Ardent Health Q1 2025 slides: Revenue up 4%, company reaffirms full-year guidance

Ardent Health Partners LLC (NYSE:ARDT) reported modest growth in its first quarter of 2025, with total revenue increasing 4.0% year-over-year to $1.497 billion and Adjusted EBITDA rising 2.5% to $98.2 million. The healthcare provider reaffirmed its full-year 2025 guidance during its earnings presentation on May 6, 2025, which helped drive shares up 7.69% in after-hours trading despite a 1.21% decline during the regular session.

Quarterly Performance Highlights

Ardent Health’s Q1 2025 results demonstrated continued operational momentum, though at a more modest pace compared to the previous quarter. The company reported a 7.6% increase in admissions to 41,389, driven by higher inpatient surgeries and a heightened flu season. Adjusted admissions grew 2.7% year-over-year to 84,536, while net patient service revenue per adjusted admission increased 1.2% to $17,402.

As shown in the following summary of Q1 2025 results:

The company’s Adjusted EBITDA margin experienced a slight compression of 10 basis points year-over-year, declining to 6.6% from 6.7% in Q1 2024. This modest margin pressure comes despite overall revenue and EBITDA growth, reflecting ongoing cost challenges in the healthcare sector.

The operational performance metrics reveal mixed results across service lines, with emergency room visits increasing 2.3% and inpatient surgeries growing 3.4%, while outpatient surgeries declined 2.3% year-over-year.

Payor Mix Evolution

Ardent’s payor mix showed subtle but important shifts that impact the company’s revenue profile. Medicare and managed care both increased slightly as a percentage of the total, while Medicaid declined by 0.8 percentage points year-over-year, primarily due to ongoing Medicaid redeterminations.

The following chart illustrates these changes in payor mix:

The increase in managed care coverage, driven by growth in Exchange plans, generally represents a positive trend for the company’s reimbursement rates. The self-pay and other category remained stable at 5.5% of the total mix.

Financial Position and Capital Structure

Ardent Health significantly strengthened its balance sheet over the past year, with its net leverage ratio improving to 1.4x in Q1 2025 from 2.6x in Q1 2024. Similarly, the lease-adjusted net leverage ratio decreased to 3.0x from 4.3x year-over-year. The company reported total available liquidity of $790 million, consisting of $495 million in cash and $295 million in ABL capacity.

This improved financial position is illustrated in the following chart:

The enhanced balance sheet strength positions Ardent well for its stated growth strategy, which includes both organic expansion and potential acquisitions. Management emphasized that this financial flexibility will support opportunistic growth initiatives, including potential acute care hospital M&A and ambulatory care build-out.

Forward-Looking Statements and Guidance

Ardent Health reaffirmed its full-year 2025 guidance, projecting total revenue between $6,200 million and $6,450 million and Adjusted EBITDA between $575 million and $615 million. The company expects diluted earnings per share to range from $1.73 to $2.01 and anticipates adjusted admissions growth of 2.0% to 3.0%.

Looking beyond 2025, Ardent outlined its long-term growth algorithm, targeting mid-single-digit organic revenue growth with a roughly even split between volume and rate increases. The company aims to achieve 100-200 basis points of core margin expansion over the next 3-4 years, bringing its EBITDAR margin to approximately 13.6%-14.6%.

Strategic Direction

Ardent Health’s presentation concluded with a summary of its strategic priorities organized around three key pillars: Expand, Improve, and Invest. The company plans to leverage its strong market positions to drive consistent growth in the high-single-digit range when including capital deployment initiatives.

Management emphasized its focus on margin improvement initiatives that are largely within the company’s control, targeting 100-200 basis points of core margin expansion. The investment strategy leverages Ardent’s strong balance sheet for opportunistic acute care M&A and ambulatory build-out, with $495 million in cash available for strategic deployment.

This Q1 2025 performance represents a more modest growth trajectory compared to Q4 2024, when Ardent reported a 19% increase in revenue and a 213% surge in adjusted EBITDA. However, the company’s reaffirmation of its full-year guidance suggests management remains confident in accelerating performance through the remainder of 2025.

Full presentation:

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