U S PHYSICAL THERAPY INC /NV
For the period ended Sep 30, 2025. Filed Nov 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 7, 2025
USPH$99.49+2.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0001140361-25-029744
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-07.
0001140361-25-041152
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 163 previous paragraphs and 173 current paragraphs.
86 unchanged; 62 reworded; 25 added; 14 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 63 previous and 64 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
On July 31, 2025, we acquired a 60% equity interest in a three-clinic practice with the original practice owners retaining a 40% equity interest.
Current report
(1) Certain incentive costs related to the Metro acquisition and gains or losses related to clinic closures, as applicable.
Current report
(2) Excludes costs related to management contracts.
Current report
(3) Amortization of certain intangible assets was reallocated between the physical therapy operations and IIP segments. Prior year amounts were reallocated to conform with current presentation.
Current report
2025 Third Quarter versus 2024 Third Quarter
Current report
Gross profit increased $7.7 million or 26.6%, to $36.9 million in the 2025 Third Quarter, compared to $29.1 million, for the 2024 Third Quarter.
Current report
(2) Includes 36 owned clinics added during the nine months ended September 30, 2025, and 96 owned clinics added during the year ended December 31, 2024. See Clinic Count Roll Forward on page 36 for additional information.
Current report
(3) Includes 13 owned clinics closed during the nine months ended September 30, 2025 and 45 owned clinics closed during the year ended December 31, 2024. See Clinic Count Roll Forward on page 36 for additional information.
Current report
(7) Amortization of certain intangible assets was reallocated between the physical therapy operations and IIP segments. Prior year amounts were reallocated to conform with current presentation.
Current report
(8) Per visit costs exclude management contract costs.
Current report
Net revenue from physical therapy operations increased $25.4 million, or 17.8%, to $168.1 million for the 2025 Third Quarter from $142.7 million for the 2024 Second Quarter. This growth was due to the increase in visits from the 84 net owned clinics added since the comparable prior year period. Net rate per patient visit for the 2025 Third Quarter was $105.54 compared to $105.65 for the 2024 Third Quarter.
Current report
Total patient visits were 1,554,207, which includes 30,137 home-care visits, for the 2025 Third Quarter, an 18.0% increase from the 2024 Third Quarter. Average daily patient visits per clinic, which does not include home-care visits, was 32.2 for the 2025 Third Quarter, a record-high volume per clinic for a third quarter, compared to 30.1 for the 2024 Third Quarter.
Current report
Operating costs from physical therapy operations increased $18.2 million, or 15.3%, to $136.9 million for the 2025 Third Quarter from $118.7 million for the 2024 Third Quarter primarily driven by the 84 net owned clinics added since the comparable prior year period. Excluding certain incentive costs related to the Metro acquisition and gains and losses related to clinic closures for both periods, total operating costs per visit was $86.88 in the 2025 Third Quarter compared to $86.00 in the comparable prior year period. See the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Current report
Gross profit from physical therapy operations increased $7.2 million or 30.0% to $31.2 million, or 18.6% as a percent of net revenues, for the 2025 Third Quarter as compared to $24.0 million, or 16.8% as a percent of net revenues, for the 2024 Third Quarter. Excluding certain incentive costs related to the Metro acquisition and gains and losses related to clinic closures for both periods, the adjusted gross profit margin (a non-GAAP measure) increased $3.7 million or 13.5% to $31.1 million, or 18.6% as a percent of net revenues, for the 2025 Third Quarter compared to $27.4 million, or 19.2% as a percent of net revenues, for the 2024 third Quarter. See the reconciliation of non-GAAP measures to the more directly comparable GAAP measure provided on page 40 for more information.
Current report
(1) Amortization of certain intangible assets was reallocated between the physical therapy operations and IIP segments. Prior year amounts were reallocated to conform with current presentation.
Current report
2025 Nine Months versus 2024 Nine Months
Current report
Non-GAAP Adjusted EBITDA increased $10.3 million to $70.3 million for the 2025 Nine Months from $60.0 million for the 2024 Nine Months while non-GAAP Operating Results increased $0.6 million to $29.7 million, or $1.96 per share, for the 2025 Nine Months from $29.2 million, or $1.94 per share, for the 2024 Nine Months.
Current report
(7) Amortization of certain intangible assets was reallocated between the physical therapy operations and IIP segments. Prior year amounts were reallocated to conform with current presentation.
Current report
(8) Per visit costs exclude management contract costs.
Current report
Revenues from physical therapy operations increased $72.2 million, or 17.2%, in the 2025 Nine Months versus the comparable prior year period due to increased volume from the 84 net owned clinics added since the comparable prior year period as well as an increase in net rate per patient visit to $105.50 for the 2025 Nine Months from $104.71 for the 2024 Nine Months.
Current report
For the 2025 Nine Months, we had 4,556,768 total patient visits, which includes 81,573 home-care visits, compared to 3,920,388 for the 2024 Nine Months. There were no home-care visits in the 2024 Nine Months.
Current report
Gross profit from physical therapy operations increased $15.0 million or 19.3% to $92.9 million, or 18.8% as a percent of net revenues, for the 2025 Third Quarter as compared to $77.8 million, or 18.5% as a percent of net revenues, for the 2024 Third Quarter. Excluding certain incentive costs related to the Metro acquisition and gains and losses related to clinic closures for both periods, the adjusted gross profit margin (a non-GAAP measure) increased $11.5 million or 14.0% to $93.4 million, or 19.0% as a percent of net revenues for the 2025 Third Quarter compared to $81.9 million, or 19.5% as a percent of net revenues, for the 2024 Third Quarter. See the reconciliation of non-GAAP measures to the more directly comparable GAAP measure provided on page 40 for information.
Current report
(1) Amortization of certain intangible assets was reallocated between the physical therapy operations and IIP segments. Prior year amounts were reallocated to conform with current presentation.
Current report
On September 30, 2025, together with a local partner, we acquired a 100% equity interest in a two-clinic practice for a purchase price of $0.4 million, which was paid in cash. As part of this transaction, we agreed to additional consideration if future objectives are met. The contingent consideration was valued at less than $0.1 million as of September 30, 2025.
Current report
On July 31, 2025, we acquired a 60% equity interest in a three-clinic practice with the practice owners retaining a 40% equity interest. The purchase price for the 60% equity interest was approximately $7.6 million, of which $7.3 million was paid in cash and $0.3 million in the form of a note payable. The note accrues interest at 5.0% per annum and the principal and interest is payable on July 31, 2027. As part of this transaction, we agreed to additional consideration if future operational objectives are met. The contingent consideration was valued at $2.6 million as of September 30, 2025.
Removed paragraphs (14)
Previous report
(1) See definition of the metrics above in the Glossary of Terms – Revenue Metrics on page 38.
Previous report
(2) We also manage clinics owned by third parties through management contracts. In addition to the clinic count shown above, (excluding the home-care business unit count), as of June 30, 2025, we managed 36 clinics bringing the total owned/managed clinics to 768. As of June 30, 2024, we managed 41 clinics bringing the total owned/managed clinics to 722.
Previous report
(3) Excludes home-care visits.
Previous report
2025 Second Quarter versus 2024 Second Quarter
Previous report
Gross profit, which included less than $0.1 million of costs associated with four clinic closures, in the 2025 Second Quarter was $41.6 million, or 21.1% of net revenue, during the 2025 Second Quarter compared to $33.9 million, or 20.3% of net revenue, for the 2024 Second Quarter.
Previous report
(2) Includes six clinics added during the 2025 Second Quarter, 14 clinics added during the 2025 First Quarter and 96 clinics added during the year ended December 31, 2024. (Owned)
Previous report
(3) Includes three clinics closed during the 2025 Second Quarter, seven clincs closed in the 2025 First Quarter and 45 clinics closed during the year ended December 31, 2024. (Owned)
Previous report
Net revenue from physical therapy operations increased $24.8 million, or 17.3%, to $168.3 million for the 2025 Second Quarter from $143.5 million for the 2024 Second Quarter. This growth was due to the increase in visits from the 51 net clinics added since the comparable prior year period and an increase in net rate per patient visit, which reflects the Company’s strategic priority of increasing reimbursement rates through contract negotiations with commercial and other payors, and the addition of acquisitions with accretive net rate per patient visit. Net rate per patient visit for the 2025 Second Quarter was $105.33 up from $105.05 for the 2024 Second Quarter, despite the approximate 2.9% Medicare rate reduction which went into effect on January 1, 2025.
Previous report
Total patient visits were 1,558,756 for the 2025 Second Quarter, a 16.7% increase from the 2024 Second Quarter. Total patient visits includes 28,493 home-care visits, which we will break out separately each period going forward. For the six months ended June 30, 2025, we had 3,002,561 total patient visits, which includes 51,436 home-care visits. There were no home-care visits in the first six months of 2024.
Previous report
Operating costs from physical therapy operations increased by $18.4 million, or 16.0%, to $133.1 million for the 2025 Second Quarter from $114.7 million for the 2024 Second Quarter primarily driven by the 51 net clinics added since the comparable prior year period. Operating costs were 79.1% of net revenue for the 2025 Second Quarter compared to 79.9% of net revenue for the 2024 Second Quarter. Total operating costs per visit (excluding management contracts and certain incentive costs related to Metro) was $83.95 compared to $84.46 in the 2024 Second Quarter, as higher visit volume did not result in a proportional increase in fixed costs.
Previous report
Gross profit from physical therapy operations for the 2025 Second Quarter was $35.2 million with a gross profit margin of 20.9% compared to $28.8 million with a gross profit margin of 20.1% for the 2024 Second Quarter. Excluding certain incentive costs related to the Metro acquisition of $0.2 million, the adjusted gross profit margin was 21.1% for the 2025 Second Quarter (See reconciliation of non-GAAP measures to the most comparable GAAP measure on page 40).
Previous report
2025 Six Months versus 2024 Six Months
Previous report
Revenues from physical therapy operations increased $46.8 million, or 16.8% in the 2025 Six Months versus the comparable prior year period due to increased volume from the 51 net new clinics added since the comparable prior year period as well as an increase in net rate per patient visit to $105.49 for the 2025 Six Months from $104.23 for the 2024 Six Months. Gross profit from physical therapy operations increased $7.9 million, or 14.9%, to $60.7 million for the 2025 Six Months. Excluding certain incentive costs related to the Metro acquisition of $0.3 million, the adjusted gross profit margin was 18.8% for the 2025 Six Months (See reconciliation of non-GAAP measures to the most comparable GAAP measure on page 40).
Previous report
Gross profit from physical therapy operations for the 2025 Six Months was $60.7 million with a gross profit margin of 18.7% compared to $52.8 million with a gross profit margin of 19.0% for the 2024 Six Months. Excluding certain incentive costs related to the Metro acquisition of $0.3 million, the adjusted gross profit margin was 18.8% for the 2025 Six Months (See reconciliation of non-GAAP measures to the most comparable GAAP measure on page 40).
Reworded paragraphs (62)
Previous wording
We operate our business through two reportable business segments. Our physical therapy operations consist of physical therapy and occupational therapy clinics, and home-care physical and speech therapy practices that provide speech therapy, pre- and post-operative care and treatment for a variety of orthopedic-related disorders, and sports-related injuries, and rehabilitation of injured workers. Services provided by the industrial injury prevention services (“IIP”) segment include onsite services for clients’ employees including injury prevention and rehabilitation, performance optimization, post-offer employment testing, functional capacity evaluations and ergonomic assessments. The majority of IIP services is contracted with and paid for directly by employers, including a number of Fortune 500 companies. IIP is performed through Industrial Sports Medicine Professionals with specialized training related to the musculoskeletal system.
Current wording
We operate our business through two reportable business segments. Our physical therapy operations consist of physical therapy and occupational therapy clinics, and home-care physical and speech therapy practices that provide speech therapy, pre- and post-operative care and treatment for a variety of orthopedic-related disorders, sports-related injuries, and rehabilitation of injured workers. Services provided by the industrial injury prevention services (“IIP”) segment include onsite services for clients’ employees including injury prevention and rehabilitation, performance optimization, post-offer employment testing, functional capacity evaluations and ergonomic assessments. The majority of IIP is contracted with and paid for directly by employers, including a number of Fortune 500 companies. IIP is performed through Industrial Sports Medicine Professionals with specialized training related to the musculoskeletal system.
Previous wording
During the six months ended June 30, 2025, and for the year ended December 31, 2024, we completed the acquisitions of clinic practices and IIP businesses detailed below:
Current wording
During the nine months ended September 30, 2025, and for the year ended December 31, 2024, we completed the acquisitions of clinic practices and IIP businesses detailed below:
Previous wording
Our strategy is to continue acquiring multi-clinic outpatient physical therapy practices and home-care physical and speech therapy practices, develop outpatient physical therapy clinics as satellites in existing partnerships, and continue acquiring companies that provide or serve our IIP sector.
Current wording
Our strategy is to continue acquiring multi-clinic outpatient physical therapy practices and home-care physical and speech therapy practices, to develop outpatient physical therapy clinics as satellites in existing partnerships, and to continue acquiring companies that provide industrial injury prevention services.
Previous wording
The Company’s Board of Directors approved a share repurchase program effective August 5, 2025. The program authorizes the repurchase by the Company of up to $25 million of its outstanding shares of common stock over the period ending on December 31, 2026. Under the share repurchase program, shares may be repurchased from time to time in the open market or negotiated transactions at prevailing market rates, or by other means in accordance with federal securities laws. The timing and amount of share repurchases under the share repurchase program, if any, will depend on several factors, including the Company’s stock price performance, ongoing capital allocation priorities and general market conditions.
Current wording
Our Company’s Board of Directors approved a share repurchase program effective August 5, 2025. The program authorizes the repurchase by the Company of up to $25.0 million of its outstanding shares of common stock over the period ending on December 31, 2026. Under the share repurchase program, shares may be repurchased from time to time in the open market or negotiated transactions at prevailing market rates, or by other means in accordance with federal securities laws. The timing and amount of share repurchases under the share repurchase program, if any, will depend on several factors, including the Company's stock price performance, ongoing capital allocation priorities and general market conditions. During the three and nine months ended September 30, 2025, no shares were repurchased as part of this program.
Previous wording
For calendar years 2021, 2022 and 2023, Centers for Medicare and Medicaid Services (“CMS”) expected decreases in Medicare reimbursement were partially offset by one-time increases in payments as a result of other legislation passed by Congress, resulting in decreases of approximately 3.5%, 0.75% and 2.0% in each of these years, respectively. For January 1 through March 8 of 2024, CMS’s final rule resulted in an approximate 3.5% decrease in Medicare payments for the therapy specialty. However, effective as of March 9, 2024, pursuant to the Consolidated Appropriations Act, 2024, Congress minimized the reduction in Medicare payments for therapy services for the balance of 2024, resulting in an approximate 1.8% reduction in Medicare payments for therapy services (rather than the 3.5% decrease). The MPFS for 2025 decreased Medicare reimbursement for therapy services by approximately 2.9% as compared to the reimbursement rates in effect for most of 2024.
Current wording
For calendar years 2021, 2022 and 2023, Centers for Medicare and Medicaid Services (“CMS”) expected decreases in Medicare reimbursement were partially offset by one-time increases in payments as a result of other legislation passed by Congress, resulting in decreases of approximately 3.5%, 0.75% and 2.0% in each of these years, respectively. For January 1 through March 8 of 2024, CMS’s final rule resulted in an approximate 3.5% decrease in Medicare payments for the therapy specialty. However, effective as of March 9, 2024, pursuant to the Consolidated Appropriations Act, 2024, Congress minimized the reduction in Medicare payments for therapy services for the balance of 2024, resulting in an approximate 1.8% reduction in Medicare payments for therapy services (rather than the 3.5% decrease). The MPFS for 2025 decreased Medicare reimbursement for therapy services by approximately 2.9% as compared to the reimbursement rates in effect for most of 2024. For 2026, the proposed MPFS is expected to increase Medicare reimbursement for therapy services by approximately 1.5% as compared to the reimbursement rates for 2025.
Previous wording
Our Net Income was $12.4 million for the 2025 Second Quarter compared to $7.5 million in the 2024 Second Quarter. In accordance with Generally Accepted Accounting Principles (“GAAP”), the revaluation of noncontrolling interest, net of taxes, is not included in Net Income but is charged directly to retained earnings; however, this change is included in the computation of earnings per share. Earnings per share was $0.58 for the 2025 Second Quarter compared to $0.47 for the 2024 Second Quarter
Current wording
Our net income attributable to our shareholders (“USPH Net Income”) was $13.1 million for the 2025 Third Quarter compared to $6.6 million in the 2024 Third Quarter. In accordance with Generally Accepted Accounting Principles (“GAAP”), the revaluation of redeemable noncontrolling interest, net of taxes, is not included in USPH Net Income but is charged directly to retained earnings. However, this change is included in the computation of earnings per share. Earnings per share was $0.48 and $0.39 in 2025 Third Quarter and 2024 Third Quarter, respectively.
Previous wording
Our Net Income was $22.3 million for the 2025 Six Months as compared to $15.6 million for the 2024 Six Months while earnings per share was $1.38 for the 2025 Six Months compared to $0.93 for the 2024 Six Months.
Current wording
USPH Net Income was $35.4 million for the 2025 Nine Months as compared to $22.2 million for the 2024 Nine Months while earnings per share was $1.85 for the 2025 Nine Months compared to $1.32 for the 2024 Nine Months.
Previous wording
The following tables provide details of the basic and diluted earnings per share computation and reconcile net income attributable to our shareholders calculated in accordance with GAAP to Adjusted EBITDA and Operating Results. The tables also provide a reconciliation of additional non-GAAP measures to the most comparable GAAP measure. We believe providing Adjusted EBITDA and Operating Results to investors is useful for comparing our period-to-period results as well as for comparing with other similar businesses since most do not have redeemable instruments and therefore have different equity structures. We use Adjusted EBITDA and Operating Results, which eliminate certain items described above that can be subject to volatility and unusual costs, as the principal measures to evaluate and monitor financial performance period over period.
Current wording
The following tables provide details of the basic and diluted earnings per share computation and reconcile net income attributable to our shareholders calculated in accordance with GAAP to Adjusted EBITDA and Operating Results. The tables also provide a reconciliation of additional non-GAAP measures to the most comparable GAAP measure. We believe providing Adjusted EBITDA and Operating Results to investors is useful for comparing our period-to-period results as well as for comparing them with other similar businesses since most do not have redeemable instruments and therefore have different equity structures. We use Adjusted EBITDA and Operating Results, which eliminate certain items described above that can be subject to volatility and unusual costs, as the principal measures to evaluate and monitor financial performance period over period.
Previous wording
Total net revenue for the 2025 Second Quarter increased $30.2 million, or 18.0%, to $197.3 million from $167.2 million for the 2024 Second Quarter while operating costs increased $22.4 million, or 16.8%, to $155.7 million from $133.3 million over the same periods, respectively. This increase was due to the increase in visits from the 51 net clinics added since the comparable prior year period and an increase in net rate per patient visit.
Current wording
Total net revenue for the 2025 Third Quarter increased $29.1 million, or 17.3%, to $197.1 million from $168.0 million for the 2024 Third Quarter while operating costs increased $21.4 million, or 15.4%, to $160.3 million from $138.9 million over the same periods, respectively. This increase was due to the increase in visits from the 84 net owned clinics added since the comparable prior year period.
Previous wording
Adjusted EBITDA, a non- GAAP measure, was $26.9 million for the 2025 Second Quarter, an increase of $4.7 million, or 21.4%, from $22.1 million for the 2024 Second Quarter primarily driven by higher patient visits.
Current wording
Adjusted EBITDA, a non- GAAP measure, was $23.9 million for the 2025 Third Quarter, an increase of $2.8 million, or 13.2%, from $21.1 million for the 2024 Third Quarter primarily driven by clinic additions.
Previous wording
Operating Results, a non-GAAP measure, was $12.4 million for the 2025 Second Quarter compared to $11.0 million for the 2024 Second Quarter, an increase of 11.8% over the same period. On a per share basis, Operating Results was $0.81 for the 2025 Second Quarter compared to $0.73 for the 2024 Second Quarter.
Current wording
Operating Results, a non-GAAP measure, was $10.1 million for the 2025 Third Quarter compared to $10.4 million for the 2024 Third Quarter. On a per share basis, Operating Results was $0.66 for the 2025 Third Quarter compared to $0.69 for the 2024 Third Quarter.
Previous wording
(6) Excludes $0.2 million of certain incentive costs related to the Metro acquisition. Please refer to the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Current wording
(6) Excludes $0.1 million of certain incentive costs related to the Metro acquisition and gains or losses related to clinic closures, as applicable. See the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Previous wording
Other revenues increased approximately $0.9 million, or 27.8%, to $4.1 million for the 2025 Second Quarter from $3.2 million for the 2024 Second Quarter.
Current wording
Other revenues increased approximately $0.5 million, or 14.5%, to $4.1 million for the 2025 Third Quarter from $3.6 million for the 2024 Third Quarter.
Previous wording
Salaries and related costs, clinics (excluding management contracts) increased to $93.9 million in the 2025 Second Quarter from $79.7 million in the 2024 Second Quarter, an increase of $14.3 million, or 17.9% mostly due to the net clinics added since the comparable prior year period. Salaries and related costs per visit (excluding management contracts and certain incentive costs related to Metro) increased to $60.08 for the 2025 Second Quarter from $59.66 for the 2024 Second Quarter.
Current wording
Salaries and related costs, clinics (excluding management contracts) increased to $96.5 million in the 2025 Third Quarter from $82.3 million in the 2024 Third Quarter, an increase of $14.2 million, or 17.2% mostly due to the net clinics added since the comparable prior year period. Excluding certain incentive costs related to the Metro acquisition salaries and related costs per visit decreased to $62.07 for the 2025 Third Quarter from $62.47 for the 2024 Third Quarter. See the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Previous wording
Rent, supplies, contract labor and other costs, related to clinics (excluding management contracts) increased to $29.7 million in the 2025 Second Quarter from $27.3 million in the 2024 Second Quarter, an increase of $2.4 million, or 8.7% mostly due to clinic additions.
Current wording
Rent, supplies, contract labor and other costs, related to clinics (excluding management contracts) increased to $31.8 million in the 2025 Third Quarter from $29.3 million in the 2024 Third Quarter, an increase of $2.5 million, or 8.4% mostly due to clinic additions.
Previous wording
Depreciation and amortization related to physical therapy operations increased to $5.5 million in the 2025 Second Quarter from $4.1 million in the 2024 Second Quarter, an increase of $1.5 million, or 35.7%, primarily due to the larger number of clinics in the 2025 Second Quarter compared to the 2024 Second Quarter.
Current wording
Depreciation and amortization related to physical therapy operations increased to $4.6 million in the 2025 Third Quarter from $3.4 million in the 2024 Third Quarter, an increase of $1.3 million, or 39.0%, primarily due to the larger number of clinics in the 2025 Third Quarter compared to the 2024 Third Quarter.
Previous wording
The provision for credit losses was $2.0 million for the 2025 Second Quarter and $1.7 million for the 2024 Second Quarter. As a percentage of net revenues, the provision for credit losses was 1.2% for both periods.
Current wording
The provision for credit losses was $2.0 million for the 2025 Third Quarter and $1.7 million for the 2024 Third Quarter. As a percentage of net revenues, the provision for credit losses was 1.2% over the same periods.
Previous wording
IIP revenue increased $5.3 million, or 22.6%, to $29.1 million for the 2025 Second Quarter as compared to $23.7 million for the 2024 Second Quarter. Gross profit from IIP operations for the 2025 Second Quarter increased $1.3 million, or 25.8%, to $6.4 million from $5.1 million for the 2024 Second Quarter. Gross profit margin from IIP operations was 22.0% for the 2025 Second Quarter compared to 21.4% for the 2024 Second Quarter. Excluding the IIP acquisition made in April 2024, IIP revenue increased by $4.0 million or 18.4% in the 2025 Second Quarter and gross profit margin increased $1.0 million or 21.8% in the 2025 Second Quarter over the comparable prior year period.
Current wording
IIP revenue increased $3.7 million, or 14.6%, to $29.0 million for the 2025 Third Quarter as compared to $25.3 million for the 2024 Third Quarter. Gross profit from IIP operations for the 2025 Third Quarter increased $0.5 million, or 10.7%, to $5.7 million from $5.1 million for the 2024 Third Quarter. Gross profit margin from IIP operations was 19.6% for the 2025 Third Quarter compared to 20.3% for the 2024 Third Quarter.
Previous wording
Corporate office costs increased to $17.5 million for the 2025 Second Quarter from $14.2 million for the 2024 Second Quarter, primarily to support of the larger number of clinics, as well as, acquisition integration costs and costs associated with the implementation of a new financial and human resources system. Implementation costs associated with the new financial and human resources system are expected to continue through the end of 2026. As a ratio to net revenue, corporate office costs was 8.9% for the 2025 Second Quarter compared to 8.5% for the 2024 Second Quarter. Excluding the acquisition integration costs and the costs associated with the implementation of the new financial and human resources system of $0.3 million, corporate office costs was 8.7% of net revenue for the 2025 Second Quarter.
Current wording
Corporate office costs increased to $17.4 million for the 2025 Third Quarter from $14.4 million for the 2024 Third Quarter, primarily to support the larger number of clinics, as well as costs associated with acquisition integration and the implementation of a new financial and human resources system. Implementation costs associated with the new financial and human resources system are expected to continue through the end of 2026. As a percentage of net revenue, corporate office costs was 8.8% for the 2025 Third Quarter compared to 8.6% for the 2024 Third Quarter. Excluding the acquisition integration costs and the costs associated with the implementation of the new financial and human resources system of $0.7 million, corporate office costs was 8.5% of net revenue for the 2025 Third Quarter.
Previous wording
We revalued contingent consideration related to certain acquisitions and recognized a net gain (a decrease in the related liabilities) of $0.8 million for the 2025 Second Quarter compared to a net loss (an increase in the related liabilities) of $4.0 million for the 2024 Second Quarter.
Current wording
We revalued contingent consideration related to certain acquisitions and recognized a net gain (a decrease in the related liabilities) of $5.9 million for the 2025 Third Quarter compared to a net loss (an increase in the related liabilities) of $1.9 million for the 2024 Third Quarter.
Previous wording
Operating income was $24.9 million for the 2025 Second Quarter compared to $15.6 million for the 2024 Second Quarter. Excluding the impact of change in value of contingent consideration in the 2025 Second Quarter of $0.8 million, and the 2024 Second Quarter of $4.0 million, operating income increased to $24.1 million for the 2025 Second Quarter from $19.6 million in the 2024 Fourth Quarter.
Current wording
Operating income was $25.3 million for the 2025 Third Quarter compared to $12.8 million for the 2024 Third Quarter. Excluding the impact of change in value of contingent consideration as discussed above, operating income increased to $19.5 million for the 2025 Third Quarter from $14.7 million in the 2024 Third Quarter.
Previous wording
Interest expense increased by $0.4 million to $2.4 million for the 2025 Second Quarter compared to $2.0 million for the 2024 Second Quarter due to a higher average outstanding balance on our revolving credit facility for the 2025 Second Quarter. Theinterest rate associated with borrowings on our credit facilities was 5.1% for the 2025 Second Quarter and 4.7% for the 2024 Second Quarter, with an all-in-effective interest rate (including all associated costs), of 5.6% and 5.4% over the same periods, respectively.
Current wording
Interest expense increased by $0.4 million to $2.4 million for the 2025 Third Quarter compared to $2.0 million for the 2024 Third Quarter due to a higher average outstanding balance on our revolving credit facility for the 2025 Third Quarter. Theinterest rate associated with borrowings on our credit facilities was 5.0% for the 2025 Third Quarter and 4.7% for the 2024 Third Quarter, with an all-in-effective interest rate (including all associated costs), of 5.7% and 5.4% over the same periods, respectively.
Previous wording
Interest income was less than $0.1 million during the 2025 Second Quarter compared to $1.1 million for the 2024 Second Quarter as the cash on the balance sheet at the end of the 2024 Second Quarter has since been deployed to fund acquisitions.
Current wording
Interest income was less than $0.1 million during the 2025 Third Quarter compared to $1.0 million for the 2024 Third Quarter as the excess cash on the balance sheet at the end of the 2024 Third Quarter has since been deployed to fund acquisitions.
Previous wording
We revalued a put-right liability related to the future purchase of an IIP business and recognized a net non-cash expense (an increase in the related liability) of $0.3 million for the 2025 Second Quarter compared to $0.2 million for the 2024 Second Quarter (an increase in the related liability).
Current wording
We revalued a put-right liability related to the future purchase of an IIP business and recognized a net non-cash expense (an increase in the related liability) of $0.7 million for the 2025 Third Quarter compared tonet non-cash gain (a decrease in the related liability) of $0.2 million for the 2024 Third Quarter.
Previous wording
The provision for income taxes was $4.9 million for the 2025 Second Quarter compared to $3.1 million during the 2024 Second Quarter while the effective tax rate was 28.5% and 29.1% over the same periods, respectively.
Current wording
The provision for income taxes was $5.2 million for the 2025 Third Quarter compared to $2.6 million during the 2024 Third Quarter while the effective tax rate was 28.5% and 27.9% over the same periods, respectively.
Previous wording
Net income attributable to non-controlling interest (temporary and permanent) was $5.3 million for the 2025 Second Quarter compared to $4.2 million for the 2024 Second Quarter.
Current wording
Net income attributable to non-controlling interest (temporary and permanent) was $4.5 million for the 2025 Third Quarter compared to $3.1 million for the 2024 Third Quarter.
Previous wording
Total net revenue for the 2025 Six Months increased $58.3 million, or 18.0%, to $381.1 million from $322.9 million for the 2024 Six Months while operating costs increased $47.8 million, or 18.4%, to $308.4 million from $260.6 million over the same periods, respectively. Gross profit for the 2025 Six Months was $72.7 million, or 19.1% of net revenue, compared to $62.3 million for the 2024 Six Months, or 19.3%, of net revenue.
Current wording
Total net revenue for the 2025 Nine Months increased $87.4 million, or 17.8%, to $578.3 million from $490.9 million for the 2024 Nine Months while operating costs increased $69.2 million, or 17.3%, to $468.7 million from $399.5 million over the same periods, respectively. Gross profit for the 2025 Nine Months was $109.6 million, or 18.9% of net revenue, compared to $91.4 million for the 2024 Nine Months, or 18.6%, of net revenue.
Previous wording
(2) Includes 20 clinics added during the 2025 Six Months and 96 clinics added during the year ended December 31, 2024. (Owned)
Current wording
(2) Includes 36 owned clinics added during the 2025 Nine Months and 96 owned clinics added during the year ended December 31, 2024. See Clinic Count Roll Forward on page 36 for additional information.
Previous wording
(3) Includes 10 clinics closed during the 2025 Six Months and 45 clinics closed during the year ended December 31, 2024. (Owned)
Current wording
(3) Includes 13 owned clinics closed during the 2025 Nine Months and 45 owned clinics closed during the year ended December 31, 2024. See Clinic Count Roll Forward on page 36 for additional information.
Previous wording
(6) Excludes $0.3 million of certain incentive costs related to the Metro acquisition. Please refer to the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Current wording
(6) Excludes $0.6 million of certain incentive costs related to Metro acquisition and gains or losses related to clinic closures, as applicable. See the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Previous wording
Other revenues increased approximately $1.4 million, or 21.4% , to $7.8 million for the 2025 Six Months from $6.6 million for the 2024 Six Months.
Current wording
Other revenues increased approximately $1.9 million, or 19.0%, to $12.1 million for the 2025 Nine Months from $10.1 million for the 2024 Nine Months.
Previous wording
Operating costs from physical therapy operations increased by $38.9 million, or 17.3%, to $264.0 million for the 2025 Six Months from $225.1 million for the 2024 Six Months, primarily driven by the 51 net clinics added since the comparable prior year period. Operating costs were 81.3% of net revenue for the 2025 Six Months compared to 81.0% of net revenue for the 2024 Six Months. Total operating costs per visit (excluding management contracts and certain incentive costs related to Metro) was $86.52 compared to $84.97 in the prior year quarter, as higher visit volume did not result in a proportional increase in fixed costs.
Current wording
Operating costs from physical therapy operations increased by $57.1 million, or 16.7%, to $399.9 million for the 2025 Nine Months from $342.8 million for the 2024 Nine Months, primarily driven by the 84 net owned clinics added since the comparable prior year period. Operating costs were 81.2% of net revenue for the 2025 Nine Months compared to 81.5% of net revenue for the 2024 Nine Months. Excluding certain incentive costs related to the Metro acquisition and gains and losses related to clinic closures for both periods, total operating costs per visit (excluding management contract) was $86.36 in the 2025 Nine Months compared to $84.89 in the comparable prior year period. See the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Previous wording
Salaries and related costs, clinics (excluding management contracts) increased to $185.7 million in the 2025 Six Months from $157.6 million in the 2024 Six Months, an increase of $28.1 million, or 17.9% mostly due to the net clinics added since the comparable prior year period. Salaries and related costs per visit (excluding management contracts and certain incentive costs related to Metro) increased to $61.74 for the 2025 Six Months from $60.52 for the 2024 Six Months.
Current wording
Salaries and related costs, clinics (excluding management contracts) increased to $282.1 million in the 2025 Nine Months from $239.8 million in the 2024 Nine Months, an increase of $42.3 million, or 17.6% mostly due to the net clinics added since the comparable prior year period. Excluding certain incentive costs related to the Metro acquisition salaries and related costs per visit decreased to $61.86 for the 2025 Nine Months from $61.17 for the 2024 Nine Months. See the reconciliation of non-GAAP measures to the most directly comparable GAAP measure on page 40.
Previous wording
Rent, supplies, contract labor and other costs, related to clinics (excluding management contracts) increased to $59.9 million in the 2025 Six Months from $52.5 million in the 2024 Six Months, an increase of $7.4 million, or 14.1% mostly due to clinic additions.
Current wording
Rent, supplies, contract labor and other costs, related to clinics (excluding management contracts) increased to $91.7 million in the 2025 Nine Months from $81.8 million in the 2024 Nine Months, an increase of $9.9 million, or 12.1% mostly due to clinic additions.
Previous wording
Depreciation and amortization related to physical therapy operations increased to $10.7 million in 2025 Six Months from $7.8 million in the 2024 Six Months, an increase of $2.9 million, or 36.5%, primarily due to the larger number of clinics in the 2025 Six Months compared to the 2024 Six Months.
Current wording
Depreciation and amortization related to physical therapy operations increased to $14.3 million in 2025 Nine Months from $10.2 million in the 2024 Nine Months, an increase of $4.1 million, or 40.8%, primarily due to the larger number of clinics in the 2025 Nine Months compared to the 2024 Nine Months.
Previous wording
The provision for credit losses was $3.8 million for the 2025 Six Months and $3.3 million for the 2024 Six Months. As a percentage of net revenues, the provision for credit losses was 1.2% for both periods.
Current wording
The provision for credit losses was $5.9 million for the 2025 Nine Months and $5.1 million for the 2024 Nine Months. As a percentage of net revenues, the provision for credit losses was 1.2% for both periods.
Previous wording
Revenues from IIP increased $11.5 million, or 25.5%, to $56.4 million for the 2025 Six Months versus the comparable prior year period. Gross profit from IIP operations increased $2.6 million, or 27.3%, to $12.0 million for the 2025 Six Months and the gross profit margin from IIP operations was 21.2% for the 2025 Six Months. Excluding the IIP acquisition made in April 2024, IIP revenue increased by $7.2 million or 16.7% in the 2025 Six Months and gross profit margin increased $1.9 million or 21.01% in the 2025 Six Months over the comparable prior year period.
Current wording
Revenues from IIP increased $15.2 million, or 21.6%, from $70.3 million for the 2024 Nine Months to $85.5 million for the 2025 Nine Months. Gross profit from IIP operations increased $3.1 million, or 23.0%, from $13.6 million to $16.7 million for the 2025 Nine Months. The gross profit margin from IIP operations was 19.5% for the 2025 Nine Months compared to 19.3% for the 2024 Nine Months. Excluding the IIP acquisition made in April 2024, IIP revenue increased by $10.5 million or 16.0% in the 2025 Nine Months and gross profit margin increased $2.0 million or 16.1% in the 2025 Nine Months over the comparable prior year period.
Previous wording
Corporate office costs were $33.7 million for the 2025 Six Months, compared to $28.3 million for the 2024 Six Months. As a percent of net revenue, corporate office costs were 8.8% for both periods. Excluding the acquisition integration costs and the costs associated with the implementation of the new financial and human resources system of $0.7 million, corporate office costs was 8.7% of net revenue for the 2025 Six Months.
Current wording
Corporate office costs were $51.1 million for the 2025 Nine Months, compared to $42.7 million for the 2024 Nine Months. As a percentage of net revenue, corporate office costs were 8.8% and 8.7% over the same periods, respectively. Excluding the acquisition integration costs and the costs associated with the implementation of the new financial and human resources system of $1.8 million, corporate office costs was 8.5% of net revenue for the 2025 Nine Months.
Previous wording
We revalued contingent consideration related to certain acquisitions and recognized a net gain (a decrease in the related liabilities) of $5.6 million for the 2025 Six Months compared to a net non-cash loss of $3.4 million for the 2024 Six Months (an increase in the related liabilities).
Current wording
We revalued contingent consideration related to certain acquisitions and recognized a net gain (a decrease in the related liabilities) of $11.5 million for the 2025 Nine Months compared to a net loss of $5.3 million for the 2024 Nine Months (an increase in the related liabilities).
Previous wording
Operating income was $44.6 million for the 2025 Six Months compared to $30.5 million for the 2024 Six Months. Excluding the impact of change in value of contingent consideration of $5.6 million for the 2025 Six Months and $3.4 million for the 2024 Six Months, operating income increased to $39.0 million for the 2025 Six Months from $33.9 million for the 2024 Six Months, an increase of 14.9%.
Current wording
Operating income was $69.9 million for the 2025 Nine Months compared to $43.3 million for the 2024 Nine Months. Excluding the impact of change in value of contingent consideration discussed above, operating income increased to $58.4 million for the 2025 Nine Months from $48.7 million for the 2024 Nine Months, an increase of 20.0%.
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Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
On April 30, 2025, we acquired an outpatient home-care physical and speech therapy practice through our 50%-owned subsidiary, Metro. After the transaction, our ownership interest is 40%, our local partners have an ownership interest of 40% and the practice’s preacquisition owners have a 20% ownership interest.