What CareCloud (CCLD) Said on Its Q3 Earnings Call

Key Points

• CareCloud posted record quarterly profitability: Q3 revenue rose 9% to $33.7 million, net income increased 54% to $4.7 million, and adjusted EBITDA grew 28% to $9.9 million. The company recorded its 10th consecutive quarter of positive GAAP net income.
• Automation and acquisitions supported improving margins: Revenue less direct operating costs rose to 50.5% of revenue, while automation cut manual claim touches and helped lower denial rates. Medsphere contributed $6.3 million in revenue following its acquisition.
• Full-year 2026 guidance was reaffirmed: CareCloud expects revenue of $128 million to $132 million, adjusted EBITDA of $29 million to $31 million, and GAAP EPS of $0.20 to $0.23, while prioritizing investment in AI and technology, debt reduction, and selective acquisitions.

CareCloud NASDAQ: CCLD reported record third-quarter profit and adjusted EBITDA as revenue growth, automation and a shift toward higher-margin services helped improve profitability. The healthcare technology company also reaffirmed its full-year guidance.

Revenue rose 9% from a year earlier to $33.7 million, while net income increased 54% to $4.7 million. Earnings attributable to common shareholders climbed to $4.2 million from $1.7 million, and GAAP earnings per share rose to $0.10 from $0.04. Adjusted EBITDA increased 28% to $9.9 million.

“The third quarter was the most profitable quarter in CareCloud’s history,” Chief Executive Officer Stephen Snyder said on the earnings call. The company recorded its 10th consecutive quarter of positive GAAP net income.

Automation and acquisitions support margins

Revenue less direct operating costs rose to 50.5% of revenue from 47.8% a year earlier. Chief Financial Officer Bonnie Boyer said direct operating costs increased 3% while revenue grew approximately 9%, reflecting operating efficiencies and changes in the revenue mix.

Snyder said automation in revenue cycle operations reduced manual claim touches by approximately 44% over three months. Chief Strategy Officer Hadi Chaudhry said zero-touch processing rose to 84% from 74% a year earlier in the division serving most of CareCloud’s revenue cycle management clients. The company’s denial rate across those operations fell to under 4% from about 8%.

Boyer said quarterly revenue benefited from a full quarter of contributions from Medsphere, the contribution from compliance business Empower and initial development revenue from KabaFusion. Those gains were partly offset by lower project-based professional services revenue at medSR.

Medsphere, acquired in August 2025, contributed $6.3 million in quarterly revenue, Chaudhry said. Snyder said near-term opportunities include selling AI products and revenue cycle services to existing Medsphere customers. CareCloud also continues to pursue smaller hospitals and critical access hospitals, he said.

Debt repayment and preferred dividends

CareCloud’s capital restructuring increased the share of earnings attributable to common shareholders. The company redeemed its Series B preferred stock in May, and quarterly preferred dividends fell to $538,000 from approximately $1.4 million a year earlier, Boyer said.

Approximately 89% of third-quarter net income was attributable to common shareholders, compared with approximately 55% a year earlier. Net interest expense was approximately $1.7 million, including $934,000 in non-cash financing-related expense associated with warrants issued in connection with the credit facility, Boyer said.

CareCloud ended September with $4.6 million in cash and approximately $37.3 million in total debt. It repaid the $9 million drawn on its revolving credit line during the quarter, leaving the full $10 million facility available. Snyder said the term loan balance fell from $36.7 million at the end of September to $34.2 million as of Nov. 2.

Boyer said the company’s capital priorities include investing in technology and AI, reducing debt and pursuing selective acquisitions. CareCloud is also evaluating options for its remaining Series A preferred stock, she said.

AI and compliance initiatives

CareCloud recognized its first revenue in the quarter from developing LailaCare, an AI-native platform for home infusion provider KabaFusion. The platform is intended to connect referral intake, authorization, patient engagement and revenue cycle workflows. Chaudhry said KabaFusion will own the platform.

CareCloud’s AI prior authorization solution is live with a pilot client. Across more than 600 submissions, it achieved a 91% initial pass approval rate and reduced submission time from about 15 minutes to under two, Chaudhry said.

The company plans to launch a subscription software-based compliance offering toward the end of the fourth quarter, drawing on expertise from Empower, which it acquired in May. Snyder said Empower’s relationships have already led to revenue cycle management signings with a management services organization and a wound care practice.

Full-year outlook reaffirmed

CareCloud maintained its 2026 guidance for revenue of $128 million to $132 million, adjusted EBITDA of $29 million to $31 million and GAAP earnings per share of $0.20 to $0.23. Revenue for the first nine months was $96.9 million, up 13% from a year earlier.

Boyer said the company was confident it would meet all three guidance measures, while executives noted seasonal effects in the fourth quarter. Snyder said the outlook depends on factors including client and vendor relationships, project timing and execution of integration and expense-management initiatives. CareCloud expects to provide guidance for next year on its next earnings call.

About CareCloud (NASDAQ:CCLD)

CareCloud, Inc NASDAQ: CCLD provides cloud-based health care information technology and revenue cycle management services to medical practices, hospitals and other health care organizations. The company's solutions are designed to help providers manage administrative, clinical and financial operations through integrated software and technology-enabled services.

Its offerings include electronic health records, practice management, medical billing and revenue cycle management, patient engagement tools, telehealth capabilities and related health care technology services.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.