Encompass Health Corporation reported third‑quarter 2025 results with net operating revenue of $1,477.5 million, up 9.4% from $1,351.0 million a year earlier. Revenue was slightly below consensus estimates of $1,480.39 million. Diluted earnings per share were $1.24 and adjusted earnings per share were $1.23, both beating analyst expectations of $1.19.
The company opened three new inpatient rehabilitation hospitals during the quarter: a 40‑bed facility in Danbury, Connecticut; a 50‑bed hospital in Daytona Beach, Florida; and a 50‑bed hospital in Wildwood, Florida (The Villages). It also added 39 beds to existing hospitals, with the inpatient rehabilitation segment accounting for the majority of revenue.
Encompass Health raised its full‑year 2025 guidance to a net operating revenue range of $5,905 million to $5,955 million, adjusted EBITDA of $1,235 million to $1,255 million, and adjusted earnings per share of $5.22 to $5.37. The guidance lift reflects confidence in sustained demand and the impact of its expansion strategy, including prefabricated construction and strategic joint ventures.
Adjusted free cash flow fell 8.2% to $174.2 million from $189.7 million in Q3 2024, largely due to capital expenditures on new facilities. Management noted rising labor costs and reimbursement rate pressures as potential headwinds.
Encompass Health remains the largest owner and operator of inpatient rehabilitation hospitals in the United
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