Tenet Healthcare Corporation

What they do

Tenet runs two reporting segments: Hospital Operations and Services, and Ambulatory Care. Hospital Operations includes 50 acute care and specialty hospitals in eight states, 135 outpatient facilities (urgent care, imaging, off-campus EDs, micro hospitals) as of June 30, 2026, and Conifer Health Solutions, which provides revenue cycle management and value-based care services. Ambulatory Care is USPI, which held interests in 538 ASCs (405 consolidated) and 26 surgical hospitals (eight consolidated) in 37 states as of June 30, 2026.

Revenue drivers

• Hospital Operations and Services — Acute care and specialty hospitals plus outpatient facilities; for the year ended December 31, 2025, approximately 70% ($9.696 billion) of net patient service revenues for these hospitals and related outpatient facilities came from managed care payers, including Medicare and Medicaid managed care.
• Ambulatory Care (USPI) — ASC and surgical hospital ownership and management; second quarter 2026 Ambulatory segment net operating revenues were $1.388 billion, and Ambulatory Adjusted EBITDA was $542 million, up 8.8% year over year.
• Conifer Health Solutions — Revenue cycle management and value-based care services to hospitals, health systems, physician practices, employers and other clients, reported within the Hospital Operations segment.

Recent performance

Second quarter 2026 net operating revenues were $5.628 billion versus $5.271 billion in second quarter 2025. Net income available to common shareholders was $826 million, or $9.84 per diluted share, compared with $288 million, or $3.14 per diluted share. Adjusted EBITDA rose 16.3% to $1.304 billion, and adjusted diluted EPS rose 52.2% to $6.12. Hospital Adjusted EBITDA margin improved to 18.0% from 15.6% despite payer mix headwinds, and Ambulatory Adjusted EBITDA grew 8.8% to $542 million.

Strategy

Management cites strong same-store revenue growth and expense management, and says it is navigating industry dynamics through operational execution, investments in innovation, and a focus on higher-acuity services. In September 2025 Tenet opened the 54-bed Florida Coast Medical Center in Port St. Lucie, Florida, offering cardiac care, diagnostics, emergency care, general surgery, neurosciences, orthopedics, robotics and urology. USPI continues to expand its ASC and surgical hospital footprint across 37 states. The board authorized a $2.0 billion increase to the share repurchase program in July 2026, leaving $2.13 billion remaining as of July 23, 2026.

Risks

• Managed care contracting and payer concentration — About 70% ($9.696 billion) of 2025 Hospital Operations net patient service revenues came from managed care payers, so failure to maintain or renew favorable contracts, rate reductions, or collection difficulty could hurt results.
• Payer mix and exchange admissions — Second quarter 2026 Adjusted EBITDA growth was partly offset by unfavorable payer mix due to lower exchange admissions.
• Payer consolidation — Tenet states that ongoing consolidation among non-government payers tends to increase their bargaining power over contract terms.
• Leverage and interest-rate exposure — The ratio of net debt to Adjusted EBITDA was 2.33x at June 30, 2026, up from 2.25x at December 31, 2025.

Outlook

Tenet raised its full-year 2026 Adjusted EBITDA outlook to $4.83 billion to $5.03 billion, a $295 million increase at the midpoint. Full-year 2026 Adjusted Free Cash Flow is now expected at $2.725 billion to $3.025 billion, a $225 million increase. Management said second quarter 2026 Adjusted EBITDA exceeded the high end of its guidance range.