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Sep 30, 2025
Encompass Health Q3 2025 Earnings Report
Encompass Health reported its results for the third quarter of 2025, showing significant growth in revenue and earnings, and increased its full-year guidance.
Key Takeaways
Encompass Health demonstrated strong performance in the third quarter of 2025, with net operating revenue increasing by 9.4% to $1,477.5 million and diluted EPS from continuing operations rising by 15.9% to $1.24. Adjusted EBITDA also saw an impressive 11.4% growth, reaching $300.1 million. The company further expanded its capacity by opening three new hospitals and adding 39 beds to existing facilities, and increased its full-year guidance.
Net operating revenue for Q3 2025 increased by 9.4% to $1,477.5 million compared to Q3 2024.
Diluted earnings per share from continuing operations grew by 15.9% to $1.24 in Q3 2025.
Adjusted EBITDA rose by 11.4% to $300.1 million for the third quarter of 2025.
The company expanded its inpatient rehabilitation capacity by opening three new hospitals and adding 39 beds to existing hospitals during the quarter.
Forward Guidance
Encompass Health increased its full-year 2025 guidance for net operating revenue, Adjusted EBITDA, and adjusted earnings per share, reflecting continued optimism about its business prospects.
Positive Outlook
- Updated full-year 2025 net operating revenue guidance increased to $5,905 million to $5,955 million from $5,880 million to $5,980 million.
- Updated full-year 2025 Adjusted EBITDA guidance increased to $1,235 million to $1,255 million from $1,220 million to $1,250 million.
- Updated full-year 2025 adjusted earnings per share guidance increased to $5.22 to $5.37 from $5.12 to $5.34.
- The company's value proposition and operating strategy continue to be validated.
- Management remains highly optimistic about the long-term prospects of the business.
Challenges Ahead
- Guidance does not include the future impact of items deemed outside the company's control or not indicative of ongoing operating performance.
- Uncertainty regarding government, class action, and related settlements.
Historical Earnings Impact
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