Community Health Systems (CYH) investor relations material

Executive summary

• Net operating revenues for Q1 2026 were $2.965 billion, down 6.1% year-over-year, primarily due to hospital divestitures, while same-store revenues increased 3.1% driven by higher reimbursement rates and supplemental program revenue.

• Adjusted EBITDA for Q1 2026 was $309 million, down 17.8% year-over-year and at the low end of expectations, with margin dropping to 10.4%.

• Net loss attributable to stockholders was $58 million ($0.43 per share), compared to a $13 million loss ($0.10 per share) in Q1 2025, reflecting higher impairment charges and a loss from early extinguishment of debt.

• Significant investments were made in ambulatory surgery centers (ASCs), including acquisitions and new centers in Alabama and Alaska.

• Operational improvements in quality and patient experience are ongoing, with expectations for higher Leapfrog and CMS ratings for hospitals.

Financial highlights

• Same-store net revenue increased 3.1% year-over-year, driven by a 3.7% rise in net revenue per adjusted admission, offset by a 0.5% decline in adjusted admissions.

• Consolidated admissions and adjusted admissions declined 10.8% and 10.5% year-over-year, while same-store admissions fell 1.3% and adjusted admissions 0.5%.

• Uncompensated care as a percentage of adjusted net revenue rose to 29.9% from 27.1% in Q1 2025.

• Cash flow from operations was a use of $297 million, compared to a positive $120 million in the prior year, mainly due to timing of Medicaid payments, provider taxes, and bonus payments.

• Labor costs were well managed, with average hourly rates up 2% and contract labor spend down 11% year-over-year.

Outlook and guidance

• 2026 guidance is reaffirmed: net operating revenues projected at $11,600–$12,000 million and adjusted EBITDA at $1.34–$1.49 billion.

• Net loss per share (diluted) expected between $(0.60) and $0.00; capital expenditures forecast at $350–$400 million.

• Low single-digit volume growth is assumed for the year, with expectations for recovery in the second half as comps ease and economic conditions improve.

• Management expects proceeds from future divestitures to be used for debt repayment, capital expenditures, and general corporate purposes.

• Potential future guidance adjustments may result from new state payment programs or Rural Health Transformation Program tailwinds.