Encompass Health Q4 Earnings: A Test of Momentum for a Sector Leader

BIRMINGHAM, AL – January 09, 2026 – Encompass Health Corp. (NYSE: EHC), the nation's largest operator of inpatient rehabilitation hospitals, has set the stage for a critical financial disclosure, announcing it will release its fourth-quarter 2025 results after the market closes on Thursday, February 5, 2026. The announcement will be followed by a conference call for investors and analysts at 10 a.m. ET the next morning, Friday, February 6.

The upcoming report is more than a routine financial update; it serves as a capstone on a year of robust growth and strategic expansion for the company. For investors and industry observers, the results will provide crucial insights into Encompass Health's ability to maintain its powerful momentum and will act as a key bellwether for the health of the broader post-acute care sector heading into the new year.

A Year of Consistent Growth and Raised Expectations

Encompass Health enters its fourth-quarter reporting period on the back of a remarkably strong performance throughout 2025. The company consistently surpassed analyst expectations and demonstrated significant year-over-year growth across key metrics. This track record has set a high bar for the final quarter's results.

In the first quarter of 2025, the company posted a 10.6% increase in net operating revenue to $1.46 billion and an adjusted earnings per share (EPS) of $1.37, comfortably beating forecasts. This trend continued into the second quarter, with revenue climbing 12.0% to $1.46 billion and adjusted EPS hitting $1.40, a notable 15.7% surprise over estimates. Following these strong results, Encompass Health raised its full-year guidance.

The third quarter saw continued top-line growth, with revenue rising 9.4% to $1.48 billion and adjusted EPS of $1.23 once again exceeding expectations. This sustained performance prompted management to raise its full-year 2025 guidance for a second time. The updated forecast projects net operating revenues between $5.905 billion and $5.955 billion, with adjusted EPS expected to land between $5.22 and $5.37. The Q4 results will be scrutinized to see if the company can meet or exceed the high end of this ambitious guidance.

Driving this financial success has been strong patient volume. Across the first three quarters, total discharge growth remained a key theme, supported by a combination of same-store growth and an aggressive expansion strategy. Net patient revenue per discharge also saw steady increases, reflecting a healthy operational environment.

What Investors and Analysts Will Be Watching

When Encompass Health reports its results, all eyes will be on several key performance indicators. Beyond the headline revenue and EPS figures, analysts will closely examine discharge growth, particularly the breakdown between new (de novo) hospitals and same-store performance. This metric is a direct indicator of demand and market share capture.

Adjusted EBITDA, a measure of profitability, will also be a focal point. The company's updated full-year guidance projects Adjusted EBITDA between $1.235 billion and $1.255 billion. Achieving this range will depend on the company's ability to manage costs effectively in the fourth quarter, a period that can sometimes see seasonal variations in patient admissions and expenses.

Furthermore, the investor call on February 6 will be just as important as the report itself. Analysts will be keen to hear management's forward-looking guidance for 2026. Commentary on anticipated patient volumes, reimbursement rate trends from Medicare, and strategies for managing persistent labor cost pressures will shape market sentiment and influence the stock's trajectory. Any updates to the company's long-term growth plan—which currently targets opening 6 to 10 new hospitals and adding 80 to 120 beds annually through 2027—will be of significant interest.

Navigating Broader Healthcare Currents

Encompass Health's performance is not occurring in a vacuum. As a leader in its field, the company's results offer a valuable lens into the dynamics of the entire inpatient rehabilitation market. The sector continues to benefit from powerful demographic tailwinds, including an aging U.S. population and a rising prevalence of chronic conditions requiring intensive post-acute care.

However, the industry also faces significant headwinds. Staffing shortages and rising labor costs remain a persistent challenge for all healthcare providers. While Encompass Health has managed these pressures effectively, as evidenced by its strong EBITDA margins, any commentary on future labor trends will be highly relevant. Similarly, changes in reimbursement policies from the Centers for Medicare & Medicaid Services (CMS) and other private payers represent a constant variable that can impact revenue per discharge.

The company's ability to navigate these crosscurrents—capitalizing on high demand while mitigating operational and regulatory risks—is a core element of its investment thesis. The Q4 report will provide the latest data point on how well that balance is being struck.

Strategic Expansion and Market Leadership

Underpinning Encompass Health's financial success is a clear and consistent strategy focused on quality of care and aggressive, targeted expansion. Throughout 2025, the company continued its national rollout, opening three new inpatient rehabilitation hospitals in the third quarter alone and steadily adding beds to its existing 173 facilities across 39 states and Puerto Rico. This expansion directly addresses the underserved demand for high-quality rehabilitative services.

This focus on quality has not gone unnoticed. In 2025, for the sixth consecutive year, Encompass Health was named America's Most Awarded Leader in Inpatient Rehabilitation by Newsweek and Statista. It also holds a place among Fortune's World's Most Admired Companies, accolades that strengthen its brand and competitive positioning when attracting patients, clinicians, and hospital partners.

By investing in advanced technology, innovative treatments, and specialized clinical programs, the company has cultivated a reputation for delivering superior patient outcomes. This clinical excellence is the foundation of its economic model, allowing it to operate as a cost-effective provider within the broader healthcare ecosystem. As the industry continues its shift toward value-based care, this proven ability to maximize recovery and manage costs effectively positions Encompass Health for sustained leadership. The forthcoming earnings report will be the next chapter in this ongoing story of strategic growth and operational execution.