UNIVERSAL HEALTH SERVICES INC

Previous wording

As of March 31, 2026, we owned and/or operated 375 inpatient facilities and 168 outpatient and other facilities located in 40 states, Washington, D.C., the United Kingdom and Puerto Rico.

Current wording

As of June 30, 2026, we owned and/or operated 376 inpatient facilities and 168 outpatient and other facilities located in 40 states, Washington, D.C., the United Kingdom and Puerto Rico.

Previous wording

Net revenues from our acute care hospitals, outpatient facilities and commercial health insurer accounted for 58% of our consolidated net revenues during each of the three-month periods ended March 31, 2026 and 2025. Net revenues from our behavioral health care facilities and commercial health insurer accounted for 42% of our consolidated net revenues during each of the three-month periods ended March 31, 2026 and 2025.

Current wording

Net revenues from our acute care hospitals, outpatient facilities and commercial health insurer accounted for 56% of our consolidated net revenues during each of the three-month periods ended June 30, 2026 and 2025, and 57% of our consolidated net revenues during each of the six-month periods ended June 30, 2026 and 2025. Net revenues from our behavioral health care facilities and commercial health insurer accounted for 44% of our consolidated net revenues during each of the three-month periods ended June 30, 2026 and 2025, and 43% of our consolidated net revenues during each of the six-month periods ended June 30, 2026 and 2025.

Previous wording

Our behavioral health care facilities located in the U.K. generated net revenues of approximately $261 million and $227 million during the three-month periods ended March 31, 2026 and 2025, respectively. Total assets at our U.K. behavioral health care facilities were approximately $1.522 billion as of March 31, 2026 and $1.531 billion as of December 31, 2025.

Current wording

Our behavioral health care facilities located in the U.K. generated net revenues of approximately $269 million and $247 million during the three-month periods ended June 30, 2026 and 2025, respectively, and $530 million and $474 million during the six-month periods ended June 30, 2026 and 2025, respectively. Total assets at our U.K. behavioral health care facilities were approximately $1.530 billion as of June 30, 2026 and $1.531 billion as of December 31, 2025.

Previous wording

You should carefully review the information contained in this Quarterly Report and should particularly consider any risk factors that we set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, this Quarterly Report and in other reports or documents that we file from time to time with the Securities and Exchange Commission (the “SEC”). In this Quarterly Report, we state our beliefs of future events and of our future financial performance. This Quarterly Report contains “forward-looking statements” that reflect our current estimates, expectations and projections about our future results, performance, prospects and opportunities. Forward-looking statements include, among other things, the information concerning our possible future results of operations, business and growth strategies, financing plans, expectations that regulatory developments or other matters will or will not have a material adverse effect on our business or financial condition, our competitive position and the effects of competition, the projected growth of the industry in which we operate, and the benefits and synergies to be obtained from our completed and any future acquisitions, and statements of our goals and objectives, and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “appears,” “projects” and similar expressions, as well as statements in future tense, identify forward-looking statements. In evaluating those statements, you should specifically consider various factors, including the risks related to healthcare industry trends and those set forth in Part 1, Item 1A. Risk Factorsand Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk Factorsin our Annual Report on Form 10-K for the year ended December 31, 2025 and in Part II, Item 1A. Risk Factors and Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk

Current wording

You should carefully review the information contained in this Quarterly Report and should particularly consider any risk factors that we set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, this Quarterly Report and in other reports or documents that we file from time to time with the Securities and Exchange Commission (the “SEC”). In this Quarterly Report, we state our beliefs of future events and of our future financial performance. This Quarterly Report contains “forward-looking statements” that reflect our current estimates, expectations and projections about our future results, performance, prospects and opportunities. Forward-looking statements include, among other things, the information concerning our possible future results of operations, business and growth strategies, financing plans, expectations that regulatory developments or other matters will or will not have a material adverse effect on our business or financial condition, our competitive position and the effects of competition, the projected growth of the industry in which we operate, and the benefits and synergies to be obtained from our completed and any future acquisitions, and statements of our goals and objectives, and other similar expressions concerning matters that are not historical facts. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “appears,” “projects” and similar expressions, as well as statements in future tense, identify forward-looking statements. In evaluating those statements, you should specifically consider various factors, including the risks related to healthcare industry trends and those set forth in Part 1, Item 1A. Risk Factorsand Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk Factorsin our

Previous wording

Factors, as included herein. Those factors may cause our actual results to differ materially from any of our forward-looking statements.

Current wording

Annual Report on Form 10-K for the year ended December 31, 2025 and in Part II, Item 1A. Risk Factors and Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Forward Looking Statements and Risk Factors, as included herein. Those factors may cause our actual results to differ materially from any of our forward-looking statements.

Previous wording

as discussed below in Sources of Revenue, we receive revenues from various state and county-based programs, including Medicaid in all the states in which we operate. We receive annual Medicaid revenues of approximately $100 million, or greater, from each of Nevada, California, Texas, Washington, D.C., Illinois, Pennsylvania, Kentucky, Ohio, Virginia, Massachusetts, Michigan, Mississippi, Florida and Tennessee. Most of these programs are approved on a year-to-year basis and there is no assurance that these revenues will continue at their current rates or at all. We are therefore particularly sensitive to potential reductions in Medicaid and other state-based revenue programs as well as regulatory, economic, environmental and competitive changes in those states;

Current wording

as discussed below in Sources of Revenue, we receive revenues from various state and county-based programs, including Medicaid in all the states in which we operate. We receive annual Medicaid revenues of approximately $100 million, or greater, from each of California, Texas, Nevada, Florida, Washington, D.C., Illinois, Pennsylvania, Kentucky, Mississippi, Virginia, Michigan, Massachusetts, Tennessee, Arizona, Ohio, and Washington. Most of these programs are approved on a year-to-year basis and there is no assurance that these revenues will continue at their current rates or at all. We are therefore particularly sensitive to potential reductions in Medicaid and other state-based revenue programs as well as regulatory, economic, environmental and competitive changes in those states;

Previous wording

legislation adopted on July 4, 2025 (the One Big Beautiful Bill Act), attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditure. That legislation also places limits on provider fees used to increase federal Medicaid funding to states. The legislation prohibits states not previously having expanded Medicaid eligibility to 138% of federal poverty level from increasing the rate of current provider fees which fund certain state supplemental payments or increasing the base of the fee to a class or items of services that the fee did not previously cover. That current provider fee threshold will remain at 6%. For states having expanded Medicaid eligibility under the legislation, the provider fee threshold will be reduced by 0.5% annually between federal fiscal years 2028 and 2032 with the resulting threshold ultimately becoming 3.5%. Under current law, and based on our current expectations, we estimate that, commencing with the 2028 state fiscal years, our aggregate annual net benefit will be reduced, on an annually increasing and relatively pro rata basis, by approximately $432 million to $480 million by 2032. The legislation also eliminates certain insurance exchange premium tax credits beyond 2025 and exchange enrollment is expected to be adversely impacted. On January 8, 2026, the U.S. House of Representatives passed H.R.1834 to extend for three years the enhanced premium tax credits ("EPTCs") that expired on December 31, 2025. As of early May 2026, no legislation extending the EPTCs has been enacted, and there can be no assurance regarding the timing or outcome of future legislative action. We cannot predict whether these subsidies will ultimately be adopted in federal fiscal year 2026. All of these factors, which could have a material unfavorable impact on our results of operations, may be expected to reduce our revenue and likely increase the level of uncompensated care provided by our facilities;

Current wording

the One Big Beautiful Bill Act, which became law on July 4, 2025, attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditure. The law also places limits on provider fees used to increase federal Medicaid funding to states. The law prohibits states not previously having expanded Medicaid eligibility to 138% of federal poverty level from increasing the rate of current provider fees which fund certain state supplemental payments or increasing the base of the fee to a class or items of services that the fee did not previously cover. That current provider fee threshold will remain at 6%. For states having expanded Medicaid eligibility under the law, the provider fee threshold will be reduced by 0.5% annually between federal fiscal years 2028 and 2032 with the resulting threshold ultimately becoming 3.5%. Under current law, and based on our current expectations, we estimate that, commencing with the 2028 state fiscal years, our aggregate annual net benefit will be reduced, on an annually increasing and relatively pro rata basis, by approximately $500 million by 2032. The law also eliminated certain insurance exchange premium tax credits beyond 2025 and exchange enrollment has already been adversely impacted. On January 8, 2026, the U.S. House of Representatives passed H.R.1834 to extend for three years the enhanced premium tax credits ("EPTCs") that expired on December 31, 2025. However, no law extending the EPTCs has been enacted, and there can be no assurance regarding the timing or outcome of future legislative action. All of these factors could have a material unfavorable impact on our results of operations and may be expected to reduce our revenue and likely increase the level of uncompensated care provided by our facilities;

Previous wording

there are additional legislative changes that are likely to result in major changes in the health care delivery system on a national or state level, including changes in the structure and administration of, and funding for, federal and state agencies and programs. For example, Congress has reduced to $0 the penalty for failing to maintain health coverage that was part of the original Patient Protection and Affordable Care Act, as amended by the Health and Education Reconciliation Act (collectively, the “ACA") as part of the Tax Cuts and Jobs Act. The Biden administration had issued executive orders implementing a special enrollment period permitting individuals to enroll in health plans outside of the annual open enrollment period and reexamining policies that may undermine the ACA or the Medicaid program. The Inflation Reduction Act of 2022 (“IRA”) was passed on August 16, 2022, which among other things, allows for the Centers for Medicare and Medicaid Services ("CMS") to negotiate prices for certain single-source drugs reimbursed under Medicare Part B and Part D. The American Rescue Plan Act’s expansion of subsidies to purchase coverage through an ACA exchange, which the IRA continued through 2025, has increased exchange enrollment. These enhanced subsidies expired on December 31, 2025;

Current wording

there have been additional changes in the law that have resulted in and that are likely to result in major changes in the health care delivery system on a national or state level, including changes in the structure and administration of, and funding for, federal and state agencies and programs. For example, Congress has reduced to $0 the penalty for failing to maintain health coverage that was part of the original Patient Protection and Affordable Care Act, as amended by the Health and Education Reconciliation Act (collectively, the “ACA") as part of the Tax Cuts and Jobs Act. The Biden administration had issued executive orders implementing a special enrollment period permitting individuals to enroll in health plans outside of the annual open enrollment period and reexamining policies that may undermine the ACA or the Medicaid program. The Inflation Reduction Act of 2022 (“IRA”) enables the Centers for Medicare and Medicaid Services ("CMS") to negotiate prices for certain single-source drugs reimbursed under Medicare Part B and Part D. The American Rescue Plan Act’s expansion of subsidies to purchase coverage through an ACA exchange, which the IRA continued through 2025, has increased exchange enrollment, but along with the EPTCs, these enhanced subsidies expired on December 31, 2025;

Previous wording

there have been numerous political and legal efforts to expand, repeal, replace or modify the ACA since its enactment, some of which have been successful, in part, in modifying the ACA, as well as court challenges to the constitutionality of the legislation. The U.S. Supreme Court held in California v. Texas that the plaintiffs lacked standing to challenge the legislation’s requirement to obtain minimum essential health insurance coverage, or the individual mandate. The Court dismissed the case without specifically ruling on the constitutionality of the ACA. The legislation faced its most recent challenge when the Supreme Court, in the June 2025 Kennedy v. Braidwood Management decision, opined in favor of ACA HIV preventive care coverage. The impacts of this decision cannot be predicted. Any future efforts to challenge, replace or replace the ACA or expand or substantially amend its provision is unknown. See below in Sources of Revenues and Health Care Reformfor additional disclosure;

Current wording

there have been numerous political and legal efforts to expand, repeal, replace or modify the ACA since its enactment, some of which have been successful, in part, in modifying the ACA, as well as court challenges to the constitutionality of the law. The U.S. Supreme Court held in California v. Texas that the plaintiffs lacked standing to challenge the law’s requirement to obtain minimum essential health insurance coverage, or the individual mandate. The Court dismissed the case without specifically ruling on the constitutionality of the ACA. ACA provisions continue to be subject to court challenges such as the June 2025 Kennedy v. Braidwood Management Supreme Court decision, which opined in favor of ACA HIV preventive care coverage and upheld the ACA's requirement that most private insurers and Medicaid expansion programs cover preventive services recommended by the United States Preventive Services Task Force, absent cost sharing. The impact of any future efforts to challenge, replace or replace the ACA or expand or substantially amend its provisions is unknown. See below in Sources of Revenues and Health Care Reformfor additional disclosure;

Previous wording

the healthcare industry is labor intensive and salaries, wages and benefits are subject to inflationary pressures, as are supplies expense and other operating expenses. In the past, staffing shortages have, at times, required us to hire expensive temporary personnel and/or enhance wages and benefits to recruit and retain nurses and other clinical staff and support personnel. At certain facilities, particularly within our behavioral health care segment, there have been occasions when we were unable to fill all vacant positions and, consequently, we were required to limit patient volumes. Additionally, California is in the process of implementing staffing standards specific to acute psychiatric hospitals and requirements to determine appropriate staffing based on patient acuity and care needs, which are expected to take effect on June 1, 2026. This can further increase our costs and limit our revenue if we are required to limit the number of patients at our California facilities;

Current wording

the healthcare industry is labor intensive and salaries, wages and benefits are subject to inflationary pressures, as are supplies expense and other operating expenses. In the past, staffing shortages have, at times, required us to hire expensive temporary personnel and/or enhance wages and benefits to recruit and retain nurses and other clinical staff and support personnel. At certain facilities, particularly within our behavioral health care segment, there have been occasions when we were unable to fill all vacant positions and, consequently, we were required to limit patient volumes. Additionally, effective June 1, 2026, California implemented staffing standards specific to acute psychiatric hospitals and requirements to determine appropriate staffing based on patient acuity and care needs. This has further increased our costs and may limit our revenue if we are required to limit the number of patients at our California facilities;

Previous wording

Significant tariffs or other restrictions, if imposed on our imported pharmaceutical ingredients, medical devices, medical equipment and their ingredients and components, could escalate costs of medications, medical devices and medical equipment and disrupt our supply chains. While we continue to evaluate the potential impact of the new tariffs on our business, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S. and the impacted foreign countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful. Therefore, changes in laws or policies governing the terms of foreign trade, and in particular, increased trade restrictions, tariffs or taxes on imports from where our products or materials are made (either directly or through our suppliers) could have an impact on our competitive position, business operations and financial results.

Current wording

significant tariffs or other restrictions, if imposed on our imported pharmaceutical ingredients, medical devices, medical equipment and their ingredients and components, or otherwise on our suppliers, could escalate costs of medications, medical devices and medical equipment and disrupt our supply chains. While we continue to evaluate the potential impact of new tariffs on our business, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S. and the impacted foreign countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful. Therefore, changes in laws or policies governing the terms of foreign trade, and in particular, increased trade restrictions, tariffs or taxes on imports from where our products or materials are made (either directly or through our suppliers) could have an impact on our competitive position, business operations and financial results;

Previous wording

as of early May 2026, Congress has enacted appropriations legislation funding most federal agencies for fiscal year 2026, following a lapse in appropriations affecting certain Department of Homeland Security operations that began on February 14, 2026 and was resolved on April 30, 2026. In the past several years political disputes concerning authorization of a federal budget have led to shutdown of substantial portions of the federal government and other federal budget authorization delays have occurred. Federal budget delays and federal government shutdowns are unpredictable and may occur in the future. We cannot predict whether or not there will be future appropriations legislation avoiding a federal government shutdown, however, our operating cash flows and results of operations could be materially unfavorably impacted by the federal government shutdown;

Current wording

as of early August 2026, Congress has enacted appropriations funding most federal agencies for fiscal year 2026. In the past several years political disputes concerning authorization of a federal budget have led to shutdown of substantial portions of the federal government and other federal budget authorization delays have occurred. Federal budget delays and federal government shutdowns are unpredictable and may occur in the future. We cannot predict whether or not there will be future appropriations legislation avoiding a federal government shutdown, however, our operating cash flows and results of operations could be materially unfavorably impacted by a federal government shutdown;

Previous wording

as part of the Consolidated Appropriations Act of 2021 (the "CAA"), Congress passed legislation aimed at preventing or limiting patient balance billing in certain circumstances. The CAA addresses surprise medical bills stemming from emergency services, out-of-network ancillary providers at in-network facilities, and air ambulance carriers. The CAA prohibits surprise billing when out-of-network emergency services or out-of-network services at an in-network facility are provided, unless informed consent is received. In these circumstances providers are prohibited from billing the patient for any amounts that exceed in-network cost-sharing requirements. HHS, the Department of Labor and the Department of the

Current wording

the Consolidated Appropriations Act of 2021 (the "CAA"), included provisions aimed at preventing or limiting patient balance billing in certain circumstances. The CAA addresses surprise medical bills stemming from emergency services, out-of-network ancillary providers at in-network facilities, and air ambulance carriers. The CAA prohibits surprise billing when out-of-network emergency services or out-of-network services at an in-network facility are provided, unless informed consent is received. In these circumstances providers are prohibited from billing the patient for any amounts that exceed in-network cost-sharing requirements. HHS, the Department of Labor and the Department of the Treasury have issued rules to implement the CAA. The rules have limited the ability of our hospital-based physicians to receive payments for services at usually higher out-of-network rates in certain circumstances, and, as a result, have caused us to increase subsidies to these physicians or to replace their services at a higher cost;

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the impact of a shift of care from inpatient to lower cost outpatient settings and controls designed to reduce inpatient services;

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the impact of the increasing shift of care from inpatient settings to lower cost outpatient settings and controls designed to reduce inpatient services or payments for inpatient services which payers believe could have been performed on an outpatient or outside facility basis;

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our ability to achieve operating and financial targets, develop and execute plans to offset to the extent possible impacts from the recent regulatory changes, including the enactment of the One Big Beautiful Bill Act and the expiration of EPTCs, and tariffs, attain expected levels of patient volumes and revenues, and control the costs of providing services;

Current wording

our ability to achieve operating and financial targets, develop and execute plans to offset to the extent possible impacts from the One Big Beautiful Bill Act, the expiration of EPTCs, other legal and regulatory changes, and tariffs, attain expected levels of patient volumes and revenues, and control the costs of providing services;

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the outcome of known and unknown litigation, government investigations, inquiries, false claims act allegations, and liabilities and other claims asserted against us and other matters, and the effects of adverse publicity relating to such matters, as disclosed in Note 6 to the Condensed Consolidated Financial Statements - Commitments and Contingencies, including, but not limited to, the jury verdict returned against Cumberland Hospital for Children and Adolescents located in New Kent, Virginia, an indirect subsidiary of ours, and the verdict in the Pinnacle litigation in Washoe County, Nevada, against certain subsidiaries of ours;

Current wording

the outcome of known and unknown litigation, government investigations, civil investigative demands, inquiries, false claims act allegations, and liabilities and other claims asserted against us and other matters, and the effects of adverse publicity relating to such matters, as disclosed in Note 6 to the Condensed Consolidated Financial Statements - Commitments and Contingencies, including, but not limited to, the jury verdict returned against Cumberland Hospital for Children and Adolescents located in New Kent, Virginia, an indirect subsidiary of ours;

Previous wording

there is a heightened risk of future cybersecurity threats, including ransomware attacks targeting healthcare providers. If successful, future cyberattacks could have a material adverse effect on our business. Any costs that we incur as a result of a data security incident or breach, including costs to update our security protocols to mitigate such an incident or breach could be significant. Any breach or failure in our operational security systems, or any third-party security systems that we rely on, can result in loss of data or an unauthorized disclosure of or access to sensitive or confidential member or protected personal or health information and could result in violations of applicable privacy and other laws, significant penalties or fines, litigation, loss of customers, significant damage to our reputation and business, and other liability or losses. We may also incur additional costs related to cybersecurity risk management and remediation. There can be no assurance that we or our service providers, if applicable, will not suffer losses relating to cyber-attacks or other information security breaches in the future or that our insurance coverage will be adequate to cover all the costs resulting from such events;

Current wording

there is a heightened risk of future cybersecurity threats, including ransomware attacks targeting healthcare providers. If successful, future cyberattacks could have a material adverse effect on our business. Any costs that we incur as a result of a data security incident or breach, including costs to update our security protocols to mitigate such an incident or breach could be significant. Any breach or failure in our operational security systems, or any third-party security systems that we rely on, can result in loss of data or an unauthorized disclosure of or access to sensitive or confidential member or protected personal or health information and could result in violations of applicable privacy and other laws, significant penalties or fines, litigation, loss of customers, significant damage to our reputation and business, and other liability or losses. We may also be subject to litigation related to our uses and disclosures of health information. We may also incur additional costs related to cybersecurity risk management and remediation. There can be no assurance that we or our service providers, if applicable, will not suffer losses relating to cyber-attacks or other information security breaches in the future or that our insurance coverage will be adequate to cover all the costs resulting from such events;

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on March 9, 2026, we announced that we entered into a definitive agreement to acquire Talkspace, Inc. ("Talkspace") for $5.25 per share, or approximately $835 million in the aggregate. The transaction is expected to close during the third quarter of 2026 and is subject to approval by Talkspace’s stockholders, satisfaction of regulatory approvals and other customary closing conditions. The acquisition is subject to numerous risks and uncertainties including uncertainty as to whether the parties will be able to complete the merger on the terms set forth in the merger agreement; uncertainty regarding the timing of the receipt of required regulatory approvals for the merger and the possibility that the parties may be required to accept conditions that could reduce or eliminate the anticipated benefits of the merger as a condition to obtaining the outcome of any legal proceedings that may be instituted against the parties or others following announcement of the transactions contemplated by the merger agreement; challenges, disruptions and costs of closing, integrating the business and achieving anticipated synergies, or that such synergies will take longer to realize than expected; failure to retain key employees of Talkspace during the period prior to closing or thereafter; failure to retain a significant portion of Talkspace’s providers or relationships with payors, risks that the merger and other transactions contemplated by the merger agreement disrupt current plans and operations that may harm the parties’ businesses or divert management’s attention from the parties’ ongoing business operations; and the amount of any costs, fees, expenses, impairments and charges related to the merger including costs and use of capital related to financing the merger;

Current wording

on March 9, 2026, we announced that we entered into a definitive agreement to acquire Talkspace, Inc. ("Talkspace") for $5.25 per share, or approximately $835 million in the aggregate. The transaction was approved by Talkspace's stockholders during the second quarter of 2026. The transaction is expected to close during the third quarter of 2026 and is subject to satisfaction of regulatory approvals and other customary closing conditions. The acquisition is subject to numerous risks and uncertainties including uncertainty as to whether the parties will be able to complete the merger on the terms set forth in the merger agreement; uncertainty regarding the timing of the receipt of required regulatory approvals for the merger and the possibility that the parties may be required to accept conditions that could reduce or eliminate the anticipated benefits of the merger as a condition to obtaining the outcome of any legal proceedings that may be instituted against the parties or others following announcement of the transactions contemplated by the merger agreement;

Previous wording

Legislation adopted on July 4, 2025 attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditures and the legislation also places limits on provider taxes used to increase federal Medicaid funding to states. In addition, insurance exchange subsidies expired on December 31, 2025 which could unfavorably impact insurance exchange enrollment. As these provisions become effective over the next several years, they may be expected to reduce our revenues and likely increase the level of uncompensated care provided by our facilities. Please see Sources of Revenue below for additional disclosure related to Medicaid supplemental payment programs in various states in which we operate.

Current wording

Legislation adopted on July 4, 2025 attaches work and community service requirements to eligibility for Medicaid benefits that will have the effect of limiting Medicaid enrollment and expenditures and the legislation also places limits on provider taxes used to increase federal Medicaid funding to states. In addition, insurance exchange subsidies expired on December 31, 2025 which has unfavorably impacted insurance exchange enrollment and has increased the level of uncompensated care that we provide. As these provisions become effective over the next several years, they may be expected to reduce our revenues and likely further increase the level of uncompensated care provided by our facilities. Please see Sources of Revenue below for additional disclosure related to Medicaid supplemental payment programs in various states in which we operate.

Previous wording

significant tariffs or other restrictions, if imposed on our imported pharmaceutical ingredients, medical devices, medical equipment and their ingredients and components, could escalate costs of medications, medical devices and medical equipment and disrupt our supply chains. While we continue to evaluate the potential impact of the new tariffs on our business, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S. and the impacted foreign countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful. Therefore, changes in laws or policies governing the terms of foreign trade, and in particular, increased trade restrictions, tariffs or taxes on imports from where our products or materials are made (either directly or through our suppliers) could have an impact on our competitive position, business operations and financial results;

Current wording

Significant tariffs or other restrictions, if imposed on our imported pharmaceutical ingredients, medical devices, medical equipment and their ingredients and components, could escalate costs of medications, medical devices and medical equipment and disrupt our supply chains. While we continue to evaluate the potential impact of new tariffs on our business, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S. and the impacted foreign countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful. Therefore, changes in laws or policies governing the terms of foreign trade, and in particular, increased trade restrictions, tariffs or taxes on imports from where our products or materials are made (either directly or through our suppliers) could have an impact on our competitive position, business operations and financial results.

Previous wording

Net revenues increased by 9.6%, or $395 million, to $4.495 billion during the three-month period ended March 31, 2026, as compared to $4.100 billion during the first quarter of 2025. The net increase was primarily attributable to: (i) a $313 million, or 7.9%, increase in net revenues generated from our acute care hospital services and behavioral health services operated during both periods (which we refer to as “Same Facility”), and; (ii) an other combined net increase of $82 million, consisting of a $48 million increase in provider tax assessments (which had no impact on income before income taxes since the amounts offset between net revenues and other operating expenses) and other combined net increase of $34 million consisting primarily of the net revenues generated during the first quarter of 2026 at a newly constructed acute care hospital located in Washington, D.C. (Cedar Hill Regional Medical Center which opened during the second quarter of 2025).

Current wording

Net revenues increased by 8.3%, or $354 million, to $4.638 billion during the three-month period ended June 30, 2026, as compared to $4.284 billion during the second quarter of 2025. The net increase was primarily attributable to: (i) a $322 million, or 7.8%, increase in net revenues generated from our acute care hospital services and behavioral health services operated during both periods (which we refer to as “Same Facility”), and; (ii) an other combined net increase of $32 million, consisting of primarily of a $47 million increase in provider tax assessments (which had no impact on income before income taxes since the amounts offset between net revenues and other operating expenses).

Previous wording

Income before income taxes (before income attributable to noncontrolling interests) increased by $49 million, or 12%, to $469 million during the three-month period ended March 31, 2026 as compared to $420 million during the first quarter of 2025. The net increase was due to:

Current wording

Income before income taxes (before income attributable to noncontrolling interests) increased by $6 million, or 1%, to $479 million during the three-month period ended June 30, 2026 as compared to $473 million during the second quarter of 2025. The net increase was due to:

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an increase of $26 million at our behavioral health care facilities, as discussed below in Behavioral Health Care Services, and;

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an increase of $15 million at our behavioral health care facilities, as discussed below in Behavioral Health Care Services, and;

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Net income attributable to UHS increased by $32 million, or 10%, to $349 million during the three-month period ended March 31, 2026, as compared to $317 million during the first quarter of 2025. This increase was primarily attributable to:

Current wording

Net income attributable to UHS increased by $5 million, or 2%, to $358 million during the three-month period ended June 30, 2026, as compared to $353 million during the second quarter of 2025. This increase was primarily attributable to:

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an increase of $25 million at our acute care facilities, as discussed below in Acute Care Hospital Services;

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an increase of $24 million at our acute care facilities, as discussed below in Acute Care Hospital Services;

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a $2 million other combined net decrease.

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a $12 million other combined net decrease.

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a $5 million decrease due to an increase in income attributable to noncontrolling interests, and;

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a $2 million decrease due to an increase in income attributable to noncontrolling interests, and;

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a decrease of $12 million resulting from an increase in the provision for income taxes resulting primarily from the increase in the provision for income taxes resulting from the $44 million increase in income before income taxes ($49 million increase in income before income taxes net of a $5 million increase in income attributable to noncontrolling interests).

Current wording

a decrease of $15 million resulting from an increase in the provision for income taxes resulting primarily from the $53 million increase in income before income taxes ($54 million increase in income before income taxes less a $2 million increase in income attributable to noncontrolling interests).

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The following table sets forth certain operating statistics for our acute care hospital services for the three-month periods ended March 31, 2026 and 2025.

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The following table sets forth certain operating statistics for our acute care hospital services for the three and six-month periods ended June 30, 2026 and 2025.

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The following table summarizes the results of operations for our acute care facilities on a Same Facility basis and is used in the discussion below for the three-month periods ended March 31, 2026 and 2025 (dollar amounts in thousands):

Current wording

The following table summarizes the results of operations for our acute care facilities on a Same Facility basis and is used in the discussion below for the three and six-month periods ended June 30, 2026 and 2025 (dollar amounts in thousands):

Previous wording

During the three-month period ended March 31, 2026, net revenue per adjusted admission increased by 6.3% while net revenue per adjusted patient day increased 5.5%, as compared to the comparable quarter of 2025. During the three-month period ended March 31, 2026, as compared to the comparable prior year quarter, inpatient admissions to our acute care hospitals decreased by 1.5% while adjusted admissions (adjusted for outpatient activity) were unchanged. Patient days at these facilities decreased by 0.7% and adjusted patient days increased by 0.8% during the three-month period ended March 31, 2026, as compared to the comparable prior year quarter. The average length of inpatient stay at these facilities was 4.9 days during each of the three-month periods ended March 31, 2026 and 2025, respectively. The occupancy rate, based on the average available beds at these facilities, was 69% and 70% during the three-month periods ended March 31, 2026 and 2025, respectively.

Current wording

During the three-month period ended June 30, 2026, net revenue per adjusted admission increased by 3.0% while net revenue per adjusted patient day increased 2.8%, as compared to the comparable quarter of 2025. During the three-month period ended June 30, 2026, as compared to the comparable prior year quarter, inpatient admissions to our acute care hospitals increased by 1.5% while adjusted admissions (adjusted for outpatient activity) increased by 2.9%. Patient days at these facilities increased by 1.7% and adjusted patient days increased by 3.1% during the three-month period ended June 30, 2026, as compared to the comparable prior year quarter. The average length of inpatient stay at these facilities was 4.7 days during each of the three-month periods ended June 30, 2026 and 2025, respectively. The occupancy rate, based on the average available beds at these facilities, was 64% and 65% during the three-month periods ended June 30, 2026 and 2025, respectively.

Previous wording

On a Same Facility basis, during the three-month period ended March 31, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $39 million, or 4.3%. As a percentage of net revenues, salaries, wages and benefits expense decreased to 38.6% during the first quarter of 2026 as compared to 40.0% during the first quarter of 2025.

Current wording

On a Same Facility basis, during the three-month period ended June 30, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $53 million, or 5.7% due, in part, to the increased patient volumes. As a percentage of net revenues, salaries, wages and benefits expense decreased to 39.5% during the second quarter of 2026 as compared to 40.5% during the second quarter of 2025.

Previous wording

Supplies expense increased by $17 million, or 4.8%, during the first quarter of 2026, as compared to the first quarter of 2025. As a percentage of net revenues, supplies expense decreased to 14.8% during the three-month period ended March 31, 2026, as compared to 15.3% during the first quarter of 2025.

Current wording

Supplies expense increased by $1 million, or 0.3%, during the second quarter of 2026, as compared to the comparable quarter of 2025. As a percentage of net revenues, supplies expense decreased to 14.4% during the three-month period ended June 30, 2026, as compared to 15.6% during the second quarter of 2025.

Previous wording

Other operating expenses increased by $90 million, or 14.0%, during the first quarter of 2026, as compared to the comparable quarter of 2025. Operating expenses incurred by our commercial health insurer, consisting primarily of medical costs, increased by $45 million, or 27.6% (due to an increase in membership), during the first quarter of 2026, as compared to the comparable quarter of 2025. Excluding the operating costs of our commercial insurer from each period, other operating expenses increased by $45 million, or 9.3%. Contributing to the increased operating expenses during the first quarter of 2026, as compared to the comparable quarter of 2025, was a $20 million, or 12.3%, aggregate increase in physician expenses incurred at certain hospitals. As a percentage of net revenues, other operating expenses increased to 29.5% during the first quarter of 2026, as compared to 28.0% during the comparable quarter of 2025.

Current wording

Other operating expenses increased by $196 million, or 15.0%, during the first six months of 2026, as compared to the comparable period of 2025. Operating expenses incurred by our commercial health insurer, consisting primarily of medical costs, increased by $98 million, or 29.1% (due to an increase in membership), during the first six months of 2026 as compared to the comparable period of 2025. Excluding the operating costs of our commercial insurer from each period, other operating expenses increased by $98 million, or 10.1%. Contributing to the increased operating expenses during the first six months of 2026, as compared to the comparable period of 2025, was a $43 million, or 12.4%, aggregate increase in physician expenses incurred at certain hospitals. As a percentage of net revenues, other operating expenses increased to 30.3% during the first six months of 2026, as compared to 28.5% during the comparable period of 2025.

Previous wording

The following table summarizes the results of operations for all our acute care operations during the three-month periods ended March 31, 2026 and 2025. These amounts include: (i) our acute care results on a Same Facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of recently acquired and/or opened facilities and businesses. Dollar amounts below are reflected in thousands.

Current wording

The following table summarizes the results of operations for all our acute care operations during the three and six-month periods ended June 30, 2026 and 2025. These amounts include: (i) our acute care results on a Same Facility basis, as indicated above; (ii) the impact of provider tax assessments which increased net revenues and other operating expenses but had no impact on income before income taxes, and; (iii) certain other amounts including the results of recently acquired and/or opened facilities and businesses. Dollar amounts below are reflected in thousands.

Previous wording

During the three-month period ended March 31, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $57 million, or 6.3%. The increase was due primarily to the above-mentioned $39 million, or 4.3%, increase related to our acute care hospital services, on a Same Facility basis, as well as the salaries, wages and benefits expense incurred at the two above-mentioned newly constructed acute care hospitals.

Current wording

During the three-month period ended June 30, 2026, as compared to the comparable quarter of 2025, salaries, wages and benefits expense increased by $61 million, or 6.5%. The increase was due primarily to the above-mentioned $53 million, or 5.7%, increase related to our acute care hospital services, on a Same Facility basis, as well as the salaries, wages and benefits expense incurred at the above-mentioned newly constructed and recently opened acute care hospital.

Previous wording

Supplies expense increased by $19 million, or 5.5%, during the first quarter of 2026, as compared to the comparable quarter of 2025. The increase was due to the above-mentioned $17 million increase related to our acute care hospital services, on a Same Facility basis, as well as the supplies expense incurred during the first quarter of 2026 at Cedar Hill Regional Medical Center.

Current wording

Supplies expense increased by $2 million, or 0.7%, during the second quarter of 2026, as compared to the comparable quarter of 2025. The increase was due to the above-mentioned increase related to our acute care hospital services, on a Same Facility basis, as well as the supplies expense incurred during the second quarter of 2026 at the Alan B. Miller Medical Center.

Previous wording

During the three-month period ended March 31, 2026, as compared to the comparable prior year quarter, net revenues from our acute care hospital services increased by $252 million, or 10.7%, due to: (i) the $188 million, or 8.2% increase in Same Facility revenues, as discussed above, and; (ii) an other combined net increase of $64 million consisting of increased provider tax assessments and the net revenues generated during the first quarter of 2026 at a newly constructed acute care hospital located in Washington, D.C. (Cedar Hill Regional Medical Center which opened during the second quarter of 2025).

Current wording

During the six-month period ended June 30, 2026, as compared to the comparable prior year period, net revenues from our acute care hospital services increased by $458 million, or 9.6%, due to: (i) the $377 million, or 8.2% increase in Same Facility revenues, as discussed above, and; (ii) an other combined net increase of $81 million consisting of increased provider tax assessments and the net revenues generated during the first six months of 2026 at a newly constructed acute care hospital located in Washington, D.C. (Cedar Hill Regional Medical Center which opened during the second quarter of 2025).

Previous wording

Income before income taxes increased by $25 million, or 10%, to $288 million, or 11.0% of net revenues during the first quarter of 2026, as compared to $263 million, or 11.1% of net revenues during the comparable quarter of 2025. The increase resulted primarily from: (i) the $36 million, or 14%, increase in income before income taxes from our acute care hospital services, on a Same Facility basis, as discussed above, partially offset by; (ii) an $11 million increase in the aggregate pre-tax losses incurred during the first quarter of 2026, as compared to the first quarter of 2025, at the recently completed and opened Cedar Hill Regional Medical Center located in Washington, D.C., as well as the new acute care hospital being constructed in Palm Beach Gardens, FL (Alan B. Miller Medical Center) that is scheduled to be completed and opened during the second quarter of 2026.

Current wording

Income before income taxes increased by $24 million, or 5.0%, to $515 million, or 9.9% of net revenues during the first six months of 2026, as compared to $491 million, or 10.3% of net revenues during the comparable period of 2025. The increase resulted from: the $53 million, or 10.7% increase in income before income taxes from our acute care hospital services, on a Same Facility basis, as discussed above, partially offset by; (ii) an increase of $29 million in aggregate pre-tax losses incurred during the first six months of 2026, as compared to the comparable period of 2025, at the recently completed and opened Alan B. Miller Medical Center located in Palm Beach Gardens, FL., and Cedar Hill Medical Center located in Washington, D.C., which was completed and opened during the second quarter of 2025 (this facility's results of operations are reflected in our acute care hospital services, on a Same Facility basis, as of April 1st. of each year).

Previous wording

Other operating expenses increased by $143 million, or 20.0%, during the first quarter of 2026, as compared to the comparable quarter of 2025. The increase was due primarily to: (i) the $90 million above-mentioned increase related to our acute care hospital services, on a Same Facility basis; (ii) a $35 million increase in provider tax assessments, and; (iii) a combined increase of $18 million consisting primarily of the operating expenses incurred at Cedar Hill Regional Medical Center.

Current wording

Other operating expenses increased by $272 million, or 18.4%, during the first six months of 2026, as compared to the comparable period of 2025. The increase was due primarily to: (i) the $196 million, or 15.0% above-mentioned increase related to our acute care hospital services, on a Same Facility basis; (ii) a $52 million increase in provider tax assessments, and; (iii) a $22 million increase related to the operating expenses incurred at the above-mentioned newly constructed acute care hospitals.