What were the key takeaways from Surgery Partners’s earnings call?

What is Surgery Partners's latest dividend and current dividend yield?

What guidance did Surgery Partners's management provide for the next earnings period?

What is Surgery Partners's gross profit margin?

What is the market's earnings forecast for Surgery Partners next quarter?

What factors drove the changes in Surgery Partners's revenue and profit?

Did Surgery Partners beat or miss consensus estimates last quarter?

What is the revenue and EPS growth rate for Surgery Partners year over year?

- **Revenue Growth**: Q3 revenue up 6.6% to $821.5M, driven by 16% YoY growth in total joint surgeries.
- **Strategic Challenges**: 20% EBITDA reduction due to delayed M&A ($71M vs. $250M target) and softer commercial payer mix.
- **Portfolio Optimization**: Evaluating divestitures of larger surgical hospitals to reduce leverage and improve cash flow conversion.
- **De Novo Risks**: Regulatory delays push breakeven timelines, but long-term accretive potential remains.

**【CEO Summary Section】**
- **Revenue Growth**: Q3 net revenue of $821.5 million (+6.6% YoY), adjusted EBITDA of $136.4 million (+6.1% YoY), and same-facility revenue growth of 6.3%.
- **Organic Growth**: 166,000 surgical cases, with 16% YoY growth in total joint surgeries. Robotics investment (74 surgical robots) and 500+ new physician recruits drive high-acuity demand.
- **Challenges**: Modest payer mix shift (commercial -160bps, Medicare +120bps) and softer-than-expected volume growth, prompting Q4 outlook revision.
- **Capital Deployment**: $71M in M&A, $45M from 3 ASC divestitures, and 9 de novo facilities under construction. Full year guidance revised to $3.275B-$3.3B revenue and $535M-$540M EBITDA.
- **Portfolio Optimization**: Evaluating strategic divestitures of larger surgical hospitals to reduce leverage and improve cash flow conversion.

**【CFO Financial Commentary】**
- **Financial Health**: Cash balance of $203.4M, operating cash flow of $83.6M, and net leverage of 4.2x. Repriced debt reduces interest rates to SOFR +250bps.
- **Expense Management**: Salaries (29.6% of revenue), supply costs (25.4%), and G&A (2.7%) reflect cost discipline. Procurement initiatives offset inflationary pressures.
- **Guidance Adjustment**: Full year EBITDA reduced by ~$20M due to delayed M&A ($71M deployed vs. $250M target), divestiture earnings loss, and cautious Q4 volume outlook.
- **De Novo Challenges**: Regulatory and construction delays delay breakeven for new facilities, but long-term accretive potential remains.

**【Q&A Highlights】**
- **Demand Weakness**: Broader-based commercial payer mix softness, not tied to specific procedures or geographies. Q4 growth expected but below internal targets.
- **M&A Timing**: Pipeline remains robust ($>300M opportunities), but 2025 deployment slower than planned. 60% of EBITDA reduction attributed to M&A timing.
- **Portfolio Strategy**: Focusing on higher-acuity ASCs and potential partnerships to streamline operations and improve cash flow.
- **Free Cash Flow**: Operating cash flow strong ($83.6M Q3), but variability in physician distributions limits predictability.
- **De Novo Outlook**: Delays in 2025 openings, but 12-18-month timeline for new facilities to reach breakeven remains intact.

Surgery Partners, Inc. (SGRY) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

SGRY

SGRY fundamentals

You can ask Aime