Surgery Partners (SGRY) Q4 2025 earnings summary

Executive summary

• Full year 2025 net revenue reached $3.3 billion, up 6.2% year-over-year, but at the low end of expectations.

• Adjusted EBITDA was $526.2 million, up 3.5% year-over-year, but significantly below expectations due to second-half headwinds.

• Margin compression was concentrated in three surgical hospital markets, driven by softer case growth, payer mix shifts, and anesthesia cost pressures.

• Net loss attributable to the company was $77.9 million for the year, with Q4 net loss at $15.0 million.

• Portfolio optimization and disciplined capital allocation remain strategic priorities.

Financial highlights

• Fourth quarter revenue grew 2.4% to $885 million; full year revenue up 6.2% to $3.3 billion.

• Same facility revenue growth was 4.9% for the year and 3.5% in Q4; same facility case growth was 1.3% in Q4 and 3.4% for the year.

• Adjusted EBITDA margin for the year was 15.9%, down 40 basis points; Q4 margin was 17.7%.

• Salaries and wages rose to 28.7% of net revenue in Q4, supply costs to 27%, both reflecting payer mix pressure.

• Operating cash flow for 2025 was $274 million, down from 2024 due to higher interest costs and slower earnings growth.

Outlook and guidance

• 2026 net revenue guidance is $3.35–$3.45 billion, implying single-digit growth.

• Adjusted EBITDA guidance for 2026 is at least $530 million, a 0.7% increase, reflecting continued headwinds.

• Guidance incorporates $9 million from 2025 M&A, $8 million in provider taxes, and $4 million in tariff-related supply cost pressure.

• Organic same-facility revenue growth expected at 3–5% for 2026, with price and volume contributing roughly equally.

• No explicit M&A earnings included in initial 2026 guidance due to timing uncertainty.