Tenet Healthcare (THC) Q4 2024 earnings summary

Executive summary

• Delivered strong Q4 and FY 2024 performance with $20.7B net operating revenues and $4B adjusted EBITDA, up 13% year-over-year, driven by ambulatory growth and significant portfolio transformation including divesting 14 hospitals and adding nearly 70 ASCs.

• Q4 2024 Adjusted EBITDA reached $1.048B, at the upper end of guidance, with margin expansion to 20.7%.

• Net income available to common shareholders in Q4 2024 was $318M ($3.32 per diluted share), up from $244M ($2.30) in Q4 2023; FY 2024 net income was $3.2B, including a $2.916B pre-tax gain from divestitures.

• Significant deleveraging achieved, with EBITDA leverage ratio reduced to 2.54x by year-end 2024.

• Returned $1.12B to shareholders via share repurchases since late 2022, retiring 14% of shares.

Financial highlights

• Q4 2024 net operating revenues were $5.1B; consolidated adjusted EBITDA was $1.048B, with a 20.7% margin, up nearly 200 basis points year-over-year.

• FY 2024 adjusted EBITDA was $3.995B, up from $3.541B in 2023; adjusted diluted EPS for Q4 2024 was $3.44, up from $2.68 in Q4 2023.

• FY 2024 free cash flow was $1.1B, or nearly $2B excluding tax payments on divestitures; $435M after NCI distributions.

• Q4 2024 net income available to common shareholders was $318M, up from $244M in Q4 2023.

• Year-end leverage ratio improved to 2.54x EBITDA (3.2x EBITDA less NCI).

Outlook and guidance

• FY 2025 adjusted EBITDA guidance: $3.975–$4.175B, representing 7% normalized growth at midpoint, with margin of 19.3%–19.9%.

• FY 2025 net operating revenues expected at $20.6–$21.0B, up 3–6% year-over-year.

• FY 2025 adjusted diluted EPS forecasted at $11.74–$12.84; free cash flow projected at $1.8B–$2.05B.

• USPI 2025 adjusted EBITDA growth projected at 8.5% midpoint; hospital segment at 5.7%.

• Ambulatory segment revenues expected to grow 3–6%; hospital segment admissions to rise 2–3%.