Surgery Partners, Inc.

What they do

The company owns or operates surgical facilities, primarily in partnership with physicians, across 30 states. As of June 30, 2026, the portfolio consisted of 178 surgical facilities: 159 ambulatory surgery centers and 19 surgical hospitals. Facilities provide non-emergency procedures across specialties including orthopedics and pain management, ophthalmology, gastroenterology and general surgery. Ancillary operations include anesthesia services, urgent care facilities and multi-specialty physician practices.

Revenue drivers

• Surgical Facilities (sole reportable segment) — The segment includes ASCs, surgical hospitals, anesthesia services, urgent care and multi-specialty physician practices, and contributed substantially all of total revenue in 2025, 2024 and 2023. Patient services at ASCs and surgical hospitals generated approximately $3.2 billion of the $3.31 billion in 2025 annual revenue.
• Same-facility revenue and case volume — Growth is measured primarily through same-facility revenue and cases, driven by physician recruitment, service line expansion and revenue per case. In Q2 2026, same-facility revenue rose 5.0% on a 4.8% increase in revenue per case and a 0.3% increase in same-facility cases.
• Third-party payor reimbursement — Revenue depends on payments from government health care programs and private insurance payors, including HMOs, PPOs and other managed care organizations. Payor mix and surgical case mix are cited as factors that affect results.
• Acquisitions and health-system partnerships — The company pursues a disciplined acquisition strategy, new physician partnerships and strategic relationships with health systems seeking to build or expand ambulatory surgery footprints.

Recent performance

Second quarter 2026 revenue increased 2.7% to $848.9 million from $826.2 million in the prior-year quarter. Same-facility revenue rose 5.0%, with revenue per case up 4.8% and same-facility cases up 0.3%. Adjusted EBITDA was $125.2 million, down from $129.0 million a year earlier, and net loss attributable to Surgery Partners was $15.0 million. Year-to-date 2026 revenue increased 3.6% to $1,659.8 million, while year-to-date Adjusted EBITDA was $227.5 million versus $232.9 million in the prior year period.

Strategy

Management is executing a portfolio optimization strategy, including a pending sale of ownership interests in Mountain View Hospital and Idaho Falls Community Hospital to Intermountain Health, subject to physician, regulatory and other approvals. The company said the transaction is intended to improve cash conversion and reduce leverage. Management reaffirmed full-year 2026 revenue guidance of $3.35 billion to $3.45 billion and Adjusted EBITDA of at least $530 million, excluding the pending divestiture. Stated priorities include supporting a return to growth, enhancing operational efficiency, capitalizing on long-term ASC market tailwinds and deploying capital with discipline.

Risks

• Payor reimbursement pressure — Reductions in payments from government health care programs and private insurance payors, or failure to negotiate favorable contracts, could materially reduce revenue and profitability.
• Physician relationships and competition — The business depends on maintaining relationships with affiliated physicians who use its facilities, and the company faces competition for physicians, nurses, strategic relationships and managed care contracts.
• Acquisition integration and growth execution — Growth depends partly on integrating acquired surgical facilities and attracting new physician partners; failure to do so could limit future growth and hurt operating results.
• Indebtedness — The company carries significant debt, with long-term debt of $3.74 billion at December 31, 2025 and a total net debt to EBITDA ratio of approximately 4.4x at the end of the second quarter of 2026.

Outlook

Management reaffirmed full-year 2026 revenue guidance of $3.35 billion to $3.45 billion and Adjusted EBITDA of at least $530 million, excluding the recently disclosed pending divestiture of facilities in Idaho Falls, Idaho. The company expects the Idaho Falls transaction to improve cash conversion and support deleveraging, though it remains subject to closing conditions. Management also said it will continue disciplined capital allocation and focus on structural ASC market growth.