Select Medical Holdings Reports Strong 2025 Financial Results, Announces 2026 Outlook, Dividend, and Stock Repurchase Program

Overview and Key Financial Results

Select Medical Holdings Corporation (NYSE: SEM), one of the largest operators of critical illness recovery hospitals, rehabilitation hospitals, and outpatient rehabilitation clinics in the U.S., released its financial results for the fourth quarter and full year ended December 31, 2025, along with its 2026 business outlook and significant corporate actions. The company also provided updates on its dividend and share repurchase program.

Q4 2025 Revenue: \$1,396.6 million, up 6.4% from \$1,312.6 million in Q4 2024.
Q4 2025 Income from Continuing Operations (Net): \$37.7 million, up 461.0% compared to a loss of \$10.5 million in Q4 2024.
Full Year 2025 Revenue: \$5,452.8 million, up 5.1% from \$5,187.1 million in 2024.
Full Year 2025 Income from Continuing Operations (Net): \$214.5 million, up 65.0% from \$130.0 million in 2024.
Q4 2025 Adjusted EBITDA: \$104.7 million, down from \$116.0 million in Q4 2024.
Full Year 2025 Adjusted EBITDA: \$493.2 million, down from \$510.4 million in 2024.
Q4 2025 Earnings Per Share (EPS) from Continuing Operations: \$0.16 vs. (\$0.19) in Q4 2024.
Full Year 2025 EPS from Continuing Operations: \$1.16 vs. \$0.51 in 2024.

Segment Performance

Critical Illness Recovery Hospitals

Q4 2025 Revenue: \$629.7 million, up 4.9%.
Q4 2025 Adjusted EBITDA: \$66.4 million, up 5.3%.
Full Year 2025 Revenue: \$2,477.8 million, up 1.4%.
Full Year 2025 Adjusted EBITDA: \$265.4 million (down from \$301.6 million), margin 10.7% (down from 12.3%).

Rehabilitation Hospitals

Q4 2025 Revenue: \$339.2 million, up 15.2%.
Q4 2025 Adjusted EBITDA: \$69.2 million, up 11.1%.
Full Year 2025 Revenue: \$1,289.0 million, up 16.1%.
Full Year 2025 Adjusted EBITDA: \$278.6 million, up 13.4%, margin 21.6% (down slightly from 22.1%).

Outpatient Rehabilitation

Q4 2025 Revenue: \$324.6 million, up 1.6%.
Q4 2025 Adjusted EBITDA: \$11.2 million (down from \$26.6 million), margin 3.4% (down from 8.3%).
Full Year 2025 Revenue: \$1,284.9 million, up 2.8%.
Full Year 2025 Adjusted EBITDA: \$90.2 million (down from \$108.6 million), margin 7.0% (down from 8.7%).

Strategic & Price-Sensitive Updates

Take Private Proposal

On November 24, 2025, Executive Chairman, Co-Founder, and Director Robert A. Ortenzio submitted a non-binding indication of interest to acquire all outstanding shares for cash consideration of \$16.00 to \$16.20 per share. An independent special committee has been formed by the Board to evaluate this proposal and other potential strategic alternatives to maximize shareholder value. This process could result in significant changes to the company’s ownership structure and is highly price-sensitive for shareholders.

Concentra Distribution

On November 25, 2024, Select Medical completed a tax-free distribution of 104,093,503 shares of Concentra Group Holdings Parent common stock to shareholders. Select Medical no longer owns any shares of Concentra. Results and costs related to Concentra are reflected as discontinued operations. The prior year’s results include one-time stock compensation due to this separation (\$45.9 million) and a loss on early retirement of debt (\$28.8 million).

Cash Dividend Declaration

The Board of Directors declared a quarterly cash dividend of \$0.0625 per share, payable on or about March 12, 2026 to shareholders of record as of March 2, 2026. Future dividends remain at the Board’s discretion and are subject to financial conditions and other relevant factors.

Share Repurchase Program

Board authorized repurchases up to \$1.0 billion through December 31, 2027.
In 2025, 6,375,512 shares were repurchased at a cost of \$96.5 million (\$15.13 per share).
Total repurchases since program inception: 54,610,335 shares at a cost of \$696.8 million (\$12.76 per share).
\$0.8 million accrued for the 1% excise tax on stock repurchases above \$1.0 million (per the Inflation Reduction Act of 2022).

2026 Business Outlook

Select Medical expects:

Revenue: \$5.6 billion to \$5.8 billion
Adjusted EBITDA: \$520 million to \$540 million
Fully Diluted EPS: \$1.22 to \$1.32

The company will host a conference call/webcast on February 20, 2026, to discuss these results and outlook.

Risks and Forward-Looking Statements

The company cautions that forward-looking statements are subject to numerous risks and uncertainties, including:

Changes in government reimbursement and payment policies
Inflationary pressures and rising labor costs
Shortages in qualified healthcare professionals
Potential impacts from pandemics or infectious disease outbreaks
Loss of Medicare certification for facilities
Government investigations and regulatory risks
Risks related to acquisitions and joint ventures
Third-party payor policy changes
Competition, loss of key management, cybersecurity risks, and legal claims
Uncertainty regarding the take-private proposal and Board actions

Investors should review the company’s SEC filings, including the 10-K, for detailed risk factors.

Balance Sheet and Cash Flow Highlights

Cash & Equivalents (End of 2025): \$26.5 million
Total Assets (End of 2025): \$5.85 billion
Total Liabilities (End of 2025): \$3.82 billion
Total Equity (End of 2025): \$2.02 billion
Net Cash Provided by Operating Activities (2025): \$346.5 million
Net Cash Used in Financing Activities (2025): (\$163.2 million)

Operational Statistics

As of December 31, 2025: 104 critical illness recovery hospitals, 38 rehabilitation hospitals, and 1,917 outpatient rehabilitation clinics across 39 states and DC.
Rehabilitation hospitals saw significant growth in revenue and admissions.
Outpatient rehabilitation segment experienced lower EBITDA margins.

Investor Contact

Robert S. Kido
Senior Vice President and Treasurer
717-972-1100
[email protected]

Disclaimer

This article is for informational purposes only and does not constitute investment advice or a solicitation to buy or sell any securities. Investors should consult official filings and their financial advisors before making any investment decisions. Forward-looking statements are subject to risks and actual results may differ materially.