Earnings call transcript: US Physical Therapy Q3 2025 sees mixed results

US Physical Therapy (USPH) delivered its Q3 2025 earnings, revealing a mixed financial performance. The company reported earnings per share (EPS) of $0.66, narrowly missing the forecast of $0.67. Despite this, USPH exceeded revenue expectations, posting $197.13 million against a projected $194.05 million, a positive surprise of 1.59%. However, the market reacted negatively, with the stock dropping 9.9% in premarket trading to $84.38, reflecting investor concerns over the EPS miss.

Key Takeaways

• USPH reported a slight EPS miss but exceeded revenue forecasts.
• The stock dropped 9.9% in premarket trading following the earnings release.
• The company saw strong growth in physical therapy revenues and clinic visits.
• Operational efficiencies improved, with low clinician turnover rates.
• Increased salaries and related costs were noted, though marginally.

Company Performance

US Physical Therapy demonstrated solid operational performance in Q3 2025, with significant growth in physical therapy revenues, which rose 17.3% year-over-year. The company also recorded an impressive 32.7 visits per clinic per day, up from 30.6 in the previous year. Despite these gains, the slight EPS miss may have overshadowed these achievements in investor eyes.

Financial Highlights

• Revenue: $197.13 million, up from the forecast of $194.05 million.
• Earnings per share: $0.66, slightly below the forecast of $0.67.
• Adjusted EBITDA: $26.9 million, up $4.7 million from Q2 2024.
• Adjusted EBITDA margin: 17.5%, up from 16.4% in Q2 2024.

Earnings vs. Forecast

USPH’s EPS of $0.66 fell short of the forecasted $0.67, marking a negative surprise of 1.49%. In contrast, the company delivered a revenue beat, with actual figures surpassing forecasts by 1.59%. This mixed performance reflects a slight deviation from previous quarters where USPH might have consistently met or exceeded both earnings and revenue expectations.

Market Reaction

Following the earnings release, USPH’s stock experienced a significant decline, dropping 9.9% in premarket trading to $84.38. This negative market reaction suggests investor concerns over the EPS miss, despite the revenue beat and operational improvements.

Outlook & Guidance

Looking forward, US Physical Therapy raised its full-year 2025 adjusted EBITDA guidance to $93-$97 million. The company remains optimistic about future Medicare rate increases and plans to expand its de novo clinic openings and injury prevention partnerships.

Executive Commentary

Chris, a Senior Executive, highlighted the company’s strong market position, stating, "We’re having an impact. We’re making the world in our little, little way better." He also emphasized the high net promoter score of 93.5, with 95% active promoters, reflecting strong customer satisfaction.

Risks and Challenges

• Potential for rising operational costs, as indicated by increased salaries.
• Market volatility and investor sentiment affecting stock performance.
• Competitive pressures in the physical therapy market.
• Dependence on Medicare rate adjustments for future profitability.

Q&A

During the earnings call, analysts inquired about USPH’s growth capacity in existing clinics and strategies for negotiating Medicare rates. The company also addressed potential expansions in virtual physical therapy networks and detailed ongoing operational efficiency improvements.

Full transcript - US Physical Therapy Inc (USPH) Q3 2025:

Chris, CEO or Senior Executive, US Physical Therapy: Thank you. Good morning, everyone, and welcome to US Physical Therapy second quarter 2025 earnings call. With me on the call include Carey Hendrickson, our Chief Financial Officer, Eric Williams, our President and Chief Operating Officer in the East, Graham Reeve, the Chief Operating Officer in the West, Rick Binstein, our Executive Vice President and General Counsel, and Jason Curtis, our Senior Vice President, Accounting and Finance Area. Before we begin today’s call, we need to cover a brief disclosure, which I’ll ask Jason to go ahead and read.

Jason Curtis, Senior Vice President, Accounting and Finance, US Physical Therapy: Thank you, Chris. The presentation includes forward-looking statements, which involve certain risks and uncertainties. These forward-looking statements are based on the company’s current views and assumptions. The company’s actual results may vary materially from those anticipated. Please see the company’s filings with the Securities and Exchange Commission for more information. This presentation also contains certain non-GAAP measures as defined in Regulation G, and the related reconciliations can be found in the company’s earnings release and the company presentations on our website.

Chris, CEO or Senior Executive, US Physical Therapy: Thanks, Jason. Guys, I’m going to do this, I think, a lot like I did it last time. More of a candid overview allows me to tell the story a little bit better. I want to start out by thanking our partners, our staff, and our home office support around the country. They’re just doing an excellent job. I’m going to share with you some statistics that we don’t normally share, we haven’t shared before, that relates to our patient sentiment around our care. Our clinical staff, our partners, they’re doing a wonderful job. We’ve had good, strong focus and execution in a number of different areas this quarter we’ll talk about. I also want to mention our industrial injury prevention partnerships. Both are really firing on all cylinders at this point. We’ve added a number of very large opportunities, some of which haven’t even started yet.

We continue to be very, very bullish about that part of our business. As we go through the stats, you’ll understand why. For this second quarter, talk about physical therapy first and volumes. A record second quarter for us, as you guys know, second quarter is typically our busiest quarter in terms of, you know, peak volume. Every second quarter, pretty much, you know, last year, the same was a record quarter for us a year ago. This year, our visits per clinic per day jumped to 32.7, up really nicely from, again, last year’s second quarter record of 30.6. The drivers around this, I think more than anything, are happy patients who love us at the end of their care, who refer their family and friends and neighbors to us.

When pickleball happens, you know, a year or two down the road, they come back and see us. This is the stat I want to share with you that we really have not talked about before. It is not a new stat for us. We measure it every quarter. We have an outside company tabulate our surveys. This is company-wide. Our net promoter score is 93.5. Now, just to give you some perspective, before this call, I Googled, "What is a good net promoter score for a healthcare company?" and I got two answers: good was 30 and excellent was 50. The way that we get these results tabulated, we are able to see what percentage of patients are active promoters of our business, and we are at 95%. Only 1% of our patients is a negative or a detractor. That puts us in amazingly good.

Standing and an amazing category. Part of the reason for our success, obviously, it’s what we try to do every day. On the injury prevention side, again, I can’t say enough good things about our teams. Both partnerships doing really well. Revenues up 22.6%. Gross profit up 25.8% compared to the prior year quarter. Again, we’re working on some really large contracts, one new in the auto industry, actually several new, many. One really large one and one very large one to come here later in the year. Revenues in PT were also strong, increasing 17.3%. We added over 50 net clinics compared to the prior year period. For the first time through this first six months, we exceeded 3 million visits on a year-to-date so far.

We’re also able to drive a slight increase in our net rate despite the Medicare headwinds, which you guys know all too well about. I just want to point out that if you go back to when just the period before these Medicare cuts started, which have been now sequential layered cuts for a number of years, the impact in this year on those stacked cuts is right around $25 million. That’s straight off profit line. It’s been a huge impact. It’s been a major headwind. On a year-over-year basis, it was—I can’t remember exactly, Carey can tell us—but between $5 million and $6 million compared to last year and this year. You know, that’s 8-8.5% of our earnings on last year’s number, maybe even a little bit more than that. To grow over 20% with that kind of a headwind consistently.

We’re really happy about right now. Things are—things are coming together. Our cost, our salaries and related costs was up on a per-visit basis ever so slightly, less than 1%. But our overall cost per visit was down slightly. And really, I think beginning March and continuing forward, we’re beginning to get traction on a number of the initiatives that we’ve been working on that will help us impact cost, that will help us continue to drive more volume. We’re feeling better about things right now than we have in some time. When you look at PT, our gross profit margin, and we’re going to say adjusted very, very slightly, I think around a couple hundred thousand dollars only relating to an incentive payment that Metro had as a result of closing that deal. Our gross profit margin came in at 21.1% for the quarter.

That is a nice move forward as well. On the development front, we’ve added a home care business, a couple of physical therapy acquisitions. We have more to come for the remainder of the year. We intend to focus hard on our injury prevention business. Given the organic and the overall growth elements in that business, the margins, just the performance of both those teams. We widened our industry verticals in that space. We widened our service offerings in that space. We’re competing and winning large contracts. We’re able to do that with some margin improvement as well. That business is very strong for us and has continued to be strong really for a very long time. The combination of these positive factors has caused us to look out over the remainder of the year and increase guidance, which is now between.

million and $97 million in adjusted EBITDA. And then before I turn it over to Carey, because I skipped through a lot of things, I wanted to tell the story. Carey’s going to go through the numbers with a little bit more granularity. Again, I just want to thank our teams. At times, you know, we endeavor every day to try to make a difference, to try to make a positive impact in our patients’ lives or within the injury prevention space, in the lives of the workers who are working at our nation’s largest companies, most prestigious companies. We’re having an impact. We’re making the world in our little, little way better. We feel really good about that. Again, I want to thank everybody that’s involved in that. It’s making a difference, and we appreciate it very much. Carey, if you would, go ahead.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Great. Thank you, Chris. Good morning, everyone. As Chris mentioned, we’re very pleased with our second quarter results. A few performance metrics that stood out to me, we achieved a new record, company record, 32.7 average visits per clinic per day. That was the highest in our history. Our salaries and related costs, as Chris mentioned, increased slightly, just 0.7% compared to the prior year. That’s the smallest increase in that metric we’ve had since the fourth quarter of 2023. Our total operating cost per visit actually decreased year over year. Our PT margin, as Chris noted, improved to 21.1%, up from 20.1% in the second quarter of last year. Our IIP revenue, excluding acquisitions, so on an organic basis, grew 18.4%. Our IIP gross profit increased 21.8% on an organic basis.

Our adjusted EBITDA increased to $26.9 million in the second quarter of 2025, which was up $4.7 million from the second quarter of last year. Our adjusted EBITDA margin expanded to 17.5%, up from 16.4% in the second quarter of last year. All of those metrics I was really pleased with. Turning to patient visit volumes, our average visits per day were 33.0 in April. They were 32.9 in May and 32.3 in June. That slight taper in June is consistent with our historical summer patterns when volumes dipped slightly in the summer months before rebounding again in mid-August. We recorded 1,530,263 clinic visits in the second quarter and then also had 28,493 home care visits. This is the first time we’ve reported home care visits separately from our in-clinic visits.

They stem from the home care business that we acquired through the Metro PT transaction in New York in the fourth quarter of last year, and we’ll continue to report those separately going forward. For reference, we had 22,943 in-home visits in the first quarter of this year. That number’s the year-to-date numbers in the release too, just so you’ll have that for going forward. Our net rate per patient visit was $105.33. That’s ahead of the $105.05 we achieved in the second quarter of last year, but it is slightly less than what we had in the first quarter at $105.66. As a reminder, we absorbed a 2.9% Medicare rate reduction that took effect at the beginning of the year.

Our largest payer in Michigan, which is our third largest state with 56 clinics, implemented a policy change on April 1 that negatively impacted our net rate a little bit. In that state, that was a bit of a headwind too. Even with those headwinds, though, our net rate held up well in the second quarter, and we expect it to grow from there. We continue our efforts to have a strategic focus on increasing reimbursement rates through targeted contract negotiations, as well as efforts to grow our higher net rate workers’ comp business. Workers’ comp represented 10.4% of our net patient revenues in the second quarter, with visits increasing 8.4% year over year. We remain fully committed to all of our rate-enhancing initiatives, and we are working on those every day.

Physical therapy revenues were $168.3 million in the second quarter of 2025, which represented a $24.8 million, 17.3% increase compared to the same period last year. The majority of that growth was driven by acquisitions completed since the second quarter of last year, most notably that Metro acquisition that we made in New York last November. That was $19.6 million of the $24.8 million. Physical therapy operating costs were $133.1 million. That was an increase of $18.4 million or 16% over the prior year quarter. Importantly, we managed cost effectively our salaries and related costs. I mentioned we’re just up 0.7% at $60.08. And our total operating costs, as I also mentioned, were actually down year over year. Our physical therapy profit margin, I noted already, 21.1%. That’s our highest quarterly margin since the second quarter of 2023.

That, of course, reflects solid revenue growth and the cost management. Our IIP team delivered another strong performance in the second quarter. Our IIP net revenues increased $5.3 million or 22.6% compared to the second quarter of 2024. Income rose $1.3 million or 25.8% over the prior year quarter. I gave the organic numbers earlier. IIP revenues increased 18.4% and gross profit up 21.8%. The IIP margin for the second quarter was 22%, which is up from 21.4% in the same quarter last year, reflecting strong top line growth and continued focus on operational execution. Our corporate costs remained in line with expectations. They were 8.7% of net revenue in the second quarter. That compares to 8.5% in the second quarter of last year. We’re in the early stages of implementing a new enterprise-wide financial and human resources system.

Implementation costs related to that project will continue through 2026. Consistent with our practice for similar non-recurring costs, we’ll add those costs back in our adjusted EBITDA calculation. Year to date, we’ve incurred $221,000 in implementation costs. That was really related to the selection part of our implementation. We’ll start full bore on our implementation in the third quarter. That’ll always be itemized on our non-GAAP reconciliation page. Operating results were $12.4 million, up from $11 million in the second quarter of last year. On a per share basis, we were at $0.81 versus $0.73 in the prior year quarter. Our balance sheet remains in excellent shape. We currently have $135 million in our term loan with a swap agreement in place that fixes that interest rate at 4.7% that extends through mid-2027.

In addition, we have a $175 million revolving credit facility that had $24.5 million drawn on it at June 30, 2025. We ended the quarter with $34.1 million in cash. As disclosed in our earnings release, the Board of Directors authorized a share repurchase program this week, providing us the flexibility to repurchase up to $25 million of our shares through December 31, 2026, if market conditions are appropriate. We view this as a prudent tool to have at our disposal. However, acquisitions will continue to be our primary capital allocation priority, consistent with our strategic growth strategy. Our performance in the first half of the year has been strong, exceeding our expectations coming into the year. We believe we’re well positioned for a solid second half as well.

As a result, we’ve raised our full year 2025 adjusted EBITDA guidance from a range of $88-$93 million to the new range of $93-$97 million. In effect, the high end of our prior range becomes the low end of our new range with a $4 million increase at the top. With that, I’ll turn the call back over to Chris.

Chris, CEO or Senior Executive, US Physical Therapy: Thanks, Carey. Appreciate it. I want to mention one more thing. We’re happy with where we are this quarter and the progress. We still have plenty of things to work on, right? Which, to me, is also encouraging because we’re not there yet. We have room for improvement. One of those things I want to point out as a matter of perspective relates to our same-store growth and mature facilities, which this quarter was a little bit lighter than maybe everybody expected. It was over 1%, but not in what I would call our normal range. We still have a few markets where staffing is a little tight. With cost control, it probably put a little bit of a damper on us. I want to point out one thing now. Back in the spring, we initiated a staged rollout of cash-based programs.

We haven’t spent a lot of time talking about it. As with anything, it takes a little time to get traction, getting real traction with that now. In our other income line, this doesn’t show up as additional visits, although some of our patients were coming in for these cash-based services. We have generated about $900,000 worth of additional revenue, a lot of that coming from our cash-based services, which are continuing to ramp up as we go forward. That’s an added benefit that we really haven’t had before. We’re seeing some of our partnerships do extraordinarily well with that. That concludes our prepared and our candid comments. We’d like to go ahead and open it up for questions.

Conference Operator, Call Moderator: Thank you. At this time, if you would like to ask a question, please press Star 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing Star 2. Once again, that is Star 1 to ask a question. We will pause for a moment to allow questions to queue. Our first question will come from Brian Tanquilut with Jefferies. Your line is open.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Hey, good morning, guys. Congrats on a solid quarter. Chris, maybe I’ll start with a follow-up or a question around your last comment. As I think about your same-store outlook, how would you characterize demand for your services or just broadly in the market versus, like you were saying, kind of like pulling back and managing the cost because of the clinician and the labor situation? Maybe how do I think about your capacity versus thinking about maybe de novo builds in the future as you start bumping up against capacity constraints potentially?

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Demand’s really, Brian, demand’s really solid pretty much everywhere. There is a little push-pull that we have to manage. Always when we’re trying to get costs under control. You’re trying not to be fat, to use that term, to have too many FTE resources, yet you’re still trying to meet demand. We certainly, it’s not perfect. We have some markets where the market’s still a little tight, where we have additional FTEs we need to hire where the demand is strong and yet we need some more resources. Other places are being dialed in where they need to be. That’s a work in progress. The cash-based programs are helping us to generate additional revenue. That has been kind of a net add for us that we haven’t had before.

I’m trying to remember the second kind of part of your question.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Chris, yeah, just as you think about capital deployment into maybe de novos as you start bumping up against maybe capacity constraints.

Chris, CEO or Senior Executive, US Physical Therapy: On the de novo side, look, we’re going to. We’ve had this market where we’ve had some headwinds and we’ve had to deal with that. This is going to be. Probably the strongest de novo year that we’ve had since I’ve been with the company. De novos are going to be good this year. They’re on a really good pace. We’re making adjustments and have made adjustments on the recruiting side of the house, on the residency side, which get more students into our programs. We think we’ll be able to continue to ramp into the demand, which we just have to keep dialed in right now. I don’t see it impacting our de novo openings. Frankly, in markets like New York, where net rate is considerably higher than most of our competition, particularly our small competition.

We’re able to do these small Aqua Novos, which frankly, we don’t even announce. We’re able to do those at very, very nice multiples and get a nice rate lift as a result. A lot more resources to help them grow and scale. That is going to continue to be strong as well.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Chris, to follow up on that, I mean, as we think about capital deployment, obviously, the announcement of the dividend is positive. Just curious how you and the board thought about that decision to introduce a dividend just when it sounds like this is going to be one of your best de novo years, maybe just thinking about the balance sheet, the cash generation, and then just the decision to do the buyback.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. You mentioned dividend. The dividend’s ongoing. We’ve been paying the dividend for a long time.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Yeah, sorry. Sorry. I meant the buyback.

Chris, CEO or Senior Executive, US Physical Therapy: The buyback is new. Look, we feel like the stock’s been undervalued for some time. We understand healthcare services having a little bit of a tough year. We’ve had some Medicare headwinds. Yet we’re making progress and continuing to grow the company. We wanted to be in a position to have flexibility at a certain level where we could go in and demonstrate our belief that we’re going to continue to grow this company and do well over time. It gives us flexibility. As Carey mentioned, it’s not our first preference for capital deployment. I would say our first preference right now, frankly, is directed toward injury prevention, where the embedded organic elements of that business are really, really strong. The next would be PT and then on from there. We’ll be disciplined about any share buyback. It’s going to be dependent upon.

Other capital demands and really where the stock is at any given time.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Got it. Chris, if I may throw one more question. As I think about just the efficiency of your physical therapists, I mean, we hear about AI tools in the market. Aimed at physical therapists. I mean, is that something that you’re throwing in the mix that’s helping you out? Maybe kind of related tangentially, you talked about your home PT business. Just if anything is out there that you can share with us in terms of the dynamics there, because obviously, it’s new to us investors. On what that business looks like. Thank you.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. There are some cool AI tools right now. We’re deploying AI-backed technologies for clinical documentation, which is helping people get through their least favorite thing of the day if you’re a clinician, which is to document all the cool stuff that you did with somebody. In physical therapy, you have to document a lot of things, sets and reps and weights and motions and joint-related movements. It is tedious. It takes time. This ambient listening, AI-driven assist is helping our clinicians get through that much quicker, much more efficiently. We’re just on the front end of rolling that out, but that’s been well received. We’re rolling out what I would call broadly a semi-virtualization of the front desk, which enables us not to go completely virtual because I don’t think we’re ready for that yet. Nor do I think patients are ready.

An augmented situation where we’re able to focus efforts from across multiple clinics through one individual that may be on-site or remote somewhere and be much, much more efficient and save the number of front desk FTEs, which continue to be a labor challenge for us just in terms of longevity. Unlike our PT group, which frankly, right now, we’re having the best, least amount of turnover that we’ve seen in maybe my recollection. We’re really good right now. These tools are helping us get some margin and efficiencies in areas where we just haven’t been able to do that in the past. We’re early, but it’s directionally encouraging.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Thank you.

Chris, CEO or Senior Executive, US Physical Therapy: Thanks, Brian.

Conference Operator, Call Moderator: Thank you. Our next question will come from Joanna Gajuk with Bank of America. Your line is open.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Hi. Good morning. We’re taking the questions. Hi. Let me first on the metric that really stood out besides the visit to a clinic, but the cost per visit, right, a decline to all costs, right? Maybe in that context, can you walk us through or give us some update on your labor management strategies, the wage, maybe talk about turnover and other, I guess, metrics you can share? Because it sounds like you’re doing a pretty good job there.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Eric, you want to go ahead and take that, talk about turnover and some of the things we’re working on and what we’re seeing?

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Yeah. This is, again, you recall from our quarterly conversations here, we made a lot of investments in systems and resources in 2024 that are really starting to pay dividends for us in 2025 as it relates to recruiting and retention. We’ve seen a 25% increase in student clinical rotations across our partnerships in 2025. Part of that was participating in a student rotation matching program with software, the exact software that’s being used by all of the PT schools out there. We’ve seen almost a 200-student pickup this year. We put in a new applicant tracking system in 2024 that’s also given us better company-wide visibility across our partnerships to all the applicants who are applying for jobs. It gives us better opportunity to follow up with these applicants, track them pre-hire or post-hire.

For the ones, of course, that do not take jobs with us, we have this huge database that we are building of people that we can go back to when we do have job openings. Systems have made a big difference, putting in some additional resources to help us on the recruiting front made a big difference for us. The mentorship piece has been a major focus for us. We really push that hard with our partners to make sure that we are connecting and spending time with the younger therapists that we bring on board in order to reduce turnover rates. As Chris mentioned, these are the lowest turnover rates we have seen for the six months this year, January through June, the lowest numbers we have seen in the last seven years. It is absolutely making an impact for us.

The pieces that we’re really excited about, and Chris referenced one of them, I’ll touch base on that in a second, this mentorship piece, while we’re really focusing it on a partnership level, which is where our clinical staff goes to work, we’re in the process of building out a platform here, a software platform that’s going to allow us to expand our mentorship programs beyond the four walls of the clinic and beyond the existing partnership. It’s going to give us the ability to connect 2,600 clinicians across our company with each other so that people that have particular interests or specialties have an opportunity to connect with people that might not have that specialty within the partnership but have that expertise. We can take advantage of that across our entire company. We’re excited about that.

We think that will pay dividends for us as well as it relates to our ability to retain staff. Those are the big ones, Chris. You mentioned AI. I’ll talk about that as well. We are in the early innings of using that voice recognition technology that Chris talked about. I think we have that in the hands of 200 or 250 PTs right now. It’s been really, really well received. I think that is going to have an impact for us over time with retention as well. I mean, if you can reduce documentation, it’s the things that clinicians hate to do the most. Right now, there’s a lot of people dabbling in it. I think we’re farther ahead than most. I think we’re farther ahead than most large platforms experimenting with that right now.

I think that is going to help us attract and retain staff going forward. All that gives us some.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): For turnover, are you willing?

Chris, CEO or Senior Executive, US Physical Therapy: Go ahead.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Go ahead.

Chris, CEO or Senior Executive, US Physical Therapy: I’m sorry.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Are you willing to share the turnover number that you track?

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: We will report that publicly at the end of the year. You’ll find that in our ESG.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Joanna, I don’t want to be in a position quarter to quarter to add to our already exhaustive list of metrics. But we’re in a good spot right now. We’re in a really good spot.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Yeah. Sounds like it. No, thank you. If I may, another topic. Medicare rates, right, been a headline for a couple of years now, but it sounds like 2026 is going to be a better rate update. The overall physician fee schedule is going up like 2.5% or more, 3.6%, 3.8%. I think we had estimated like 2.5% or so for physical therapy codes. Can you talk about your estimate for your company in terms of how the rate increase would translate for your portfolio into next year? Thank you.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Let me make the quick comment, and then I’m going to kick it to Carey and help get you through the specifics. This year, and this is proposed rules, so there’s going to be a lot of commentary and certainly a lot from the PT industry. This year was the most complicated of any year that I can remember literally in my career. They changed a lot of. Think about turning. Kind of metaphorically, turning knobs. They turned a lot of different knobs. For our views, for work values, for. Geographic index factors. And there were particularly large swings on the geography side, so much that both us and the APTA thought that some of the tables weren’t correct. And so, our overall assessment is. Carey can get into. But the takeaway is it’s positive. It’s no longer. A headwind.

We haven’t had any kind of a tailwind in a while. We’re happy that it’s forward. We think there’s more work to be done, obviously, with CMS. Carey, why don’t you go through the specifics?

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Yeah. Thank you. So, Joanna, we’ve looked at it looking at the various geographies and what the changes were in those geographies. As Chris mentioned, that varies a lot. Based on where we are and the rate increases in those geographies, I think we’re probably going to be somewhere between 1% and a 1.75% increase, something like that. For us, again, positive. We’re happy to have a positive increase and not be looking at negative numbers for next year. We’re really pleased about that. That 1%. If it’s in that 1-1.75% range, that would be somewhere between $2 million and $3 million of a positive force next year on the top line. From an EBITDA standpoint, it would translate to somewhere between $1.5 million and $2.5 million. In that range is kind of what we’re looking at at this point.

Again, this is a preliminary ruling. We’ll know the final ruling in December, and we’ll see if anything changes. That’s kind of where we see it today.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): All right. This is very helpful. Thank you. I guess, you made it sound like there’s going to be pushback on that level. Is it your expectation maybe the final is a little bit better than proposal, or I guess too early to say?

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Yeah. We certainly hope that it will be. The irony is, unfortunately, if you get under the hood and see how the sausage is made, is that the specialties that have the most extraordinary increases in the cost of equipment, so very expensive equipment. And have the most highly litigated areas where there’s exposure to litigation and other things, which you just heard, the number of patients that love us on a percentage basis. So, physical therapy in general doesn’t have that problem. We’re making a decided push. Where we know that we saved the system a lot of money. In fact, in the state of Maryland, where physical therapy on a pilot program of CMS is in the position as kind of a primary care from musculoskeletal, they determine the physical therapist too what happens in the case. There’s a massive aggregate savings.

We’re hoping to use those results with CMS to extend that pilot beyond the state of Maryland, which could be a big pay for. A reasonable, rational annual cost of living increase for the fee schedule. We think we should be front and center in that. Yes, we’re pushing. We hope it gets better. We think there’s some flaws in the existing methodology, and we’re going to be working on that between now and year.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Great. Appreciate the call. Thank you so much.

Chris, CEO or Senior Executive, US Physical Therapy: Thanks, Joanne.

Conference Operator, Call Moderator: Thank you. Our next question will come from Benjamin Rossi with JP Morgan. Your line is open.

Speaker 4: Hi. Good morning. Thanks for taking my question here.

Chris, CEO or Senior Executive, US Physical Therapy: Morning, Brian.

Speaker 4: Turning to the IP segment performance, you mentioned adding some services here over the course of the year. Certainly seems to be off to a strong start through the first half with margins expanding year over year. Is it fair to say that that segment’s coming in ahead of your initial expectations of a $3 million absolute increase in gross profit, particularly as we head into the seasonally stronger 3Q?

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. I don’t have in front of me exactly what our budget was, but we’re definitely ahead of budget for the year. Q. Second half is. There’s a little different seasonal pattern with injury prevention. We tend to be pretty strong through the year, a little light in January like everywhere else, and a little light in December, where in some of the big auto manufacturers and some of the nation’s biggest manufacturers, there’s an early shutdown in December. That blunts our earnings a little bit. If you go back, not just this first half or this quarter, but on a year-over-year-over-year basis, injury prevention’s really done well for us and had really strong organic growth attributed to it. We continue to be bullish. We’re spending more time in development in that area. We’re identifying good companies.

Of course, like anything else, we’ve got to get things done. We expect to continue to deploy capital directionally there.

Speaker 4: Got it. I guess this is a follow-up to your comments on Medicare PFS rates. Obviously, it seems like the change for 2026 is kind of a mountain to more of like a one-time fix. It does not necessarily address anything in 2027 and does not obviously dig you out of that $25 million hole you described after decreases in recent years. Can you just walk us through where your conversations stand with your counterparts at the federal level and maybe how they are framing the decision to include that one-time fix for 2026 in the OBBBA?

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. I think it depends on who you talk to. Nobody in Congress is happy that this is an annual issue. This is not the only annual issue that the government faces these days. It seems like that’s how we fund the government each year is through this crisis management process that eventually ultimately gets done with a lot of chicken on both sides. It’s not the optimal way to do anything. It’s certainly not fair to providers to have a one-month runway, basically where you’re notified in December what the final decision is, and then you have until all of January through the holiday to get things ready to go. We should have a multi-year plan. It should be locked. All of the lawmakers believe that’s the way it should be. And yet.

Let’s call it a 10-year kind of permanent fix on the physician fee schedule, about a $100 billion event. They need savings to be able to do that. One of the big areas that we think is a saver, and we’re through APTQI, the Alliance for Physical Therapy Quality and Innovation, a group that I’m heavily involved in, and with all the other big companies in PT. We’re going to have a pretty significant spend this year to use an outside Beltway analytics group to take the results that we’ve seen from the equipped study in Maryland and extrapolate those real results, not theoretical but actual, over the nation and create what we think is a massive savings for the system with physical therapists in that key role as kind of the primary care director of the musculoskeletal case.

That’s a possible pay for a physician fee schedule fix. It’s gotten a lot of very positive attention among our lawmakers, our Congress, on both sides. CMS, I would tell you, is kind of a difficult place to be because it’s so siloed. People have one infinitesimally small fraction of what amounts to a very complicated series of areas and rules and responsibilities. It’s a little bit different to get a clear picture there, a little bit difficult. With Congress, as long as we can come up with some savings that we can get out of this deficit spending that we’re in, maybe hear about tariffs and all the revenue that’s creating, we’ll see. We need more than a one-year fix for sure. We have the AMA and the hospital association and everybody else wants more than a year-to-year fix.

It’s unsustainable.

Speaker 4: Great. Thanks for the additional commentary here.

Conference Operator, Call Moderator: Thank you. Our next question will come from Larry Solow with CJS Securities. Your line is open.

Chris, CEO or Senior Executive, US Physical Therapy: Good morning, guys. Thanks for taking the question. Most of my questions have been actually answered. Just a couple. I’m just curious. So, the 7% or nearly 7% year-over-year increase in just visits per day per clinic, and also the very modest growth in labor. And then less contractual overall operating expenses per visit. How much of that just relates to the close? You had an acceleration in closures last year. I know you closed like 30 clinics back in Q3, I think. It feels like a lot of that just more efficiencies driving these gains. Is that fair to say? The second part of the question is, I know you had set out. You discussed last year some cost-cutting initiatives. You never really put a number on it, but you sort of thought you could add up to maybe even double-digit millions over the time.

I’m curious how that has played into the good performance this quarter. Yeah. It’s like baking a cake. There’s a lot of ingredients that go together, and at the end of the day, you hope it tastes good. I don’t have in front of me the relative pieces, parts of every one of those ingredients. In fact, some blend together, so it’s a little bit hard to measure. Cost efficiencies, on one hand, create some both challenges and opportunities sometimes in terms of volume-related aspects. We’re trying to do the best we can to balance technology, efficiency, appropriate levels of labor, which minute to minute are never perfect, perceived demand, expansion. It’s pretty complicated. It’s running a business, and there are a lot of moving parts. All those things are coming together. What you’re hearing is.

We’re feeling more confident that the things that we’ve done, which again, as you point out, are multifaceted, are coming together in the right way. As I pointed out earlier, it’s not perfect. We still have plenty to work on. There’s still plenty of opportunity being focused on it. Where we are feels a little better than where we’ve been for maybe a while now.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Right. In terms of.

Speaker 4: Yeah, please.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: I was just going to say, the factor in the visits per day growth is the addition of Metro in November. It has been higher since that point in time. We were probably running at about 31 before, and then that has kicked up a little bit because they average about 45 visits per clinic per day there at Metro. That does move a little bit, but there is still really good growth in that overall visits per clinic per day.

Chris, CEO or Senior Executive, US Physical Therapy: Good. That is a good segue then, Carey, into Metro because I know that was, I think, your biggest acquisition historically. Curious, it sounds like that is progressing really well. I know when you acquired at the time of the acquisition, you spoke about a lot of opportunities. I guess these Aqua Novo openings, sounds like that is happening at Metro. I assume since New York has one of the better rates, that probably benefits you guys disproportionately too. Yeah. We have a strong team there. Michael and his team are strong. They are very strong. Clinically, they are strong operators. They are strong in development. Yeah, we have plenty of opportunities to chew on and work our way through for what should be a long period of time. Aqua Novo is just one of those. They are doing well.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Did you, Larry? One of the things that’s been really positive there, and we’ve talked about this before, is the net rate increase we’ve seen at Metro since we acquired them. That’s one of the things that we do with acquisitions. We look at trying to increase their contracts as we bring them over. When we first, the first month for Metro was around $101 net rate. That increased, it was like averaged $104.50 in the first quarter. It was $107.50 in the second quarter. We’ve really seen some nice rate improvement there. That doesn’t show up in the mature clinics line. Instead, it shows up in the clinic additions line. I just wanted to point out that we’re seeing really good net rate increases there at Metro. That’s helpful as well.

Chris, CEO or Senior Executive, US Physical Therapy: Can you just walk through just the pricing breakout in the quarter? I guess, did you discuss that? Usually, you give us kind of what commercial pricing was in the quarter. I know I heard you discuss the workers’ comp piece. Did you give any more detail on the commercial side?

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Sure. I’m sure happy to look at that. It was $105.33 overall. Commercial rates were about, around $105.50. That was a nice increase in commercial rates. Medicare’s a little north of $92. Workers’ comp was still a little bit north of $150 per visit, which is really good. Those are the three primary categories. The others were relatively stable as well: Medicaid, personal injury, self-pay.

Chris, CEO or Senior Executive, US Physical Therapy: Great. Okay. Appreciate it. Thank you, guys. Thanks a lot.

Conference Operator, Call Moderator: Thank you. Our next question will come from Jared Haas with William Blair. Your line is open.

Eric Williams, President and Chief Operating Officer in the East, US Physical Therapy: Hey. Good morning. Thanks for taking all the questions. Chris, maybe for you, I wanted to ask another one on the IIP segment. And nice to see the continued momentum there. I think you mentioned a number of larger opportunities that haven’t started yet. I’m wondering if there’s any way that you can contextualize, I guess, what that backlog looks like or any way to frame up what the incremental revenue opportunity is and how that might compare to prior years.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. I do not have it. Jared, I do not have it in front of me. My preference, and maybe I need to be a little bit careful, my preference is to not constitute revenue ahead of when we have generated it, either in development or otherwise. We are definitely making progress. We are having a good year. I am not prepared to get into. The reason is, frankly, it is all about staffing. The team’s done a fantastic job, both with the auto industry major contract that we got where we needed to hire 50 FTEs to staff that opportunity. If we had not hired 50, if we had only hired 20 or 30, the revenue generation compared to the potential would have been different. I really cannot afford to be that far out on a limb and do not want to be. We are not going to do that.

As that comes about and we’re realizing it, I’m happy to talk more about it once it actually happens.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Yeah. That’s fair. Totally makes sense. Maybe I’ll ask a follow-up. I think you all have made some public comments in the past about some of the virtual PT applications that are out there. I think recently, one of the larger ones announced they’re building out sort of a network of in-person providers as a way to kind of supplement their digital offering. I’m wondering if you have any more that you can say about that. Would you consider participating in a virtual network like that, or, excuse me, in a network like that with a virtual partner? How are you thinking about maybe the potential opportunity in terms of, call it, patient acquisition or opening up a new referral channel?

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Again, I don’t want to speculate too much in hypothetical situations. Have we had discussions with one or more providers about providing a brick-and-mortar opportunity in person to add to a virtual offering? Yes. It remains to be seen whether that’s something that the industry is accepting of or not. I say that because a lot of the virtual providers have sold, I’m going to use air quotes, the PT service at a very low cost, kind of a per member pricing level, very generic, not delivered by therapists. It’s delivered either through an app or backed up by call center employees who, again, for the most part, aren’t licensed clinical folks. They follow a script. What’s been sold is that they can take all comers and any diagnosis and very complicated things, post-op reconstructions and rotator cuff repairs. And frankly.

I’ll tell you my opinion is that can’t be done efficiently or effectively. I think they are in a tough spot where they have to figure out whether there’s a bricks-and-mortar solution. Reciprocally, we are now using technology through companies like Limber, who’s been a nice partner for us. That has an augmented solution that we use with our patients to be able to go into their home and see them complete their home program and actually see objective measures of motion and activity and other things which help us be better informed to guide that care. There will be a point in time, and we’re not there yet because we’re working on some really important things. There’ll be a time when we focus more on a broader digital solution that I think will help to augment what we do for our patients and, in some cases.

Make us a little bit more geographically agnostic where somebody is. We’re going to approach it very differently than the groups that have done it so far. I think they’ve tried to do too much, and I think they’re finding out it’s not possible to deliver it that way.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Okay. That’s great. Thank you. I appreciate all the color.

Chris, CEO or Senior Executive, US Physical Therapy: Thank you.

Conference Operator, Call Moderator: Thank you. Our next question will come from Jeton Sanghai with Quarry Partners. Your line is open.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Hey, guys. Congrats on a great quarter. I appreciate the questions and answers here. Maybe two for me. One is, is there a theoretical capacity we should think about? Because clearly, the volume growth, the record Q2 is great. Is the system operating at 90% or some X percent? I ask the question because incremental visits are very, very accretive to margins. Related point, if you think about the de novos, what is the staffing environment like? How will you attract the number of FTEs? I think, Chris, you mentioned maybe a record year for opening de novos. I think they both relate to what’s available in the system, but then how will you recruit X number? I do not know if it’s 50, 100 of FTEs. Finding them is hard, but the question is not just finding them.

It’s what you pay them and how the economics work. I think there’s two parts to it. If you could address both, that would be super helpful. Thank you.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. On the capacity side, think of it this way. Our capacity really isn’t limited, generally speaking, by physical footprint. The typical clinic may be open from 7:00 A.M. to 6:00 P.M., but we have the ability in that same physical footprint, which has more peak times and also has slower times. We have the ability to fill in certainly some of the slower times. We have the ability to extend hours and do other things. Our visit per clinic per day number can continue to grow. It’s not constrained by our physical footprint. It may be limited, or it correlates with our staffing. We have to have the staff available, as you mentioned, to be able to see the next 5 or 10 visits per day. There really is the possibility ultimately of.

Getting that number up much higher than it is right now. It won’t happen overnight, but a little bit over time, as we’ve shown. Over the last couple of decades, we’ve increased that number really ex-COVID every single year. That part, I think, will continue to move forward. As long as we can continue, as you mentioned, to find staff. I would point you back to Eric’s comments around the investments that we’ve made in recruiting and retention, in school affiliations, residency programs, mentorship, and other things to try to have a stable bench from which to draw from to backfill our more senior therapists. Those are the ones who go and open the next adjacent clinic, not the new grad, but the more senior person.

That more senior person then gets backed up maybe by somebody more junior in a clinic with a lot of people with tenure so they can grow and learn. It is easier to absorb that way. Again, it is not perfect. The market is competitive, and in some cases, it is tight. We are finding people, and we are growing, and we expect to continue to be able to do that, particularly with the investments that we have made over the last six to nine months.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Chris, that’s super helpful because what it sounds like is there’s no theoretical capacity. Is the way we’re thinking about it as equity holders the right lens, which is incremental visits are extremely margin accretive? Whatever your margin guide suggests for this year, using your updated EBITDA range, as we think about next year or beyond, there should be some flow-through or increase in EBITDA. Your sort of margin should expand over time as you have incremental volumes. Is that the right general lens? I don’t know if you can quantify that, or if that’s just a good soundbite to sort of end on from my perspective.

Chris, CEO or Senior Executive, US Physical Therapy: No, I think it’s a reasonable soundbite. There’s certainly points of inflection where when you have to go up, you may go back a little bit before you can go forward again. Generally, you’re right. The last few patients of the day are incrementally more profitable. Your fixed costs are covered. I think that’s one of the reasons why you see our total cost per visit come down a bit this quarter is because of the jump in visits per clinic per day. Hopefully, with particularly continued commercial rate wins, continued wins like we’re seeing with Metro, with five, six, seven dollars a visit in rate growth, with a combination of continued efforts around work comp and other more preferable payers, that combination gives us more than enough to offset what might be a little bit of wage pressure year to year. That wage pressure for us.

I mean, we’re well below right now the average increase that people got at the end of the year. We’re getting that with some efficiencies. I’d point to some of the initiatives around AI and virtualization at the front desk, which are really just now getting started, but should give us some additional lift as we go forward. You have to deliver it. You have to make it happen. I’m hopeful at this point that we can continue to execute on that.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Great. Thank you for your time, guys. Appreciate it.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. Thank you.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Thank you.

Conference Operator, Call Moderator: Thank you. Our next question will come from Michael Potesky with Barrington Research. Your line is open.

Chris, CEO or Senior Executive, US Physical Therapy: Hey, Mike.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Hey. Good morning. Morning.

Chris, CEO or Senior Executive, US Physical Therapy: Morning.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Hey, Terry. Hey, you gave sort of the hard numbers on the rate per visit. But I’m just curious, commercial pricing, was that—I’m assuming that was up a little bit in the quarter. Do you have a percentage that was up versus the comparable period a year ago?

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Sure. I can calculate that real quick. It was up.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): I guess the second—yeah. Go ahead. Sorry.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Sure. It was up about between right about 1-1.5% versus last year’s second quarter. The second quarter of last year is actually the strongest quarter for commercial rates last year. It’s up about 2.2% from the first quarter. We had a nice bump in the second quarter versus the first quarter in that commercial rate.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Okay. The issue in Michigan with the large payer, how much impact did that have on the commercial pricing overall? I mean, did that take down 20 basis points, more than that?

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Yeah. It was. Again, let me calculate just a second. I know how much the impact is. So. It probably had about a $0.30 per visit impact or so. Yeah. So, it would have been—we would have been kind of right at the first quarter number had it not been for that Michigan rule kind of. Payer rule change.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Okay. Okay. Is there anything to suggest that what’s going on in terms of that payer in Michigan could be an issue with other payers elsewhere? Or do you really feel like this is sort of an isolated situation?

Chris, CEO or Senior Executive, US Physical Therapy: Mike, I mean. Each year. I wish it was—I guess I wish it was uniform. Maybe I should not wish that. I mean, we have got 48 or 49 other states where it is not an issue. I do not see a contagion problem necessarily. Michigan has had some ebb and flow with this payer on a number of different fronts. Utilization caps and other things have been challenged and even litigated. It has bounced around a bit. We are always going to have that. People are going to try different things at different points in time. It is really no different. That is one that we have called out this year, which is a little bit of a headwind.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Yeah. Mike, as Chris said, there’s always puts and takes on the net rate. You’ll have things like that. We have other things that are overcoming it in other areas. I don’t see it, as Chris said, as a contagion kind of thing at all.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Okay. Great. That’s what I was trying to get at. Chris, earlier you said that IIP you felt like was a top priority in terms of capital allocation. When you were talking about that, were you sort of talking about it in terms of internal investment, hiring trainers and such? Or were you talking about it more in terms of external assets that you may try to sort of build on the current base of business or both things?

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. It’s always internal. I mean, but that’s really not a problem. I really don’t think about that. Maybe I should. When I talk about capital allocation, that’s just a matter of course. What I’m talking about is investing in additional companies to continue to fill in or service complement to build on what we have to give us more opportunities for cross-sale and to continue to grow as we have the last few years.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Do you feel like there are assets out there?

Chris, CEO or Senior Executive, US Physical Therapy: There are external investments.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Yeah. Do you feel like there are assets out there that you’re engaged with in terms of active discussions? Or is this more like a couple-year, two-year, three-year type target?

Chris, CEO or Senior Executive, US Physical Therapy: It’ll be ongoing, but we’re actively involved. We’ve spent more time this year, I think, probably than ever before, attending conferences and getting face-to-face meetings and being active in the space. People now kind of know who we are. While it’s a much smaller space in aggregate than the PT world, we’re making some progress. Do not be surprised if we’re active and continue to be in that area. It’s important. It works. Team has done and is doing a really good job. We like the embedded growth elements in this business, particularly, I think. Not to make any kind of a political statement, but if manufacturing is going to increase in this country, and I think just with the announcement yesterday on Apple and others, there’s going to be a push to onshore manufacturing. We’re positioned pretty well to benefit from that.

We continue to execute on what we’ve been doing. I think we will.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Absolutely. Hey, let me just sneak one last one in, and then I’ll let the next person ask questions. Chris, you mentioned on the last conference call that you guys had been involved in sort of a deep operational dive with your top 40 partnerships. I’m just wondering, anything interesting, surprising? Has anything come out of that that you sort of would be willing to share that might matter? Thanks.

Chris, CEO or Senior Executive, US Physical Therapy: Yeah. The only thing that I’ll share is that a couple of things. One, those calls have been important, making progress. I think what partners have appreciated, and it was kind of my theory going into this, is when you look back, beginning with COVID and after the year after COVID, we were both lean and busy. It was kind of a good year to benchmark against. I use the analogy, it’s like your weight that may fluctuate. If you use your college days as being kind of this is a great comparative point or maybe a difficult comparative point, as you go forward, it might not change a lot year to year, but the change over time, you kind of lose track of where you were. Pretty soon, your belt doesn’t fit the same way anymore.

You lose kind of where you are in space a little bit. That is one measure. Weight is kind of pretty easy to keep track of. We are measuring a bunch of different things in this business. There have been a lot of influences that have caused certain things to happen. They are just part of the reality. I think having now a really visible, tangible tool that our partners get every month that compares where they are now to where they were at their most efficient point, and how things stack against that, has been kind of a really good yardstick to see change and then to be able to focus on those areas that need focus. We have used that, and we are making progress. I think our partners have been very understanding and appreciative. We are seeing change as a result.

Various Analysts, Analyst, Various (Jefferies, Bank of America, JP Morgan, etc.): Thank you.

Chris, CEO or Senior Executive, US Physical Therapy: Sure.

Conference Operator, Call Moderator: Thank you. It appears we have no further questions at this time. I’ll now turn the program back over to management for any additional or closing remarks.

Chris, CEO or Senior Executive, US Physical Therapy: Look, it’s been a good call. Thank you all for your questions. A lot of really good questions. Carey and I are available for the rest of the day. Whenever you need us, we appreciate your time and attention and particularly your support. I hope you have a great day. Thanks.

Carey Hendrickson, Chief Financial Officer, US Physical Therapy: Great. Thank you.

Conference Operator, Call Moderator: Thank you, ladies and gentlemen. This concludes today’s event. You may now.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.