Claritev (NYSE:CTEV) raised its 2026 revenue, adjusted EBITDA and free cash flow outlook after third-quarter results exceeded management’s expectations, driven in part by higher volumes in its surprise billing services business.
The company also said it expects to generate at least $1.1 billion in revenue in 2027, reaching a target it had previously outlined for 2028. Chief Financial Officer Doug Garis said Claritev is running about a year ahead of the financial plan presented at its March investor day.
Third-quarter revenue rose 9.1% from a year earlier to $268.3 million, marking the company’s sixth consecutive quarter of year-over-year revenue growth. Adjusted EBITDA increased 4.4% to $162 million, although the adjusted EBITDA margin narrowed to 60.4% from 63.1% a year earlier.
Claims Intelligence Drives Growth
Revenue in Claritev’s largest business, Claims Intelligence, increased 17.1% year over year. Garis attributed the growth primarily to incremental No Surprises Act, or NSA, volumes associated with a client win early in 2026.
Chief Executive Officer Travis Dalton said dispute initiations rose 75% from the third quarter of 2025. Head of Investor Relations Todd Friedman said some of that increase was related to the new client. Garis added that NSA claims volumes also grew sequentially but said the company was still assessing the effects of final rule changes.
Elsewhere, Network revenue fell 5.6% year over year, primarily because the prior-year quarter included $5.4 million in nonrecurring revenue. Garis said Network revenue would have risen approximately 5% excluding that item.
Payment & Revenue Integrity also declined as some customers moved from legacy clinical negotiations services to Claims Intelligence offerings. Garis said revenue in the segment was approximately flat excluding the clinical negotiations business. He expects the segment to return to growth in 2027, supported by bookings in newer solutions.
Bookings and Cash Flow
Claritev booked $27 million in annual contract value, or ACV, during the quarter, bringing its year-to-date total above $100 million. That compared with $67 million for all of 2025. The company expects full-year ACV bookings of $115 million to $125 million, representing growth of 70% to 90% from last year.
Garis said 78% of year-to-date bookings came from existing customers, while more than half came from markets outside the company’s core payer business. Bookings generally take two to four quarters to begin converting to revenue, followed by another four quarters to reach their full annualized contribution, he said.
The company generated $18.1 million in operating cash flow during the third quarter but used $25.8 million in free cash flow. It ended the quarter with $10.1 million in unrestricted cash and $95 million drawn on its revolving credit facility. Net leverage was 7.7 times, down 0.1 turn from a year earlier.
Higher Outlook for 2026
Claritev raised its full-year revenue guidance to $1.038 billion to $1.043 billion, an increase of $30.5 million at the midpoint. The range implies revenue growth of 7.5% to 8% for the year.
The company also raised its adjusted EBITDA forecast to $625 million to $630 million and its free cash flow outlook to $10 million to $20 million. Capital expenditures are expected to be $165 million to $170 million.
For the fourth quarter, management expects operating cash flow of $110 million to $120 million and free cash flow of $74 million to $84 million. Garis said the company plans to provide more detailed 2027 revenue, adjusted EBITDA and free cash flow guidance when it reports fourth-quarter results in February.
New Products and AI Investment
Dalton highlighted a new Medicare Advantage offering that combines more than 15 existing solutions, along with a pricing product using publicly available data and Claritev’s reimbursement intelligence. The company also introduced a healthcare intelligence platform with an AI agent called Clara.
Dalton said Claritev has dozens of AI agents in production and is prioritizing their use in areas including NSA workflows. The company sees opportunities to improve operating efficiency as well as customer service, he said. Garis declined to comment on potential headcount changes in specific businesses.
About Claritev (NYSE:CTEV)
Claritev is a healthcare technology, data and insights company focused on improving affordability, transparency and quality. Led by deeply experienced associates, data scientists, and innovators, Claritev provides tech-enabled solutions and services fueled by multiple data sources from over 40 years of claims repricing. Claritev utilizes world-class technology and AI solutions to power a robust enterprise platform that delivers meaningful insights to drive affordability in healthcare, brings price transparency and optimizes networks and benefits design.
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