Universal Health Services, Inc. Announces Financial Results for the Three and Nine-Month Periods Ended September 30, 2026

Consolidated Results of Operations, As Reported and As Adjusted – Three-month periods ended September 30, 2026 and 2025:

KING OF PRUSSIA, Pa., Oct. 27, 2026 -- Universal Health Services, Inc. (NYSE: UHS) announced today that its reported net income attributable to UHS was $308.7 million, or $5.22 per diluted share, during the third quarter of 2026, as compared to $373.0 million, or $5.86 per diluted share, during the third quarter of 2025. Net revenues increased by 5.3% to $4.733 billion during the third quarter of 2026, as compared to $4.495 billion during the third quarter of 2025.

Included in our operating results during the third quarter of 2026, was an aggregate net favorable pre-tax impact of approximately $21 million recorded in connection with the following items which were not included in our 2026 operating results forecast, as previously disclosed on July 27, 2026: (i) a favorable net pre-tax impact of $47 million (net of related provider taxes) recorded in connection with increases in amounts received from Medicaid supplemental payment programs in various states (consisting primarily of Washington, D.C. and California), partially offset by; (ii) an unfavorable pre-tax impact of $26 million resulting from an increase to our reserves for self-insured professional and general liability claims due primarily to the tentative settlement agreement reached during the third quarter of 2026 in the matter discussed below in Legal Proceedings Update.

Included in our operating results during the third quarter of 2025, was an aggregate net favorable pre-tax impact of approximately $55 million recorded in connection with the following: (i) $90 million of pre-tax reimbursements (net of related provider taxes), covering the period of October 1, 2024 through September 30, 2025, in connection with a Medicaid state directed payment program in Washington, D.C., and; (ii) a $35 million pre-tax charge incurred to increase our reserves for self-insured professional and general liabilities resulting from unfavorable claims’ trends.

As reflected on the Schedule of Non-GAAP Supplemental Information (“Supplemental Schedule”), there were no adjustments applicable to our operating results during the third quarter of 2026.

As reflected on the Supplemental Schedule, included in our reported results during the third quarter of 2025 were: (i) an unrealized after-tax gain of $10.0 million, or $.16 per diluted share ($13.1 million pre-tax), resulting from an increase in the market value of certain equity securities that were sold during the fourth quarter of 2025 (included in “Other (income) expense, net”), and; (ii) a favorable net after-tax impact of $0.6 million, or $.01 per diluted share, resulting from the net tax benefit recorded in connection with “ASU 2016-09”, Compensation – Stock Compensation: Improvements to Employee Share-Based Payment Accounting, net of the impact of executive compensation limitations pursuant to IRC section 162(m). After giving effect to these items, our adjusted net income during the third quarter of 2025 was $362.3 million, or $5.69 per diluted share.

As calculated on the attached Supplemental Schedule, our earnings before interest, taxes, depreciation & amortization (“EBITDA net of NCI”, NCI is net income attributable to noncontrolling interests), was $640.4 million during the third quarter of 2026, as compared to $684.2 million during the third quarter of 2025. Our adjusted earnings before interest, taxes, depreciation & amortization (“Adjusted EBITDA net of NCI”), which excludes the impact of other (income) expense, net, was $624.6 million during the third quarter of 2026, as compared to $670.6 million during the third quarter of 2025.

Consolidated Results of Operations, As Reported and As Adjusted – Nine-month periods ended September 30, 2026 and 2025:

Reported net income attributable to UHS was $1.016 billion, or $16.86 per diluted share, during the first nine months of 2026, as compared to $1.043 billion, or $16.07 per diluted share, during the comparable period of 2025. Net revenues increased by 7.7% to $13.867 billion during the first nine months of 2026, as compared to $12.879 billion during the comparable period of 2025.

As reflected on the Supplemental Schedule, our adjusted net income during the first nine months of 2026 was $1.014 billion, or $16.83 per diluted share, as compared to $1.030 billion, or $15.87 per diluted share, during the comparable period of 2025.

As reflected on the Supplemental Schedule, included in our reported results during the first nine months of 2026 was a favorable net after-tax impact of $2.2 million, or $.03 per diluted share, resulting from the net tax benefit recorded in connection with ASU 2016-09. Included in our reported results during the first nine months of 2025 were the following: (i) an unrealized after-tax gain of $11.3 million, or $.17 per diluted share ($14.7 million pre-tax), resulting from an increase in the market value of certain equity securities that were sold during the fourth quarter of 2025, and; (ii) a favorable net after-tax impact of $1.9 million, or $.03 per diluted share, resulting from the net tax benefit recorded in connection with ASU 2016-09.

As calculated on the attached Supplemental Schedule, our EBITDA net of NCI, was $1.972 billion during the first nine months of 2026, as compared to $1.939 billion during the comparable period of 2025. Our Adjusted EBITDA net of NCI, which excludes the impact of other (income) expense, net, was $1.951 billion during the first nine months of 2026, as compared to $1.912 billion during the comparable period of 2025.

Acute Care Services – Three and nine-month periods ended September 30, 2026 and 2025:

During the third quarter of 2026, at our acute care hospitals owned during both periods (“same facility basis”), adjusted admissions (adjusted for outpatient activity) and adjusted patient days each increased by 4.9%, as compared to the third quarter of 2025. At these facilities, during the third quarter of 2026, net revenue per adjusted admission and net revenue per adjusted patient day each decreased by 1.7%, as compared to the third quarter of 2025. Net revenues generated from our acute care services, on a same facility basis, increased by 4.7% during the third quarter of 2026, as compared to the third quarter of 2025.

During the first nine months of 2026, on a same facility basis, adjusted admissions increased by 2.6% and adjusted patient days increased by 2.9%, as compared to the comparable period of 2025. At these facilities, during the first nine months of 2026, net revenue per adjusted admission increased by 2.4% while net revenue per adjusted patient day increased by 2.1%, as compared to the comparable period of 2025. Net revenues generated from our acute care services, on a same facility basis, increased by 7.0% during the first nine months of 2026, as compared to the comparable period of 2025.

Behavioral Health Care Services – Three and nine-month periods ended September 30, 2026 and 2025:

During the third quarter of 2026, at our behavioral health care facilities on a same facility basis, adjusted admissions increased by 2.5% while adjusted patient days increased by 2.1%, as compared to the third quarter of 2025. At these facilities, during the third quarter of 2026, net revenue per adjusted admission increased by 1.7% and net revenue per adjusted patient day increased by 2.1%, as compared to the third quarter of 2025. Net revenues generated from our behavioral health care services, on a same facility basis, increased by 4.0% during the third quarter of 2026, as compared to the third quarter of 2025.

During the first nine months of 2026, at our behavioral health care facilities on a same facility basis, adjusted admissions increased by 1.4% while adjusted patient days increased by 1.7%, as compared to the comparable period of 2025. At these facilities, during the first nine months of 2026, net revenue per adjusted admission increased by 4.9% and net revenue per adjusted patient day increased by 4.7%, as compared to the comparable period of 2025. Net revenues generated from our behavioral health care services, on a same facility basis, increased by 6.2% during the first nine months of 2026, as compared to the comparable period of 2025.

Net Cash Provided by Operating Activities and Capital Resources:

Net Cash Provided by Operating Activities:

During the nine-month period ended September 30, 2026, our net cash provided by operating activities increased by 14.9% to $1.481 billion as compared to $1.290 billion during the first nine months of 2025.

The $192 million net increase in our net cash provided by operating activities consisted of: (i) an unfavorable change of $179 million in other working capital accounts due primarily to the timing of accrued expenses and accounts payable disbursements; (ii) a favorable change of $178 million in accounts receivable; (iii) a favorable change of $90 million in accrued insurance expense, net of payments made in settlement of self-insured claims; (iv) a favorable change of $77 million in accrued and deferred income taxes, and; (v) $26 million of other combined net favorable changes.

Capital Resources:

As of September 30, 2026, pursuant to the terms of our $1.5 billion revolving credit facility, we had $1.187 billion of available borrowing capacity, net of outstanding borrowings ($310 million) and letters of credit ($3 million).

Stock Repurchase Program:

In connection with our stock repurchase program, shares of our Class B Common Stock may be repurchased, from time to time as conditions allow, on the open market or in negotiated private transactions.

Pursuant to this program, during the third quarter of 2026, we have repurchased 1.35 million shares at an aggregate cost of approximately $242.1 million (average price of approximately $179 per share). During the first nine months of 2026, we have repurchased 3.915 million shares at an aggregate cost of approximately $689.6 million (average price of approximately $176 per share).

As of September 30, 2026, we had an aggregate available repurchase authorization of approximately $735.4 million pursuant to our stock repurchase program.

Conference call information:

We will hold a conference call for investors and analysts at 8:00 a.m. eastern time on October 28, 2026. A live webcast of the call will be available on our website at www.uhs.com. To participate via telephone, please register in advance at this link. Upon registration, all telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number along with a unique passcode and registrant ID that can be used to access the call. Supplemental financial disclosures related to our financial results are available on our website.

Legal Proceedings Update:

The disclosure below provides an update for recent developments related to the matter referenced which has been previously disclosed in various Forms 10-Q and 10-K, as filed with the Securities and Exchange Commission, most recently our Form 10-Q for the quarterly period ended June 30, 2026.

K.E.E., et al., Plaintiffs v. Cumberland Hospital, LLC d/b/a Cumberland Hospital for Children and Adolescents, et al. (and related lawsuits)

Cumberland Hospital for Children and Adolescents (“Cumberland”), an indirect subsidiary of Universal Health Services, Inc. (the “Company”) and UHS of Delaware, Inc. (“UHS Delaware”), our administrative services company, are defendants in multi-plaintiff lawsuits filed in the Circuit Court for Richmond, Virginia (the “Cumberland Litigation”). The lawsuits relate to allegations of, among other things, inappropriate sexual contact during medical examinations by Dr. Daniel Davidow, an independent contractor and the former medical director for Cumberland.

The claims asserted by three of the plaintiffs in the Cumberland Litigation were consolidated for trial in September 2024. There are approximately 53 additional claimants making similar allegations with claims pending in the Cumberland Litigation. The Company and UHS Delaware were dismissed from the September 2024 trial on the first three plaintiffs’ claims. In late September 2024, a jury entered a verdict finding Dr. Davidow and Cumberland liable and awarded these three plaintiffs combined compensatory damages of $60 million for all liability theories, an additional combined $180 million in trebled damages for violation of the Virginia Consumer Protection Act, and an additional combined $120 million in punitive damages. Based upon Virginia law, the Court reduced the punitive damage amount to a combined maximum of $1.05 million ($350,000 per plaintiff).

In August 2026, we reached a tentative settlement agreement, which is subject to execution of final release agreements and certain court approvals (as necessary), to resolve all of the outstanding claims related to the current claimants in the Cumberland Litigation. Pursuant to the tentative settlement agreement, the terms of the aggregate settlement are confidential. We believe a substantial portion of the tentative aggregate settlement amount, and related expenses, is covered by our commercial excess insurance and the remainder is covered by our reserves recorded in connection with the Cumberland Litigation.

General Information, Forward-Looking Statements and Risk Factors and Non-GAAP Financial Measures:

Headquartered in King of Prussia, PA, UHS is one of the nation’s largest and most respected providers of hospital and healthcare services, with annual revenues of approximately $17.4 billion during 2025. Through its subsidiaries, UHS employs more than 102,000 employees and, as of September 30, 2026, operated 30 inpatient acute care facilities, 388 inpatient behavioral health facilities, 169 outpatient and other facilities, nationwide virtual behavioral health services, an insurance offering, a physician network and various related services with physical locations in 40 states, Washington, D.C., Puerto Rico, Ireland and the United Kingdom. Since our founding in 1979, UHS has grown steadily into a premier Fortune 500® corporation perennially recognized by multiple esteemed national rating entities.  Our strategy includes investing in talented staff, facilities, technology and innovation across broad care continuums to deliver favorable patient outcomes and contribute to the overall health and wellbeing of the patients we are privileged to serve. A wholly-owned subsidiary of UHS also acts as the advisor to Universal Health Realty Income Trust, a real estate investment trust (NYSE: UHT). For additional information, please visit www.uhs.com.

This press release contains forward-looking statements based on current management expectations. Numerous factors, including those disclosed herein, those related to healthcare industry trends and those detailed in our filings with the Securities and Exchange Commission (as set forth in Item 2-Forward Looking Statements and Risk Factors in our Form 10-Q for the quarter ended June 30, 2026 and in Item 1A-Risk Factors, and Item 7-Forward-Looking Statements and Risk Factors, in our Form 10-K for the year ended December 31, 2025), may cause the results to differ materially from those anticipated in the forward-looking statements. These statements are subject to risks and uncertainties and therefore actual results may differ materially. Readers should not place undue reliance on such forward-looking statements which reflect management’s view only as of the date hereof. We undertake no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

Many of the factors that could affect our future results are beyond our control or ability to predict, including, but not limited to:

• A significant portion of our revenues are derived from federal and state government programs including the Medicare and Medicaid programs. Payments from these programs are subject to statutory and regulatory changes, administrative rulings, interpretations and determinations, requirements for utilization review, and federal and state funding restrictions. Changes to these programs could materially affect program payments which could materially impact our results of operations. In addition, we receive substantial reimbursement from multiple states in connection with various supplemental Medicaid payment programs. Failure to renew these programs beyond their scheduled termination dates, failure of the public hospitals to provide the necessary Inter-Governmental Transfers for the states’ share of the Medicaid disproportionate share hospital programs, and the failure of our hospitals that currently receive supplemental Medicaid revenues to qualify for future funds under these programs could cause our actual results of operations for the year ended December 31, 2026 to differ materially from our 2026 operating results forecast.
• 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. That legislation also places limits on provider fees used to increase federal Medicaid funding to states and eliminated certain exchange premium tax credits beyond 2025. 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.
• The increase in interest rates during the past few years has increased our interest expense significantly thereby reducing our free cash flow. As such, the effects of increased borrowing rates have adversely impacted our results of operations, financial condition and cash flows. We cannot predict future changes to interest rates, however, significant increases in our borrowing rates could have a material unfavorable impact on our future results of operations and our ability to access the capital markets on favorable terms.
• 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.
• The outcome of known and unknown litigation, liabilities and other claims asserted against us and/or our subsidiaries.
• The ability to successfully integrate and realize the benefits and synergies from our acquisition of Talkspace, Inc. which was completed in August 2026.

We believe that adjusted net income attributable to UHS, adjusted net income attributable to UHS per diluted share, EBITDA net of NCI and Adjusted EBITDA net of NCI, which are non-GAAP financial measures (“GAAP” is Generally Accepted Accounting Principles in the United States of America), are helpful to our investors as measures of our operating performance. In addition, we believe that, when applicable, comparing and discussing our financial results based on these measures, as calculated, is helpful to our investors since it may neutralize the effect of material items impacting our net income attributable to UHS, such as, changes in the value of certain non-marketable securities (in connection with our minority ownership in a healthcare generative artificial intelligence company), the impact of ASU 2016-09, and other potential material items that are nonrecurring or non-operational in nature including, but not limited to, impairments of goodwill, long-lived and intangible assets, reserves for various matters including settlements, legal judgments and lawsuits, costs related to extinguishment of debt, gains/losses on sales of assets and businesses, potential impacts of non-ordinary acquisitions, divestitures, joint ventures or other strategic transactions, and other amounts that may be reflected in the current or prior year financial statements that relate to prior periods. To obtain a complete understanding of our financial performance these measures should be examined in connection with net income attributable to UHS, as determined in accordance with GAAP, and as presented in the condensed consolidated financial statements and notes thereto in this report or in our filings with the Securities and Exchange Commission including our Report on Form 10-Q for the quarter ended June 30, 2026 and our Report on Form 10-K for the year ended December 31, 2025. Since the items that may be included or excluded from these measures are significant components in understanding and assessing financial performance under GAAP, these measures should not be considered to be alternatives to net income as a measure of our operating performance or profitability. Since these measures, as presented, are not determined in accordance with GAAP and are thus susceptible to varying calculations, they may not be comparable to other similarly titled measures of other companies. Investors are encouraged to use GAAP measures when evaluating our financial performance.