Athenahealth Posts Stable Earnings After Eventful Q2

In the face of a sudden CEO exit and a takeover bid from Elliott Management Corp., the health technology servicer posted a solid quarter.

Athenahealth Inc., generated $323.3 million in total revenues, according to its Q2 earnings report released Monday afternoon.

The health technology servicer achieved a GAAP operating income of $43.1 million, along with a GAAP net income of $36.4 million. As for its non-GAAP financials, Athenahealth posted an operating income of $61.4 million and a net income of $44.6 million.

Athenahealth also improved its financial guidance for the second half of the year, projecting slight increases for its GAAP total revenues and operating income, as well as non-GAAP total revenues and operating income.

"We are pleased to deliver strong financial results during the second quarter. We achieved double digit top-line growth on a comparable basis and significantly improved profitability and operating cash flow year-over-year. As a result, we are raising our fiscal 2018 earnings guidance," Marc Levine, CFO of athenahealth, said in a statement. "We remain focused on executing against our product and technology initiatives, improving the customer experience, and delivering on our financial commitments."

The past three months have been eventful for Athenahealth, as the company still considers a $7 billion takeover bid from Elliott Management Corp., with the aim of taking it private again. However, communications between the companies have been frayed, with dueling public letters exhibiting hostility, highlighted by Elliott deeming one of Athenahealth's responses "careless."

In early June, Athenahealth CEO Jonathan Bush stepped down due to numerous misconduct allegations, including from female coworkers and a report of assaulting his ex-wife.

Related: Athenahealth CEO Exit Means Sale More Likely

Below are highlights from Athenahealth's Q2 earnings report:  

• Athenahealth experienced 20% growth in the covered lives through its population health services year-over-year.

• Additionally, the company's performance was bolstered by double-digit percentage increases in ambulatory providers in the company's network compared to this time last year.

• The GAAP gross margin and non-GAAP gross margin for Athenahealth rose slight year-over-year.

Additional information is available in Athenahealth's filing with the Securities and Exchange Commission.