Community Health Systems reported a sharp year-over-year decline in third-quarter earnings and adjusted EBITDA, even as patient volumes and operating cash flow improved on a same-store basis. The hospital operator attributed the weaker results chiefly to divestitures, unfavorable payer mix and higher costs.
The company also updated its 2026 annual earnings guidance. The guidance figures and assumptions are not included in the material provided here.
Key details
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Revenue fell 10.7% to $2.757 billion from $3.087 billion a year earlier. On a same-store basis, revenue rose 3.8%, reflecting improved performance at hospitals included in both periods.
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Reported patient volumes declined, while same-store volumes grew. Admissions were down 12.3% and adjusted admissions fell 11.9% year over year across the reported business. On a same-store basis, admissions increased 2.2% and adjusted admissions rose 3.6%.
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The company posted a net loss attributable to shareholders of $86 million, or 63 cents per diluted share, compared with net income of $130 million, or 96 cents per share, in the third quarter of 2025. Excluding adjusting items, the loss was 48 cents per share, versus adjusted earnings of $1.27 per share a year earlier.
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Adjusted EBITDA was $280 million, down from $376 million. The company cited divestitures, an unfavorable change in payer mix, lower non-patient revenue and higher medical specialist fees and supplemental reimbursement program expenses. The prior-year quarter included $28 million from a legal settlement, which also contributed to the comparison. Increased volumes and reimbursement rates partly offset the pressures.
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Operating cash flow increased to $155 million from $70 million in the year-earlier quarter.
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Management said payer mix and patient acuity were weaker than expected. CEO Kevin Hammons said volume trends and cash flow improved sequentially, but the shortfall in payer mix and acuity weighed on quarterly results and the company’s expectations for the rest of the year.
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For the first nine months of 2026, revenue totaled $8.547 billion, down 8.9% from $9.379 billion in the same period of 2025. The company also announced updated full-year 2026 earnings guidance, but the specific forecast is not included in the text provided.
Plain-English implications
The contrast between declining reported revenue and growing same-store revenue and volumes reflects, in part, the effect of divestitures on year-over-year comparisons. But the quarter’s lower adjusted EBITDA shows that stronger same-store activity did not offset weaker payer mix and acuity, along with higher expenses and reduced non-patient revenue. Operating cash flow was higher than a year ago.