Community Health Systems, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net operating revenues for the three months ended September 30, 2026, totaled $2.757 billion, a 10.7% decrease from $3.087 billion in the same period in 2025; on a same-store basis, revenues increased 3.8%.
• Net operating revenues for the nine months ended September 30, 2026, totaled $8.547 billion, an 8.9% decrease from $9.379 billion in the same period in 2025; on a same-store basis, revenues increased 2.9%.
• Net loss attributable to Community Health Systems, Inc. stockholders for the three months ended September 30, 2026, was $(86) million, or $(0.63) per share (diluted), compared to net income of $130 million, or $0.96 per share (diluted), in 2025.
• Net loss attributable to Community Health Systems, Inc. stockholders for the nine months ended September 30, 2026, was $(74) million, or $(0.55) per share (diluted), compared to net income of $399 million, or $2.97 per share (diluted), in 2025.
• Adjusted EBITDA for the three months ended September 30, 2026, was $280 million, a 25.5% decrease from $376 million in 2025.
• Adjusted EBITDA for the nine months ended September 30, 2026, was $918 million, an 18.8% decrease from $1.131 billion in 2025.
• Net cash provided by operating activities for the three months ended September 30, 2026, was $155 million, compared to $70 million in 2025.
• Net cash used in operating activities for the nine months ended September 30, 2026, was $(55) million, compared to net cash provided of $277 million in 2025.
• Total liabilities were $13.045 billion as of September 30, 2026, compared to $14.041 billion as of December 31, 2025.
• Long-term debt was $9.568 billion as of September 30, 2026, compared to $10.380 billion as of December 31, 2025.
• Cash and cash equivalents were $155 million as of September 30, 2026, compared to $260 million as of December 31, 2025.
• Stockholders' deficit was $(1.273) billion as of September 30, 2026, compared to $(1.159) billion as of December 31, 2025.

Guidance and Future Outlook:

• The Company updated its 2026 annual earnings guidance to project net operating revenues between $11.3 billion and $11.5 billion.
• Adjusted EBITDA for 2026 is projected to be between $1.225 billion and $1.275 billion.
• Net loss per share (diluted) for 2026 is projected to be between $(1.70) and $(1.60).
• Capital expenditures for 2026 are projected to be between $350 million and $400 million.
• Net cash provided by operating activities for 2026 is projected to be between $100 million and $300 million.
• Diluted weighted-average shares outstanding for 2026 are projected to be approximately 136 million.
• Depreciation and amortization for 2026 is expected to be approximately 3.8% to 3.9% of net operating revenues.
• Interest expense for 2026 is estimated to be between $820 million and $830 million.
• The guidance excludes the impact of future divestitures, debt refinancing activities, potential Rural Health Transformation Program grants, asset impairments, gains/losses on business sales, restructuring costs, and legal settlements.

Business Segments and Product Lines:

• The Company operates 59 affiliated hospitals with more than 8,000 beds and over 800 sites of care across 32 distinct markets in 12 states as of October 28, 2026.
• Admissions decreased 12.3% to 85,591 for the three months ended September 30, 2026, compared to 2025; on a same-store basis, admissions increased 2.2%.
• Adjusted admissions decreased 11.9% to 195,677 for the three months ended September 30, 2026, compared to 2025; on a same-store basis, adjusted admissions increased 3.6%.
• For the nine months ended September 30, 2026, admissions decreased 11.5% to 266,828; on a same-store basis, admissions increased 0.7%.
• For the nine months ended September 30, 2026, adjusted admissions decreased 11.4% to 598,982; on a same-store basis, adjusted admissions increased 1.9%.
• Net inpatient revenues represented 47.8% of net operating revenues for the three months ended September 30, 2026.
• Net outpatient revenues represented 52.2% of net operating revenues for the three months ended September 30, 2026.
• The Company divested one hospital (80% ownership interest) completed on February 1, 2026, and nine other hospitals completed between February 1 and October 1, 2026.

Market and Competitive Landscape:

• Management cited a challenging macro environment impacting payor mix and acuity, which negatively affected financial results.
• Volume trends and cash flow improved sequentially in the third quarter, though payor mix and acuity did not develop as expected.
• The Company noted higher medical specialist fees and supplemental reimbursement program expenses as factors contributing to the decrease in Adjusted EBITDA.
• The decrease in Adjusted EBITDA was partially offset by increased volumes and reimbursement rates.
• Non-patient revenue declined, primarily due to the absence of a $28 million legal settlement receipt recorded in the third quarter of 2025.

Risks and Challenges:

• The Company faces risks related to substantial indebtedness, leverage, and debt service obligations, including the ability to refinance and remain in compliance with debt covenants.
• Risks include changes in federal, state, or local laws and regulations affecting Medicare, Medicaid, and health insurance exchanges.
• Potential adverse impacts from legal, regulatory, and governmental proceedings, including false claims act litigation, are noted.
• The Company faces challenges regarding the ability to enter into and maintain provider arrangements with payors amidst increasing insurer consolidation.
• Risks include cybersecurity threats, security breaches, and data privacy compliance failures.
• The Company faces competitive labor market conditions affecting the ability to hire and retain qualified medical personnel and increased labor expenses.
• Risks include the inability of third-party contractors to provide hospital-based physicians and the effectiveness of mitigation efforts.
• Potential impairments in the carrying value of goodwill, intangible assets, or long-lived assets are a risk.
• The concentration of revenue in a small number of states presents a risk.

Management Commentary and Tone:

• Kevin J. Hammons, CEO, stated the Company is pleased to make continued progress on strategic initiatives regarding quality outcomes, patient satisfaction, physician experience, and employee satisfaction.
• Management remains confident that these investments will lead to improved financial performance.
• Management acknowledged that volume trends and cash flow improved sequentially in the third quarter.
• Management noted that payor mix and acuity did not develop as expected due to the challenging macro environment.

Other Key Points:

• The Company has approximately $745 million of additional borrowing capacity under its $1.0 billion ABL Facility as of September 30, 2026, after accounting for $32 million in outstanding letters of credit.
• Total fixed rate debt is expected to average approximately 98% of total debt during 2026.
• Net income attributable to noncontrolling interests is projected to be approximately 1.2% to 1.3% of net operating revenues for 2026.
• Provision for income taxes is projected to be approximately 0.8% to 0.9% of net operating revenues for 2026.
• The Company held a conference call on October 29, 2026, to review results.
• The Company's headquarters is located in Franklin, Tennessee.