How Pro Medicus (ASX:PME) is expanding its US hospital contracts after record FY26 earnings

Sonal Goyal

11 November 2026 10:38 PM AEDT

How Pro Medicus (ASX:PME) is expanding its US hospital contracts after record FY26 earnings

Image Source: Shutterstock

You are reading a free article with opinions that may differ from the recommendation given by Kalkine in its paid research reports. Become a Kalkine member today to get access to our research reports, in-depth technical and fundamental research. Learn more

Start Your Free Trial Now!

Key Highlights

Pro Medicus reported FY26 Revenue of AUD 261.7 million, increasing 22.9% YoY, while underlying net profit after tax rose 24.1% to AUD 144.7 million.
The company secured 10 new contracts worth a combined minimum of AUD 407 million during FY26 and renewed six existing agreements worth AUD 141 million.
Three additional US healthcare contracts announced between August and October 2026 carried a combined minimum value of AUD 92 million.
Pro Medicus ended FY26 with AUD 252.3 million in cash and other financial assets, no Debt and an underlying EBIT Margin of 74.9%.

Pro Medicus Limited (ASX:PME) develops medical imaging software used by hospitals, radiology providers and healthcare institutions to manage, interpret and distribute diagnostic images. Its principal Visage 7 platform provides cloud-based imaging, workflow management and image archiving capabilities. The company operates internationally, with North America representing its largest revenue market. During FY26, increasing transaction volumes, new hospital contracts and software implementations supported revenue and Earnings growth. Additional US contracts announced after the annual results have expanded its future revenue opportunities, while product development remains focused on medical imaging workflows and artificial intelligence.

FY26 Financial Performance and Profitability

For the financial year ended 30 June 2026, Pro Medicus reported revenue of AUD 261.7 million, representing growth of 22.9% compared with FY25.

Underlying net profit after tax increased 24.1% to AUD 144.7 million, while underlying EBIT rose 24.4% to AUD 196.1 million.

The underlying EBIT margin expanded to 74.9% from 74.0%, reflecting the Operating Leverage of its software business.

On a constant-currency basis, revenue increased 28.4% and underlying net profit grew 32.5%.

Statutory net profit after tax reached AUD 265.3 million, including a substantial non-cash fair-value gain associated with financial investments.

This investment-related gain is separate from operating earnings generated by medical imaging software.

At 30 June 2026, Pro Medicus held AUD 252.3 million in cash and other financial Assets and remained debt-free.

The company declared a fully franked final Dividend of 37 Australian cents per share, bringing total FY26 dividends to 69 cents.

US Hospital Contracts Expand Revenue Opportunities

Pro Medicus continued securing healthcare technology agreements across the United States during 2026.

In FY26, the company signed 10 new contracts with a combined minimum value of AUD 407 million.

These included a 10-year, AUD 170 million agreement with UCHealth in Colorado and a seven-year, AUD 90 million agreement with Beth Israel Lahey Health.

All six contracts scheduled for renewal during FY26 were renewed, representing a combined minimum value of AUD 141 million.

Additional agreements followed the annual results.

On 21 August 2026, Pro Medicus announced a seven-year, AUD 25 million contract with Valley Health in Virginia.

In October, it announced a seven-year, AUD 24 million agreement with Billings Clinic–Logan Health in Montana.

A further seven-year, AUD 43 million contract with Virtua Health in New Jersey expanded its US hospital customer base.

The three agreements represent a combined minimum contract value of AUD 92 million.

These contracts generally follow a transaction-based revenue model, with fees linked to medical imaging examination volumes.

Consequently, actual revenue contributions depend on implementation timing, contracted minimums and customer usage.

Visage 7 Platform and Product Development

The Visage 7 platform supports radiology image viewing, workflow management and image storage across large healthcare organisations.

Its cloud-based architecture allows clinicians to access diagnostic images without transferring complete imaging datasets to individual workstations.

The company continues expanding the platform across radiology, cardiology and other medical imaging applications.

During FY26, Pro Medicus completed 16 implementations, including several major hospital deployments.

These deployments are expected to contribute additional transaction revenue during FY27 as customer examination volumes increase.

Product development also includes an AI-optimised reporting solution designed to support radiologists' diagnostic workflows.

Management is targeting an early calendar 2027 US launch for the reporting module.

The company is also developing digital pathology capabilities and AI-assisted image analysis tools.

Commercial contributions from these products will depend on regulatory requirements, product readiness and customer adoption.

FY27 Outlook and Operational Priorities

Pro Medicus has not issued formal quantitative FY27 earnings guidance.

However, management expects increased transaction revenue contributions from recently implemented hospital systems and further deployments scheduled during the financial year.

The company's established US customer relationships and recurring transaction-based contracts provide visibility over a portion of future revenue.

Additional growth opportunities include expanding existing customer agreements to incorporate cardiology, workflow and archive products.

The Business is also investing in software development, cloud capabilities and AI-enabled medical imaging applications.

These initiatives may broaden the range of services offered to healthcare customers, although implementation schedules and adoption rates remain uncertain.

Business Risks and Earnings Considerations

Pro Medicus remains exposed to customer concentration, implementation delays, foreign-exchange movements and competition within medical imaging software.

North America accounts for approximately 90% of revenue, creating sensitivity to US healthcare spending and changes in the Australian dollar.

Large hospital deployments can involve complex technology integration, making project scheduling important to transaction revenue growth.

Regulatory approvals and clinical validation requirements may affect the commercialisation of newer AI products.

The company also faces cybersecurity, data privacy and software reliability obligations associated with healthcare information systems.

Maintaining product performance, customer retention and implementation efficiency will remain important as the business expands.

Key Insights

Pro Medicus Limited (ASX:PME) delivered higher revenue and underlying profitability in FY26, supported by new hospital contracts, existing customer renewals and medical imaging software deployments. Additional US agreements announced during August and October 2026 expanded its contracted revenue opportunities. With a debt-free Balance Sheet and recurring transaction-based revenue model, the company is continuing to invest in new imaging applications. Its FY27 operating performance will depend on customer implementations, examination volumes and adoption of additional software products.

Download Free Report – Explore 3 Stock Ideas & Industry Insights

Unlock 3 stock ideas and key industry insights in our free report. This information is general in nature and does not consider your personal objectives, financial situation, or needs. It is not financial advice.

All investments involve risk—consider independent advice before making any investment decisions.

View 3 Research Reports

Disclaimer:

This article (“Article”) has been prepared by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and its related bodies corporate who are authorised to provide general financial product advice. Kalkine.com.au and its associated pages are published by Kalkine.

Any information/advice provided in this article is general in nature and does not take into account your objectives, financial situation or needs. You should therefore consider whether the information is appropriate for your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Memorandum or other offer document (“Offer Document”) for the securities or other financial products referred to in Kalkine articles. You should obtain a copy of the Offer Document and consider it before making any decision about whether to acquire the security or financial product.

Kalkine strongly recommends that you seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) before acting on any advice/information in this Article or on the Kalkine website. Not all investments are appropriate for all people.

The information in this Article and on Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of the information contained in its articles (including this Article), newsletters and websites. All information represents our views at the date of publication and may change without notice.

The information in this Article does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products.

Kalkine does not issue, sell or deal in any financial products.

This Article may contain information on past performance of particular investments. Please note past performance is neither an indicator nor a guarantee of future performance.

To the extent permitted by law, and excluding any dishonesty or gross negligence by Kalkine, Kalkine disclaims and excludes all liability for any direct, indirect, implied, punitive, special, incidental or other consequential loss or damage arising from the use of or reliance on this Article, the Kalkine website and any information published on the Kalkine website without any warranties or representations by Kalkine to you. To the extent the law prohibits or limits this exclusion, Kalkine limits its liability to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this Article or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Some of the images/music that may be used in the Article are copyright to their respective owner(s). Kalkine does not claim ownership of any of the pictures displayed/music used in the Article unless stated otherwise. The images/music that may be used in the Article are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.