HCA Healthcare, Inc. (HCA) Q4 2024 Earnings Summary

Executive Summary

Q4 2024 revenue was $18.285B, up 5.7% YoY; adjusted EBITDA rose to $3.712B with margin 20.3%, despite hurricane-related headwinds; GAAP diluted EPS was $5.63, and adjusted EPS was $6.22 .
Management quantified ~~$200M (~~$0.60 EPS) adverse hurricane impact in Q4 (Largo, FL and North Carolina), and noted margin pressure of ~60 bps YoY, with ~100 bps attributable to hurricanes; payer mix remained strong, with managed care admissions up 9.2% YoY .
2025 guidance introduced: revenue $72.8–$75.8B, adjusted EBITDA $14.3–$15.1B, diluted EPS $24.05–$25.85, capex $5.0–$5.2B; Board authorized a new $10B buyback and raised quarterly dividend to $0.72, likely key stock catalysts .
Q3 and Q2 trends show robust volume growth, revised 2024 guidance higher mid-year, and initial 2025 outlook near or above long-term ranges; Q4 met expectations amid depressed respiratory season and hurricane impacts .
S&P Global consensus estimates were unavailable at retrieval; results vs estimates context is noted as unavailable; any estimate-related adjustments should be made when data access is restored (Consensus via S&P Global unavailable).

What Went Well and What Went Wrong

What Went Well

“We finished 2024 with strong business fundamentals…operations were in good order and stable” — solid demand, strong payer mix and acuity, 3% same-facility inpatient admissions growth and 2.9% increase in same-facility net revenue per equivalent admission .
Adjusted EPS grew 5.4% YoY in Q4; adjusted EBITDA increased 2.6% YoY despite hurricanes; full-year adjusted EBITDA +9%, diluted EPS +15.5% YoY, and operating cash flow +11% YoY to $10.5B .
Capital allocation: new $10B repurchase authorization and dividend raised to $0.72; leverage target lowered to 2.75–3.75x, signaling balance sheet strength and shareholder-friendly actions .

What Went Wrong

Hurricanes Helene/Milton reduced Q4 EPS by ~$0.60 and EBITDA margin by ~100 bps (within the ~60 bps overall decline YoY); additional OpEx and supply cost pressure from repairs at Largo and North Carolina .
Depressed respiratory season vs Q4 2023 dragged volumes by ~1 pt on admissions and ~2 pts on ER visits, muting growth vs strong prior-year comp .
Professional fees pressure persisted, especially radiology; while moderating in 2025, expected to remain above normal inflation; professional fees are ~24% of other OpEx .

Financial Results

Metric	Q4 2023	Q3 2024	Q4 2024
Revenue ($USD Billions)	$17.303	$17.487	$18.285
Net Income Attributable ($USD Billions)	$1.607	$1.270	$1.438
Diluted EPS (GAAP) ($)	$5.93	$4.88	$5.63
Adjusted EPS ($)	$5.90	$4.90	$6.22
Adjusted EBITDA ($USD Billions)	$3.618	$3.267	$3.712
Adjusted EBITDA Margin (%)	20.9%	18.7%	20.3%
Net Income Margin % (Attributable)	9.3%	7.3%	7.9%

Non-GAAP adjustments: Q4 2024 included $195M losses on sales of facilities (~$0.59/share), primarily related to a pending sale in California; adjusted metrics exclude such items .

KPIs (Operating statistics and same-facility performance)

KPI	Q4 2023	Q3 2024	Q4 2024
Reported Admissions	544,554	537,943	559,170
Reported Equivalent Admissions	974,561	958,504	1,007,623
Revenue per Equivalent Admission ($)	$17,755	$17,381	$18,146
ER Visits (Reported)	2,452,395	2,343,514	2,498,429
Inpatient Surgery Cases (Reported)	132,417	133,521	135,643
Outpatient Surgery Cases (Reported)	270,286	254,557	263,832
Same-Facility Admissions	536,350	534,323	552,610
Same-Facility Equivalent Admissions	950,949	943,614	980,330
Same-Facility Rev/Equivalent Admission ($)	$17,674	$17,311	$18,185
Same-Facility Inpatient Surgeries	130,779	132,793	134,482
Same-Facility Outpatient Surgeries	261,155	249,753	257,663
Same-Facility ER Visits	2,410,050	2,325,946	2,466,784

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenues ($B)	FY 2025	Initial 2025 outlook qualitative only (near or slightly above upper end of long-term ranges)	$72.8–$75.8	Introduced numeric guidance
Net Income Attributable ($B)	FY 2025	NA (not previously provided numerically)	$5.85–$6.29	Introduced
Adjusted EBITDA ($B)	FY 2025	NA (not previously provided numerically)	$14.3–$15.1	Introduced
Diluted EPS ($)	FY 2025	NA (not previously provided numerically)	$24.05–$25.85	Introduced
Capital Expenditure ($B)	FY 2025	NA (not previously provided numerically)	~$5.0–$5.2	Introduced
Quarterly Dividend ($/share)	Q1 2025	$0.66 (declared for Dec 27, 2024)	$0.72 (payable Mar 31, 2025)	Raised
Share Repurchase Authorization	Ongoing	$764M remaining at 12/31/24	New $10B program authorized	Expanded

Management noted that hurricane impacts in 2025 are expected to offset (Largo tailwind vs North Carolina headwind), not providing a net tailwind; Medicaid supplemental programs net effect assumed flat to a $250M headwind vs 2024 due to one-time payments in 2024 and the new Tennessee program uncertainty .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024 and Q3 2024)	Current Period (Q4 2024)	Trend
Demand & Payer Mix	Q2: strong demand; raised 2024 guidance . Q3: strong YoY volume growth; reaffirmed 2024 guidance; initial 2025 outlook positive .	Strong payer mix; same-facility managed care admissions +9.2% YoY; 2.9% increase in net revenue per equivalent admission .	Stable/positive mix and volumes.
Hurricanes	Q3: forecast Q4 impact $200–$300M (~$0.60–$0.90 EPS) .	Actual Q4 impact ~~$200M (~~$0.60 EPS); margin decline ~60 bps YoY with ~100 bps due to hurricanes; facilities back to normal operations .	Impact realized; remediation ongoing; 2025 net-neutral by market offset .
Medicaid Supplemental Payments	Q3: variability noted across states .	2024 incremental net benefit ~$400M (Q2 high $125M; Q4 lowest); 2025 assumed flat to -$250M; TN partial-year approved July–Dec 2024; 2025 program pending .	Higher-than-expected 2024; potential 2025 headwind.
Labor & Professional Fees	Q2/Q3: ongoing workforce development; contract labor trending down .	Contract labor down ~8% YoY to ~4.5–4.6% of SWD; professional fees ~24% of other OpEx; radiology pressure to persist but moderate .	Improving labor stability; fee pressure moderating.
ER/OR Throughput & Case Management	Q2/Q3: ER optimization highlighted .	Continued success in ER throughput; operating room optimization underway; case management improving post-acute placement and discharge; expecting solid LOS mgmt in 2025 .	Operational efficiency scaling.
AI/Technology Initiatives	Q3: broader tech efforts referenced; AI highlighted in forward-looking risks .	Ambient AI platform deployment via Commure/Augmedix partnership underway to improve documentation and productivity .	Scaling AI adoption across workflows.
Tariffs & Supply Chain	Limited prior detail.	Monitoring new tariff policies; 70% of 2025 supplies under firm pricing; ongoing supplier diversification away from China .	Risk mitigation in place; watch policy developments.
Two‑Midnight Rule (MA)	Noted in prior call; benefit in 2024.	~50 bps admissions uplift in 2024; MA observation share ~20% higher than traditional Medicare; not expected to materially change in 2025 .	One-time uplift; flat trajectory ahead.

Management Commentary

CEO Sam Hazen: “The company finished the year with strong business fundamentals… Demand for health care services remains strong… These accomplishments… position us well for the future” .
CFO Mike Marks: Lowered targeted leverage ratio from 3–4x to 2.75–3.75x; guided FY25 revenue $72.8–$75.8B, adjusted EBITDA $14.3–$15.1B, EPS $24.05–$25.85, capex $5.0–$5.2B; expects 2025 margins consistent with 2024 and operating cash flow $10.75–$11.25B .
Hurricanes: “Increase at Largo and decline in North Carolina are expected to offset and are not expected to produce a tailwind for us in 2025” .
Medicaid supplemental programs: 2024 net incremental benefit ~$400M; 2025 net effect flat to $250M headwind; Tennessee partial-year approval received for 2H 2024, 2025 pending .
Operational initiatives: ER revitalization and OR optimization; case management improving post-acute placement; labor engagement at all-time high, reducing turnover .

Q&A Highlights

Medicaid supplemental payments: Quarterly cadence clarified (Q2 high, Q4 low); 2025 net effect flat to -$250M due to 2024 one-time payments and TN program uncertainty .
Managed care dynamics: Pricing contracts 80% for 2025, 60% for 2026; denial rates not a material impact due to enhanced capabilities; managed care admissions strength .
Two‑Midnight Rule: ~50 bps admissions benefit in 2024; MA observation rate ~20% higher than traditional Medicare; benefit unlikely to repeat in 2025 .
Cost structure: Professional fees ~24% of other OpEx; radiology pressure persists but expected to moderate; ER and hospital medicine pressures have moved more fully through challenges .
Policy watch: Site-neutral payment concerns; ASC same-store revenue growth ~5–6% with case volumes down ~1%; strategy unchanged for outpatient networks .
Tariffs & supply chain: 70% supplies under firm pricing for 2025; suppliers diversifying; monitoring admin actions .

Estimates Context

Metric	Q4 2024 Actual	Q4 2024 Consensus (S&P Global)
Revenue ($USD Billions)	$18.285	Unavailable (S&P Global consensus not retrievable at time of access)
Diluted EPS ($)	$5.63	Unavailable (S&P Global consensus not retrievable at time of access)

Consensus estimates from S&P Global were unavailable at retrieval due to access limitations. Portfolio managers should revisit this section once access is restored to confirm beat/miss vs Street.

Key Takeaways for Investors

Q4 print was resilient: revenue +5.7% YoY to $18.285B and adjusted EPS $6.22, absorbing ~$0.60/share hurricane headwind; underlying demand and mix remained strong .
Margin trajectory: Adjusted EBITDA margin 20.3% vs 20.9% YoY; ~100 bps hurricane‑driven drag implies potential normalization post-remediation; 2025 margins guided “consistent with 2024” .
2025 setup: Guidance brackets imply mid‑single digit revenue growth and stable margins; an expected Largo tailwind offsets North Carolina headwind; watch Medicaid supplemental programs (flat to -$250M) .
Capital returns: $10B new buyback and dividend increase to $0.72 provide support; lowered leverage target underscores balance sheet strength — catalyst for investor sentiment .
Operational execution: ER/OR optimization, case management, and AI deployment (Commure/Augmedix) aimed at throughput and documentation efficiency; supports medium‑term productivity gains .
Near-term trading lens: With estimate comparisons unavailable, focus on narrative drivers — hurricane recovery cadence, payer mix durability, and policy watches (site-neutral, tariffs) .
Monitoring items: Respiratory season normalization, professional fees (radiology), MA Two‑Midnight Rule non‑repeat in 2025, and Tennessee supplemental program approval timeline .