What DaVita (DVA) Said on Its Q3 Earnings Call

Key Points

• DaVita reported solid Q3 results, including $561 million in adjusted operating income, $3.82 in adjusted EPS and $276 million in free cash flow. The company narrowed its 2026 outlook to $2.175 billion–$2.25 billion in adjusted operating income and $14.30–$15.20 in adjusted EPS.
• U.S. dialysis volume increased 1.2% year over year, but higher labor, medical supply and technology costs pressured results. Technology spending rose more than 20%, although management expects its growth rate to slow.
• Integrated Kidney Care exceeded expectations, with 2026 adjusted operating income now expected to reach at least $65 million. DaVita also began rolling out expanded hemodialysis dialyzers nationally, with potential mortality and volume benefits expected to emerge from 2028 onward.

DaVita NYSE: DVA reported third-quarter adjusted operating income of $561 million, adjusted earnings per share of $3.82 and free cash flow of $276 million, while narrowing its full-year 2026 outlook. The kidney-care provider said its Integrated Kidney Care business outperformed expectations, though higher technology spending continued to weigh on U.S. dialysis results.

Chief Executive Officer Javier Rodriguez said the company’s investments in clinical programs, technology and new dialysis treatments were intended to improve patient outcomes while supporting longer-term volume growth. “Our maturing Integrated Kidney Care business is a prime example, as it continues to deliver clinical performance for our patients while starting to demonstrate its economic potential,” Rodriguez said.

U.S. Dialysis Volume and Cost Trends

U.S. dialysis treatment volume rose 1.2% from the third quarter of 2025, while treatments per normalized day increased about 65 basis points year over year. Chief Financial Officer Joel Ackerman said higher patient census, driven primarily by improving mortality, supported the growth. However, an uptick in missed treatments limited the quarterly benefit.

The company expects an approximately 1% headwind to treatment volume in the fourth quarter from year-over-year day mix. Ackerman said DaVita’s fourth-quarter assumptions include missed-treatment trends returning to a more normal pattern and continued benefits from census growth.

Revenue per treatment increased approximately 1.1% from a year earlier and was roughly flat sequentially. Normal rate increases were partly offset by lower commercial mix and lower phosphate-binder reimbursement. Management said the impact from the expiration of enhanced Affordable Care Act premium tax credits remained in line with expectations and that it continues to anticipate a $40 million year-over-year headwind in 2026.

Patient-care costs per treatment increased 2.4% year over year. While phosphate-binder expenses declined, labor costs rose, and medical supply and professional liability costs were higher than expected. Ackerman said those latter expenses are expected to return to more typical levels over time.

U.S. dialysis general and administrative costs, excluding non-GAAP-adjusted cyber expenses in the prior-year period, rose less than 2%. Technology spending, however, grew more than 20% year over year during the quarter. Rodriguez said DaVita has invested more than $1 billion over recent years to modernize its technology platform, with benefits in areas including mortality, revenue operations, labor productivity, care management and pharmacy costs. The company expects technology investment growth to decelerate, though Ackerman said spending itself is not expected to decline in 2027.

Expanded HD Dialyzer Rollout

DaVita said it will begin a national rollout of expanded hemodialysis dialyzers in the following week and expects to transition the vast majority of eligible patients during November. The new dialyzers are compatible with the company’s existing dialysis machines.

The company completed pilot programs at 150 centers involving more than 10,000 patients. Rodriguez said roughly 75% of DaVita’s total patient census is clinically eligible for the therapy, excluding home and acute-care dialysis patients, pediatric patients and patients with acute kidney injury. More than 90% of eligible patients in the pilot adopted the treatment, according to the company.

DaVita said more than 95% of its clinical teammates nationally have been trained on expanded HD. Management does not expect the rollout to have a material net impact on adjusted operating income in 2026 or 2027. It expects the benefit of lower mortality and higher treatment volume growth to begin in the second half of 2028 and increase over time, supporting its goal of returning to volume growth of 2% or more by 2029.

Rodriguez also highlighted fluid-management initiatives, which he said have helped drive mortality improvement. The company reported a 10% improvement in treatments achieving optimal fluid removal, a 5% improvement in patients’ management of weight gain between treatments, and nearly a 5-pound reduction in the average patient’s weight.

Integrated Kidney Care Outperforms Plan

DaVita raised its outlook for Integrated Kidney Care, or IKC, and now expects the business to generate at least $65 million in adjusted operating income in 2026. That represents a $45 million improvement from 2025 and at least a $25 million increase from the company’s previous guidance.

Ackerman attributed the outperformance largely to a higher shared-savings rate in the Medicare fee-for-service Comprehensive Kidney Care Contracting program and in value-based contracts with Medicare Advantage insurers. Higher physician payouts tied to shared savings and the launch of a chronic kidney disease program with Humana partly offset those gains.

Rodriguez said DaVita is seeking additional growth opportunities for the business as its clinical, actuarial and technology capabilities mature. The recently announced Humana partnership is expected to expand upstream care to approximately 10,000 chronic kidney disease patients.

Guidance, International Results and Policy Updates

DaVita narrowed its full-year 2026 adjusted operating income guidance to $2.175 billion to $2.25 billion and its adjusted EPS outlook to $14.30 to $15.20. The company maintained its free-cash-flow forecast of $1 billion to $1.25 billion.

International adjusted operating income totaled $46 million in the third quarter, up $20 million from a year earlier, primarily due to growth and improved performance in Latin America. The company continues to expect approximately $135 million of international adjusted operating income for the full year.

DaVita repurchased approximately 600,000 shares during the third quarter and another 500,000 shares after quarter-end, including shares from Berkshire Hathaway. Its leverage ratio was 3.38 times consolidated EBITDA at the end of September, roughly unchanged from the preceding quarter.

On policy, management said the Centers for Medicare & Medicaid Services’ final ESRD rule permanently incorporates phosphate binders into the dialysis payment bundle. Ackerman estimated the net full-year 2027 impact to DaVita at approximately 1.5% to 2%, noting that the headline 3.5% increase for large dialysis organizations applies to the first quarter and will be subject to quarterly adjustments thereafter.

Rodriguez said DaVita supports goals in the Department of Health and Human Services’ Kidney Care National Plan, including earlier intervention, disease prevention, transplant access and innovation. He also said the company expects to work with policymakers as the plan’s provisions are developed.

About DaVita (NYSE:DVA)

DaVita Inc NYSE: DVA is a health care services company focused on kidney care. Through its DaVita Kidney Care business, the company provides outpatient dialysis treatments for people with chronic kidney failure, including in-center hemodialysis, home dialysis and related clinical support services.

DaVita also offers integrated kidney care programs intended to support patients across the stages of chronic kidney disease. Its services may include care coordination, disease management, education, transplant support and other services designed to improve clinical outcomes and help manage the needs of patients with complex kidney conditions.

The company operates a network of dialysis centers and related facilities in the United States and serves patients in select international markets.

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