01—Abstract
Summary
Summary of the 10-Q filed April 29, 2026. Cited figures are marked; the original filing is the authoritative source.
HCA Healthcare's first quarter 2026 revenue rose 4.3% to $19.109 billiona, driven by a 3.1% increase in revenue per equivalent admission and a 1.1% rise in equivalent admissions.
Diluted EPS increased 10.9% to $7.15b, but this was largely a function of a roughly 9% reduction in diluted share count (226.7 million versus 249.4 million) from ongoing buybacks. Net income attributable to HCA grew only 0.6% to $1.620 billion, and pre-tax income fell 1.7% to $2.287 billion as interest expense rose 6.8% to $584 million and depreciation and amortization rose 8.1%. The lower effective tax rate (21.0% versus 23.8%) was supported by a $103 million tax benefit from employee equity award settlements, which flatters the current quarter's earnings quality.
The filing highlights a payer-mix shift that investors should monitor. Managed care and insurer revenue as a share of total revenue fell to 47.5% from 49.4%, reflecting the expiration of enhanced Exchange premium tax credits at the end of 2025. Uninsured admissions rose 15.6% on a consolidated basis, and charity care rose to $5.513 billionc from $3.644 billion.
Estimated uncompensated care costs increased to $1.252 billiond from $1.055 billion. Respiratory-related admissions fell 42% against a weak seasonal comparison, which weighed on volumes. Outpatient surgeries declined 2.7%.
Balance sheet and liquidity require attention. Total debt was $48.0 billion, and short-term debt and current maturities climbed to $8.5 billion, including $3.65 billion of commercial paper. Working capital was negative $3.2 billion, although management states that excluding commercial paper it would have been positive $444 million and that the company can refinance commercial paper under its senior unsecured credit facility.
Operating cash flow improved to $2.014 billion from $1.651 billion, but capital expenditures of $1.119 billion and share repurchases of $1.571 billion were funded in part by net borrowings of $1.4 billion. Stockholders' deficit widened to $(2.978) billion. Management reiterated 2026 capital expenditure guidance of $5.0 to $5.5 billion and declared a $0.78 quarterly dividend.
02—Key points
Key Highlights
- Revenue grew 4.3% to $19.109 billion (same facility +4.5%), driven by a 3.1% increase in revenue per equivalent admission and a 1.1% increase in equivalent admissions.
- Diluted EPS rose 10.9% to $7.15 from $6.45, but net income attributable to HCA rose only 0.6% to $1.620 billion; pre-tax income declined 1.7% to $2.287 billion. EPS growth was driven primarily by a roughly 9% decrease in diluted shares.
- Managed care and insurer revenue share fell to 47.5% from 49.4% after expiration of enhanced Exchange premium tax credits; consolidated uninsured admissions rose 15.6% and charity care rose to $5.513 billion from $3.644 billion.
- Interest expense rose 6.8% to $584 million, and the average debt balance increased to $47.2 billion from $43.7 billion.
- Operating cash flow increased 22% to $2.014 billion, partly reflecting a $314 million favorable working capital swing; the effective tax rate fell to 21.0% from 23.8%, aided by a $103 million equity award tax benefit.
- Total debt reached $48.0 billion, with $8.5 billion due within one year including $3.65 billion of commercial paper; reported working capital was negative $3.2 billion.
- The company repurchased 3.16 million shares for $1.571 billion in cash, leaving $9.179 billion of authorization available; total stockholders' deficit widened to $(2.978) billion.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 29, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $19.11B$18.32B | +4.3% |
| Operating Expenses | $16.82B$15.99B | +5.2% |
| Interest Expense | $584.00M$547.00M | +6.8% |
| Net Income | $1.62B$1.61B | +0.6% |
| EPS (Basic) | $7.25$6.52 | +11.2% |
| EPS (Diluted) | $7.15$6.45 | +10.9% |
| Shares Outstanding (Basic) | 223.59M246.94M | −9.5% |
| Shares Outstanding (Diluted) | 226.65M249.44M | −9.1% |
05—Questions
Frequently Asked Questions
Did HCA's earnings growth come from operations or from share buybacks?
Mostly from buybacks. Diluted EPS rose 10.9%, but net income attributable to HCA rose only 0.6% and pre-tax income fell 1.7%. The share count fell about 9% year over year, and the lower tax rate, aided by a $103 million equity award benefit, also contributed.
How is the expiration of enhanced Exchange subsidies affecting HCA?
The filing shows a shift toward uninsured care. Managed care and insurer revenue share declined to 47.5% from 49.4%, consolidated uninsured admissions rose 15.6%, and estimated uncompensated care costs increased to $1.252 billion from $1.055 billion. Management attributes the change to the expiration of enhanced premium tax credits and administrative reforms, and has not quantified the full-year impact in this filing.
Is HCA's negative working capital a liquidity concern?
The negative $3.2 billion working capital position is driven primarily by $3.65 billion of commercial paper classified as current. Management states that working capital excluding commercial paper was positive $444 million and that commercial paper can be refinanced on a long-term basis under its senior unsecured credit facility, which had $4.3 billion available at March 31, 2026.
Is HCA's capital spending and shareholder return sustainable from operating cash flow?
Operating cash flow of $2.014 billion covered capital expenditures of $1.119 billion in the quarter, but buybacks of $1.571 billion, dividends of $183 million and distributions to noncontrolling interests of $191 million were funded in part by $1.4 billion of net new borrowings. The company's 2026 capex plan of $5.0 to $5.5 billion implies continued reliance on operating cash flow and debt markets.
What drove the weak volume trends in the first quarter?
Management cited an absence of the typical seasonal respiratory-related volume increase, with respiratory admissions down 42% and respiratory emergency room visits down 32%, along with a January 2026 winter storm. Outpatient surgeries declined 2.7% on a consolidated basis, while total admissions rose 0.7%.
06—Continue