Encompass Health's Promising Fourth Quarter: Financial Highlights and 2026 Guidance
Encompass Health Corporation Reports Strong Q4 2025 and Full Year Overview
Encompass Health Corporation, the largest operator of inpatient rehabilitation hospitals in the United States, has recently announced its financial results for the fourth quarter of 2025 and shared insights regarding its outlook for 2026. This follows a year marked by impressive growth across key financial metrics and service expansions.
Quarterly Performance Highlights
For the fourth quarter ending December 31, 2025, Encompass Health reported a remarkable increase in net operating revenue reaching $1,544.6 million, compared to $1,405.0 million in the same quarter of 2024, representing a nearly 10% year-over-year growth. The income from continuing operations attributable to Encompass Health also saw a significant rise, amounting to $202.3 million or $1.42 per diluted share, which is a 20.3% increase relative to the previous year's results.
In addition, adjusted earnings per share climbed modestly from $1.17 in Q4 2024 to $1.46 in Q4 2025, marking a 24.8% rise, further solidifying the company’s financial health. The adjusted EBITDA for the quarter hit $335.6 million, an increase of 15.9% over the previous year. Furthermore, cash flows from operating activities surged, generating $346.0 million, a 24.1% rise from the previous year.
Growth in Service Capacity
Mark Tarr, the President and CEO, emphasized the company’s commitment to expanding its service capacity, which is crucial given the aging U.S. population. In 2025, Encompass Health expanded by adding 517 inpatient rehabilitation beds through the establishment of eight new hospitals, along with the addition of 127 beds to existing facilities. This strategic expansion reflects the increasing demand for rehabilitation services in the U.S. which Encompass is positioned to meet effectively.
Looking Ahead: Guidance for 2026
The financial strategy for 2026 appears robust and forward-thinking, with the company projecting net operating revenue between $6,365 million and $6,465 million, alongside an adjusted EBITDA of $1,340 million to $1,380 million. The adjusted earnings per share guidance is set between $5.81 and $6.10, projecting continued earnings growth and shareholder value enhancement.
Investor Communication
To provide shareholders and interested parties with further context, Encompass Health will host an investor conference call at 10:00 a.m. ET on February 6, 2026. Interested parties can participate and access detailed financial information through their investor relations portal.
Conclusion
Encompass Health's impressive performance in the fourth quarter of 2025, alongside its ambitious plans for 2026, reflect a corporation well-positioned for growth. The ongoing enhancements in capacity and service provision align with the increasing demand for rehabilitation services. Investors and stakeholders will likely watch these developments closely as the company continues to navigate the evolving healthcare landscape. For more insights and updates, visit encompasshealth.com.
Encompass Health Corporation, the largest operator of inpatient rehabilitation hospitals in the United States, has recently announced its financial results for the fourth quarter of 2025 and shared insights regarding its outlook for 2026. This follows a year marked by impressive growth across key financial metrics and service expansions.
Quarterly Performance Highlights
For the fourth quarter ending December 31, 2025, Encompass Health reported a remarkable increase in net operating revenue reaching $1,544.6 million, compared to $1,405.0 million in the same quarter of 2024, representing a nearly 10% year-over-year growth. The income from continuing operations attributable to Encompass Health also saw a significant rise, amounting to $202.3 million or $1.42 per diluted share, which is a 20.3% increase relative to the previous year's results.
In addition, adjusted earnings per share climbed modestly from $1.17 in Q4 2024 to $1.46 in Q4 2025, marking a 24.8% rise, further solidifying the company’s financial health. The adjusted EBITDA for the quarter hit $335.6 million, an increase of 15.9% over the previous year. Furthermore, cash flows from operating activities surged, generating $346.0 million, a 24.1% rise from the previous year.
Growth in Service Capacity
Mark Tarr, the President and CEO, emphasized the company’s commitment to expanding its service capacity, which is crucial given the aging U.S. population. In 2025, Encompass Health expanded by adding 517 inpatient rehabilitation beds through the establishment of eight new hospitals, along with the addition of 127 beds to existing facilities. This strategic expansion reflects the increasing demand for rehabilitation services in the U.S. which Encompass is positioned to meet effectively.
Looking Ahead: Guidance for 2026
The financial strategy for 2026 appears robust and forward-thinking, with the company projecting net operating revenue between $6,365 million and $6,465 million, alongside an adjusted EBITDA of $1,340 million to $1,380 million. The adjusted earnings per share guidance is set between $5.81 and $6.10, projecting continued earnings growth and shareholder value enhancement.
Investor Communication
To provide shareholders and interested parties with further context, Encompass Health will host an investor conference call at 10:00 a.m. ET on February 6, 2026. Interested parties can participate and access detailed financial information through their investor relations portal.
Conclusion
Encompass Health's impressive performance in the fourth quarter of 2025, alongside its ambitious plans for 2026, reflect a corporation well-positioned for growth. The ongoing enhancements in capacity and service provision align with the increasing demand for rehabilitation services. Investors and stakeholders will likely watch these developments closely as the company continues to navigate the evolving healthcare landscape. For more insights and updates, visit encompasshealth.com.
Topics Health）
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