Tenet Reports 73% Net Income Surge to $702M, Free Cash Flow at $978M
THC•Tenet’s first-quarter net income jumped 73% year-over-year to $702 million (EPS $8.01) on revenues of $5.37 billion versus $406 million a year earlier. Operating cash flow rose to $1.64 billion and adjusted free cash flow hit $978 million, while net debt/EBITDA improved to 2.24x after a $318 million share buyback.
1. Q1 Financial Results
Tenet reported net operating revenues of $5.368 billion in Q1 2026, up from $5.223 billion in Q1 2025, driving net income available to common shareholders to $702 million ($8.01 per diluted share) versus $406 million ($4.27). Adjusted EBITDA was $1.162 billion, roughly flat year-over-year.
2. Cash Flows and Capital Allocation
Operating cash flow rose to $1.641 billion for the quarter, compared with $815 million in Q1 2025, while adjusted free cash flow increased to $978 million from $678 million. The company repurchased 1.35 million shares for $318 million and reduced net debt/Adjusted EBITDA to 2.24x from 2.25x at year-end.
3. Ambulatory Segment Performance
The Ambulatory segment’s net operating revenues climbed 10.6% to $1.320 billion, driven by 5.3% system-wide net patient service revenue growth and acquisitions. Adjusted EBITDA rose 6.1% to $484 million, with margin at 36.7%, supported by disciplined expense management and higher-acuity case mix across 541 surgery centers and 26 surgical hospitals.
4. CommonSpirit Health Transaction
An early contract conclusion with CommonSpirit Health contributed $413 million of revenue ($314 million after tax) and a $40 million pre-tax revenue adjustment. The agreement also included $1.9 billion in installment payments over three years and the redemption of Conifer Health Solutions’ minority interest, improving capital structure.
