Revenue during the quarter grew 17.20 percent to $276.67 million from $236.07 million in the previous year period. Gross margin for the quarter expanded 286 basis points over the previous year period to 62.69 percent. Total expenses were 94.52 percent of quarterly revenues, down from 98.65 percent for the same period last year. This has led to an improvement of 412 basis points in operating margin to 5.48 percent.

Operating income for the quarter was $15.15 million, compared with $3.19 million in the previous year period.

However, the adjusted operating income for the quarter stood at $41.47 million compared to $25.45 million in the prior year period. At the same time, adjusted operating margin improved 421 basis points in the quarter to 14.99 percent from 10.78 percent in the last year period.

"As we continue to build our national network - today, having connected over 85,000 providers, 83 million unique patient records, and 140,000 network endpoints - athenahealth is well-positioned to improve healthcare delivery in this country," said Jonathan Bush, chairman and chief executive officer, athenahealth. "We are also uniquely positioned to leverage our network data for good and are making great strides in furtherance of our mission to unbreak healthcare. To this end, we recently launched athenaInsight, an editorial hub reporting from the heart of the healthcare internet on healthcare’s bright spots, drivers of effective physician leadership and engagement, and trends tied to public health. As we look ahead, our strategic priorities and investments will be focused on further leveraging our unique platform to deliver true client success."

Athenahealth expects revenue to be in the range of $1,085 million to $1,115 million for financial year 2016. For fiscal year 2016, Athenahealth forecasts net income to be in the range of $10.80 million to $19.50 million. For the fiscal year 2016, Athenahealth projects adjusted net income to be in the range of $68.80 million to $77.20 million. For fiscal year 2016, the company expects operating income to be in the range of $23.70 million to $38.80 million. For fiscal year 2016, the company expects adjusted operating income to be in the range of $120 million to $135 million. For financial year 2016, the company projects diluted earnings per share to be in the range of $1.65 to $1.85 on adjusted basis.

The company has spent $137.02 million cash to meet investing activities during the nine month period as against cash outgo of $155.55 million in the last year period.

The company has spent $10.83 million cash to carry out financing activities during the nine month period as against cash inflow of $96.01 million in the last year period.

Cash and cash equivalents stood at $129.99 million as on Sep. 30, 2016, up 11.38 percent or $13.28 million from $116.71 million on Sep. 30, 2015.

Working capital increases marginally
Athenahealth has recorded an increase in the working capital over the last year. It stood at $132.60 million as at Sep. 30, 2016, up 3.61 percent or $4.62 million from $127.98 million on Sep. 30, 2015. Current ratio was at 1.71 as on Sep. 30, 2016, down from 1.72 on Sep. 30, 2015.

Days sales outstanding went down to 46 days for the quarter compared with 53 days for the same period last year.

At the same time, days payable outstanding went down to 12 days for the quarter from 13 for the same period last year.