EarningsQ2 2026 Earnings Report
MX:EHC Q2 2026 EPS Results
Actual EPS$28.05
Consensus EPS$26.78
Beat/MissBeat by +$1.27
One Year Ago EPS$25.33
MX:EHC Q2 2026 Revenue Results
Actual Revenue$28.91B
Expected Revenue$28.43B
Beat/MissBeat by +$472.25M
YoY Revenue Growth+9.58%
Earnings Announcement Details
QuarterQ2 2026
Date08/05/2026
TimeAfter Close
Conference CallWednesday, August 5, 2026
MX:EHC Upcoming Earnings
Encompass Health's next earnings date is estimated for October 28, 2026, based on past reporting schedules.
Q2 2026 Earnings Call Audio
MX:EHC Q2 2026 Earnings Call
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Q2 2026 Earnings Slide Deck
Q2 2026 Earnings Call Summary
Earnings Call Sentiment|Positive
The call conveyed a predominantly positive operational and financial story: strong top-line and EPS growth, raised 2026 guidance, improving occupancy and de novo ramp economics, meaningful workforce improvements driving retention and quality, successful capital-return actions (dividend increase and repurchase authorization), and a favorable CMS pricing rule offsetting some pressures. Key challenges include a retroactive Florida net provider tax adjustment (~$11M adverse impact), higher SWB and preopening costs, persistent Medicare Advantage denial friction, and increased CapEx intensity. Overall, the positives (revenue/EBITDA/EPS growth, guidance raise, quality metrics, pipeline, and successful workforce initiatives) materially outweigh the manageable negatives described.Company Guidance
Top-Line and Profitability Growth
Q2 revenue grew 9.6% year-over-year; adjusted EBITDA increased 9.2% to $348 million; adjusted EPS rose 10.7%.
Raised Full-Year 2026 Guidance
Company raised 2026 guidance: net operating revenue $6.41B–$6.49B, adjusted EBITDA $1.365B–$1.395B, and adjusted EPS $6.02–$6.25.
Strong Discharge and Quality Metrics
Q2 discharge-to-community 84.7%, discharge-to-acute 8.4%, discharge-to-SNF 6.1%, with performance stated as exceeding industry averages.
Volume and Pricing Drivers
Discharge growth of 5.6% and net revenue per discharge increased 3.9% (driven by higher patient acuity); Medicare IRF 2027 final rule estimated to raise net revenue per Medicare discharge by ~2.3% beginning Oct 1, 2026.
Medically Complex Case Growth
Stroke and brain injury categories showed notable growth (stroke +7.9% total / +5.5% same-store; brain injury +8.0% total / +3.9% same-store), while lower-extremity joint cases were up modestly (~1%).
Capacity Expansion and Development Pipeline
Opened 3 hospitals YTD (139 beds) and added 54 beds; Q2 opened a 50-bed (Concordville, PA) and 40-bed (Loganville, GA) hospital. Plan to open 5 more hospitals (250 beds) and add 100–150 beds for the remainder of the year. Pipeline beyond 2026: 13 hospitals / 606 beds.
Occupancy and Census Improvements
Q2 occupancy 77.4%, up 290 basis points YoY; sequential ADC trends improved with Q1 and Q2 representing the first two quarters with ADC >9,000 in company history.
Workforce Development and Retention Gains
Career ladder participation at 43% of eligible RNs; nursing turnover annualized ~19% (lowest in 12+ years), therapy turnover ~7% (lowest in 5 years). Laddered RN turnover ~5% vs non-ladder ~25%. CRRN certification at ~22% of RNs; certified nurses up ~21% YoY and 60% since 2023.
Labor Cost Improvements and Efficacy
Premium labor costs declined $2.6M to $25M vs. Q2/25; contract labor FTEs 1.1% of total FTEs (improvement of 20 bps YoY); SWB per FTE rose 3.4% in Q2 reflecting ladder participation benefits.
Capital Allocation and Balance Sheet Actions
Repurchased ~704k shares for $74.2M in Q2 (YTD ~1.412M shares / $145.8M); increased share repurchase authorization to $1.0B; announced quarterly dividend increase to $0.21; issued $500M 5.875% notes due 2034 and redeemed $400M 2028 notes; net leverage 1.9x.
De Novo Ramp Efficiency
De novo hospitals achieve 4-wall positive EBITDA by ~month 6 on average and typically >70% occupancy by month 10, with recent openings ramping favorably.
Admit-and-Appeal Pilot Success
Admit-and-appeal pilot for prior-authorization denials: 298 patients admitted, 144 adjudicated, and prevailed on 128 (89% success) — indicating strong appeal outcomes to date.
MX:EHC Earnings History
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat
Missed