HCA Healthcare Inc. (HCA), a major hospital chain, reported its third-quarter earnings on Tuesday, revealing a slight miss on revenue and earnings expectations. While the company saw a 7.9% year-over-year increase in revenue, reaching $17.49 billion, it fell short of the consensus estimate of $17.54 billion. Similarly, adjusted earnings per share (EPS) came in at $4.90, surpassing the previous year’s $3.91 but missing the anticipated $4.96.
The company’s operational metrics showed mixed results. Same-facility admissions and equivalent admissions both rose by 4.5% year-over-year, while emergency room visits increased by 4.6%. Inpatient surgeries saw a modest 1.6% increase, but outpatient surgeries declined by 2.0%. Notably, same facility revenue per equivalent admission climbed by 2.5%.
Despite the positive operational trends, HCA Healthcare’s outlook for the remainder of the year has been tempered by the impact of two significant hurricanes. The company’s adjusted EBITDA for the third quarter totaled $3.27 billion, up from $2.88 billion in the same period last year. However, the company anticipates ongoing expenses and revenue losses due to Hurricane Helene’s impact on its North Carolina facilities and Hurricane Milton, which affected certain facilities in Florida during October. These storm-related impacts are estimated to cost HCA Healthcare between $200 and $300 million, or $0.60 to $0.90 per diluted share, during the fourth quarter.
As a result of these hurricane-related challenges, HCA Healthcare has revised its full-year guidance. The company now anticipates 2024 revenue to fall within the range of $69.75 billion to $71.75 billion, down from its previous guidance of $67.75 billion to $70.25 billion and the consensus estimate of $70.91 billion. Similarly, EPS guidance for 2024 has been adjusted to $21.60 to $22.80, up from the prior range of $19.70 to $21.20 but still below the consensus estimate of $22.62. Adjusted EBITDA for 2024 is now expected to be between $12.85 billion and $13.55 billion, compared to the previous guidance of $13.75 billion to $14.25 billion.
Despite the near-term challenges, HCA Healthcare remains confident about its long-term growth prospects. The company expects some ongoing impact from Hurricane Helene on its North Carolina facilities in 2025, but it believes these effects will be manageable. HCA Healthcare anticipates that 2025 diluted EPS and adjusted EBITDA growth will be near or slightly above the upper end of its long-term growth ranges.
The news of the revised guidance sent HCA Healthcare’s stock down 8.95% to $363.19 during the premarket session on Friday.