Sonida Senior Living 2025 Q3 Earnings Wider Loss Amid 31.2% Revenue Surge

Sonida Senior Living (SNDA) reported mixed Q3 2025 results, with revenue surging 31.2% year-over-year but net losses widening by 91.7%. The company’s strategic merger with CNL Healthcare Properties is expected to close by late Q1 2026, aiming to enhance liquidity and growth.

Revenue

Sonida’s total revenue rose to $98.04 million in Q3 2025, driven by a 26.3% increase in resident revenue to $84.60 million. Managed community reimbursement revenue grew to $12.29 million, while management fees reached $1.15 million, contributing to the overall 31.2% year-over-year gain. The performance reflects strong occupancy trends and recent acquisitions, particularly in Texas and the Southeast.

Earnings/Net Income

The company’s losses deepened to $1.56 per share in Q3 2025, a 59.2% wider loss compared to $0.98 per share in Q3 2024. Net loss expanded to $27.35 million, up from $14.27 million a year ago. The deteriorating profitability underscores the challenges of scaling operations and integrating new communities.

Post-Earnings Price Action Review

The strategy of buying SNDA shares after a revenue increase on the earnings release date and holding for 30 days has underperformed, with a cumulative return of -25.4% over three years. This poor performance suggests broader market dynamics or company-specific factors, such as debt burden or integration costs, have offset short-term revenue gains. The negative return highlights the need for investors to consider long-term operational and strategic outcomes rather than immediate revenue metrics.

CEO Commentary

CEO Brandon Ribar emphasized 21% year-over-year NOI growth, driven by occupancy and rate improvements. The CNL merger is expected to reduce leverage to 6x and boost liquidity. Operational priorities include labor efficiency via technology and clinical excellence, with optimism around 88% October occupancy and reduced labor volatility.

Guidance

Sonida anticipates the CHP merger to close by late Q1 2026, with $75 million in transaction costs. Post-merger, the company aims for 6x leverage and margin expansion through occupancy stabilization. CFO Kevin Detz noted sequential labor cost improvements and $1.1 million in acquisition portfolio NOI growth.

Additional News

Sonida’s $1.8 billion merger with CNL Healthcare Properties is a strategic inflection point, creating a $3 billion senior housing entity. The deal, expected to close by early 2026, will integrate 69 CHP communities, doubling Sonida’s unit count. CEO Ribar highlighted the merger’s potential to enhance growth, reduce leverage, and expand into high-growth markets. Additionally, Sonida’s weighted occupancy hit a post-COVID high of 87.7% in Q3, with October spot occupancy reaching 89%. The company is investing in technology, including electronic health records, to optimize staffing and improve resident care.