NEW YORK, July 27, 2026, 18:09 EDT — U.S. cash market finished; after-hours trade remains active.
- UHS shares dropped roughly 5% in after-hours trading following a cut to its 2026 profit outlook.
- The midpoint for revenue increased by 0.2%, while the midpoint for adjusted EPS declined by 2.6%.
- Calculated results show that nearly 85% of the quarterly EPS increase was due to a lower number of diluted shares.
Shares of Universal Health Services NYSE:UHS declined around 5% to $151.21 in after-hours trading. The hospital operator lowered its yearly profit outlook due to uncertainty about Medicaid reimbursement. The stock had previously dropped close to 8%.
The decline wiped out nearly all progress made since July 17. Shares of UHS climbed 3.0% over the past week and advanced another 2.3% on Monday, reaching $159.31. The S&P 500 was little changed, ticking up 0.02%.
The shift in guidance clarifies the turnaround. UHS increased its revenue midpoint by 0.2%, but lowered the EBITDA midpoint by 1.9%. The midpoint for adjusted EPS declined 2.6%.
The company now expects adjusted EPS in the range of $22.28 to $23.65, compared with its earlier guidance of $22.64 to $24.52. Projected revenue has been updated to between $18.50 billion and $18.76 billion.
The quarter highlighted the impact of share buybacks. Net income rose by 1.5%, while diluted earnings per share increased 10.1%. Diluted weighted shares were down 7.8%.
| Metric | Q2 2026 | Q2 2025 | Calculated change |
|---|---|---|---|
| Revenue | $4.638 billion | $4.284 billion | up 8.3% |
| Net income attributable to UHS | $358.4 million | $353.2 million | up 1.5% |
| Reported diluted EPS | $5.98 | $5.43 | up 10.1% |
| Diluted weighted shares | 59.9 million | 65.0 million | down 7.8% |
| Adjusted EBITDA margin | 14.6% | 15.0% | down 40 basis points |
With last year’s share count, quarterly EPS would have reached approximately $5.52, about eight cents higher than the prior year on a constant-share basis. Calculations show that the lower share count accounted for nearly 85% of the reported EPS increase.
UHS acquired 1.89 million shares for $320.3 million over the quarter, paying an average price of approximately $169 per share. As of late Monday, the stock quote was nearly 11% lower than that average. At June 30, $977.6 million remained available for repurchase authorization.
Demand remained strong. Adjusted admissions for acute care climbed 2.9%, and behavioral admissions edged up 0.5%. Revenue per adjusted admission in behavioral services rose 7.1%.
Adjusted EBITDA increased by 5.4% to $677.9 million, while its margin slipped to 14.6% from 15.0%. Revenue advanced 8.3% to $4.64 billion.
The quarter slightly surpassed Wall Street expectations. Adjusted earnings per share reached $5.98, edging above the LSEG consensus of $5.96. Revenue also came in ahead of the $4.58 billion projection.
The results showed a net pretax gain of $72 million. This reflected a $100 million advantage from Florida Medicaid that offset a $28 million rise in liability reserves. UHS has not projected any additional benefit from Florida past September 2025.
The difference in valuations is still significant. UHS ended Monday trading at 6.7 times its trailing earnings. HCA Healthcare NYSE:HCA was at 13.4 times, and Tenet Healthcare NYSE:THC was at 12.7 times.
Cash conversion declined. Operating cash flow for the first half dropped 7% to $845 million. Capital expenditure guidance stays unchanged at $950 million to $1.1 billion.
Management meets with investors at 9 a.m. EDT Tuesday. Discussion topics will likely include Florida reimbursement, margins, and the speed of the share buyback. UHS projects its takeover of Talkspace (NASDAQ:TALK) will be finalized in the third quarter.
Risks: Securing CMS approval may postpone supplemental Medicaid payments. Liability reserves face the potential of another increase, and significant capital expenditures restrict operational flexibility. The acquisition of Talkspace introduces additional financing and integration uncertainties.
Volume increased during the quarter, but the updated outlook indicates a smaller share of that revenue could flow through to earnings.
