Fresenius Medical Care AG & Co. KGaA

Group revenue remained broadly stable in the third quarter, supported by organic growth in Care Delivery and offset by the anticipated decline in Value-Based Care revenue; divestitures reduced group revenue by 30 basis points. Operating income, excluding special items, declined 6% at constant currency, and operating margin was 11%. Special items were a net negative EUR 161 million. Care Delivery revenue rose 1% at constant currency and 2% organically, with operating income up 2% at constant currency and margin at 14.7%; the underlying operating income excluding TDAPA rose 21% year over year. Value-Based Care revenue fell 9% organically and at constant currency, while operating income excluding special items improved to EUR 1 million from a EUR 21 million loss. Care Enablement revenue grew 5% organically and at constant currency, and earnings increased 4%. Operating cash flow increased 8% in the quarter. Net leverage was 2.6x, and 9.1 million shares, or 3.4% of share capital, had been repurchased for EUR 357 million as of September 30. For full year 2026, management still expects broadly flat revenue growth on a constant-currency basis and now expects operating income growth to be between flat and a negative mid-single-digit percentage rate. On TDAPA, management said the full-year 2026 headwind should be around EUR 50 million, with roughly EUR 140 million expected in Q4, and for 2027 it now expects an overall TDAPA-related operating income headwind of EUR 300 million to EUR 350 million. Management also said inflation headwinds for the group are now expected to exceed the previously assumed EUR 300 million top end.

Shervin Korangy used his first call to stress that Fresenius Medical Care has strong assets but still has room to refine portfolio, execution, and performance metrics. He framed his approach as balancing cost discipline with reinvestment for short-, medium-, and long-term growth, while saying the company will communicate a fuller 2027 vision later. His tone was constructive and patient: urgent about action, but explicitly asking investors for time to assess the business and define priorities.

Martin Fischer focused on the quarter’s mechanics and the outlook reset. He highlighted that TDAPA moved from a first-half tailwind of EUR 160 million to a second-half headwind, with Q3 showing slightly above EUR 60 million of headwind and Q4 expected to carry roughly EUR 140 million to reach the full-year EUR 50 million headwind. He also pointed to EUR 74 million of sustainable FME25+ savings in the quarter, EUR 54 million of one-time costs, EUR 357 million spent on buybacks, and a stable 2.6x net leverage ratio near the low end of the 2.5x-3x target range. He acknowledged inflation pressures, saying the company now expects group inflation headwinds to exceed the original EUR 300 million top end, and said the 2027 reimbursement environment remains challenging.

Analysts focused heavily on TDAPA, 2027 reimbursement, and whether the business can reaccelerate volumes. Management said 2026 TDAPA should still land around a EUR 50 million headwind overall, but 2027 will see a much larger EUR 300 million to EUR 350 million operating income headwind as TDAPA expires and pharmacy-related effects roll through. On U.S. same-market treatment growth, management said Q3 stabilized after weaker inflows in the first seven months, but that recovery will take several months because earlier patient losses still weigh on reported growth; they also said the decline was not structural, but market-by-market and addressable through referral, admissions, and access work. On capital allocation, management said buybacks remain appropriate given cash generation and the current leverage range, and on China and DaVita they said portfolio changes create some headwinds in specific areas but do not change the overall strategic rationale.