Key Highlights:

  • Net Operating Revenue came in at USD 1.597 billion for.
  • Adjusted EPS totaled USD 1.55, representing a 10.7% increase compared to USD 1.40 in the second quarter of 2025.
  • 2026 Revenue Guidance stood at USD 6.41 billion to USD 6.49 billion, updated from the previous range of USD 6.375.
  • Adjusted EBITDA was reported at USD 348 million, an increase of 9.2% reflecting operational efficiencies despite an USD 11.5 million.

Encompass Health Corporation (NYSE:EHC) is scheduled to report third quarter results on Wednesday, Oct. 28, after the market close. Consensus estimates call for adjusted earnings per share of USD 1.36 on revenue of USD 1.60 billion, against a market capitalization of USD 12.24 billion.

In the most recently reported quarter, Net Operating Revenue came in at USD 1.597 billion for. Adjusted EPS totaled USD 1.55, representing a 10.7% increase compared to USD 1.40 in the second quarter of 2025.

Total Discharges and Other Business Trends

Total Discharges came in at 68,895, an increase of 5.6% year over year supported by new capacity and solid demand for inpatient services. Same-Store Discharge Growth totaled 2.8%, an acceleration of 120 basis points from the first quarter of 2026. Net Revenue per Discharge stood at USD 22,521, up 3.9% due to higher patient acuity and increased growth in medically complex categories. SWB per FTE Growth was reported at 3.4% in the quarter, with full-year inflation guidance revised to 3.5% to 4% due to increased clinical ladder participation.

What Management Guided

2026 Adjusted EBITDA Guidance came in at USD 1.365 billion to USD 1.395 billion, raised from the prior range of USD 1.35 billion to USD 1.38 billion. 2026 Adjusted EPS Guidance totaled USD 6.02 to USD 6.25, increased from the previous expectation of USD 5.89 to USD 6.11.

Premium Labor Costs and Capital Position

Premium Labor Costs came in at USD 25 million, a decrease of USD 2.6 million from the second quarter of 2025. Contract Labor totaled 1.1% of total FTEs, an improvement of 20 basis points compared to the same period last year. Capacity Expansions stood at 139 beds added through three new hospitals and 54 beds added to existing facilities in the first half of 2026. Future Bed Additions was reported at 250 beds through five new hospitals and 100 to 150 beds at existing hospitals planned for the remainder of 2026. CMS 2027 IRF Final Rule came in at 2.3% estimated increase in net revenue per discharge for Medicare patients beginning Oct. 1, 2026.

Share Repurchases and Additional Detail

Share Repurchases came in at USD 74.2 million for approximately 704,000 shares in the second quarter, with the total authorization increased to USD 1 billion. Net Leverage totaled 1.9x at quarter end, maintaining a target level for liquidity and capital allocation. Occupancy Rate stood at 77.4%, representing an increase of 290 basis points year over year. Medicare Advantage Admit and Appeal Pilot was reported at 89% success rate on 144 fully adjudicated cases, leading to potential portfolio-wide scaling. Nursing Turnover came in at 19% on an annualized basis through the second quarter, the lowest level in more than 12 years.

Figures to Follow in the Release

Investors can watch third quarter results against the figures management has already put on record, including the following: 2026 Revenue Guidance came in at USD 6.41 billion to USD 6.49 billion, updated from the previous range of USD 6.375 billion to USD 6.47 billion.