60.
Our Take on HQY
HealthEquity exited first-quarter fiscal 2027 with better-than-expected results. The company witnessed solid top-line and bottom-line performances in the reported quarter. Solid growth in HSAs also drove the top line. The solid uptick in total HSA assets in the reported quarter is promising. Improvements in operating and gross margins also bode well.
HealthEquity management noted that the company opened approximately 172,000 new HSAs during the quarter. Management noted that the company outpaced industry HSA growth, supported by strong client retention, an active enterprise sales pipeline and continued adoption of HSA-qualified plans. They emphasized that digital engagement continues to strengthen, with monthly active mobile usage surging 90% year over year. Increased use of the mobile platform is helping improve member engagement, boost investing activity and support marketplace adoption, all of which are expected to enhance long-term member lifetime value.
Management also pointed to encouraging early traction in marketplace offerings, particularly metabolic health, diagnostics and men’s health programs. These offerings can become a significant contributor to service revenues over time, given the high-margin nature of marketplace transactions.
At the same time, management acknowledged a few near-term headwinds. Softer healthcare utilization trends modestly pressured interchange revenue growth during the quarter. The company also noted limited visibility in long-term marketplace member retention and adoption patterns, particularly in newer offerings like GLP and men’s health programs. HSA cash yield assumptions remain sensitive to future interest rate movements and custodial contract renewals. While these dynamics may create near-term variability, HealthEquity remains confident that strong digital capabilities, AI-driven operational efficiencies and growing enterprise demand can support long-term growth.
HQY’s Zacks Rank & Other Key Picks
Currently, HealthEquity carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space are Globus Medical (GMED - Free Report) , West Pharmaceutical (WST - Free Report) and Intuitive Surgical (ISRG - Free Report) .
Globus Medical, currently flaunting a Zacks Rank #1 (Strong Buy), reported a first-quarter 2026 adjusted earnings per share (EPS) of $1.12 per share, which surpassed the Zacks Consensus Estimate by 22.1%. Revenues of $759.9 million beat the Zacks Consensus Estimate by 4.0%. You can see the complete list of today’s Zacks #1 Rank stocks here.
GMED has an estimated long-term earnings growth rate of 10.2% compared with the industry’s 12.6% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 26.3%.
West Pharmaceutical, currently sporting a Zacks Rank #1, reported first-quarter 2026 EPS of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%.
WST has an estimated long-term earnings growth rate of 13.9% compared with the industry’s 9.5% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.4%.
Intuitive Surgical, carrying a Zacks Rank #2 at present, reported first-quarter 2026 adjusted EPS of $2.50, which beat the Zacks Consensus Estimate by 20.2%. Revenues of $2.77 billion surpassed the Zacks Consensus Estimate by 6.2%.
ISRG has a long-term estimated growth rate of 14.6% compared with the industry’s 12.6% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.8%.
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HealthEquity Stock Gains as Q1 Earnings Top Estimates, Revenues Up Y/Y
Key Takeaways
HealthEquity, Inc. (HQY - Free Report) reported adjusted earnings per share (EPS) of $1.24 for first-quarter fiscal 2027, surpassing the Zacks Consensus Estimate by 11.7%. The bottom line improved 28% on a year-over-year basis.
GAAP EPS in the fiscal first quarter was 82 cents, up from the year-ago quarter’s EPS of 61 cents.
Shares of HQY gained 1.04% in after-market trading following the earnings call.
HealthEquity’s Q1 Revenues in Detail
In the fiscal first quarter, the company generated revenues of $354.6 million, which beat the Zacks Consensus Estimate by 0.06%. The top line improved 7% from the prior-year quarter.
HSA Details of HQY
As of April 30, 2026, the total number of Health Savings Accounts (HSAs) for which HealthEquity served as a non-bank custodian was 10.6 million, up 8% year over year.
HealthEquity reported 909,000 HSAs with investments as of April 30, 2026, up 18% year over year. Total accounts, as of April 30, 2026, were 17.8 million. This uptick included total HSAs and 7.2 million Consumer Direct Benefits (CDBs).
Total HSA assets were $37.1 billion at the end of April 30, 2026, up 19% year over year. This included $17.5 billion of HSA cash and $19.6 billion of HSA investments. This figure compares to our fiscal first-quarter HSA cash and HSA investments projection of $17.6 billion and $17.9 billion, respectively. We had projected total HSA assets of $35.5 billion for the fiscal first quarter.
Client-held funds, which are deposits held on behalf of HealthEquity’s clients to facilitate the administration of its CDBs and from which the company generates custodial revenues, were $1.0 billion as of April 30, 2026.
Revenue Sources of HealthEquity
HealthEquity derives revenues from three sources: Service revenues, Custodial revenues and Interchange revenues.
Service revenues totaled $122.9 million in the quarter, up 2.6% year over year. This reflected a higher number of HSAs and invested HSA Assets. This figure compares favorably with our fiscal first-quarter projection of $122 million.
Custodial revenues totaled $174.3 million, up 11.4% from the year-ago period. Our projection for the fiscal first-quarter Custodial revenues was $176 million.
Interchange revenues totaled $57.4 million, up 5.1% year over year. This figure compares favorably with our fiscal first-quarter projection of $58 million.
HealthEquity, Inc. Price, Consensus and EPS Surprise
HealthEquity, Inc. price-consensus-eps-surprise-chart | HealthEquity, Inc. Quote
HQY’s Q1 Margin Details
In the quarter under review, HealthEquity’s gross profit rose 14.3% year over year to $256.3 million. The gross margin expanded 450 basis points (bps) to 72.3%.
Sales and marketing expenses increased 3.3% to $26.8 million year over year, whereas technology and development expenses climbed 10.3% year over year to $67.8 million. General and administrative expenses increased 21.9% year over year to $31.1 million. Total operating expenses of $153.4 million increased 8.6% year over year.
Operating profit totaled $103 million, improving by 23.9% from the prior-year quarter. The operating margin in the quarter expanded by 390 bps to 29% compared with the prior-year quarter.
Financial Position of HQY
The company exited the first quarter of fiscal 2027 with cash and cash equivalents of $265.4 million compared with $318.9 million at the fiscal 2026-end. Total debt (net of issuance costs) at the end of first-quarter fiscal 2027 was $942.6 million compared with $957.4 million at the end of fiscal 2026.
Cumulative net cash provided by operating activities at the end of first-quarter fiscal 2027 totaled $97.5 million compared with $64.7 million a year ago.
HealthEquity’s FY27 Guidance
HealthEquity has updated its revenue and EPS projections for fiscal 2027.
For fiscal 2027, revenues are now projected to be between $1.410 billion and $1.420 billion compared with the previous guidance of $1.405 billion and $1.415 billion. The Zacks Consensus Estimate is currently pegged at $1.41 billion.
Adjusted EPS is now expected to be in the range of $4.66-$4.73 compared with the previous guidance of $4.56-$4.65. The Zacks Consensus Estimate currently stands at $4.60.
Our Take on HQY
HealthEquity exited first-quarter fiscal 2027 with better-than-expected results. The company witnessed solid top-line and bottom-line performances in the reported quarter. Solid growth in HSAs also drove the top line. The solid uptick in total HSA assets in the reported quarter is promising. Improvements in operating and gross margins also bode well.
HealthEquity management noted that the company opened approximately 172,000 new HSAs during the quarter. Management noted that the company outpaced industry HSA growth, supported by strong client retention, an active enterprise sales pipeline and continued adoption of HSA-qualified plans. They emphasized that digital engagement continues to strengthen, with monthly active mobile usage surging 90% year over year. Increased use of the mobile platform is helping improve member engagement, boost investing activity and support marketplace adoption, all of which are expected to enhance long-term member lifetime value.
Management also pointed to encouraging early traction in marketplace offerings, particularly metabolic health, diagnostics and men’s health programs. These offerings can become a significant contributor to service revenues over time, given the high-margin nature of marketplace transactions.
At the same time, management acknowledged a few near-term headwinds. Softer healthcare utilization trends modestly pressured interchange revenue growth during the quarter. The company also noted limited visibility in long-term marketplace member retention and adoption patterns, particularly in newer offerings like GLP and men’s health programs. HSA cash yield assumptions remain sensitive to future interest rate movements and custodial contract renewals. While these dynamics may create near-term variability, HealthEquity remains confident that strong digital capabilities, AI-driven operational efficiencies and growing enterprise demand can support long-term growth.
HQY’s Zacks Rank & Other Key Picks
Currently, HealthEquity carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the broader medical space are Globus Medical (GMED - Free Report) , West Pharmaceutical (WST - Free Report) and Intuitive Surgical (ISRG - Free Report) .
Globus Medical, currently flaunting a Zacks Rank #1 (Strong Buy), reported a first-quarter 2026 adjusted earnings per share (EPS) of $1.12 per share, which surpassed the Zacks Consensus Estimate by 22.1%. Revenues of $759.9 million beat the Zacks Consensus Estimate by 4.0%. You can see the complete list of today’s Zacks #1 Rank stocks here.
GMED has an estimated long-term earnings growth rate of 10.2% compared with the industry’s 12.6% growth. The company’s earnings beat estimates in each of the trailing four quarters, the average surprise being 26.3%.
West Pharmaceutical, currently sporting a Zacks Rank #1, reported first-quarter 2026 EPS of $2.13, which beat the Zacks Consensus Estimate by 26.8%. Revenues of $844.9 million surpassed the Zacks Consensus Estimate by 8.5%.
WST has an estimated long-term earnings growth rate of 13.9% compared with the industry’s 9.5% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 19.4%.
Intuitive Surgical, carrying a Zacks Rank #2 at present, reported first-quarter 2026 adjusted EPS of $2.50, which beat the Zacks Consensus Estimate by 20.2%. Revenues of $2.77 billion surpassed the Zacks Consensus Estimate by 6.2%.
ISRG has a long-term estimated growth rate of 14.6% compared with the industry’s 12.6% growth. The company’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 16.8%.