Brookdale Senior Living (B7S) Q2 2026 Earnings Report

Overall the call was constructive and cautiously optimistic. Management reported solid RevPAR (+8.2% YoY), modest adjusted EBITDA growth (+4.3% YoY in Q2) and positive adjusted free cash flow, while proactively strengthening liquidity and refinancing near-term maturities. They reaffirmed full‑year guidance and outlined clear execution actions (sales leadership hire, First Impressions reinvestments, selective acquisitions, and cost actions) to accelerate results in H2. Key challenges remain — occupancy growth lagged internal expectations in Q2, resident fees declined due to unit base reductions, some operating expenses were elevated, and leverage, though improved, is still above target. On balance, the positives and execution plans materially outweigh the near-term operational headwinds.

Brookdale reaffirmed 2026 guidance of 8%–9% consolidated RevPAR growth and $502M–$516M adjusted EBITDA, and reiterated its multi‑year targets of mid‑teen annual adjusted EBITDA growth and reducing leverage to <6.0x by year‑end 2028; Q2 actuals included $122.1M adjusted EBITDA (+4.3% YoY), RevPAR +8.2% YoY, consolidated RevPOR +5.2% (same‑community +4.1%), consolidated occupancy 82.4% (+230 bps YoY; same‑community 82.9% +110 bps), and adjusted free cash flow of $38.2M (now meaningfully positive YTD). Management expects full‑year consolidated occupancy of ~83%, average units of 42,820 in Q2 declining to ~42,200 in Q3 and ~41,500 in Q4 (reflecting planned dispositions), third‑quarter adjusted EBITDA growth in the low double‑digits and fourth‑quarter growth above mid‑teens, labor as a % of revenue to slightly improve in Q3/Q4, annual G&A of ~$157M, cash lease expense slightly under $180M, CapEx of $175M–$195M, liquidity of $566M and annualized leverage improved to 8.4x (from 8.8x). Strategic transactions noted: closed Brookdale Galleria for $23.4M (244 units), announced purchase of 17 leased communities for ~ $157M (735 units; ~$214k/unit) expected to add roughly $11M to 2027 adjusted EBITDA, and expect ~30 “First Impressions” projects in 2026 averaging $500k–$600k each, with total disposition net proceeds for 2026 of ~ $190M.