AdaptHealth Corp.

Current report

Reliance on relatively few suppliers for the majority of AdaptHealth's patient service equipment and supplies could adversely affect its ability to operate.

Current report

AdaptHealth currently relies on a relatively small number of suppliers to provide it with the majority of its patient service equipment and supplies. Significant price increases, product recalls or other disruptions in the ability to obtain such equipment and supplies from existing suppliers, may force AdaptHealth to use alternative suppliers. Additionally, trade policy developments, including ongoing investigations, could result in new tariffs on imported medical equipment or components, which could increase the costs of manufacturing or procuring patient service equipment and supplies. Such tariffs or any new excise taxes imposed on manufacturers of certain medical equipment could be passed on to customers, such as AdaptHealth. Such manufacturers may be forced to make other changes to their products or manufacturing processes that are unacceptable to AdaptHealth, resulting in a need to change suppliers. Any change in suppliers AdaptHealth uses could cause delays in the delivery of such products and possible losses in revenue, which could adversely affect AdaptHealth’s results of operations. In addition, alternative suppliers may not be available, or may not provide their products and services at similar or favorable prices. If AdaptHealth cannot obtain the patient service equipment and supplies it currently uses, or alternatives at similar or favorable prices, AdaptHealth’s ability to provide such products may be severely impacted, which could have an adverse effect on its business, financial condition, results of operations, cash flow, capital resources and liquidity.

Current report

For example, in October 2026, AdaptHealth received notice from Medline Industries, LP (“Medline”) that Medline has initiated a voluntary field action involving the removal, repair, discontinuation, and market exit of all Medline Brand beds, including homecare beds, bariatric beds, and long-term-care beds, and their associated pendants, accessories, replacement parts, and bed-containing order packages. Medline has stated that the field action relates to potential electrical system safety risks that may result in fire and entrapment risk from the use of bed accessories. As a result, AdaptHealth is no longer able to purchase these products from Medline. AdaptHealth may be unable to obtain sufficient quantities of replacement beds and related products from alternative supplies on a timely basis or on similar or favorable terms, which could limit AdaptHealth’s ability to meet patient demand for these products and for other products that are ordered together with them. This field action may also cause AdaptHealth to incur significant costs, some or all of which may not be recoverable from the product manufacturer. Any of these effects could materially and adversely affect AdaptHealth's business, financial condition and results of operations.

Previous report

The pending sale of our Diabetes Health business may not be completed on the anticipated timeline, or at all.

Previous report

On July 19, 2026, we announced that we entered into an agreement to sell substantially all of the assets related to our Diabetes Health business (the “Divestiture”). We expect the closing of the Divestiture to occur in the first quarter of 2027, although there can be no assurances as to the timing of the closing or that the Divestiture will be completed at all. The completion of the Sale is subject to regulatory review under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and other customary closing conditions. Such conditions, some of which are beyond our control, may not be satisfied or waived in a timely manner, or at all. Any failure to complete the Divestiture could result in, among things, failure to achieve the full strategic and financial anticipated benefits of the Divestiture and an adverse impact to the market price of our common stock to the extent that the current market price reflects an assumption that the Divestiture will be completed. In addition, we have expended and will continue to expend significant management time and resources and have incurred and will continue to incur significant expenses due to advisory fees related to the sale.

Previous report

If the pending sale of our Diabetes Health business is completed, we may not achieve the anticipated benefits of the transaction, and the completion of the Divestiture may expose us to new risks.

Previous report

Even if the Divestiture is completed, we may be unable to achieve the full strategic and financial anticipated benefits of the Divestiture, including the expected use of net proceeds to pay down debt and the deployment of capital toward higher growth and higher margin businesses in our core businesses. We may not achieve these or other anticipated benefits for a variety of reasons, including among other things, the possibility that we receive less net proceeds than we expect, that we may not benefit as expected from the increased focus on our core businesses, and costs and expenses that may be incurred in connection with the sale process. Failure to achieve some or all of the anticipated benefits of the Divestiture, or the delay of achievement of such benefits, could adversely affect our business, financial condition, or results of operations.

Previous report

In addition, following the expected closing of the Divestiture, and subject to the limitations set forth in the transaction agreement, we agreed to indemnify the buyer for, among other things, breaches of representations, warranties, covenants and agreements and excluded assets and excluded liabilities, and a portion of the purchase price will be escrowed at closing to secure such indemnification obligations. We also expect to have continuing obligations pursuant to the transition services agreement to be entered into between the Company and the buyer at closing. These ongoing commitments may reduce our ability to fully realize cost savings and efficiency initiatives that we would otherwise be able to implement following the closing of the Divestiture.