10-Q · May 5, 2026
DaVita Inc. reported strong Q1 2026 results with revenues of $3.416 billion and EPS of $2.87, both exceeding analyst expectations. The company also improved its guidance for adjusted operating income, indicating…
Earnings analysis · 10-Q
DVA earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
DaVita delivered a strong Q2, with revenue of $3.554 billion rising 4.0% sequentially and operating income increasing 20.1% to $579 million, producing a 16.3% operating margin. U.S. dialysis volume and lower…
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DaVita delivered a strong Q2, with revenue of $3.554 billion rising 4.0% sequentially and operating income increasing 20.1% to $579 million, producing a 16.3% operating margin. U.S. dialysis volume and lower per-treatment care costs supported results, while IKC swung to $40 million of operating income. First-half free cash flow rose to $396 million, but commercial-mix pressure reduced revenue per treatment sequentially and receivables, borrowing, and debt expense increased. Gross margin was not disclosed in the filing; free cash flow of $396 million is for the six months ended June 30, 2026.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $4.02
- Operating margin
- 16.3%
What stood out
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Revenue accelerated sequentially
Q2 revenue was $3.554 billion, up $138 million (4.0%) from $3.416 billion in Q1 2026. First-half revenue increased $367 million (5.6%) year over year to $6.970 billion.
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Operating leverage drove EPS beat
Operating income rose $97 million (20.1%) sequentially to $579 million, equating to a 16.3% operating margin versus 14.1% in Q1 2026. Diluted EPS was $4.02, above the $3.88 consensus estimate.
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Volume and productivity improved
U.S. dialysis treatments increased 197,075 (2.8%) sequentially to 7,226,600, while patient-care cost per treatment fell $2.71 (1.0%) to $277.40.
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IKC delivered a material profit swing
Ancillary-services operating income increased to $57 million from $6 million sequentially, led by U.S. IKC income of $40 million versus a $19 million loss, principally from higher shared savings.
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Cash conversion strengthened
First-half operating cash flow increased $307 million (60.9%) year over year to $811 million and free cash flow increased $284 million to $396 million. Maintenance plus development capex was $272 million, or 33.5% of operating cash flow.
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Substantial repurchase capacity remains
The company repurchased 2.238 million shares for the quarter at an average $154.95 per share; approximately $1.373 billion remained authorized as of July 31, 2026.
What to watch
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Commercial mix pressures revenue per treatment
U.S. dialysis revenue per treatment declined $1.72 (0.4%) sequentially to $415.87, with management attributing the decline primarily to payor-mix changes. Management says expiration of enhanced premium tax credits adversely affected ACA-exchange enrollment and commercial mix.
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Receivables and DSO increased
U.S. dialysis accounts receivable increased $109 million to $1.719 billion since December 31, 2025, and DSO rose to 52 days from 49 days, primarily due to collection timing.
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Incremental borrowing raises financing exposure
Debt expense rose $5 million (3.4%) sequentially to $150 million after increased revolver borrowing and incremental Term Loan B-2 activity. The company incurred a $500 million incremental Term Loan B-2 tranche and had $65 million drawn on its $1.5 billion revolver at June 30.
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Some ancillary businesses remain volatile
International operating income declined $5 million (16.7%) sequentially to $25 million, primarily due to a loss on divested centers; U.S. other ancillary loss widened to $8 million from $6 million.
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No formal risk-factor update; reimbursement remains key
Item 1A states there were no material changes to risk factors from the 2025 10-K. Nonetheless, management identifies a proposed 1.1% 2027 Medicare ESRD reimbursement increase, leaving final reimbursement policy and rate execution uncertain.
Management's outlook
The 10-Q does not provide company quantitative EPS or revenue guidance. MD&A notes that CMS's proposed 2027 ESRD rule is estimated to increase freestanding-facility average reimbursement by 1.1%, and management expects productivity efficiencies to continue through 2026.
Earlier filings 4
10-K · February 11, 2026
DaVita emphasizes its position as a leading, vertically integrated kidney care provider: U.S. dialysis represented approximately 86% of consolidated revenues for the year ended December 31, 2025, delivered through a…
10-Q · May 12, 2025
DaVita reported Q1 revenue of $3,223,529,000, up $152,974,000 (≈5.0%) vs. Q1 2024, driven by gains in both U.S. dialysis and Other — ancillary services. Operating income fell to $438,937,000 (13.6% operating margin) and…
10-K · February 13, 2025
DaVita positions itself as a scale leader in kidney care, operating 2,657 U.S. outpatient dialysis centers serving approximately 200,800 U.S. patients and 509 international centers serving approximately 80,300 patients…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.