US Physical Therapy (USPH) Q2 2026 Earnings Report

The call portrays strong operational momentum — solid revenue growth, record visit volumes, improving revenue per visit, active M&A and an expanding hospital-affiliation pipeline that management expects will materially lift results in late 2023 and 2027. Near-term profitability was pressured by elevated employee self-insured medical costs, front-loaded hiring for hospital rollouts and integration costs, leading to margin compression, lower net income and EPS. Management reaffirmed full-year adjusted EBITDA guidance and highlighted meaningful upside from ongoing hospital affiliations and rate increases, indicating confidence in future performance.

Management reaffirmed full‑year 2026 adjusted EBITDA guidance of $102–$106 million, citing Q2 momentum — total revenue $214.0M (+8.5%), PT revenue $182.0M (+8.4%), 1,662,000 visits (+6.6%), average daily visits per clinic a record 33.5, and PT revenue per visit $107.59 (+$2.26) — and expects hospital affiliations and rate lifts to drive back‑half strength. The 2026 outlook assumes a 1.75% Medicare increase (1.1% after Medicare Advantage mix), equating to roughly $2.5M of lift (~$0.35 per visit); Q2 included $5.6M of hospital‑affiliation revenue and management indicated remaining integrations should add roughly $1.5–$2.0M in Q4 with materially more benefit in 2027 (prior modeled hospital contribution ~$7.3M and now expected to be higher). They noted headwinds — a YTD ~$3.2M adverse swing from self‑insured medical claims and front‑loaded hiring that pressured margins (adjusted PT gross margin 19.9%, adjusted salaries & related 57.5% of revenue) — while retaining liquidity (cash $25M, $221M borrowings, $229M revolver availability on a $450M facility with $125M accordion) and continuing M&A (recent 12‑clinic deal: $16.4M purchase generating ~$12M annual revenue and ~112k visits).