Community Health Systems posted a loss for the first quarter of 2026 that fell below the market’s expectations as well as the for-profit health system’s performance back in 2025.
Net loss attributed to CHS stockholders was $58 million, or -$0.40 per diluted share, as opposed to the $13 million net loss, or -$0.10 per diluted share, of Q1 2025. Its shares dropped nearly 10% immediately following the results’ release in after-hours trading.
The company, which had returned its earnings to the black across 2025, also saw its quarterly net operating revenues drop by 6.1% year over year to $2.97 billion. However, CHS has been in the midst of a sweeping portfolio transformation headlined by hospital selloffs that drove the revenue reduction. Comparing facilities owned during both periods saw net operating revenues rise by 3.1%.
Similarly, CHS reported a 10.8% fall in admissions and a 10.5% drop in adjusted admissions compared to the prior year. On a same-store basis, those leveled off to a 1.3% admissions decline and a 0.5% adjusted admissions decrease.
CHS, in its earnings release, said the elevated net loss was “primarily due to divestitures, lower same-store volumes, an unfavorable change in payor mix, a period-over-period change in loss from early extinguishment of debt and an increase in the provision for income taxes.” On the other hand, the company also improved reimbursement rates and how much it received from supplemental reimbursement programs.
More broadly, CEO Kevin Hammons said the company is “pleased with the continued, tangible progress on our key priorities, demonstrated by improvements in quality scores, patient experience and physician satisfaction measures, and investments in growth opportunities. In the face of a dynamic macroeconomic environment, we remain focused on the variables within our control and believe we are positioning the Company for long-term success and value creation.”
Tuesday afternoon’s numbers were accompanied by word that the company redeemed about $223 million of its outstanding bonds (10.875% senior secured notes, due in 2032). CHS executives will elaborate on the quarter’s performance and answer analyst questions in an earnings call scheduled for Wednesday morning.
CHS’ current portfolio of 64 affiliated hospitals reflects a 35% reduction since 2019. Across 2025 the health system reported $12.5 billion total net operating revenues and $509 million of net income, a reversal of the prior year’s $516 million net loss.
On Monday the company highlighted the opening of new ambulatory surgery centers (ASCs) in Alabama and the acquisition of a majority interest in another located in Alaska. That brings the company to 36 affiliated ASCs, with another in Alabama soon to be acquired this quarter.
“By offering additional services through these outpatient settings, we are driving growth for our health systems, delivering quality care and excellent outcomes, and optimizing the surgical experience for both our physician partners and their patients,” Hammons said in a Monday release.
(Editor’s note: This story will be updated with the additional commentary).
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