Shares of National Research Corporation NRC have declined 27.2% since the company reported its earnings for the quarter ended Dec. 31, 2025. This compares unfavorably to the S&P 500 index’s 1.1% decline over the same period. Over the past month, NRC shares are down 22%, notably underperforming the broader market’s 1% drop.
In the fourth quarter of 2025, NRC Health reported adjusted earnings per share of 16 cents, down from 29 cents per share in the prior-year period.
Total revenues of $35.2 million represented a 5% decline compared to the prior-year quarter.
GAAP net income for the fourth quarter came in at $1.8 million, down sharply from $6.6 million a year earlier. On an adjusted basis, net income was $3.4 million, versus $6.7 million in the prior-year period.
National Research Corporation Price, Consensus and EPS Surprise
National Research Corporation price-consensus-eps-surprise-chart | National Research Corporation Quote
2025 Update
For the full year, revenues declined 4% year over year to $137.4 million, which the company attributed to elevated client attrition in the second half of 2024, particularly affecting its Total Recurring Contract Value (TRCV) performance.
Adjusted EPS declined to 93 cents from $1.05, and adjusted net income fell 17% to $20.7 million. Adjusted EBITDA was $40.2 million, a 3% year-over-year decline, yielding a healthy margin of 29%.
Other Key Business Metrics
Despite top-line and earnings pressure, some operational metrics showed resilience. Adjusted EBITDA for the fourth quarter was $8.7 million, representing 25% of revenues.
Cash flow from operations for the quarter increased 13% year over year to $7.2 million, representing 20% of revenue. On a full-year basis, operating cash flow reached $26.5 million, down from $34.6 million in 2024 but still accounting for 19% of total revenue. The company’s recurring revenue remained high, with 99% of total revenue classified as recurring, supporting visibility into future earnings.
TRCV, a key indicator of forward-looking subscription revenue, increased 8% year-over-year to $144.1 million, marking the fifth consecutive quarter of sequential growth. CEO Trent Green emphasized that the company’s focus on sales team realignment, product enhancements, and customer success initiatives was driving this sustained TRCV growth.
Management Commentary
CEO Trent Green and CFO Shane Harrison acknowledged the difficult year-over-year comparison due to Q4 2024’s elevated TRCV attrition, which depressed revenue growth. Nonetheless, both executives conveyed optimism about the momentum entering 2026. Green cited an 86% increase in new sales year-over-year and strong retention as outcomes of a refined go-to-market strategy. Harrison added that cost discipline helped preserve margins despite revenue pressure, enabling continued investment in growth initiatives.
The company emphasized its three-pronged customer value proposition: trust, expertise, and portfolio breadth. Management highlighted a Net Promoter Score of 68 and 74% penetration among the top 100 U.S. health systems as evidence of its market relevance. NRC also expanded its leadership team with the appointment of David Burik to lead governance strategy, underscoring a commitment to strategic insights and organizational consulting.
Factors Influencing the Headline Numbers
A significant factor impacting revenues was the high client attrition in the latter half of 2024, which created a challenging comparison base for Q4 2025. While revenue declined, TRCV growth and recurring revenue stability were highlighted as leading indicators of a potential recovery.
Operationally, increased costs from NRC’s annual HUB conference in Q4 pressured net income. However, higher SG&A and ongoing investment in platform capabilities, such as enablement tools and AI-powered solutions, were also seen as necessary to drive long-term differentiation and growth.
Guidance
Management conveyed confidence in revenue growth resuming in 2026, supported by the 8% TRCV expansion in the fourth quarter. Green described NRC's evolving go-to-market model as a “meaningful tailwind” for the year ahead. Harrison echoed this optimism, highlighting the predictability of revenue streams and the company's ability to maintain profitability even amid revenue softness.
Other Developments
Management did note that they are maintaining flexibility for strategic, accretive acquisitions and are actively exploring new growth avenues, including potential technology enhancements and partnerships through “Blue Water” opportunities.
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This article originally published on Zacks Investment Research (zacks.com).
