Tenet raises 2026 EBITDA forecast as Q3 profit climbs

Tenet Healthcare Corporation (THC) raised its full-year 2026 outlook on Oct. 29, after reporting third-quarter adjusted diluted earnings per share of $6.64, up from $3.70 a year earlier.

The company said in a press release attached to its 8-K that the results covered the quarter ended Sept. 30.

Here's how the company did:

• Adjusted diluted EPS: $6.64 vs. $3.70 a year earlier
• Net operating revenues: $5.631 billion vs. $5.289 billion a year earlier
• Adjusted EBITDA: $1.355 billion vs. $1.099 billion a year earlier
• Net income available to common shareholders: $1.000 billion, or $12.41 per diluted share, vs. $342 million, or $3.86 per diluted share, a year earlier

Chairman and Chief Executive Officer Saum Sutaria, M.D., said, "Our outperformance in the third quarter of 2026 was driven by sustained strength in same-store revenue growth and effective expense management."

Adjusted EBITDA rose 23.3% to $1.355 billion, and the adjusted EBITDA margin was 24.1%. Revenue from contract termination added $646 million in the quarter.

The company said the quarter included a $147 million favorable net impact to Adjusted EBITDA from transition activities under its revenue cycle management agreements with CommonSpirit Health, related to Conifer Health Solutions, LLC.

The company recognized cumulative catch-up adjustments that increased revenue from contract termination by $233 million and net operating revenues by $97 million. It said these are timing-related and do not change its 2026 expectations for those revenues.

Segment results

Ambulatory Care net operating revenues rose 7.5% to $1.371 billion. Its Adjusted EBITDA rose 9.1% to $537 million, and same-facility system-wide net patient service revenues increased 4.5%, with cases down 1.5%.

Hospital Operations and Services Adjusted EBITDA was $818 million, compared with $607 million a year earlier, and its margin rose to 19.2% from 15.1%.

Same-hospital admissions rose 2.8%, and adjusted admissions rose 3.2%. The Hospital segment also recognized a $32 million favorable pre-tax impact from additional Medicaid supplemental revenues related to prior years, compared with $38 million a year earlier.

2026 guidance

The company raised its 2026 adjusted EBITDA forecast to $5.05 billion to $5.20 billion, from the $4.83 billion to $5.03 billion range it gave in its July 23 results release.

Its adjusted free cash flow outlook is $2.825 billion to $3.125 billion, up from $2.725 billion to $3.025 billion in July. Its adjusted diluted EPS outlook is $22.05 to $23.01, up from $20.30 to $21.69.

The company's net operating revenues outlook is $22.05 billion to $22.45 billion, against $21.9 billion to $22.5 billion in July.

Cash and capital returns

Net cash provided by operating activities was $3.507 billion for the first nine months of 2026, versus $2.809 billion a year earlier. Adjusted free cash flow was $2.524 billion, from $2.247 billion.

In the third quarter, the company repurchased 970,000 shares for $255 million. For the first nine months, it repurchased 7.99 million shares for $1.615 billion.

Its ratio of net debt to Adjusted EBITDA was 2.11x at Sept. 30, compared with 2.33x at June 30, 2026.

In September, the company completed a private placement of $2.0 billion of 6.250% senior notes maturing in 2034. It used the proceeds, with cash on hand, to redeem all $1.5 billion of its 5.125% senior secured first lien notes due 2027 and to partially redeem $500 million of its 6.125% senior notes due 2028.

According to its SEC filings, net income rose in each of the last three quarters, from $579.0 million in the third quarter of 2025 to $1.04 billion in the second quarter of 2026.