PACS 2025 Q3 Earnings 222.8% Net Income Surge Drives 16.63% Post-Earnings Rally

PACS Group, Inc. (NYSE: PACS) delivered its first quarterly earnings report in 15 months, surpassing expectations with a 31.2% revenue increase to $1.34 billion and a 222.8% jump in net income to $52.3 million. The company confirmed full-year 2025 guidance of $5.25–$5.35 billion revenue and $480–$490 million adjusted EBITDA, aligning with its post-restatement operational momentum.

Revenue

PACS’s total revenue surged 31.2% year-over-year to $1.34 billion in Q3 2025, driven by robust performance in patient and resident services, which accounted for nearly all of the company’s revenue. Other revenue streams contributed an additional $265,000, though the core business remains concentrated in skilled nursing care. The growth reflects successful integration of 106 acquisitions in 2024 and strong occupancy rates at mature facilities.

**

**

Earnings/Net Income

The company’s earnings per share (EPS) soared 230% to $0.33 in Q3 2025, compared to $0.10 in the prior year. Net income surged 222.8% to $52.3 million, marking the third consecutive year of profitability in the same quarter. This performance underscores PACS’s operational resilience amid a complex compliance overhaul.

Post-Earnings Price Action Review

The strategy of purchasing PACS shares following a revenue decline in a previous quarter and holding for 30 days demonstrated strong returns over the past three years. The Q3 2025 earnings release triggered a 16.63% stock surge in the immediate post-earnings session, despite a slight EPS miss. Holding for 30 days allowed investors to capitalize on continued positive sentiment, with the stock reaching a 45-day closing high of $17.7—$1.24 above the earnings release price. The company’s long-term outlook remains bullish, with 2025 revenue and EBITDA projections reinforcing sustained growth momentum.

**

**

CEO Commentary

CEO Jason Murray emphasized PACS’s “locally led, centrally supported” model, crediting it for clinical excellence and operational consistency. He highlighted strengthened internal controls post-restatement and confidence in the team’s ability to execute strategic priorities, including scaling its 320-facility portfolio and leveraging demographic-driven demand in post-acute care.

Guidance

Interim CFO Mark Hancock reaffirmed 2025 guidance, projecting revenue of $5.25–$5.35 billion (30% growth) and adjusted EBITDA of $480–$490 million. He cited Q3 results ($1.3 billion revenue, $0.32 EPS) and year-to-date performance ($3.9 billion revenue, $0.80 EPS), underscoring disciplined integration of 106 2024 acquisitions.

Additional News

1. M&A Activity: PACS acquired 106 facilities in 2024, including 53 from the Prestige portfolio, expanding into five new states.

2. C-Level Changes: CFO Derick Apt resigned following an internal probe into policy violations, with Mark Hancock assuming interim duties.

3. Compliance Framework: Post-Hindenburg investigation reforms included a strengthened compliance committee, enhanced revenue recognition controls, and a 78% retention rate for administrator trainees, reflecting renewed governance priorities.

The company’s 94.8% occupancy rate at mature facilities and 68.6% of its portfolio achieving 4- or 5-star CMS ratings further validate its operational turnaround.