Universal Health Services, Inc.

UHS reported adjusted EPS of $5.98 for Q2 2026, up 12% year over year. Adjusted EBITDA less NCI was $678 million, up 5% year over year. On a same-facility basis, acute care adjusted admissions rose 2.9%, ED visits increased 4%, and surgeries declined 0.8%; acute same-facility net revenue increased 8.2% and same-facility EBITDA grew 8.2%. Behavioral health same-facility net revenue increased 7.4%, with adjusted patient days up 1.4% and same-facility EBITDA up 9.0%. Cash from operating activities was $44.3 million, capital expenditures were $228 million, and the company repurchased $320 million of stock in the quarter. UHS updated 2026 adjusted EBITDA less NCI guidance to $2.61 billion to $2.72 billion, with midpoint growth of about 3%, and said updated guidance implies about 7% revenue growth and 6% EPS growth at the midpoint. It also raised expected full-year Medicaid supplemental net benefit to about $1.5 billion, but increased professional and general liability expense by about $50 million and added $50 million of impact from the Texas behavioral facility plus $50 million from weaker Cedar Hill timing and same-facility volume fine-tuning.

Marc Miller framed the quarter as one of operational rebound, strong demand, and continued investment in capacity. He highlighted 177 new licensed beds added in three hospitals, the opening of the Alan B. Miller Medical Center in Palm Beach Gardens, and progress toward closing Talkspace in mid-August as part of building an end-to-end behavioral health continuum. His tone was optimistic but disciplined, emphasizing quality, efficient operations, and long-term value creation while acknowledging higher reserves and the Texas recertification issue.

Steve Filton said Q2 adjusted EBITDA less NCI of $678 million was boosted by a $100 million out-of-period Florida DPP benefit that was not in guidance, while the underlying quarter missed internal expectations due to roughly $63 million of items including $28 million of higher liability reserves, about $20 million tied to the San Antonio behavioral facility, and about $15 million from slower Cedar Hill ramp. He cited cash from operations of $44.3 million, capex of $228 million, cash of $139 million, total debt of $4.85 billion, net leverage of 1.8x, and $1.27 billion of revolver availability. He also reiterated a very active buyback posture, with $978 million of authorization remaining and expectations to stay active through 2026.

Analysts focused on whether weaker volume trends reflected pressure in the base business, the size and timing of DPP benefits, the behavioral volume outlook, malpractice reserve increases, and the ramp of Cedar Hill, the Florida de novo hospital, and San Antonio’s recertification process. Management said acute and behavioral volume guidance was lowered mainly to reflect first-half trends and continued outpatient migration, while Talkspace should help accelerate behavioral outpatient growth once closed. On reserves, Filton said higher professional and liability costs reflect industry-wide claim severity and are difficult to predict, and on exchange-related payer mix he said lost exchange coverage was largely replaced by self-pay rather than commercial coverage.