HCA Healthcare, Inc.

Previous wording

This quarterly report on Form 10-Q includes certain disclosures that contain “forward-looking statements” within the meaning of the federal securities laws, which involve risks and uncertainties. Forward-looking statements include statements regarding expected capital expenditures, expected dividends, expected share repurchases, expected net claim payments, expected inflationary pressures, expected labor costs and all other statements that do not relate solely to historical or current facts, and can be identified by the use of words like “may,” “believe,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “initiative” or “continue.” These forward-looking statements are based on our current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond our control, which could significantly affect current plans and expectations and our future financial position and results of operations. These factors include, but are not limited to, (1) changes in or related to general economic or business conditions nationally and regionally in our markets, including inflation, and the impact of trade policies, including changes in, or the imposition of, tariffs and/or trade barriers; changes in revenues resulting from declining patient volumes; changes in payer mix (including increases in uninsured and underinsured patients); potential increased expenses related to labor, pharmaceuticals, supply chain or other expenditures; workforce disruptions; supply and pharmaceutical shortages and disruptions (including as a result of tariffs or geopolitical disruptions); and the impact of federal government shutdowns, holds on or cancellations of congressionally authorized spending and interruptions in the distribution of governmental funds, (2) the impact of current and future health care public policy developments and the implementation of new, and possible changes to existing, federal, state or local laws and regulations affecting health care spending or the health care industry, including the expiration at the end of 2025 of enhanced premium tax credits (“EPTCs”) for eligible individuals purchasing insurance coverage through federal and state-based health insurance exchanges (the “Exchanges”), changes in the structure and administration of, and funding for, federal and state agencies and programs, effects of the 2025 Federal Budget Act (the “FBA”) and efforts to address health care affordability, (3) the impact of our significant indebtedness and the ability to refinance such indebtedness on acceptable terms, (4) the effects related to the implementation of sequestration spending reductions required under the Budget Control Act of 2011, related legislation extending these reductions, and the potential for future deficit or other spending reduction legislation that may alter current spending reductions, which include cuts to Medicare payments, or impose additional spending reductions, (5) the abilit…

Excerpt shortened here; the source contains the full paragraph.

Current wording

This quarterly report on Form 10-Q includes certain disclosures that contain “forward-looking statements” within the meaning of the federal securities laws, which involve risks and uncertainties. Forward-looking statements include statements regarding expected capital expenditures, expected dividends, expected share repurchases, expected net claim payments, expected inflationary pressures, expected labor costs and all other statements that do not relate solely to historical or current facts, and can be identified by the use of words like “may,” “believe,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “initiative” or “continue.” These forward-looking statements are based on our current plans and expectations and are subject to a number of known and unknown uncertainties and risks, many of which are beyond our control, which could significantly affect current plans and expectations and our future financial position and results of operations. These factors include, but are not limited to, (1) changes in or related to general economic or business conditions nationally and regionally in our markets, including inflation, and the impact of trade policies, including changes in, or the imposition of, tariffs and/or trade barriers; changes in revenues resulting from declining patient volumes; changes in payer mix (including increases in uninsured and underinsured patients); potential increased expenses related to labor, pharmaceuticals, supply chain or other expenditures; workforce disruptions; supply and pharmaceutical shortages and disruptions (including as a result of tariffs or geopolitical disruptions); and the impact of federal government shutdowns, holds on or cancellations of congressionally authorized spending and interruptions in the distribution of governmental funds, (2) the impact of current and future health care public policy developments and the implementation of new, and possible changes to existing, federal, state or local laws and regulations affecting health care spending or the health care industry, including the expiration at the end of 2025 of enhanced premium tax credits (“EPTCs”) for eligible individuals purchasing insurance coverage through federal and state-based health insurance exchanges (the “Exchanges”), changes in the structure and administration of, and funding for, federal and state agencies and programs, effects of the 2025 Federal Budget Act (the “FBA”) and efforts to address health care affordability, (3) the ability to achieve operating and financial targets, develop and execute resiliency plans to offset to the extent possible impacts from the FBA, the expiration of EPTCs and tariffs, attain expected levels of patient volumes and revenues and service mix, and control the costs of providing services, (4) the impact of our significant indebtedness and the ability to refinance such indebtedness on acceptable terms, (5) the effects related to the implementation of sequestration spending reductions require…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

Revenues increased 8.7% on a consolidated basis and 9.3% on a same facility basis for the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. The increase in consolidated revenues can be primarily attributed to the combined impact of a 6.0% increase in revenue per equivalent admission and a 2.6% increase in equivalent admissions. The same facility revenues increase primarily resulted from the combined impact of a 6.4% increase in same facility revenue per equivalent admission and a 2.7% increase in same facility equivalent admissions.

Current wording

Revenues increased 3.6% on both a consolidated basis and same facility basis for the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. The increase in consolidated revenues can be primarily attributed to the combined impact of a 0.7% increase in revenue per equivalent admission and a 2.8% increase in equivalent admissions. The same facility revenues increase resulted from the combined impact of a 0.6% increase in same facility revenue per equivalent admission and a 3.0% increase in same facility equivalent admissions.

Previous wording

During the quarter ended June 30, 2026, consolidated admissions increased 2.4% and same facility admissions increased 2.5% compared to the quarter ended June 30, 2025. Inpatient surgical volumes declined 2.3% on both a consolidated basis and a same facility basis during the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. Outpatient surgical volumes declined 4.4% on a consolidated basis and 3.4% on a same facility basis during the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. Emergency department visits increased 3.5% on a consolidated basis and 3.6% on a same facility basis during the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. Consolidated and same facility uninsured admissions increased 23.3% and 23.4%, respectively, for the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025. Uninsured admissions increased for the second quarter and first six months of 2026 reflecting impacts from the expiration of the EPTCs at the end of 2025 and administrative reforms, as well as a decline in Medicaid conversions. The second quarter increase in uninsured admissions includes the impact of attrition related to Exchange volumes from the first quarter that occurred during the second quarter.

Current wording

During the quarter ended September 30, 2026, consolidated admissions increased 2.5% and same facility admissions increased 2.7%, compared to the quarter ended September 30, 2025. Inpatient surgical volumes declined 1.3% on a consolidated basis and 1.4% on a same facility basis during the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. Outpatient surgical volumes declined 4.2% on a consolidated basis and 3.7% on a same facility basis during the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. Emergency department visits increased 5.3% on a consolidated basis and 5.1% on a same facility basis during the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. Consolidated and same facility uninsured admissions increased 27.2% and 27.4%, respectively, for the quarter ended September 30, 2026, compared to the quarter ended September 30, 2025. Uninsured admissions increased for the third quarter of 2026, reflecting continued impacts from the expiration of the EPTCs at the end of 2025 and administrative reforms, as well as a decline in Medicaid conversions.

Previous wording

Revenues increased 8.7% from $18.605 billion in the second quarter of 2025 to $20.230 billion in the second quarter of 2026. Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual adjustments under managed care and commercial insurance plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured and other discounts). We also record estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenues at the estimated amounts we expect to collect. Patients treated at our hospitals for non-elective care who have income at or below 400% of the federal poverty level are eligible for charity care. Because we do not pursue collection of amounts determined to qualify as charity care, they are not reported in revenues. Our revenues by primary third-party payer classification and other (including uninsured patients) for the quarters and six months ended June 30, 2026 and 2025 are summarized in the following table (dollars in millions):

Current wording

Revenues increased 3.6% from $19.161 billion in the third quarter of 2025 to $19.849 billion in the third quarter of 2026. Revenues increased 5.5% from $56.087 billion in the first nine months of 2025 to $59.188 billion in the first nine months of 2026. Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual adjustments under managed care and commercial insurance plans are based upon the payment terms specified in the related contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured and other discounts). We also record estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenues at the estimated amounts we expect to collect. Patients treated at our hospitals for non-elective care who have income at or below 400% of the federal poverty level are eligible for charity care. Because we do not pursue collection of amounts determined to qualify as charity care, they are not reported in revenues. Our revenues by primary third-party payer classification and other (including uninsured patients) for the quarters and nine months ended September 30, 2026 and 2025 are summarized in the following table (dollars in millions):

Previous wording

To quantify the total impact of the trends related to uninsured patient accounts, we believe it is beneficial to consider total uncompensated care, which is comprised of charity care, uninsured discounts and implicit price concessions. Total uncompensated care was $15.076 billion and $11.625 billion, respectively, for the quarters ended June 30, 2026 and 2025, and the estimated cost of total uncompensated care was $1.445 billion and $1.116 billion, respectively, for the quarters ended June 30, 2026 and 2025. Total uncompensated care was $28.688 billion and $22.618 billion, respectively, for the six months ended June 30, 2026 and 2025, and the estimated cost of total uncompensated care was $2.697 billion and $2.171 billion, respectively, for the six months ended June 30, 2026 and 2025. The estimated cost of uncompensated care was based on a ratio of patient care costs (salaries and benefits, supplies, other operating expense and depreciation and amortization) to gross charges.

Current wording

To quantify the total impact of the trends related to uninsured patient accounts, we believe it is beneficial to consider total uncompensated care, which is comprised of charity care, uninsured discounts and implicit price concessions. The estimated cost of total uncompensated care was $1.477 billion and $1.188 billion for the quarters ended September 30, 2026 and 2025, respectively. The estimated cost of total uncompensated care was $4.174 billion and $3.359 billion for the nine months ended September 30, 2026 and 2025, respectively. The estimated cost of uncompensated care was based on a ratio of patient care costs (salaries and benefits, supplies, other operating expenses and depreciation and amortization) to gross charges.

Previous wording

Consolidated and same facility revenue per equivalent admission increased 6.0% and 6.4%, respectively, in the second quarter of 2026, compared to the second quarter of 2025. The increase in revenue per equivalent admission was impacted by the incremental revenue from the Florida directed payment program approved during the quarter. Consolidated and same facility equivalent admissions increased 2.6% and 2.7%, respectively, in the second quarter of 2026, compared to the second quarter of 2025. Consolidated and same facility outpatient surgeries declined 4.4% and 3.4%, respectively, in the second quarter of 2026, compared to the second quarter of 2025. Consolidated and same facility inpatient surgeries each declined 2.3% in the second quarter of 2026, compared to the second quarter of 2025. Consolidated and same facility emergency department visits increased 3.5% and 3.6%, respectively, in the second quarter of 2026, compared to the second quarter of 2025.

Current wording

Consolidated and same facility revenue per equivalent admission increased 0.7% and 0.6%, respectively, in the third quarter of 2026, compared to the third quarter of 2025. Consolidated and same facility equivalent admissions increased 2.8% and 3.0%, respectively, in the third quarter of 2026, compared to the third quarter of 2025. Consolidated and same facility outpatient surgeries declined 4.2% and 3.7%, respectively, in the third quarter of 2026, compared to the third quarter of 2025. Consolidated and same facility inpatient surgeries declined 1.3% and 1.4%, respectively, in the third quarter of 2026, compared to the third quarter of 2025. Consolidated and same facility emergency department visits increased 5.3% and 5.1%, respectively, in the third quarter of 2026, compared to the third quarter of 2025.

Previous wording

The approximate percentages of our admissions related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers and the uninsured for the quarters and six months ended June 30, 2026 and 2025 are set forth in the following table.

Current wording

The approximate percentages of our admissions related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers and the uninsured for the quarters and nine months ended September 30, 2026 and 2025 are set forth in the following table.

Previous wording

Same facility uninsured admissions increased 23.4% in the second quarter of 2026 compared to the second quarter of 2025. Same facility uninsured admissions increased 15.5% in the first quarter of 2026 compared to the first quarter of 2025. The increases in both periods reflect impacts from the expiration of the EPTCs at the end of 2025. Same facility uninsured admissions in 2025, compared to 2024, increased 7.1% in the fourth quarter, declined 2.0% in the third quarter, increased 0.4% in the second quarter and declined 0.7% in the first quarter.

Current wording

Same facility uninsured admissions in 2026, compared to 2025, increased 27.4% in the third quarter, increased 23.4% in the second quarter and increased 15.5% in the first quarter. The increases in these periods reflect impacts from the expiration of the EPTCs at the end of 2025 and administrative reforms, both related to insurance purchases through the Exchanges. Same facility uninsured admissions in 2025, compared to 2024, increased 7.1% in the fourth quarter, declined 2.0% in the third quarter, increased 0.4% in the second quarter and declined 0.7% in the first quarter.

Previous wording

The approximate percentages of our inpatient revenues related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers for the quarters and six months ended June 30, 2026 and 2025 are set forth in the following table.

Current wording

The approximate percentages of our inpatient revenues related to Medicare, managed Medicare, Medicaid, managed Medicaid, managed care and insurers for the quarters and nine months ended September 30, 2026 and 2025 are set forth in the following table.

Previous wording

At June 30, 2026, we had 103 hospitals in the states of Texas and Florida. During the quarter ended June 30, 2026, 58% of our admissions and 55% of our revenues were generated by these hospitals. Uninsured admissions in Texas and Florida represented 73% of our uninsured admissions during the quarter ended June 30, 2026.

Current wording

At September 30, 2026, we had 103 hospitals in the states of Texas and Florida. During the quarter ended September 30, 2026, 58% of our admissions and 51% of our revenues were generated by these hospitals. Uninsured admissions in Texas and Florida represented 73% of our uninsured admissions during the quarter ended September 30, 2026.

Previous wording

We receive a significant portion of our revenues from government health programs, principally Medicare and Medicaid, which are highly regulated and subject to frequent and substantial changes. Some states make additional payments to providers through the Medicaid program that are separate from base payments. These payments may be in the form of payments, such as upper payment limit payments, that are intended to address the difference between Medicaid fee-for-service payments and Medicare reimbursement rates, or payments under other programs that vary by state under waivers authorized by Section 1115 of the Social Security Act. In addition, many states have implemented SDP arrangements to direct certain Medicaid managed care plan expenditures. These payments are generally authorized by CMS and subject to periodic extension or reapproval.

Current wording

We receive a significant portion of our revenues from government health programs, principally Medicare and Medicaid, which are highly regulated and subject to frequent and substantial changes. Some states make additional payments to providers through the Medicaid program that are separate from base payments. These payments may be in the form of payments, such as upper payment limit payments, that are intended to address the difference between Medicaid fee-for-service payments and Medicare reimbursement rates, or payments under other programs that vary by state under waivers authorized by Section 1115 of the Social Security Act. In addition, many states have implemented SDP arrangements to direct certain Medicaid managed care plan expenditures. These payments are generally authorized by the Centers for Medicare & Medicaid Services ("CMS") and subject to periodic extension or reapproval.

Previous wording

As discussed in additional detail in Item 1,“Business — Sources of Revenue — Medicaid State Directed and Supplemental Payments” in our Annual Report on Form 10-K for the year ended December 31, 2025, the use and nature of SDP arrangements are subject to policy changes. For example, as mandated by the FBA, CMS has proposed revisions to regulations governing SDP arrangements, tying caps on payment rates paid by Medicaid managed care organizations to Medicare payment rates instead of average commercial rates. The changes proposed by CMS include applying similar limits to certain Medicaid fee-for-service targeted practitioner payments. The payment limitations for SDPs for services specified by the FBA will apply to SDP arrangements made for services furnished in the rating periods beginning on or after July 4, 2025. However, the FBA temporarily grandfathers certain SDP arrangements, including those for which an application was submitted to CMS prior to July 4, 2025, for the rating period occurring within 180 days of July 4, 2025. Certain states in which we operate have submitted applications to CMS and received approval to increase payments up to the average commercial rate before the step down begins in 2028. Those approvals or future approvals could result in the recognition of additional revenues, which may be significant. However, we are unable to predict the timing or extent of any additional approvals by CMS and the timing or amount of any resulting recognition of the related revenues. Beginning with the rating period on or after January 1, 2028, grandfathered SDP arrangements will be subject to a phase-down period consistent with the FBA payment rate caps.

Current wording

As discussed in additional detail in Item 1,“Business — Sources of Revenue — Medicaid State Directed and Supplemental Payments” in our Annual Report on Form 10-K for the year ended December 31, 2025, the use and nature of SDP arrangements are subject to policy changes. For example, as mandated by the FBA, CMS has proposed revisions to regulations governing SDP arrangements, tying caps on payment rates paid by Medicaid managed care organizations to Medicare payment rates instead of average commercial rates. The changes proposed by CMS include applying similar limits to certain Medicaid fee-for-service targeted practitioner payments. The payment limitations for SDP arrangements for services specified by the FBA will apply to SDP arrangements made for services furnished in the rating periods beginning on or after July 4, 2025. However, the FBA temporarily grandfathers certain SDP arrangements, including those for which an application was submitted to CMS prior to July 4, 2025, for the rating period occurring within 180 days of July 4, 2025. Certain states in which we operate have submitted applications to CMS and received approval to increase payments up to the average commercial rate before the step down begins in 2028. Those approvals or future approvals (if any) could result in the recognition of additional revenues, which may be significant. However, we are unable to predict the timing or extent of any additional approvals by CMS and the timing or amount of any resulting recognition of the related revenues. Beginning with the rating period on or after January 1, 2028, grandfathered SDP arrangements will be subject to a phase-down period consistent with the FBA payment rate caps.

Previous wording

Most states in which we receive payment have adopted statewide or local provider taxes to fund the non-federal share of Medicaid programs. As discussed in additional detail in Item 1,“Business — Sources of Revenue — Medicaid” in our Annual Report on Form 10-K for the year ended December 31, 2025, the FBA includes restrictions on provider tax arrangements, which are expected to reduce the federal matching funds received by state Medicaid programs. In July 2026, CMS issued a proposed rule to implement changes related to limits on the structure and applicability of provider taxes and the related safe harbor limits. Separately, in February 2026, CMS issued a final rule that implements limits on the structure and applicability of provider taxes. As a result of these changes, some taxes on managed care organizations and providers permitted prior to the enactment of the FBA must be reduced, or are no longer permissible, subject to transition periods. The changes to provider taxes could increase state budgetary pressures, reduce federal Medicaid funding, and negatively affect reimbursement rates and coverage, among other effects. We are unable to predict the ultimate impact of these changes on our business and financial results.

Current wording

Most states in which we receive payments have adopted statewide or local provider taxes to fund the non-federal share of Medicaid programs. As discussed in additional detail in Item 1,“Business — Sources of Revenue — Medicaid” in our Annual Report on Form 10-K for the year ended December 31, 2025, the FBA includes restrictions on provider tax arrangements, which are expected to reduce the federal matching funds received by state Medicaid programs. In July 2026, CMS issued a proposed rule to implement changes related to limits on the structure and applicability of provider taxes and the related safe harbor limits. Separately, in February 2026, CMS issued a final rule that implements limits on the structure and applicability of provider taxes. As a result of these changes, some taxes on managed care organizations and providers permitted prior to the enactment of the FBA must be reduced, or are no longer permissible, subject to transition periods. The changes to provider taxes could increase state budgetary pressures, reduce federal Medicaid funding, and negatively affect reimbursement rates and coverage, among other effects. We are unable to predict the ultimate impact of these changes on our business and financial results.

Previous wording

The health care industry is subject to changing political, regulatory and other influences, including health care reform efforts at the federal and state levels. We are monitoring and engaged in advocacy efforts around potential health care policy changes and reform. See Item 1A,“Risk Factors” from our Annual Report on Form 10-K for the year ended December 31, 2025 for additional information.

Current wording

The health care industry is subject to changing political, regulatory and other influences, including health care reform efforts at the federal and state levels, and continuing impacts from policy changes. We continue our work to develop and implement resiliency initiatives designed to enhance efficiency and decrease costs, in part to offset adverse impacts from such policy changes, but these efforts are subject to known and unknown risks and uncertainties. See Item 1A,“Risk Factors” from our Annual Report on Form 10-K for the year ended December 31, 2025 for additional information.

Previous wording

The following is a comparative summary of results of operations for the quarters and six months ended June 30, 2026 and 2025 (dollars in millions):

Current wording

The following is a comparative summary of results of operations for the quarters and nine months ended September 30, 2026 and 2025 (dollars in millions):

Previous wording

Salaries and benefits, as a percentage of revenues, were 41.0% in the second quarter of 2026 and 43.7% in the second quarter of 2025. Salaries and benefits per equivalent admission declined 0.7% in the second quarter of 2026, compared to the second quarter of 2025. Same facility salaries and benefits per full-time equivalent increased 2.5% for the second quarter of 2026, compared to the second quarter of 2025.

Current wording

Salaries and benefits, as a percentage of revenues, were 43.2% in the third quarter of 2026 and 43.6% in the third quarter of 2025. Salaries and benefits per equivalent admission declined 0.2% in the third quarter of 2026, compared to the third quarter of 2025. Same facility salaries and benefits per full-time equivalent increased 2.7% for the third quarter of 2026, compared to the third quarter of 2025.

Previous wording

Supplies, as a percentage of revenues, were 14.3% in the second quarter of 2026 and 15.3% in the second quarter of 2025. Supply costs per equivalent admission declined 1.0% in the second quarter of 2026, compared to the second quarter of 2025. Supply costs per equivalent admission increased 0.1% for medical devices and declined 5.0% for pharmacy supplies and 1.1% for general medical and surgical items in the second quarter of 2026, compared to the second quarter of 2025. The decline in supply costs per equivalent admission for pharmacy supplies is primarily related to a decrease in the utilization of certain drugs.

Current wording

Supplies, as a percentage of revenues, were 14.2% in the third quarter of 2026 and 14.5% in the third quarter of 2025. Supply costs per equivalent admission declined 1.4% in the third quarter of 2026, compared to the third quarter of 2025. Supply costs per equivalent admission declined 2.5% for medical devices, 2.3% for pharmacy supplies and 0.9% for general medical and surgical items in the third quarter of 2026, compared to the third quarter of 2025.

Previous wording

Other operating expenses, as a percentage of revenues, were 24.9% in the second quarter of 2026 and 20.4% in the second quarter of 2025. Other operating expenses are primarily comprised of contract services, professional fees, repairs and maintenance, rents and leases, utilities, insurance (including professional liability insurance) and non-income taxes. The 4.5% increase in other operating expenses, as a percentage of revenues, for the second quarter of 2026 compared to the second quarter of 2025 was primarily related to growth in Medicaid state directed and supplemental payment program expenses and professional fees. We have seen inflation have a negative impact on certain of these expenses and expect inflationary pressures will continue to impact operating expenses in the future.

Current wording

Other operating expenses, as a percentage of revenues, were 23.0% in the third quarter of 2026 and 21.8% in the third quarter of 2025. Other operating expenses are primarily comprised of contract services, professional fees, repairs and maintenance, rents and leases, utilities, insurance (including professional liability insurance) and non-income taxes. We have seen inflation have a negative impact on certain of these expenses and expect inflationary pressures will continue to impact operating expenses in the future.

Previous wording

Equity in earnings of affiliates was $16 million and $19 million in the second quarters of 2026 and 2025, respectively.

Current wording

Equity in earnings of affiliates was $20 million and $16 million in the third quarters of 2026 and 2025, respectively.

Previous wording

Depreciation and amortization increased $81 million, from $863 million in the second quarter of 2025 to $944 million in the second quarter of 2026. The increase in depreciation relates primarily to capital expenditures at our existing facilities.

Current wording

Depreciation and amortization increased $65 million, from $889 million in the third quarter of 2025 to $954 million in the third quarter of 2026. The increase in depreciation relates primarily to capital expenditures at our existing facilities.

Previous wording

Interest expense was $599 million in the second quarter of 2026 and $568 million in the second quarter of 2025. Our average debt balance was $49.228 billion for the second quarter of 2026, compared to $44.506 billion for the second quarter of 2025. The average effective interest rate for our debt was 4.9% and 5.1% for the quarters ended June 30, 2026 and 2025, respectively.

Current wording

Interest expense was $607 million in the third quarter of 2026 and $561 million in the third quarter of 2025. Our average debt balance was $49.743 billion for the third quarter of 2026, compared to $44.400 billion for the third quarter of 2025. The average effective interest rate for our debt was 4.8% and 5.0% for the quarters ended September 30, 2026 and 2025, respectively.

Previous wording

During the second quarters of 2026 and 2025, we recorded gains on sales of facilities of $10 million and losses on sales of facilities of $3 million, respectively.

Current wording

During the third quarters of 2026 and 2025, we recorded gains on sales of facilities of $13 million and losses on sales of facilities of $2 million, respectively.

Previous wording

The effective tax rates were 24.9% and 24.1% for the second quarters of 2026 and 2025, respectively. The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships. The increase in the effective tax rate for the quarter ended June 30, 2026 is related primarily to decreases in amounts of deductible share-based compensation for vested employee equity awards and other nontaxable items.

Current wording

The effective tax rates were 24.8% and 23.9% for the third quarters of 2026 and 2025, respectively. The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships. The increase in the effective tax rate for the quarter ended September 30, 2026 is related primarily to decreases in amounts of deductible share-based compensation for vested employee equity awards and other nondeductible items.

Previous wording

Revenues increased to $39.339 billion in the first six months of 2026 from $36.926 billion in the first six months of 2025. Net income attributable to HCA Healthcare, Inc. totaled $3.319 billion, or $14.77 per diluted share, for the six months ended June 30, 2026, compared to $3.263 billion, or $13.28 per diluted share, for the six months ended June 30, 2025. Results for the first six months of 2026 and 2025 include gains on sales of facilities of $9 million, or $0.03 per diluted share, and losses on sales of facilities of $2 million, or $0.01 per diluted share, respectively. Our provision for income taxes for the first six months of 2026 and 2025 included tax benefits of $107 million, or $0.48 per diluted share, and $33 million, or $0.13 per diluted share, respectively, related to employee equity award settlements. All “per diluted share” disclosures are based upon amounts net of the applicable income taxes. Shares used for diluted earnings per share were 224.731 million shares for the six months ended June 30, 2026 and 245.654 million shares for the six months ended June 30, 2025. During 2025 and the first six months of 2026, we repurchased 26.739 million shares and 7.909 million shares, respectively, of our common stock.

Current wording

Revenues increased to $59.188 billion in the first nine months of 2026 from $56.087 billion in the first nine months of 2025. Net income attributable to HCA Healthcare, Inc. totaled $4.898 billion, or $22.05 per diluted share, for the nine months ended September 30, 2026, compared to $4.906 billion, or $20.23 per diluted share, for the nine months ended September 30, 2025. Results for the first nine months of 2026 and 2025 include gains on sales of facilities of $22 million, or $0.08 per diluted share, and losses on sales of facilities of $4 million, or $0.01 per diluted share, respectively. Our provision for income taxes for the first nine months of 2026 and 2025 included tax benefits of $110 million, or $0.49 per diluted share, and $45 million, or $0.19 per diluted share, respectively, related to employee equity award settlements. All “per diluted share” disclosures are based upon amounts net of the applicable income taxes. Shares used for diluted earnings per share were 222.197 million shares for the nine months ended September 30, 2026 and 242.459 million shares for the nine months ended September 30, 2025. During 2025 and the first nine months of 2026, we repurchased 26.739 million shares and 15.139 million shares, respectively, of our common stock.

Previous wording

Revenues increased 6.5% on a consolidated basis and 6.9% on a same facility basis for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. The increase in consolidated revenues can be attributed to the combined impact of a 4.6% increase in revenue per equivalent admission and a 1.9% increase in equivalent admissions. The same facility revenues increase resulted primarily from the combined impact of a 4.8% increase in same facility revenue per equivalent admission and a 2.0% increase in same facility equivalent admissions.

Current wording

Revenues increased 5.5% on a consolidated basis and 5.8% on a same facility basis for the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025. The increase in consolidated revenues can be attributed to the combined impact of a 3.3% increase in revenue per equivalent admission and a 2.2% increase in equivalent admissions. The same facility revenues increase resulted primarily from the combined impact of a 3.4% increase in same facility revenue per equivalent admission and a 2.3% increase in same facility equivalent admissions.

Previous wording

Salaries and benefits, as a percentage of revenues, were 42.1% in the first six months of 2026 and 43.7% in the first six months of 2025. Salaries and benefits per equivalent admission increased 0.8% in the first six months of 2026, compared to the first six months of 2025. Same facility salaries and benefits per full-time equivalent increased 3.0% for the first six months of 2026, compared to the first six months of 2025.

Current wording

Salaries and benefits, as a percentage of revenues, were 42.5% in the first nine months of 2026 and 43.7% in the first nine months of 2025. Salaries and benefits per equivalent admission increased 0.5% in the first nine months of 2026, compared to the first nine months of 2025. Same facility salaries and benefits per full-time equivalent increased 2.8% for the first nine months of 2026, compared to the first nine months of 2025.

Previous wording

Supplies, as a percentage of revenues, were 14.6% in the first six months of 2026 and 15.2% in the first six months of 2025. Supply costs per equivalent admission increased 0.5% in the first six months of 2026, compared to the first six months of 2025. Supply costs per equivalent admission increased 2.4% for medical devices and declined 5.0% for pharmacy supplies and 0.2% for general medical and surgical items in the first six months of 2026, compared to the first six months of 2025. The decline in supply costs per equivalent admission for pharmacy supplies is primarily related to a decrease in the utilization of certain drugs.

Current wording

Supplies, as a percentage of revenues, were 14.5% in the first nine months of 2026 and 15.0% in the first nine months of 2025. Supply costs per equivalent admission declined 0.1% in the first nine months of 2026, compared to the first nine months of 2025. Supply costs per equivalent admission declined 4.2% for pharmacy supplies and 0.5% for general medical and surgical items and increased 0.7% for medical devices in the first nine months of 2026, compared to the first nine months of 2025. The decline in supply costs per equivalent admission for pharmacy supplies is primarily related to a decrease in the utilization of certain drugs.

Previous wording

Other operating expenses, as a percentage of revenues, were 23.5% in the first six months of 2026 and 20.7% in the first six months of 2025. Other operating expenses are primarily comprised of contract services, professional fees, repairs and maintenance, rents and leases, utilities, insurance (including professional liability insurance) and non-income taxes. The 2.8% increase in other operating expenses, as a percentage of revenues, for the first six months of 2026 compared to the first six months of 2025 was primarily related to growth in Medicaid state directed and supplemental payment program expenses and professional fees. We have seen inflation have a negative impact on certain of these expenses and expect inflationary pressures will continue to impact operating expenses in the future.

Current wording

Other operating expenses, as a percentage of revenues, were 23.3% in the first nine months of 2026 and 21.0% in the first nine months of 2025. Other operating expenses are primarily comprised of contract services, professional fees, repairs and maintenance, rents and leases, utilities, insurance (including professional liability insurance) and non-income taxes. The 2.3 percentage points increase in other operating expenses, as a percentage of revenues, for the first nine months of 2026 compared to the first nine months of 2025 was primarily related to growth in Medicaid state directed and supplemental payment program expenses and professional fees. We have seen inflation have a negative impact on certain of these expenses and expect inflationary pressures will continue to impact operating expenses in the future.

Previous wording

Equity in earnings of affiliates was $25 million and $37 million in the first six months of 2026 and 2025, respectively.

Current wording

Equity in earnings of affiliates was $45 million and $53 million in the first nine months of 2026 and 2025, respectively.

Previous wording

Depreciation and amortization increased $151 million, from $1.723 billion in the first six months of 2025 to $1.874 billion in the first six months of 2026. The increase in depreciation relates primarily to capital expenditures at our existing facilities.

Current wording

Depreciation and amortization increased $216 million, from $2.612 billion in the first nine months of 2025 to $2.828 billion in the first nine months of 2026. The increase in depreciation relates primarily to capital expenditures at our existing facilities.

Previous wording

Interest expense was $1.183 billion in the first six months of 2026 and $1.115 billion in the first six months of 2025. Our average debt balance was $48.256 billion for the first six months of 2026 compared to $44.061 billion for the first six months of 2025. The average effective interest rate for our debt was 4.9% and 5.1% for the six months ended June 30, 2026 and 2025, respectively.

Current wording

Interest expense was $1.790 billion in the first nine months of 2026 and $1.676 billion in the first nine months of 2025. Our average debt balance was $48.704 billion for the first nine months of 2026 compared to $44.155 billion for the first nine months of 2025. The average effective interest rate for our debt was 4.9% and 5.1% for the nine months ended September 30, 2026 and 2025, respectively.

Previous wording

Quarters Ended June 30, 2026 and 2025 (continued)

Current wording

Nine Months Ended September 30, 2026 and 2025 (continued)

Previous wording

During the first six months of 2026 and 2025, we recorded gains on sales of facilities of $9 million and losses on sales of facilities of $2 million, respectively.

Current wording

During the first nine months of 2026 and 2025, we recorded gains on sales of facilities of $22 million and losses on sales of facilities of $4 million, respectively.

Previous wording

The effective tax rates were 23.0% and 23.9% for the first six months of 2026 and 2025, respectively. The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships. Our provisions for income taxes for the first six months of 2026 and 2025 included tax benefits of $107 million and $33 million, respectively, related to employee equity award settlements.

Current wording

The effective tax rates were 23.6% and 23.9% for the first nine months of 2026 and 2025, respectively. The effective tax rate computations exclude net income attributable to noncontrolling interests as it relates to consolidated partnerships. Our provision for income taxes for the first nine months of 2026 and 2025 included tax benefits of $110 million and $45 million, respectively, related to employee equity award settlements.

Previous wording

$1.099 billion, including an increase in accounts receivable primarily related to Medicaid state directed and supplemental payment programs, as well as an increase in income taxes paid of $579 million related to the 2025 IRS deferral of quarterly estimated income tax payments for Tennessee-based taxpayers until the fourth quarter of 2025, partially offset by a $62 million increase in net income, excluding the non-cash impact of losses and gains on sales of facilities. The combination of interest payments and net income tax payments in the first six months of 2026 and 2025 totaled $1.888 billion and $1.220 billion, respectively. We had negative working capital of $122 million and $567 million at June 30, 2026 and December 31, 2025, respectively. The negative working capital related primarily to the increase in short-term borrowings and long-term debt due within one year. We have the ability to refinance our outstanding commercial paper notes with our senior unsecured credit facility on a long-term basis. Excluding the impact of our outstanding commercial paper notes, our working capital at June 30, 2026 would have been $3.768 billion.

Current wording

Cash provided by operating activities totaled $8.810 billion for the first nine months of 2026 compared to $10.277 billion for the first nine months of 2025. The $1.467 billion decline in cash provided by operating activities for the first nine months of 2026 compared to the first nine months of 2025 related primarily to unfavorable changes in working capital items of $472 million, as well as an increase in income taxes paid of $1.190 billion related to the 2025 IRS deferral of quarterly estimated income tax payments for Tennessee-based taxpayers until the fourth quarter of 2025, partially offset by a $213 million increase in net income, excluding gains and losses on sales of facilities and depreciation and amortization. The combination of interest payments and net income tax payments in the first nine months of 2026 and 2025 totaled $3.142 billion and $1.923 billion, respectively. We had negative working capital of $3.560 billion and $567 million at September 30, 2026 and December 31, 2025, respectively. The negative working capital related primarily to the increase in short-term borrowings and long-term debt due within one year. We have the ability to refinance our outstanding commercial paper notes with our senior unsecured credit facility on a long-term basis. Excluding the impact of our outstanding commercial paper notes, our working capital at September 30, 2026 would have been $2.167 billion.

Previous wording

Cash used in investing activities was $2.839 billion in the first six months of 2026 compared to $2.283 billion in the first six months of 2025. Excluding acquisitions, capital expenditures were $2.350 billion in the first six months of 2026 and $2.167 billion in the first six months of 2025. Planned capital expenditures are expected to be approximately between $5.0 billion and $5.5 billion in 2026, excluding acquisitions. At June 30, 2026, there were projects under construction which had estimated additional costs to complete and equip over the next five years of approximately $8.6 billion. We expect to finance capital expenditures with internally generated and borrowed funds.

Current wording

Cash used in investing activities was $4.755 billion in the first nine months of 2026 compared to $3.671 billion in the first nine months of 2025. Excluding acquisitions, capital expenditures were $3.707 billion in the first nine months of 2026 and $3.455 billion in the first nine months of 2025. Planned capital expenditures are expected to be between $5.0 billion and $5.5 billion in 2026, excluding acquisitions. At September 30, 2026, there were projects under construction which had estimated additional costs to complete and equip over the next five years of approximately $8.6 billion. We expect to finance capital expenditures with internally generated and borrowed funds.

Previous wording

Cash used in financing activities totaled $1.534 billion in the first six months of 2026, compared to $4.584 billion in the first six months of 2025. During the first six months of 2026, net cash flows used in financing activities included a net increase of $3.065 billion in our indebtedness, payment of dividends of $354 million, repurchase of common stock of $3.635 billion and distributions to noncontrolling interests of $334 million. During the first six months of 2025, net cash flows used in financing activities included a net increase of $1.341 billion in our indebtedness, payment of dividends of $351 million, repurchase of common stock of $5.011 billion and distributions to noncontrolling interests of $394 million.

Current wording

Cash used in financing activities totaled $4.183 billion in the first nine months of 2026, compared to $7.551 billion in the first nine months of 2025. During the first nine months of 2026, net cash flows used in financing activities included a net increase of $3.788 billion in our indebtedness, payment of dividends of $519 million, repurchase of common stock of $6.605 billion and distributions to noncontrolling interests of $574 million. During the first nine months of 2025, net cash flows used in financing activities included a net increase of $1.305 billion in our indebtedness, payment of dividends of $517 million, repurchase of common stock of $7.509 billion and distributions to noncontrolling interests of $631 million.

Previous wording

During April 2026, we issued $3.000 billion aggregate principal amount of senior notes comprised of (i) $1.000 billion aggregate principal amount of 4.700% senior notes due 2031, (ii) $750 million aggregate principal amount of 5.000% senior notes due 2033 and (iii) $1.250 billion aggregate principal amount of 5.300% senior notes due 2036. We used the net proceeds to repay borrowings under the commercial paper program and for general corporate purposes.

Current wording

During April 2026, we issued $3.000 billion aggregate principal amount of senior notes comprised of (i) $1.000 billion aggregate principal amount of 4.700% senior notes due 2031, (ii) $750 million aggregate principal amount of 5.000% senior notes due 2033 and (iii) $1.250 billion aggregate principal amount of 5.300% senior notes due 2036. We used the net proceeds to repay borrowings under our commercial paper program (“CPP”) and for general corporate purposes.

Previous wording

During May 2026, we repaid all $1.500 billion aggregate principal amount of 5.250% senior notes due 2026 and all $1.000 billion aggregate principal amount of 5.375% senior notes due 2026.

Current wording

During May 2026, we redeemed all $1.500 billion aggregate principal amount of 5.250% senior notes due 2026 and all $1.000 billion aggregate principal amount of 5.375% senior notes due 2026.

Previous wording

We have significant debt service requirements. Our debt totaled $49.718 billion at June 30, 2026. Our interest expense was $1.183 billion for the first six months of 2026 and $1.115 billion for the first six months of 2025.

Current wording

We have significant debt service requirements. Our debt totaled $50.493 billion at September 30, 2026. Our interest expense was $1.790 billion for the first nine months of 2026 and $1.676 billion for the first nine months of 2025.