With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Industries included in the sector are insurance and managed care, medical products and facilities, pharmacy services, and pharmaceutical companies.

Fortune Sector Leaders: Health Care

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

Key Financials (last Fiscal Year)

Revenues ($M)

Profits ($M)

Assets ($M)

Total Stockholder Equity ($M)

Profit Ratios

Profit as % of Revenues

Profits as % of Assets

Profits as % of Stockholder Equity

Earnings Per Share (last Fiscal Year)

Earnings Per Share ($)

EPS % Change (from prior fiscal year)

EPS % Change (5 year annual rate)

EPS % Change (10 year annual rate)

Total Return

Total Return to Investors (last year)

Total Return to Investors (5 year, annualized)

Total Return to Investors (10 year, annualized)

Founded in 1974, BrightSpring Health Services provides home and community-based health services for patients in need of specialized or chronic care. Formerly known as Phoenix Parent Holdings, the company services over 400,000 people daily with home health care, hospice care, pharmacy therapy management, and more. BrightSpring Health Services also offers infused, injectable, and oral medication services and rehabilitation services, including physical, speech, and occupational therapy.

Q3 2026

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Q3 2024

BrightSpring Health Services (BTSG): Company Profile, Stock Price, News, Rankings

legacy

BrightSpring Health Services

brightspring health services

Good day, and thank you for standing by. Welcome to the BrightSpring Health Services, Inc. Q3 2026 Earnings Call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. After the speaker's presentation, there will be a question-and-answer session. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. I would now like to hand the conference over to your speaker today, David Deuchler, Investor Relations.

Good morning. Thank you for participating in today's conference call. My name is David Deuchler with Investor Relations at BrightSpring. I'm joined on today's call by Jon Rousseau, Chief Executive Officer, and Jen Phipps, Chief Financial Officer. Earlier today, BrightSpring released financial results for the quarter ended September 30, 2026. As a reminder, we closed the Community Living transaction on March 30, 2026, and all financial results and commentary reflect only continuing operations, with Community Living results reflected in discontinued operations. A copy of the press release and presentation is available on the company's investor relations website. Please note that today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry and market conditions. Such forward-looking statements are not guarantees of future performance.

These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations. We encourage you to review the information in today's press release and presentation, as well as our quarterly report on Form 10-Q that will be filed with the SEC, including the specific risk factors and uncertainties discussed in our Form 10-K and Form 10-Q. Such factors may be updated from time to time in our periodic filings with the SEC, and we do not undertake any duty to update any forward-looking statements except as required by law. During the call, we will use non-GAAP financial measures when talking about the company's financial performance and financial condition.

You can find additional information on these non-GAAP measures and reconciliations of our non-GAAP financial measures to the most directly comparable GAAP financial measures, to the extent available without unreasonable effort, in today's earnings press release and presentation, which again are available on our investor relations website. This webcast is being recorded and will be available for replay on our investor relations website. With that, I will now turn the call over to Jon Rousseau, Chief Executive Officer.

Good morning, everyone, and thank you for joining BrightSpring's Q3 2026 Earnings Call. As always, I'd like to start by thanking everyone at BrightSpring who drives our mission forward and makes a lasting impact every day. We're grateful for the great work and commitment of all BrightSpring teammates, enabling us to deliver high-quality and timely care to patients in so many communities across the U.S. Overall, we continue to execute at a high level, providing compassionate, person-centered, quality care in patient-preferred, lower-cost settings, with another productive quarter delivered amidst an always fluid external environment, and performance enabled by our continuous focus on expanded patient reach, operational efficiency, and accretive M&A. Our strategy is aligned with enduring trends impacting the U.S. healthcare system, including demographics and the increase in the prevalence of certain health conditions, creating meaningful opportunities to support more individuals in need of our highly valuable services.

Our quality outcomes, service levels, and relationships with hospitals, physicians, and other healthcare providers in the community are what underpin our ability to capture this demand, fostering long-term durable growth. This growth, in turn, creates more and more scale and efficiency. Moreover, our services have a clear and significant ROI. Demand for these services continues to increase. We provide leading quality, innovate in operations, and we continue to see the benefits of our differentiated scale and complementary service offerings as a leading provider of health services in the U.S. Turning to the Q3 results, revenue and adjusted EBITDA were above forecast, with total company revenue of $4.2 billion, an increase of 26% year-over-year, and adjusted EBITDA of $228 million, an increase of 42% year-over-year.

EPS of $0.54 in the quarter increased 80% from the Q3 last year, and EPS increased 20% sequentially from Q2. Cash flow from operations exceeded $200 million in the quarter. Looking at the segments, Pharmacy Solutions revenue of $3.7 billion increased 26% year-over-year, and segment EBITDA was $202 million, an increase of 43% versus last year. In Provider Services, revenue of $481 million represented 31% year-over-year growth, and segment EBITDA of $79 million increased 30% versus last year. These results are consistent with the performance the company has delivered since going public in January 2024, and with growth well into the double digits over the past decade now.

In Pharmacy Solutions, Specialty and Infusion delivered broad-based revenue growth of 34%, driven by script growth of 29%, including robust contribution from branded LDDs and generics, as well as growth in value-add pharma services and mid-teens growth in both chronic and acute infusion therapies. We continue to focus on clinical, operational, and commercial execution, supported by relationships built with manufacturers, physicians, patients, and payers over the years. We launched seven LDDs in the quarter for a total of 19 year-to-date, and we are now supporting 162 total LDDs across dozens of manufacturers and indications. In the quarter, we supported the launch of life-changing and life-saving therapies across liquid and solid tumor cancers, as well as in rare disease. The outlook for our branded LDD portfolio remains compelling, and we are well-positioned to support existing and new manufacturer partners in the years to come, as well as any conversions to generics.

As we think about the growth prospects for the company, both acute and chronic infusion are meaningful components of our strategy, and we continue to invest in operational capabilities, including chronic therapy infusion suite and clinic upgrades, as well as therapeutic category expansion, like with our IG Connect program. Home and community pharmacy had an excellent quarter operationally and is now continuing to be a contributor to organic growth. Ongoing investments in technology and process improvements, with a focus on attractive end markets such as hospice, ALF, and behavioral, drove year-over-year EBITDA growth well into the double digits, despite lower revenue compared with the prior year, primarily due to IRA.

In 2026, this service line has become yet another strength of the company, and we believe home and community pharmacy has a significant growth trajectory ahead, based on operational and technological leadership and multiple opportunities to expand volume and revenue across end markets. The Provider Services segment had another strong quarter, with continued momentum across all three sub-segments, driven by volume growth and a very stable operating environment. Given the size, performance, and our leadership position in the provider segment, we are eager to continue to expand and invest in our provider platform to reach more patients with necessary and high-quality services that help patients and the entire healthcare system. Within home healthcare, census growth of approximately 58% was underpinned by leading quality measures and driven by de novo locations, expanding preferred MA relationships, core business development execution, and contribution from the Amedisys LHC branches acquisition.

Integration of the acquired branches has performed as expected, particularly on the IT and back office side. We recently held a national home health meeting in Nashville, and the enthusiasm from the combined team was really high. We continue to expect the acquired branches to contribute approximately $35 million in adjusted EBITDA in 2026, which is consistent with the Q2 update. 96% of our legacy home health branches are now rated four-star or better, and we are now doing the same to the acquired branches. Hospice operational measures remain consistent, and quality remains at industry-leading levels, and we view this service line as one of continued investment focus, given its impact and value proposition, and our service levels, consistency of performance, and team.

Rehab care continues to grow steadily, with new payer contracts for clinical neurotherapy programs and continued expansion in both existing and new de novo markets, with superior demonstrated rehab outcomes. Like across the entire company, clinician retention has improved again this year and is being sustained at well above industry average. Personal care continues to execute very well, providing high-quality support with activities of daily living for patients at home, while hours served are growing above industry average. Demand for services continues to outstrip our ability to provide them, and our operational quality and execution in this service line is marked by real consistency, and service hours delivered per day are exceeding budgets, while we continue to grow private pay and alternative payer sources. In primary care, we continue to drive operational efficiencies, quality measures that demonstrate 50% reductions in hospitalizations, and patient growth.

We see our model of primary care in the community and in patient residences as key to driving more integrated and coordinated care across our service lines, better care transitions, optimal outcomes, and growth from value-based care models and new payer opportunities. We are expanding our virtual primary care offering as well, to support more required visits to higher-risk patients, visits in rural geographies, and primary care for home health or homebound patients discharging from hospitals and nursing homes. We've been selected as a provider in the new LEAD ACO Medicare program, which starts in January. In the quarter, the $228 million of total company adjusted EBITDA, which represented year-over-year growth of 42%, reflected the consistent operational execution we have seen since going public in 2024, and in the years before that.

We believe that the breadth of growth and profitability drivers and the operational capabilities across our platform are unique to our company within health services. Operating within targeted and attractive end markets, we deploy best practices across service lines, utilize scale in procurement and contracting, leverage OpEx and acquisition synergies, and invest in new technologies and AI at a rapid pace and at large scale. Our AI investments across the organization drive automation and ongoing improvement in quality, documentation, medication review processes, HR and hiring systems, and employee efficiency and satisfaction, to name a few. We were again pleased with the breadth and level of performance across the organization, which is a result of our management practices, controls, and culture.

With our company platform, we remain active in potential acquisition opportunities and look to capital deployment to add additional scale and profitability growth, where we can bring best practices to acquired companies in our target markets that remain very large and fragmented in most cases. On cash flow, the company generated $204 million of cash flow from operations in the quarter. Leverage was reduced to 1.79 times as of September 30th. For the full year, and excluding the Community Living divestiture, we now project over $700 million of operating cash flow, with EBITDA to operating cash conversion of approximately 80%, and over $600 million of cash flow after CapEx and before debt paydown and share repurchases. Quality and patient, family, and referral source experiences remain at the center of everything we do.

In Provider Services, home health demonstrated timely initiation of care of 99%, as well as a CAHPS overall hospice rating of 86%, and a number of visits per patients that remain well above national average. Our own clinical data demonstrates that home-bound patients who cannot accurately manage their medications, as measured by the OASIS Home Health Assessment, experience hospitalization rates approximately five times higher than those who can. BrightSpring's uniquely integrated healthcare platform positions us to address this critical risk through coordinated clinical care and pharmacy services, with innovative medication management solutions that improve medication adherence in the home to reduce avoidable hospitalizations and lower total healthcare costs. In rehab, patient satisfaction was 99%, and outpatient rehab and personal care delivered a client satisfaction score of 4.6 out of 5. On the pharmacy side, home and community pharmacy achieved order completeness of 98.2% and on-time delivery of 91.9%.

Specialty pharmacy again performed well above the national average, with a medication possession ratio of 93% and a time to first fill of four days, alongside net promoter scores in the top two of the industry in the past quarter. Looking ahead, our operational footprint is uniquely positioned in a competitive advantage where patient-centric, coordinated, and lower-cost care models are essential to the future of healthcare in the U.S. We have been, and will continue to be, purposeful with our investments to support long-term growth. How we execute in any given quarter is a result of decisions made several quarters and even years prior, and we manage the business for long-term results. While we do not typically provide commentary this far in advance, we still anticipate, and reiterate from Analyst Day, at least 15%-20% organic adjusted EBITDA growth in 2027.

However, now off of a significantly larger EBITDA base in 2026. We anticipate similar levels of adjusted EBITDA year-over-year growth rates through the quarters of next year. With that, I'll turn the call over to Jen Phipps to discuss the Q3 results and updated 2026 guidance in greater detail.

Thank you, Jon. For the Q3 of 2026, company revenue was $4.2 billion, representing 26% growth from the prior year period. Pharmacy Solutions segment revenue was $3.7 billion, achieving 26% year-over-year growth. Within the pharmacy segment, specialty and infusion revenue was $3.2 billion, representing growth of 34% from prior year. Revenue growth reflects specialty and infusion script growth of 29%, driven in part by the 19 branded LDDs launched this year, mid-teen script growth from both acute and chronic infusion, and continued growth in pharma services, that being fee-for-service and hub programs. Of note, the number of year-to-date branded LDD launches is comparable with 2025 at this point in the year, but the annualized revenue contribution from the 2026 launches is tracking ahead of the 2025 LDD launches in the first year of launch.

Home and community pharmacy revenue was $553 million, representing a decline of 6% year-over-year due to an approximate $50 million impact from the IRA, along with the decision to exit some uneconomic customers, both of which we have previously discussed. We expect the revenue impact from the IRA in home and community pharmacy to be approximately $50 million in the Q4 of 2026, bringing the total year IRA impact to home and community pharmacy of approximately $200 million, consistent with the Q2 update. Excluding the impact of the IRA and voluntary customer exits, underlying growth in home and community continues to improve throughout the year. In the Provider Services segment, we reported revenue of $481 million, which represents 31% growth compared to the prior year.

Home healthcare reported $288 million in revenue, growing 50% versus last year, with revenue performance driven by average daily census growth, de novo expansion, and the acquired Amedisys and LHC branches, which contributed approximately $76 million of revenue in the quarter. Excluding the impact of the Amedisys LHC acquired branches, revenue growth was 12%. Rehab care revenue was $82 million, growing 8% versus last year, with strong growth in persons served and hours billed in core neuro rehab. Personal care revenue was $111 million, representing 8% growth year-over-year, driven by solid growth in persons served and hours billed. Moving down the P&L, Q3 company gross profit was $519 million, representing growth of 32% compared with the Q3 of last year. Adjusted EBITDA for the total company was $228 million in the Q3, an increase of 42% compared to the Q3 of 2025.

Adjusted EPS for the total company was $0.54. Profitability growth reflected strong revenue performance across our businesses, disciplined execution, and continued investment in technology, processes, and people across the company. Turning to segment profitability performance in the Q3, Pharmacy Solutions gross profit was $316 million, growing 29% compared to the Q3 of last year, and growing 6% sequentially versus the Q2 of this year. Segment EBITDA for Pharmacy Solutions was $202 million for the Q3, an increase of 43% compared to last year, representing a segment EBITDA margin of 5.4%, which increased approximately 60 basis points versus last year, and was slightly higher than the first and Q2s of 2026.

Q3 pharmacy profitability benefited from strong performance in specialty and infusion branded LDDs, pharma services, and contributions from generics, as well as strong performance in home and community pharmacy from volume, mix, and operational improvements in both gross profit and G&A. Now to the per-script metrics, which is not something we have historically commented on. Revenue per script in the quarter was $340.86, up 24% year-over-year, with gross profit per script of $28.86, up 27% year-over-year. The per-script metrics are an output result of many factors, including drug and payer mix and operational initiatives. Due to the broad diversity of scripts and mix of therapies we provide, we do not rely on the per-script metrics to inform our growth strategy or capital allocation decisions.

Across the pharmacy organization and broader BrightSpring, from a financial perspective, we are more focused on growing absolute dollars of revenue and EBITDA through a combination of initiatives where script mix is not a focus, but a byproduct of business activity. Moving on to Provider Services. Gross profit was $203 million, growing 38% versus the Q3 of last year, and segment EBITDA was $79 million, growing 30% versus last year. This represents a segment EBITDA margin of 16.4% in the quarter, consistent with the performance in the Q3 last year. Excluding the impact of the Amedisys and LHC branches, Provider Services segment EBITDA grew 16% versus last year. Growth and margin expansion were impacted by volumes and operational initiatives driving efficiency and economies of scale across the segment. On a total company basis, cash flow from operations was $204 million in the Q3.

As we look forward to the balance of the year, excluding Community Living transaction-related cash flow impacts, we anticipate annual operating cash flow of at least $700 million. As of September 30th, total debt outstanding was approximately $2.2 billion, and net of cash of $718 million, our net debt outstanding was $1.5 billion. We finished the quarter with a leverage ratio of 1.79 times. Our leverage ratio also includes the impact of $120 million of share repurchases year-to-date. We are continuing to evaluate our capital structure as we head into 2027 to support the company's growth plans over the next several years. Moving on to the guidance for 2026, which excludes the Community Living business, as well as any acquisitions that have not yet closed.

Total revenue is expected to be in the range of $15.9 billion-$16.125 billion, including Pharmacy Solutions revenue of $14.0 billion-$14.2 billion, and Provider Services revenue of $1.9 billion-$1.925 billion. This revenue range reflects 23.2%-24.9% growth over full year 2025. Total adjusted EBITDA is now expected to be in the range of $850 million-$860 million for the full year 2026. This would reflect 37.6%-39.3% growth over full year 2025. Included in total adjusted EBITDA is expected contribution from the Amedisys and LHC asset acquisition of approximately $35 million. While we plan to discuss full year 2027 guidance on the Q4 call, we currently view 2027 as another very positive year of opportunity for the company, with a broad base of growth drivers.

At this stage, we still expect 2027 organic adjusted EBITDA growth of at least 15%-20% next year, consistent with the framework outlined at our Analyst Day in March, but now on a higher 2026 EBITDA base that reflects 39% growth at the high end of the range provided. At this point in the budgeting process, we anticipate year-over-year adjusted EBITDA growth in each quarter of 2027, similar to the overall growth for the year, with year-over-year growth in the second half expected to be a little higher than the first half, consistent with normal long-term seasonal patterns. We will not be discussing 2027 beyond our prepared remarks, and expect to discuss the 2027 outlook in more detail when we report the Q4 in February.

This durable and differentiated growth profile is not easy to execute, but the quality, operational, business development, IT, HR, and finance leaders across the organization continue to perform well. With that, I will now turn it back to Jon.

Thanks, Jen. Thank you for your time today to go through BrightSpring's Q3 2026 results. We will now open up the call for questions. Operator?

Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please limit yourself to one question. Our first question comes from Whit Mayo with Leerink Partners. You may proceed.

Thanks. Jen, just back to the gross profit per script. I heard you mention that mix was a factor given the acceleration, but just maybe elaborate a little bit more on what drove that metric within the quarter. I would like to hear a little bit more on the focus on gross profit dollars and EBITDA versus per script, and remind us how much of your scripts today are coming from home and community. Thanks.

Great. Thanks so much, Whit. From a quarter-over-quarter perspective, mix was the most significant driver as it relates to the quarter-over-quarter growth. We did have higher growth in our specialty and infusion scripts, which do have a higher gross profit per script than our average. We did see favorable sequential home and community and infusion pharmacy GP per script and stable specialty GP per script. But obviously, the very strong specialty volume helped drive the overall GP per script. We are focused on gross profit dollars, as we mentioned during the call and as we have talked over the years, as well as EBITDA dollar growth. That is largely because the script growth, we are focused and have areas of growth and focus across each of our different businesses. The GP per script is a byproduct of what is happening in each of those different separate revenue streams.

Just to follow up, just remind us the percentage of scripts that are PharMerica or your home and community-based pharmacy. Thanks.

We have not disclosed that publicly in terms of our script growth. Obviously, a vast majority of our scripts are home and community pharmacy.

Thank you. Our next question comes from Joanna Gajuk with Bank of America. You may proceed.

Good morning. How are you? Thanks so much for taking that question. I guess you announced maybe seven new LDDs since the last call, and there's one of these therapies where they could be quite sizable. One of the conferences, you kind of said you expect this to be a nice tailwind into next year, according to Revolution Medicines therapy and its big launch. Can you maybe give us a comment on the early launch trajectory, and was there any meaningful contribution in September? Also, as you look into 2027, I appreciate you not going to give us specific guidance, but kind of help us frame how significant this particular therapy could be, and maybe also in the context of other therapies launched this year, how material could they be to next year? Thank you.

Good morning, Joanna. We don't comment at the individual drug or therapy level. What I can say is, 2026 has been another very successful year of partnering with biopharma and manufacturers to help them bring really incredible new therapies to market in the best possible way, get them to patients with the highest possible quality. We remain extremely excited about that for the rest of the year and for the future years when you look at the pipeline. The drugs that have come to market in 2026 are performing really well. In their first year, current year, they're actually outperforming the drugs that we launched in 2025, which are also doing well in their own right. We just continue to execute against that strategy.

Thank you. Our next question comes from Charles Rhyee with TD Cowen. You may proceed.

Thanks for taking the question. Maybe just to follow up a little bit on that question. With 29% script growth in specialty, obviously, much stronger than certainly we were expecting or at least implied by the guidance originally. Can you talk about sort of the dynamics? Are we right to think that what we're seeing in this script growth is the benefit of these LDD launches since you are one of very few pharmacies, and it's that layering effect that kind of allows us to grow at such an accelerated rate? Is there any reason why, given the number of LDDs you've announced and winning, that we should expect launching, let's say, over the next year or so, that kind of pace is sustainable? Thanks.

One thing I'd note is, despite the 29% growth rate that you referenced, it was lower than our Provider Services growth rate of 30%. So the Provider Services business just continues to perform exceedingly well, and I just want to make sure everybody always continues to realize how big of a base of a business that is, growing at over 30% this year. But on specialty, it's consistent with the track record that we've had for the past couple years and the strategy that we have. We've had really similar growth rates to this for quite a long period of time in this business due to our strategy, in our team, in our relationships, and our quality in the market. So, the 2026 launches, the 2025 launches, and the launches before those are all performing really well.

As we look at the pipeline in the future and all of our really deep relationships in the market and our focus on quality and efficiency and patient outcomes, we would expect the same going forward.

If I could just quickly follow up, when you announced that we've won X number of LDDs, what is typically the lead time before those drugs launch? Are you being selected sort of as before phase III data's out, or is this sort of after, so we would expect launch in a relatively shorter period of time? Thank you.

It can really vary depending on the specific circumstance. But typically, these things start happening, as you would imagine, at least a year in advance.

Thank you. Our next question comes from A.J. Rice with UBS. You may proceed.

Hi, everybody. Obviously, you now have your leverage down below your 2.5 target, so that's great. Deal activity's always been a part of the growth story there. I wonder if I could get you to comment a little bit on the pipeline, where there seems to be increasing opportunities and where maybe less so. One thing in concept, what we're seeing more of is these transactions where to do a bigger deal, a strategic player is sort of partnering with a private equity or multiple private equity guys, and then has the option to buy a larger entity out down the road, and that way maybe minimize the impact and disruption to near-term consolidated results. I'm just curious whether in concept you guys would be open to looking at those kind of deals, and then again, just the comments on the pipeline.

Good morning, A.J. Hope you are doing well. Look, overall in the results and the performance, you are really seeing the strength of a very unique platform in home and community health services. A piece of that historically, but probably a bigger piece in terms of opportunity going forward, would be the M&A platform that we have too. When you couple our capabilities in M&A and our track record and results there with the balance sheet, it obviously does create interesting opportunities and scenarios. I think probably more interesting and potentially more impactful is, as we look forward, certainly than the last three or four years. Our bread and butter has been tucking new acquisitions into adjacent geographies, and that has worked extremely well for us historically. We have driven really attractive pro forma multiple there, which has been highly accretive over the years. That will always remain our mainstay.

We have said over the course of the year that we think we probably should lean into some slightly larger transactions than small tuck-ins. But for us, that is probably still in the range of 20-ish of EBITDA or below, in terms of, say, a second category of deals, which might become more of a focus. But deals are hard. We are always extremely active, and our pipeline is as full as ever. We see a ton of stuff that is proprietary due to our relationships. I say a lot, we could do 400 of EBITDA in M&A tomorrow if we wanted to. I am not saying that tongue in cheek. But we are extremely intentional and extremely deliberate, as you can see with our history, and we really focus on driving value both organically and inorganically.

We are leaning in like always, but when you get into diligence on things, you find a lot of stuff. We make sure that we do transactions that we know will work. We just continue to be very intentional about anything we would do. I would say we are bullish in terms of probably the M&A volume we would do going forward as compared to the last couple years. But again, that is going to look like, from a deal profile perspective, probably very similar to what we have done historically, and maybe the size of some acquisitions increases, but again, within that size range that I mentioned before. We have not, to date, entertained any sort of transactions in partnership with anybody else, nor dhink we would in the future.

It is just hard for us to consider scenarios where that would be relevant or helpful to us.

Okay. And just a Provider versus something like infusion or the other specialty drug area, is it still both, or do you see more opportunities on one side versus the other?

We have been very balanced historically with our acquisitions, and that has worked well for us. We really like continuing to do things that have been proven and have worked well for us over time. What you are seeing in our numbers, again, for yet another quarter is broad-based growth within the organization. That continues to be something that we think is a real strength of the enterprise. So, our intention will be to be very balanced. In the specialty world, there is very little out there, maybe a couple things, but they are extremely large in size. You look at home health, you look at hospice rehab, you look at primary care, you look at infusion, you look at very low multiples, home and community pharmacy deals, and there are opportunities abound within each one of those service lines.

So, we are fortunate that most of our industries, with the exception of maybe one, are really huge and also fragmented. It just creates a wealth of opportunity, and we just try to be really careful about how we pick our way through that over time. But we will continue to take a balanced approach to continue to expand into targeted and attractive geographies within probably most of those service lines.

Thank you. Our next question comes from Ann Hynes with Mizuho Securities. You may proceed.

Good morning. Thanks for the question. Thanks for all the details on 2027, especially the quarterly data, as there was some concern in the market that the 2027 calendar of generic launches would result in lower growth in the first half of 2027. Given your guidance today that you expect the same percent growth throughout the year, does this imply that LDDs are as big of a driver as generics, maybe versus the market perception that your growth mostly comes from generics? To that end, can you provide what your view is for a long-term growth rate for LDDs and for generics, and which is actually the bigger driver of overall profits for the pharmacy? Thanks.

Good morning, Ann. At this time, we're going to leave our comments regarding 2027 exactly to what we said in the prepared remarks. Hopefully, that's helpful. What I would say is, we have a company that really has a broad base of growth drivers, and you're seeing that in Q3. You've seen that throughout this year. You've seen that since we've been public in 2024. You've seen that going back for 10 years now. We see that going forward as well. There are a plethora of growth drivers across all of our service lines, and we focus on driving each one of them as best we can from a quality and market share perspective. We're fortunate that we live in a world that's not always easy, but where there's a lot of demand for these high-need services.

We do everything we can to meet that demand in the highest quality way and to position ourselves well to do so. It was another quarter really marked by broad-based growth up and down the P&L and in the service lines. That expectation for the continuance of that is reflected in our comments for 2027.

Thank you. Our next question comes from Erin Wright with Morgan Stanley. You may proceed.

Hi. This is Michelle on for Erin. I just wanted to turn to infusion. Does the recently announced transaction in the infusion space change anything for you in terms of the competitive landscape? Do you feel comfortable with the current capacity of suites to sustain the strong growth that you have been seeing? Can you also speak about the IG Connect program, what you are seeing from that so far, and how that has been contributing to growth? Thank you.

We do not see any difference to our strategy from that transaction. We are continuing to build capacity in our business over time, so that will continue to be a focus for us. Our infusion strategy is unique to most others, not all, but most others, in that we think addressing acute is just as important to patients and referral sources and physicians and payers as is chronic specialty infusion. A lot of folks just focus on specialty, but acute is also a big market. We just saw here in the last month yet another player back out of acute, which we think just creates more opportunity on that side. Ultimately, spanning the breadth of infusion therapies in the market from acute to chronic and doing so in the home and in suites, that is our ultimate strategy.

I would just say, we're still in the pretty early innings of that within a really big market and industry. We just want to continue to grind that out over a long period of time, and we continue to focus on assembling a really good team here internally. We certainly view that as meaningful growth opportunity for us next year and beyond.

Thank you. Our next question comes from Scott Fidel with Goldman Sachs. You may proceed.

Hi. Good morning. You've got Sarah Conrad on for Scott. I wanted to ask on the home and community business. Just as we anniversary the IRA headwinds and also the customer exits, can you frame the underlying growth in this book, and just how should we think about the setup into next year? As this business returns to growth, can you frame how we should think about the mix impact on gross profit per script?

We've been really pleased to see the home and community pharmacy performance this year. As we mentioned in the prepared remarks, it has now again become a nice contributor to our overall company growth, which has really been great to see, and it's been a real focus over the last year or two. If you go back four or five years ago, due to the external actions of a competitor or two, and some of the dynamics in the skilled nursing market, it was a tough business that we had to work our way through. Our focus has always been on service level quality and then operational efficiency, but particularly in those areas, in the last year or two, we've just made a ton of progress. IRA was a headwind for the business.

It'll be a little bit of a headwind for the business next year, but at this point in time, we're demonstrating growth through that in a really nice business, really for two reasons. It's just a focus on maximizing your scale and your operational efficiency and your cost per fill, and then there's a bunch of attractive end markets there, senior living, hospice, PACE, behavioral, et cetera. Skilled nursing is just a stable market for us, which is fine because there's four other really interesting, or even five, growth markets for us. If we can have the highest service levels in the industry and the best cost per fill, that's a really winning formula.

It was a good quarter for home and community pharmacy, and if you annualize just that quarter alone, they're primed for significant growth next year, but we want to continue to do better on top of that. We've executed on a lot of operational and technological initiatives so far this year, but the pipeline is quite full of even more to come as we can just work our way through them. Probably take us a couple years to ultimately get to the point operationally that we want to in terms of sort of nirvana for how a pharmacy business serving all 50 states can be most optimally designed from a production and cost and logistics standpoint. We're working our way through that, and it's really exciting, and we think it'll be really differentiating, and this year, we're seeing the results of it.

Thank you. Our next question comes from David Larsen with BTIG. You may proceed.

Hey, congratulations on the good quarter. I heard in the prepared remarks some comments around a new ACO endeavor, 1127. Can you talk a bit about that? How do you differentiate yourself in the market? It's primary care at home. What sort of revenue and earnings contribution could you see coming from that business, maybe in the near and longer term? Thanks.

It took a lot of work, but over the course of a year or so through applications, we were approved to be in the new next-gen LEAD ACO for Medicare. It starts January 1. We're really excited about that. We view primary care as the tip of the spear and the linchpin for, quote-unquote, "integrated care" within our company. Very complementary, it sits kind of in between, if you will, Pharmacy Solutions and Provider Services. As the primary care clinician, obviously, you have attribution to the patient. It clearly drives quality outcomes. It can drive a lot more integrated care across our service lines in the business, and it's ultimately what positions you for value-based care. So our vision, 5 to 10 years, is to be the household name and national brand for primary care out in the community, people's homes and skilled nursing facilities and senior living communities.

It has a dramatic outcome on improved quality and reduced hospitalizations. You have to have shared savings models or new types of arrangements with payers for that to be most feasible, which is what we've been working on and will continue to work on over time. But excited to be in the latest version of the ACO. In our opinion, just due to the way this thing ramps and mechanics around it, 2028 would be a time period that we feel comfortable where we could see some impactful economics from this.

There are some ACO models that are making money within risk. Some companies are actually doing very well. There are others that have faced significant margin pressure in the risk business. Can you just talk a little bit about, are you confident you're going to make money in risk, where the claims costs will come in below the capitated amount you're receiving from the plans? I don't think you have the fixed cost overhead of facilities that some other organizations did have in the space in the past. Any color there would be helpful, Jon. Thanks.

We actually had a little bit of shared savings this year, but we're evolving our ACO models to be the principal in these going forward. But we have absolutely zero risk of downside today in any of this. Anything that we would do, we would be extremely measured about and just view as purely opportunity with extremely low risk. The upside from what we can do in primary care and leveraging the access to patients we have today and leveraging our quality outcomes is very significant. But there is clearly a way that we are approaching this where we view it as all potential upsides.

Thank you. Our next question comes from Matthew Gillmor with KeyBanc. You may proceed.

Hey, thanks for the question. I wanted to ask about the competitive environment within specialty pharmacy. From our vantage point, LDD networks have been narrowing, yet we see Onco360 and CareMed continue to win more than their fair share. I was just hoping you'd provide a couple comments in terms of how you feel your position competitively with prescribers and manufacturers, and if you've seen any sort of notable change or movement within the last couple quarters or years.

It's been pretty consistent. There's some other independents out there that do a nice job, and we just try to do our best to provide a suite of value-add services to our partners. We do our best to provide great outcomes and service levels to payers, and obviously patients as well. In the specialty world, the more track record you're able to build over time and the more infrastructure and scale that you have, and the more clinical and technology-based capabilities that you have is only helpful. We just continue to evolve our business and try to get a little bit better every year and be as efficient as we can and provide interesting solutions to our partners. But. Within that context, the competitive landscape has been fairly consistent overall.

Thank you. Our next question comes from Raj Kumar with Stephens. You may proceed.

Hey, good morning. Maybe I wanted to kind of touch upon the home and community pharmacy business and maybe kind of any quantitative points around just growth in scripts that you're seeing across assisted living and hospice. And maybe on the hospice piece, curious on the connection there with the provider side of the business and whether you guys fully capture the rest of the patients on the provider side of the business or still see that as an early innings opportunity.

On hospice, we serve all of our hospice patients with our pharmacy. We have an outstanding hospice pharmacy business. The quality outcomes that we get, the clinical tools that we provide, hospice companies are absolutely second to none. We are leveraging that by entering the PACE market as well. I would say on the senior living side too, our service levels and some of the offerings that we offer customers are differentiated and unique, and we look forward to continuing to grow into that market as well. Both are going extremely well.

Thank you. Our next question comes from Pito Chickering with Deutsche Bank. You may proceed.

Good morning, guys. A great quarter, and very much appreciate the comments around 2027. You've become one of the most dominant players in the LDD market in the last few years, with you and one other getting exclusivity or winning it together. As you look at the LDD market from a couple years ago versus today, have the economics changed at all? During the IPO, you used to think about LDDs at a 1.5% margin. Has that evolved with market dominance and wraparound IT offerings into more of a 3% margin when you include the hub programs? Also, do these margins change throughout the periods of these contracts? Thanks.

Good morning, Pito. Thank you. We've seen just real consistency over the past years. We haven't seen dramatic changes in those dynamics. One of the things we've done over time is start to broaden outside of oncology with leveraging the capabilities that we have, which are directly applicable to a lot of other therapies and indication areas where you're seeing LDDs, alternates, or exclusives develop. But in our GP per script and GP dollars per script, stability is a really appropriate word, and that works great. Our focus is on driving volume growth and efficiency in the organization. So, we have continued to augment some of our wraparound services. That's been helpful.

That is an area that was really nascent as recently as three or four years ago, and in the next year or two, it could be even twice as big as it is today. It has really grown significantly. The team has done an excellent job with that. I would say we have continued to evolve a lot of our processes and service offerings. Some of the items around the economics that you have mentioned, you have seen just a lot of consistency there over time.

Thank you. Our next question comes from Brian Tanquilut with Jefferies. You may proceed.

Hey, good morning, guys, and congrats, Jon, and to the team. Jon, maybe just not asking about specific drugs here, but when we think about these new oral drug LDD introductions where you are part of a very narrow network, does the historical rule of thumb of roughly 50% going to hospitals still hold, or how much variability is there? Then maybe to clarify, as we think about whatever percentage goes to the hospital channel in that exclusive or very narrow network, where do the hospitals source their drugs from? Thanks.

The 50% estimation is what we see when we look at the market data as well. They would be going direct to the manufacturer or through their other purchasing options in those scenarios. A 50/50 split is, it is going to vary a little bit by drug, but that is generally what we have seen in the most recent data still.

Thank you. Our next question comes from Jared Haase with William Blair & Company. You may proceed.

Hey, guys. Good morning. Wanted to ask about operating leverage and corporate SG&A. It looks like that was down a little bit sequentially from the first half run rate. I just wanted to ask, what is resonating or working well in terms of where you are finding efficiencies here, and then what is the incremental opportunity as we think about either Q4 modeling or even beyond that over the next couple of years?

Thank you so much for the question. We continue to see the ability to leverage our corporate infrastructure while continuing to invest in new technologies, in AI products, and people across quality, sales, and other investment opportunity areas for us. As we think about looking forward, we continue to see significant ability to leverage the infrastructure that we have across each of our different business lines. Then we continue to make very strategic investment decisions for long-term growth, and we expect that to continue. That does, depending on the opportunities and things we see from an investment standpoint, that can move our G&A a little bit from time to time and quarter to quarter. But again, that continues to be our focus.

How can we become more lean and efficient through all of our different investments, leverage our infrastructure, but then continue to invest for the future?

Thank you. Our next question comes from Sean Dodge with BMO Capital Markets. You may proceed.

BrightSpring Health Services (BTSG) Q3 2026 Earnings Call Transcript

Company Participants