AdaptHealth (AHCO) Financials

AdaptHealth (NASDAQ: AHCO) shows a mixed but improving operating trend over the last four years, with a clear turnaround in profitability from the weak period in late 2023 and early 2024. Revenue has generally been stable to slightly lower, but the company has recently improved gross margin, swung back to profitability in 2025, and generated solid operating cash flow. At the same time, leverage remains elevated and the balance sheet still carries a large goodwill/intangible asset base, which adds risk.

• Gross profit improved sharply in Q1 2026 to $111.5 million from $172.2 million in Q4 2025, while revenue held at a healthy $819.8 million, suggesting better underlying operating efficiency than the prior quarter.
• AHCO generated $93.7 million in operating cash flow in Q1 2026, showing the business is still producing meaningful cash despite reporting a net loss.
• The company returned to profitability in 2025 after a very weak 2024, including positive net income in Q2 2025 ($15.8 million), Q3 2025 ($25.8 million), and Q4 2025 would have been negative only because of a large impairment charge.
• Q3 2025 was especially strong, with revenue of $820.3 million, operating income of $61.7 million, and net income attributable to common shareholders of $24.5 million.
• The large impairment charge that distorted results in prior periods did not reappear in Q1 2026, which helped keep operating expenses relatively contained.
• Despite heavy capital spending, the company continued to invest in the business, with Q1 2026 capex of $121.2 million and still positive operating cash flow.
• Revenue has mostly moved in a narrow band over the period, generally around the $780 million to $860 million range per quarter, so top-line growth has been limited.
• Share count has been fairly stable, with weighted average diluted shares around 135 million to 137 million, so dilution has not been the main story recently.
• The balance sheet remains asset-heavy, with goodwill of $2.57 billion and other intangibles/operating assets making up a large portion of total assets.
• Q1 2026 ended with a net loss of $14.9 million and negative earnings per share of $0.12, so profitability is not yet consistent.
• Interest-related pressure remains a major issue: Q1 2026 pre-tax loss was $20.1 million after $25.6 million in negative interest and investment income, and cash interest paid was $43.1 million.
• Leverage is still high, with roughly $1.80 billion of long-term debt and $78.3 million of short-term debt at the end of Q1 2026.
• Working capital appears tight, as Q1 2026 accounts payable of $601.4 million was very large relative to cash of just $48.0 million.
• Equity remains constrained by accumulated losses: retained earnings were still negative at $649.0 million in Q1 2026.
• The company’s 2024 results were severely hurt by a massive impairment charge in Q4 2024, and the prior year also included large impairment-related losses, highlighting ongoing risk from asset write-downs.

Bottom line: AdaptHealth looks like a turnaround story that has made real progress on operations and cash flow, but the company still carries a heavy debt load and a history of earnings volatility. For retail investors, the key question is whether AHCO can sustain recent profit improvement while continuing to reduce leverage.