Tenet Reports Strong Second Quarter 2025 Results; Raises 2025 Financial Outlook

• Net income available to common shareholders in second quarter 2025 was $288 million, or $3.14 per diluted share
• Adjusted diluted earnings per share¹ increased 74% to $4.02 in second quarter 2025 compared to $2.31 in second quarter 2024
• Consolidated Adjusted EBITDA¹ in second quarter 2025 increased 18.6% to $1.121 billion compared to second quarter 2024; Second quarter 2025 Adjusted EBITDA margin was 21.3%
• Second quarter 2025 Ambulatory Care Adjusted EBITDA of $498 million increased 11.4% over second quarter 2024
• Board of Directors authorized a $1.5 billion increase to the share repurchase program
• FY 2025 Adjusted EBITDA Outlook is now expected to be in the range of $4.40 billion to $4.54 billion, a $395 million increase at the midpoint

Tenet Healthcare Corporation (Tenet) (NYSE:THC) today announced its results for the quarter ended June 30, 2025.

"Our strong second quarter results extend our track record of attractive same store revenue growth, operational performance driven by fundamentals, and robust free cash flow generation," said Saum Sutaria, M.D., Chairman and Chief Executive Officer of Tenet. "We continue to make investments both organically and inorganically to expand our capabilities and innovate to better serve our patients."

Tenet's results for second quarter 2025 versus second quarter 2024 are as follows:

• Net income available to the Company's common shareholders in second quarter 2025 was $288 million, or $3.14 per diluted share, versus $259 million, or $2.64 per diluted share, in second quarter 2024.
• Adjusted EBITDA¹ in second quarter 2025 was $1.121 billion compared to $945 million in second quarter 2024, reflecting strong growth in same facility revenue, higher acuity, favorable payer mix, and disciplined expense management.
• In the second quarter of 2025, the Hospital segment recognized a $79 million favorable pre-tax impact associated with additional Medicaid supplemental revenues related to prior periods, including the recently approved program in Tennessee. Second quarter 2024 results included a $30 million favorable pre-tax impact associated with additional Medicaid supplemental revenues related to prior years.

Balance Sheet and Cash Flows

• Cash flows provided by operating activities for the six months ended June 30, 2025 were $1.751 billion versus $1.333 billion for the six months ended June 30, 2024.
• The Company produced free cash flow¹ of $1.385 billion for the six months ended June 30, 2025 versus $948 million for the six months ended June 30, 2024.
• In the three months ended June 30, 2025, the Company repurchased 4.6 million shares of common stock for $747 million. In the six months ended June 30, 2025, the Company repurchased 7.2 million shares of common stock for $1.095 billion.
• The Company's Board of Directors authorized a $1.5 billion increase to the share repurchase program. With this new authorization, the Company has $1.781 billion remaining under its repurchase authorization as of July 22, 2025. Repurchases will be made at management's discretion from time to time in the open market or through privately negotiated transactions, subject to market conditions and other relevant factors.
• The Company's ratio of net debt to Adjusted EBITDA¹ was 2.45x at June 30, 2025 compared to 2.46x at March 31, 2025 and 2.54x at December 31, 2024.

Ambulatory Care (Ambulatory) Segment

Tenet's Ambulatory business segment is comprised of the operations of United Surgical Partners International (USPI). As of June 30, 2025, USPI had interests in 521 ambulatory surgery centers (385 consolidated) and 26 surgical hospitals (eight consolidated) in 37 states.

• Second quarter 2025 net operating revenues increased 11.3% compared to second quarter 2024 driven by strong net revenue per case growth, acquisitions of facilities, and increased service lines.
• Surgical business same-facility system-wide net patient service revenues increased 7.7% in second quarter 2025 compared to second quarter 2024, with cases down 0.6% and net revenue per case up 8.3%. Net revenue per case growth was driven by favorable case mix, increases in higher acuity volumes over the prior year, as well as favorable payer mix.
• Second quarter 2025 Adjusted EBITDA increased 11.4% compared to second quarter 2024, due to strong net revenue per case growth, disciplined expense management, and contributions from acquisitions.

Hospital Operations and Services (Hospital) Segment

Tenet's Hospital business segment is primarily comprised of acute care and specialty hospitals, imaging centers, ancillary outpatient facilities, micro-hospitals and physician practices. It also provides comprehensive end-to-end and focused point services, including hospital and physician revenue cycle management, patient communications and engagement support and value-based care solutions.

• Second quarter 2025 net operating revenues increased 0.9% from second quarter 2024 primarily due to growth in same hospital admissions, favorable payer mix and higher acuity, partially offset by the impact of hospital divestitures in 2024.
• Same-hospital net patient service revenue per adjusted admission increased 5.2% year-over-year for second quarter 2025 primarily due to favorable payer mix, and our focus on growing higher acuity services.
• Adjusted EBITDA in second quarter 2025 was $623 million compared to $498 million in second quarter 2024, reflecting strong same-hospital revenue growth, favorable payer mix, and disciplined expense management.
• In the second quarter of 2025, the Hospital segment recognized a $79 million favorable pre-tax impact associated with additional Medicaid supplemental revenues related to prior periods, including the recently approved program in Tennessee. Second quarter 2024 results included a $30 million favorable pre-tax impact associated with additional Medicaid supplemental revenues related to prior years.

2025 Outlook¹

Tenet's Outlook for full year 2025 (consolidated and by segment) follows.

Management's Webcast Discussion of Results

Tenet management will discuss the Company's second quarter 2025 results in a webcast scheduled for 10:00 a.m. Eastern Time (9:00 a.m. Central Time) on July 22, 2025. Investors can access the webcast through the Company's website at www.tenethealth.com/investors.

The slide presentation associated with the webcast referenced above, a copy of this earnings press release, and a related supplemental financial disclosures document will be available on the Company's Investor Relations website on July 22, 2025.

Cautionary Statement

This release contains "forward-looking statements" - that is, statements that relate to future, not past, events. In this context, forward-looking statements often address the Company's expected future business and financial performance and financial condition, and often contain words such as "expect," "anticipate," "assume," "believe," "budget," "estimate," "forecast," "intend," "plan," "predict," "project," "seek," "see," "target," or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that could cause the Company's actual results to be materially different than those expressed in the Company's forward-looking statements include, but are not limited to the factors disclosed under "Forward-Looking Statements" and "Risk Factors" in our Form 10-K for the year ended December 31, 2024 and other filings with the Securities and Exchange Commission.

Footnotes

1. Tables and discussions throughout this earnings release include certain financial measures, including those related to our full year 2025 Outlook, that are not in accordance with accounting principles generally accepted in the United States of America (GAAP). Reconciliations of GAAP measures to the Adjusted (non-GAAP) measures used are detailed in Tables #1-6 included at the end of this earnings release. Management's reasoning for the use of these non-GAAP measures and descriptions of the various non-GAAP measures are included in the Non-GAAP Financial Measures section of this earnings release.
2. Same-facility system-wide revenues and statistical information include the results of the facilities in which the Ambulatory segment has an investment that are not consolidated by Tenet. To help analyze the segment's results of operations, management uses system-wide measures, which include revenues and cases of both consolidated and unconsolidated facilities.
3. For 2025, same-hospital revenues and statistical data include those for hospitals and hospital-affiliated outpatient centers operated by the Company's Hospital segment continuously from January 1, 2024 through June 30, 2025. Amounts associated with physician practices are excluded.
4. Adjusted admissions represent actual patient admissions adjusted to include outpatient services provided by facilities in our Hospital segment by multiplying actual patient admissions by the sum of gross inpatient revenues and outpatient revenues, then dividing that result by gross inpatient revenues.
5. Income tax expense is calculated by multiplying 24% (the federal corporate tax rate of 21% plus an estimate of state taxes) by the sum of: pretax income less GAAP facility level NCI expense plus permanent differences, and non-deductible interest expense.
6. Change versus prior year is presented on a same-facility system-wide basis for USPI Ambulatory surgical cases and on a same-hospital basis for hospital statistics.

About Tenet Healthcare

Tenet Healthcare Corporation (NYSE:THC) is a diversified healthcare services company headquartered in Dallas. Our care delivery network includes United Surgical Partners International, the largest ambulatory platform in the country, which operates ambulatory surgery centers and surgical hospitals. We also operate a national portfolio of acute care and specialty hospitals, other outpatient facilities, a network of leading employed physicians and a global business center in Manila, Philippines. Our Conifer Health Solutions subsidiary provides revenue cycle management and value-based care services to hospitals, health systems, physician practices, employers and other clients. Across the Tenet enterprise, we are united by our mission to deliver quality, compassionate care in the communities we serve. For more information, please visit www.tenethealth.com.

Non-GAAP Financial Measures

The Company believes the non-GAAP measures described below are useful to investors and analysts because they present additional information on the Company's financial performance. Investors, analysts, Company management and the Company's Board of Directors utilize these non-GAAP measures, in addition to GAAP measures, to track the Company's financial and operating performance and compare the Company's performance to its peer companies, which use similar non-GAAP financial measures in their presentations and earnings releases. The Human Resources Committee of the Company's Board of Directors also uses certain of these measures to evaluate management's performance for the purpose of determining incentive compensation. Additional information regarding the purpose and utility of specific non-GAAP measures used in this release is set forth below.

• Adjusted EBITDA is defined by the Company as net income available (loss attributable) to Tenet common shareholders before (1) the cumulative effect of changes in accounting principles, (2) net loss attributable (income available) to noncontrolling interests, (3) income (loss) from discontinued operations, net of tax, (4) income tax benefit (expense), (5) gain (loss) from early extinguishment of debt, (6) other non-operating income (expense), net, (7) interest expense, (8) litigation and investigation benefit (costs), net of insurance recoveries, (9) net gains (losses) on sales, consolidation and deconsolidation of facilities, (10) impairment and restructuring charges and acquisition-related costs, (11) depreciation and amortization and (12) income (loss) from divested and closed businesses (i.e., health plan businesses). Litigation and investigation costs excluded do not include ordinary course of business malpractice and other litigation and related expenses.

• Adjusted diluted earnings (loss) per share is defined by the Company as Adjusted net income available (loss attributable) to Tenet common shareholders, divided by the weighted average diluted shares outstanding in the reporting period.

• Adjusted net income available (loss attributable) to Tenet common shareholders is defined by the Company as net income available (loss attributable) to Tenet common shareholders before (1) income (loss) from discontinued operations, net of tax, (2) gain (loss) from early extinguishment of debt, (3) litigation and investigation benefit (costs), net of insurance recoveries, (4) net gains (losses) on sales, consolidation and deconsolidation of facilities, (5) impairment and restructuring charges and acquisition-related costs, (6) income (loss) from divested and closed businesses (i.e., health plan businesses) and (7) the associated impact of these items on taxes and noncontrolling interests. Litigation and investigation costs excluded do not include ordinary course of business malpractice and other litigation and related expenses.

• Free Cash Flow is defined by the Company as (1) net cash provided by (used in) operating activities, less (2) purchases of property and equipment.

• Adjusted Free Cash Flow is defined by the Company as (1) Adjusted net cash provided by (used in) operating activities, less (2) purchases of property and equipment.

• Adjusted net cash provided by (used in) operating activities is defined by the Company as cash provided by (used in) operating activities prior to (1) payments for restructuring charges, acquisition-related costs and litigation costs and settlements, and (2) net cash provided by (used in) operating activities from discontinued operations.

The Company believes that Adjusted EBITDA is a useful measure, in part, because certain investors and analysts use both historical and projected Adjusted EBITDA, in addition to other GAAP and non-GAAP measures, as factors in determining the estimated fair value of shares of the Company's common stock. Company management also regularly reviews the Adjusted EBITDA performance for each operating segment. The Company does not use Adjusted EBITDA to measure liquidity, but instead to measure operating performance.

The Company uses, and believes investors use, Free Cash Flow and Adjusted Free Cash Flow as supplemental non-GAAP measures to analyze cash flows generated from the Company's operations. The Company believes these measures are useful to investors in evaluating its ability to fund distributions paid to noncontrolling interests or for acquisitions, purchasing equity interests in joint ventures or repaying debt.

These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Because these measures exclude many items that are included in the Company's financial statements, they do not provide a complete measure of the Company's operating performance. For example, the Company's definitions of Free Cash Flow and Adjusted Free Cash Flow do not include other important uses of cash including (1) cash used to purchase businesses or joint venture interests, or (2) any items that are classified as Cash Flows from Financing Activities on the Company's Consolidated Statement of Cash Flows, including items such as (i) cash used to repay borrowings, or (ii) distributions paid to noncontrolling interests. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company's financial performance.

See corresponding reconciliations of the non-GAAP financial measures referred to above to the most comparable GAAP financial measures in Tables #1 - 6 below.