Third Quarter 2026
Filed Nov 3, 2026PACS reported third-quarter revenue growth of 11.5%, Adjusted EBITDA growth of 33.6%, and raised full-year 2026 revenue and Adjusted EBITDA guidance.
Revenue, net income, diluted EPS, Adjusted EPS and Adjusted EBITDA all increased year over year. Same-store revenue, occupancy and skilled mix improved, operating cash flow was substantial for the nine months, and the company raised both full-year revenue and Adjusted EBITDA outlooks.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 total revenueGAAP | $1.50B | – | 11.5% |
| Q3 2026 patient and resident service revenueGAAP | $1.50B | – | – |
| Q3 2026 other revenuesGAAP | $441K | – | – |
| Q3 2026 cost of servicesGAAP | $1.14B | – | – |
| Q3 2026 rent - cost of servicesGAAP | $98.22M | – | – |
| Q3 2026 general and administrative expenseGAAP | $138.4M | – | – |
| Q3 2026 depreciation and amortizationGAAP | $20.08M | – | – |
| Q3 2026 total operating expensesGAAP | $1.40B | – | – |
| Q3 2026 operating incomeGAAP | $99.72M | – | – |
| Q3 2026 income before provision for income taxesGAAP | $91.31M | – | – |
| Q3 2026 provision for income taxesGAAP | $30.50M | – | – |
| Q3 2026 net incomeGAAP | $60.81M | – | 16.2% |
| Q3 2026 net income attributable to PACS Group, Inc.GAAP | $60.82M | – | – |
| Q3 2026 diluted earnings per share attributable to PACS Group, Inc.GAAP | $ 0.37 | – | 15.6% |
| Q3 2026 basic earnings per share attributable to PACS Group, Inc.GAAP | $ 0.38 | – | – |
| Q3 2026 adjusted net incomenon-GAAP | $104.0M | – | – |
| Q3 2026 Adjusted Earnings Per Sharenon-GAAP | $ 0.63 | – | 37.0% |
| Q3 2026 EBITDAnon-GAAP | $116.5M | – | – |
| Q3 2026 Adjusted EBITDAnon-GAAP | $175.7M | – | 33.6% |
| Q3 2026 Adjusted EBITDARnon-GAAP | $273.9M | – | – |
| Nine months ended September 30, 2026 total revenueGAAP | $4.35B | – | – |
| Nine months ended September 30, 2026 operating incomeGAAP | $329.1M | – | – |
| Nine months ended September 30, 2026 net incomeGAAP | $217.8M | – | – |
| Nine months ended September 30, 2026 diluted earnings per share attributable to PACS Group, Inc.GAAP | $ 1.34 | – | – |
| Nine months ended September 30, 2026 Adjusted Earnings Per Sharenon-GAAP | $ 1.90 | – | – |
| Nine months ended September 30, 2026 Adjusted EBITDAnon-GAAP | $512.8M | – | – |
| Nine months ended September 30, 2026 Adjusted EBITDARnon-GAAP | $801.3M | – | – |
| Nine months ended September 30, 2026 cash provided by operating activitiesGAAP | $583.1M | – | – |
| September 30, 2026 cash and cash equivalentsGAAP | $115.3M | – | – |
| September 30, 2026 long-term debt, less current maturities, net of deferred financing feesGAAP | $264.4M | – | – |
| September 30, 2026 current maturities of long-term debtGAAP | $7.98M | – | – |
| September 30, 2026 net leverageother | 0.2x | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Full-year 2026 outlook
- Revenue$5.95 billion to $6.05 billion
- NoteAdjusted EBITDA of $685 million to $695 million
- NoteGuidance reflects approximately $5 million of EBITDA contribution from retroactive quality incentive payments in Ohio received in the month of October.
What drove it
- Same-store skilled nursing services revenue was $ 1,378,842 (dollars in thousands) in the third quarter of 2026 versus $ 1,295,757 (dollars in thousands) in the prior-year period, a change of $ 83,085 (dollars in thousands), or 6.4%.
- Same-store occupancy rate was 91.3% versus 89.3%, a change of 200 bps.
- Total skilled nursing services revenue was $ 1,451,321 (dollars in thousands) in the third quarter of 2026 versus $ 1,310,933 (dollars in thousands) in the prior-year period.
- Total occupancy rate for skilled nursing services was 90.2% in the third quarter of 2026 versus 89.0% in the prior-year period.
- Total skilled mix by revenue was 48.9% in the third quarter of 2026 versus 48.0% in the prior-year period.
- Total skilled mix by nursing patient days was 29.1% in the third quarter of 2026 versus 28.2% in the prior-year period.
- Mature-facility occupancy was 93.1%, and mature-facility skilled mix by nursing patient days was 31.3%, in the third quarter of 2026.
- 250 facilities, or 78.9%, of the skilled nursing portfolio achieved a 4 or 5 star CMS Quality Measure Star rating. The 196 mature facilities achieved an average rating of 4.5 as of September 30, 2026.
- PACS closed the acquisition of 32 Florida skilled nursing facilities on October 1, 2026, and closed the acquisition of 10 skilled nursing facilities and one assisted living facility in Texas as of November 1, 2026.
- As of the release date, PACS's portfolio comprised 398 healthcare operations across 21 states. The company owned 66 facilities, leased an additional 49 facilities with partial ownership in real estate, and held 37 purchase options on leased facilities and 20 purchase options through partnerships.
Concerns
- Legal and other costs were $ 9,496 (dollars in thousands) in the third quarter of 2026 and $ 29,440 (dollars in thousands) for the nine months ended September 30, 2026. The company states these costs include legal and professional fees associated with the Audit Committee’s independent investigation, other ongoing investigations and SEC matters.
- Stock-based compensation expense was $ 45,320 (dollars in thousands) in the third quarter of 2026, compared with $ 12,516 (dollars in thousands) in the prior-year period.
- General and administrative expense was $ 138,409 (dollars in thousands) in the third quarter of 2026, compared with $ 102,528 (dollars in thousands) in the prior-year period.
- The company identifies integration of recently acquired Florida and Texas operations, including Florida operations in a state where it had not previously operated, as a forward-looking risk.
- The company states that its guidance includes approximately $5 million of EBITDA contribution from retroactive quality incentive payments in Ohio received in October.
What to watch
- Execution and integration of the 32 Florida facilities and 11 Texas facilities acquired during October and November 2026.
- The contribution of the Ohio retroactive quality incentive payments reflected in full-year 2026 guidance.
- Progress in same-store occupancy, skilled mix and the Ramping facilities cohort.
- M&A investment, acquisition-pipeline conversion and the use of $707.4 million in available liquidity.
- Legal and other costs, including costs tied to ongoing investigations and SEC matters.
Balance sheet and cash flow
- Cash and cash equivalents were $ 115,281 (dollars in thousands) as of September 30, 2026, compared with $ 197,016 (dollars in thousands) as of December 31, 2025.
- Available liquidity was $707.4 million as of September 30, 2026, including $115.3 million of cash and cash equivalents.
- Total assets were $ 5,918,183 (dollars in thousands) as of September 30, 2026, compared with $ 5,584,034 (dollars in thousands) as of December 31, 2025.
- Total liabilities were $ 4,699,471 (dollars in thousands) as of September 30, 2026, compared with $ 4,631,585 (dollars in thousands) as of December 31, 2025.
- Line of credit was $ — (dollars in thousands) as of September 30, 2026, compared with $ 100,000 (dollars in thousands) as of December 31, 2025.
- Net cash used in investing activities was $ 538,234 (dollars in thousands) for the nine months ended September 30, 2026, compared with $ 145,879 (dollars in thousands) in the prior-year period.
- Net cash used in financing activities was $ 148,703 (dollars in thousands) for the nine months ended September 30, 2026, compared with $ 63,521 (dollars in thousands) in the prior-year period.
- Net change in cash was $ (103,858) (dollars in thousands) for the nine months ended September 30, 2026, compared with $ 198,214 (dollars in thousands) in the prior-year period.
- The Company deployed $213.0 million in capital for M&A during the third quarter of 2026 and $403.8 million for the first nine months of the year.
Analysis
PACS reported broad third-quarter growth. Total revenue was $ 1,498,578 (dollars in thousands), up 11.5%, while net income was $ 60,812 (dollars in thousands), compared with $ 52,330 (dollars in thousands) in the prior-year period. GAAP diluted EPS was $ 0.37 versus $ 0.32, and Adjusted Earnings Per Share was $ 0.63 versus $ 0.46. Operating income increased to $ 99,721 (dollars in thousands) from $ 86,269 (dollars in thousands).
The operating KPIs show improvement in the existing skilled nursing base. Same-store skilled nursing services revenue increased 6.4% to $ 1,378,842 (dollars in thousands), occupancy rose to 91.3% from 89.3%, and same-store skilled mix by nursing patient days improved to 29.5% from 28.3%. Across all skilled nursing facilities, occupancy was 90.2% and skilled mix by nursing patient days was 29.1%, compared with 89.0% and 28.2%, respectively, in the prior-year quarter. The company attributed the overall skilled-mix improvement to continued improvement in its Ramping facilities cohort.
Profitability growth exceeded revenue growth on the company’s non-GAAP measures. Adjusted EBITDA increased 33.6% to $ 175,666 (dollars in thousands) from $ 131,515 (dollars in thousands), while Adjusted EBITDAR was $ 273,889 (dollars in thousands). The reconciliation includes $ 45,320 (dollars in thousands) of stock-based compensation expense, $ 9,496 (dollars in thousands) of legal and other costs, and $ 4,350 (dollars in thousands) of acquisition-related costs in the quarter. Rent-cost of services was $ 98,223 (dollars in thousands), a recurring operating cost that is excluded from Adjusted EBITDAR.
Cash generation and liquidity supported acquisition spending. Cash provided by operating activities was $ 583,079 (dollars in thousands) through the first nine months, while investing activities used $ 538,234 (dollars in thousands). PACS invested $213.0 million in M&A during the third quarter and $403.8 million through nine months. It ended the quarter with $707.4 million in available liquidity, including $115.3 million of cash and cash equivalents, and reported net leverage of 0.2x.
Management raised full-year 2026 revenue guidance to $5.95 billion to $6.05 billion and Adjusted EBITDA guidance to $685 million to $695 million. The outlook includes approximately $5 million of EBITDA contribution from retroactive Ohio quality incentive payments received in October. The post-quarter acquisitions of 32 Florida facilities and 11 Texas facilities broaden the portfolio, while integration execution, the acquisition pipeline, same-store occupancy and the trajectory of legal and other costs remain central items for investors to monitor.
Management, verbatim
Our third quarter results reflect the continued progress our teams are making across the organization, both in the quality of care we provide and the performance of our facilities.
Jason Murray, PACS Chief Executive Officer
Our third quarter results demonstrate the increasing earnings power of the PACS operating model, with Adjusted EBITDA growth significantly outpacing revenue growth.
Carey Hendrickson, PACS Chief Financial Officer
Given the continued excellent performance of our portfolio across all cohorts, we are increasing our full-year 2026 Adjusted EBITDA guidance to a range of $685 million to $695 million, up from our prior range of $640 million to $660 million.
Carey Hendrickson, PACS Chief Financial Officer
Not in the filing
stated, not guessed- Previous-release outlook was not provided, so no comparison of actual results with prior guidance is presented.
- Gross margin was not reported.
- Free cash flow was not reported.
- Quarterly operating cash flow was not reported.
- No dividends, share repurchases, or other capital returns were reported for the period.
- No prior-quarter values were reported for the listed financial metrics.
- No reportable operating segment revenue disclosure was provided.
- A GAAP effective income tax rate was not reported. The filing states only that the combined federal and state statutory tax rate used for non-GAAP adjustments was approximately 27%.
- Prior-year Adjusted EBITDAR was not reported.
- A forward-looking reconciliation of Adjusted EBITDA guidance to GAAP net income was not provided.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.