HCA Healthcare’s first quarter results reflected continued momentum in patient volumes and revenue growth, but the market responded negatively due to margin pressure and a slower pace of same-store sales expansion. Management noted that growth was driven by higher inpatient admissions, improved payer mix, and disciplined cost management, with CEO Sam Hazen highlighting progress in “broad-based volume growth, improved payer mix, and better operating margin.” However, CFO Mike Marks acknowledged that operating margin compression and mixed surgical volumes, especially in outpatient procedures, tempered the overall performance.
Is now the time to buy HCA? Find out in our full research report (it’s free).
HCA Healthcare (HCA) Q1 CY2025 Highlights:
- Revenue: $18.32 billion vs analyst estimates of $18.23 billion (5.7% year-on-year growth, 0.5% beat)
- EPS (GAAP): $6.45 vs analyst estimates of $5.78 (11.5% beat)
- Adjusted EBITDA: $3.73 billion vs analyst estimates of $3.52 billion (20.4% margin, 5.9% beat)
- EPS (GAAP) guidance for the full year is $24.95 at the midpoint, roughly in line with what analysts were expecting
- EBITDA guidance for the full year is $14.7 billion at the midpoint, in line with analyst expectations
- Operating Margin: 15.7%, down from 17.1% in the same quarter last year
- Same-Store Sales rose 2.6% year on year (6.2% in the same quarter last year)
- Market Capitalization: $90.82 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions HCA Healthcare’s Q1 Earnings Call
- Ann Hynes (Mizuho Securities) questioned changes in surgical volume assumptions and guidance; CEO Sam Hazen acknowledged outpatient surgical softness but cited broad-based volume growth and reaffirmed full-year guidance.
- Pito Chickering (Deutsche Bank) asked about operating leverage and workforce productivity; Hazen explained that higher volumes and cost discipline enabled margin gains, while turnover improved and contract labor use declined.
- AJ Rice (UBS) sought clarity on drivers behind revenue per admission and payer contract dynamics; CFO Mike Marks pointed to improved payer mix and successful managed care contracting, with favorable access and rates secured through 2026.
- Whit Mayo (Leerink Partners) raised concerns about Medicare Advantage plan behaviors and tariff risks; Marks stated they have seen no material impact from plan denials or policy changes so far, and that most supply costs are covered by fixed contracts in 2025.
- Sarah James (Cantor Fitzgerald) inquired about capital allocation between high- and low-acuity services; Hazen responded that inpatient capacity remains a priority, with ongoing investments in both facility expansion and clinical technology.
Catalysts in Upcoming Quarters
In the coming quarters, our team will closely monitor (1) the pace of patient volume growth and occupancy gains across HCA’s markets, (2) the company’s ability to sustain cost controls amid wage and supply chain pressures, and (3) the impact of evolving federal health policies, supplemental payments, and potential tariffs on reimbursement and profitability. Progress on digital transformation and the scaling of new facilities will also be important indicators of execution.
HCA Healthcare currently trades at $377.50, up from $341.47 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
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