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

The 300 companies on this year’s list brought in over $12.5 trillion in revenue for the latest 12 months, with the median revenue figure at $24 billion.

America's Most Innovative Companies

AI is a major force shaping this year’s list—but it’s far from the only story.

World's Most Admired Companies

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.

Leaders in all industries rely more than ever on Big Tech—and appreciate the giants that deliver, at scale, without drama.

See which workplaces made this year's list.

GPTW_Healthcare_Large_2024-DaVita, Inc_US1__20240712184600_5

<p>Employees say:</p><p>"There is a focus on making sure everyone has fun, gets to connect, feels valued, excepted, welcomed, and appreciated. The company and the employees live by its Core Values and Mission Statements."</p>

Best Large Workplaces in Health Care

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.

The 200 companies on this list are transforming industries from the inside out.

The 26th edition of the list shows how much esteem Big Tech giants command among other business leaders.

The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

The 300 companies on this list are transforming industries from the inside out.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

Just as it dominates our economy, Big Tech now dominates Fortune’s annual ranking of corporate reputation.

This year’s Fortune 500 marks the 68th running of the list.

After a year in which humanity leaned more heavily than ever on tech giants, see which companies topped Fortune's ranking of corporate reputation.

WMAC-2021-DaVita

This year’s Fortune 500 marks the 67th running of the list.

Warren Buffett's Berkshire Hathaway is DaVita's largest shareholder, with a 33% stake in the company according to a recent filing. Buffett's faith in the company, a long-term holding, has been rewarded, as the company has delivered a 13% annual return to shareholders over the past decade. Patients from around the world come to DaVita's 2,500 treatment centers for kidney dialysis.

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-230-Davita

Based in Denver, Colo., the health provider delivers dialysis treatment and other medical services to patients globally. Through DaVita Kidney Care, the company treats patients with kidney disease.

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 65th running of the list.

Here are the World's Most Admired Companies for 2018 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 64th running of the list.

Here are the World's Most Admired Companies for 2017 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 63rd running of the list.

Here are the World's Most Admired Companies for 2016 as ranked in their industries. See who made the list.

This year's Fortune 500 marks the 62nd running of the list.

Business insiders have spoken: Asked which companies they most admire, more than 4,100 executives, directors, and analysts chose these top 50 All-Stars.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

Best Workplaces In Health Care

Founded

Industry Vertical

Sites

Sector

Industry

Current All-Star Rank

Previous All-Star Rank

Industry Rank

Previous Industry Rank

Overall Score

Innovation

People Management

Use of Corporate Assets

Social Responsibility

Quality of Management

Financial Soundness

Long-Term Investment Value

Quality of Products/Services

Global Competitiveness

Strongest Dimension

Years on list

Previous rank

State

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)

DaVita, incorporated in 1994 and based in Denver, was known as DaVita HealthCare Partners Inc. until changing its name to DaVita Inc. in 2016. It provides kidney dialysis services in the U.S., operating dialysis centers and providing related lab services. In addition the company offers integrated care and disease management services, clinical research programs, physician services, and comprehensive kidney care.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

DaVita (DVA): Company Profile, Stock Price, News, Rankings

legacy

DaVita

davita

Good evening, my name is Michelle and I will be your conference facilitator today. At this time I would like to welcome everyone to the DaVita fourth quarter 2025 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer period. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. If you'd like to withdraw your question, press star then the number two. Thank you, Mr. Eliason, you may begin your conference.

Thank you and welcome to our fourth quarter conference call. I'm Nic Eliason, Group Vice President of Investor Relations, and joining me today are Javier Rodriguez, our CEO, and Joel Ackerman, our CFO. Please note that during this call we may make forward-looking statements within the meaning of the federal securities laws. All of these statements are subject to known and unknown risks and uncertainties that could cause the actual results to differ materially from those described in the forward-looking statements. For further details concerning these risks and uncertainties, please refer to our fourth quarter earnings press release and our SEC filings, including our most recent annual report on Form 10-K, all subsequent quarterly reports on Form 10-Q, and other subsequent filings that we make with the SEC. 

Our forward-looking statements are based on information currently available to us, and we do not intend and undertake no duty to update these statements except as may be required by law. Additionally, we'd like to remind you that during this call we will discuss some non-GAAP financial measures. A reconciliation of these non-GAAP measures to the most comparable GAAP financial measures is included in our earnings press release, furnished to the SEC, and available on our website. I will now turn the call over to Javier Rodriguez.

Thank you, Nic. Good afternoon, everyone, and thank you for joining the call today. As we evaluate 2025, the year represents the latest evidence of our differentiated capabilities, strategy, and platform. We executed it with discipline, met challenges head-on, and delivered on our commitments we set at the beginning of the year. At the same time, we continue to invest to enhance patient care and fuel growth in the years ahead. As a result, we're well-positioned for 2026 and beyond, with opportunities to deliver clinical and financial results consistent with our longstanding track record and guidance.

Today, I'll review our fourth quarter results, share insights on our clinical strategy, and wrap up with guidance for 2026. But first, as always, I will start with a clinical highlight. This quarter, I want to spotlight the clinical results achieved in our Integrated Kidney Care, or IKC, programs.

Patients managed under our IKC models consistently achieve better outcomes than the broader dialysis population. Our IKC patients are 35% more likely to start dialysis with a permanent vascular access, resulting in a better patient experience and costs that are 3x lower during the first 180 days of dialysis. IKC patients also experience fewer bloodstream infections, achieve higher vaccination rates, and are more likely to choose home dialysis. We also see more than 10% improvement in treatment adherence with fewer missed treatments. Most importantly, these outcomes lead to what matters most: a better quality of life with fewer hospitalizations.

Transitioning to our fourth quarter performance, we delivered results in line with our expectations. As anticipated, revenue per treatment accelerated in the quarter alongside strength in IKC. This was partially offset by higher-than-expected health benefit costs.

For the full year, we achieved adjusted operating income and adjusted earnings per share in the top half of our guidance range despite the impact of cyber incident on our U.S. dialysis business. Let me elaborate briefly on our IKC performance. As we've noted previously, we analyze IKC results on a full-year basis given quarterly volatility driven by timing of revenue recognition. As we look back to our Capital Markets Day in 2021, we outline a five-year path to IKC profitability by 2026. Our strategy is centered on sustainable contract, physician partnership, and a scalable care model supported by technology. With full-year 2025 results, we're reporting our first profitable year in IKC, which is slightly ahead of schedule.

This milestone reinforces two key learnings. First, our hands-on clinical models work. As reflected in the outcomes I highlighted earlier, our dedicated IKC caregivers are delivering on the promise of value-based care by keeping patients healthier and out of the hospital. Second, we've proven there's a viable business model that is good for our patients, good for the healthcare system, and can generate value for DaVita and our partners. The business will continue to evolve over time alongside changes in government policy, competitive dynamics, and innovation. Building from this 2025 benchmark, we expect to deliver an incremental $20 million of IKC operating income growth in 2026.

Looking more broadly at our business, we see significant opportunities ahead and believe DaVita's uniquely positioned to deliver on them. Before turning to those opportunities, let me provide some context on our journey to date.

Over the past five years, we've navigated wide-range challenges, from macro events like global pandemic and inflation to supply chain disruption and cyber incident. And through it all, we delivered on our multi-year commitments. We provided high-quality care for our patients, built a solid foundation for the future, and generated compound annual growth in line with our long-term target for adjusted operating income and adjusted EPS. This performance reflects the determination of our teammates and the resilience of our operating model. This experience also gives us the confidence as we look at the opportunities and challenges ahead of us. We're managing two near-term financial headwinds: continued pressure on treatment growth driven by elevated mortality and the revenue per treatment impact from the expiration of enhanced premium tax credits.

Even with these headwinds and the reality of unknown challenges, we remain confident in our ability to sustain our track record of profit growth. That confidence starts with the most important driver of our long-term success: an unwavering focus on clinical excellence. We're executing a set of targeted initiatives designed to enhance patient care, reduce mortality and missed treatments rates, and ultimately support higher treatment volume growth. I will highlight four specific examples. First is vaccination. For many years, we achieved flu vaccination rates above 90% for our patients and clinical teammates, and we're working hard to return to that benchmark. Our patients who received a vaccination early in this flu season have shown a 9% lower risk of hospitalization and a 27% lower risk of mortality compared to their unvaccinated peers. Protecting our vulnerable patients from the flu, COVID, and pneumonia is a clinical imperative.

Second is GLP-1 adoption and adherence. A growing body of evidence confirms that GLP-1s can reduce major adverse cardiac events and mortality for many dialysis patients. We're actively working with physicians to help our patients navigate the clinical, operational, and financial complexities of these drugs. Third is advancing dialysis technologies to remove middle molecules. Innovations such as medium-cutoff dialyzers and hemodiafiltration enable the clearance of a broader range of toxins from the body during the treatment. These technologies help the patients recover more quickly after dialysis and show promise of reducing mortality by as much as 20% or more. Finally, today we announced a strategic clinical partnership with Elara Caring, a leading home care provider, to establish an ESKD-focused offering. This model spans Elara's skilled home health, personal care, and hospice service lines and is designed to lower hospitalizations and missed treatment rates while improving the overall patient experience.

Joel will provide more details about the investment we're making alongside this strategic partnership. Together, these clinical initiatives demonstrate how our patient-centered strategy directly supports our business objectives. By improving quality of life, reducing hospitalization, and advancing clinical outcomes, we continue to believe we're on a path back to at least 2% volume growth. In parallel, we maintain a diligent focus on costs and innovation to improve efficiency, continue sustainable U.S. dialysis margins, and deliver durable financial performance. With that backdrop, we remain confident in our ability to deliver adjusted operating income growth over the next three years that is consistent with our long-term growth target of 3%-7%. On adjusted EPS, with our current capital allocation program and removing the headwinds from our investment in Mozarc, we see an opportunity to exceed our long-term adjusted EPS guidance of 8%-14%.

Taken together, these priorities reinforce our ability to generate sustainable shareholder value and continued leadership in kidney care. I'll wrap up my comments with our guidance for 2026. We expect adjusted operating income within a range of $2.085 billion-$2.235 billion, which represents 3.2% growth at the midpoint. Our guidance for adjusted earnings per share is $13.60-$15.00 even, reflecting a 33% growth at the midpoint. This guidance exceeds our long-term EPS targets, reflecting our expectation for another year of strong operating performance and the cumulative benefits of our capital allocation strategy. Finally, we expect to generate free cash flow between $1 billion and $1.25 billion. I will now turn it over to Joel to discuss our financial performance and outlook in more detail.

Thank you, Javier. First, I'll provide some detail on our fourth quarter and full-year 2025 results and then share a detailed breakdown of our 2026 guidance. Fourth quarter adjusted operating income was $586 million, bringing full-year adjusted operating income to $2.094 billion. Adjusted earnings per share from continuing operations for the fourth quarter was $3.40, with full-year adjusted EPS from continuing operations of $10.78. Free cash flow was $309 million in the fourth quarter, which brings full-year free cash flow to just over $1 billion.

Starting with U.S. dialysis, treatments declined about 20 basis points versus the fourth quarter of 2024. Although our total patient census growth during the quarter was as we expected, the timing of the census gain was back-end loaded in the quarter. For the full year, U.S. treatments declined by 1.1% versus 2024, in line with our expectations from the Q3 earnings call.

Next, revenue per treatment growth accelerated in the fourth quarter, as anticipated, up approximately $12 sequentially. Fourth quarter growth was the result of four primary factors. First, the resolution of aged receivables consistent with what we forecasted on the Q3 call. Second, normal rate increases and improved yield. Third, private pay mix improved slightly after a dip in the third quarter. And finally, RPT benefited from the typical seasonal impact of flu vaccines. Full-year RPT was approximately $410, up 4.7% for the year. As you think about RPT for the first quarter of 2026, keep in mind that Q1 bears a typical $5 or more RPT headwind due to patient responsibility amounts early in the year. Patient care costs per treatment increased by approximately $6 sequentially. The increase was primarily the result of seasonal increases, including health benefit costs and higher supply costs.

PCCs per treatment finished the year 5.9% higher than 2024, near the top end of our revised range of expectations, but lower than our original guidance for the year. As a reminder, approximately half the year-over-year increase in PCCs was from binders in the bundle. Turning to our other segments, international adjusted OI was $21 million, resulting in full-year adjusted operating income of $114 million. This reflects strong operating performance for our international business as we delivered positive organic growth and integrated the recent acquisitions in Latin America. In IKC, as Javier noted, we delivered our first profitable fiscal year. Q4 adjusted OI was $46 million, and full-year adjusted OI was $22 million. We saw strength across all three of the businesses within IKC, and final reconciliations of our 2024 performance resulted in higher-than-expected shared savings revenue.

Switching to capital allocation, during the fourth quarter, we repurchased 2.7 million shares, and we repurchased an additional 1.7 million shares since the end of the quarter. As is typical, a portion of these shares were repurchased from Berkshire Hathaway pursuant to the terms of our publicly filed repurchase agreement, which formulaically results in Berkshire's ownership remaining at or below 45%. For the full year 2025, we repurchased nearly 13 million shares for approximately $1.8 billion. At year-end, our leverage ratio was 3.26x consolidated EBITDA, down from the third quarter and at the midpoint of our target leverage range of 3x-3.5x.

With that, let me turn to 2026. As Javier said, we are guiding to an adjusted operating income range with a midpoint of $2.16 billion. At this midpoint, we have built in the following assumptions for U.S. dialysis. Treatment volume will be approximately flat to 2025. This assumes a flu impact consistent with what we saw in the 2023-2024 season. We are not assuming any improvement in non-flu mortality, though, as Javier outlined, we are working on a number of initiatives to actively drive down mortality among our patients.

Last, on admissions, we are assuming 2026 looks similar to 2025, excluding the impact of the cyber incident. To help with modeling our treatments by quarter, we have added a table to the press release showing normalized treatment days by quarter. This number adjusts for the mix of treatment days and holiday shifts, making it the most helpful number to model quarterly treatments. For example, you'll notice a year-over-year normalized treatment day headwind in Q1 2026, which drives our expectation for negative year-over-year U.S. dialysis treatment volume growth in the first quarter of this year.

Moving on to RPT. For 2026, we are forecasting growth of 1%-2%. The primary driver of this is typical rate increases. We also expect an estimated $40 million headwind from the expiration of enhanced premium tax credits for exchange plans, which is largely offset by the elimination of the $45 million headwind in 2025 from the cyber incident. We expect total U.S. dialysis costs to grow 1.25%-2.25%, mostly driven by typical wage rate increases and G&A investments, partially offset by a decline in depreciation and amortization. The net impact of all this, at the midpoint of our guidance, is an increase in adjusted operating income for the U.S. dialysis business of approximately 1.5%. Also baked into the midpoint of our adjusted OI guidance range is an expectation for each of IKC and international to contribute approximately 1% to enterprise-adjusted OI growth.

Altogether, these results reflect our expectation for 3.2% adjusted operating income growth at the midpoint of our range versus 2025. For seasonality, we expect first quarter adjusted operating income will represent approximately 20% of our full-year guidance. In other words, about $430 million at the midpoint. Below the operating income line, we expect positive other income of approximately $10 million for the year. This represents significant year-over-year improvement in this line item, resulting from no further losses from our investment in Mozarc since we have now recognized cumulative losses equal to our investment. We expect debt expense to decline by $20 million-$40 million versus 2025. This is driven by lower interest rates year-over-year, both from the decline in rates and from our repricing and refinancing transactions, which lowered spreads.

We expect non-controlling interest to be approximately 16% of U.S. dialysis OI, and we expect effective tax rate to be in the range of 24.5%-26.5%. Regarding capital allocation, related to Javier's comments, we announced the signing of an approximately $200 million minority investment alongside a majority investment from Ares Private Equity Funds to acquire Elara Caring. After the transaction closes, which we expect to happen mid-year, we expect this to contribute positively to our other income line. In addition, we will continue to repurchase shares in line with our typical framework, keeping in consideration our liquidity, leverage, and the price of our stock relative to our view of intrinsic value. As a reminder, a significant portion of our repurchases will continue to come via direct purchases from Berkshire Hathaway as part of our ongoing repurchase agreement.

At the midpoint of the range, we are guiding to adjusted EPS in 2026 of $14.30. This does not contain any unusual or non-recurring items and is a good starting point from which to model future EPS. Our 2026 guidance represents a 33% increase over last year, which is the result of two familiar drivers: increased operating income and lower share count, plus the elimination of the headwind from our share of the losses at Mozarc, as I previously noted. Finally, on free cash flow, the midpoint of our guidance for 2026 is $1.125 billion, reflecting a resilient business with discipline in the deployment of our capital resources. That concludes my prepared remarks for today. Operator, please open the call for Q&A.

Thank you, sir. If you would like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you would like to withdraw your question, press star, then the number two.

One moment, please. Kevin Fischbeck with Bank of America. Your line is open, sir.

Great. Thanks. I wanted to get a little more color on the commentary around, I guess, the confidence in getting back to the 2%+ volume number. Obviously, I guess this number that you're looking for in the guidance for 2026 is a little bit better than 2025, but it's still well below that 2%. So is it all about executing on mortalities, or is there something else that you're kind of pointing to that gives you that confidence?

Yeah, Kevin, this is Javier. I appreciate the question. The reality is it is a clinical story. If you go back and you look at the time when the industry was at its peak of growth, many people thought it was the incidents. But the reality is that it was also a clinical story throughout, meaning mortality was improving year after year. To get to that 2%, you have to assume that the things that we outline in our prepared remarks come to fruition. We think, of course, there's a lag between all of the implementation clinically and the full effect. We think that you will start to see some benefits in approximately two years, and you'd probably see the full effect by 2029 or so.

Okay. That's helpful to get that timing. I forget. You gave some kind of multi-year guidance ranges. Was it three years, you said, or was it five years that you were giving those OI and EPS comments?

We didn't say a year, but we think of it in a three-year or so timeframe.

Okay. And then just last one on the free cash flow number. So I guess the way to think about it is that number, the $1.125 billion that's before the $200 million investment. So if we thought about share repo or so, we should take $200 million out of that to think about additional deployable capital, or is there some other adjustment that you're thinking about?

Yeah, Kevin, that's the right way to think about it then. And I'd say the starting place would be with leverage level, where we came out right in the middle of the range, obviously, with EBITDA growth. If we didn't increase leverage, we'd wind up in the lower half of the range. So that would be the other thing to consider when trying to figure out what's the right number to put in for share repurchases.

Okay. But there's no other obvious use of capital that's kind of the most likely use of capital after that $200 million?

Thank you. Our next caller is Andrew Mok, Barclays. You may go ahead, sir.

Hi. I appreciate all the color on 2026 guidance. Can you help us understand how missed treatments and mortality trended throughout the fourth quarter? And is there any connection or causality that you've been able to draw between those two items as you've dug into this issue further? Thanks.

Yeah. Nothing really to highlight on mortality during the quarter. Mistreatments were up, but typically, you'd see missed treatments up in Q4. If you looked at Q4 2025 missed treatments, you wouldn't see much difference with Q4 2024 missed treatments. Year over year, not much of a change. Our clinical folks would say there absolutely is a correlation between missed treatment rate and mortality, but with some lag between those two metrics.

Great. And can you provide more detail on how you expect the ACA headwind to play out this year and maybe comment on how open enrollment performed against your expectations and what level of attrition you're expecting from here? Thanks.

I'm sorry, Andrew. I missed the first part of the question.

Can you give us more detail on how you expect the ACA headwind to play out this year from a cadence perspective and maybe comment on open enrollment, how that played out relative to expectations, and what level of attrition you're expecting on that ACA enrollment throughout the year? Thanks.

Thank you, Andrew. So the number that we gave, we said approximately 40 million this year, 70 million next year, and 10 million the year after that. The reality is that we're seeing what you're seeing in the broader market, which is open enrollment perform better than forecasted by CBO or ourselves. And we're all waiting to see the real number, which is right now, we are measuring selection of a plan or enrollment of a plan. And then, of course, people are trying to see what the payment of the plan will be to see what the yield will be. We don't have any additional color than what you or the marketplace has on what that'll be since it's the first time that these enhanced premium tax credits have gone away. But so far, it has been more resilient than people expected.

We will see once the bills start to come if people pay. We will say that our patients during the pandemic and at other time periods, because they are so ill and needing of the healthcare system, are really sophisticated understanding their insurance needs. So on average, they will go out of their way to stay insured. And that's why last call, we said that there was basically two populations: our current patient population, which we think will be more resilient, and then you have the incoming population, which is, in essence, right now, a CKD population that might not value insurance as much as someone that's already had their kidneys fail. And that's why the number grows over time. But we will obviously be watching it during the quarter, and we will see once the payments go into effect.

Great. Can I just ask a follow-up on that? Do you have a sense for how many of your ACA patients receive premium assistance? Thanks.

I do not because that obviously has a lot of categories from the enhanced premium tax credits to the normal ones. You get into the income levels and other things. I do not break it down into more detail.

Thank you. Our next caller is Justin Lake with Wolfe Research. Your line is open, sir.

Thanks. Good morning. A couple of things. First, on the ability to offset the exchange headwind with the tailwind or kind of the non-recurrence of that cyber headwind from 2025. My recollection was the last time you guys talked about this, that the cyber headwind this year, while it hurt the second quarter, was offset by some better collections and therefore wouldn't be as big a tailwind as it might have been in 2026. Did I remember that incorrectly, or have you found other initiatives on the reimbursement side?

Yeah. So let me try and lay out all the pieces for you, Justin, here. So we called out a $70 million headwind from cyber, $25 million of that is volume, and most of that recurs because it's just census that was lost, and we're not going to get back in 2026. The balance was $45 million, and that was an RPT headwind. We think that RPT headwind is offset in 2026 basically by the enhanced premium tax credit headwind. So you don't see a year-over-year growth problem in RPT because both years have a $40 million-$45 million negative. In terms of some of the other stuff we called out, in particular around Q4 and the resolution of some older claims, there's really nothing in the year from that to call out. We have resolution of older claims every year.

Looking back now, the 2025 number is roughly the same as what we saw in 2024. The 2026 number, we would expect to be similar in 2025. I wouldn't call that out as unusual in any year. What was unusual was the concentration in Q4 of 2025, which is why we called it out last quarter.

Got it. Then going back to IKC, can you give us a little more color in terms of what drove the outperformance in 2024 versus what you had previously booked and the level of confidence you have that that can continue and grow from there?

Sure. Let me grab that one, Justin, Javier. A couple of things that we've talked about as it relates to IKC. So just a quick housekeeping reminder: have to look at it on an annualized view because it moves pretty dramatically quarter to quarter. We think of it in three categories. The first one is dollars under management. You can think of it as volume. And that's been relatively flat. We talked about it last time. Secondly, the model of care cost and the G&A cost, which we've done a nice job of remaining flat there. And then the third category, which is the shared savings. And in that, of course, there is contracting and performance to what you're doing to add value to the system. As it relates to that 2024 reconciliation, we did better in that shared savings part that I just talked about. Does that help you?

Yeah. Just how did you do better? Was it inpatient admissions, outpatients? Just curious for a little more color there and what gives you confidence that that number is going to continue at that level given how much outperformance?

Yeah. I mean, look, there is a lot of little things: medication management, transitions of care, segmentation of patient population, having more access to patients earlier. We have new interventions and protocols. One of the difficulties of this business is, of course, understanding exactly what moved the needle. But rather, the cumulative portfolio is working, and that's why we felt comfortable giving a +$20 million for 2026.

Thank you. As a reminder, that is star one if you would like to ask a question. A.J. Rice with UBS. Your line is open.

Thanks. Hi, everybody. First, there's been a lot of discussion and even the talk about what you're doing with the IKC business about either people managing patients with CKD better and more effectively. And then obviously, there's discussion about some of the drugs that could have an impact. And I wondered, what are you seeing in disease progression with someone that has kidney disease, time to get to dialysis, and then are you seeing them stay longer yet on dialysis, or when do you think any of that would have an impact?

Yeah. Thanks for the question. The reality is we have not seen anything shift, but you would think that that would take some time, as we've talked about. When you talk about these drugs, they're not magic drugs, but rather, it takes some time of being on them to have the effect that you're talking about. So right now, it's too early to tell. And again, we've only been managing these CKD populations for five years or so. So that will take longer to play out.

Okay. Just maybe a follow-up on the Elara Caring investment. How should we think about that? Is it just a financial investment from your side? Are you going to do things operationally that might make a difference for you? Can you describe a little more of what's going on with that?

Sure. Our investment thesis has two pieces to it. One is, of course, we have to have a good capital return on that $200 million. We want to be disciplined. We think it's a good-sized investment, and we want it to have good capital returns. The second one is to help our patient population. Roughly a quarter of our population uses home health. And by having a specialized kidney protocol, we think we can reduce hospitalization and readmissions and then, of course, try to reduce missed treatments. So it is connecting back to this whole loop of trying to do more for our patients while we have them in our clinic and now outside of the clinic.

Thank you. Our next caller is Peter Chickering with Deutsche Bank. Your line is open, sir.

Hey. Good afternoon. Thanks for taking my questions. Can you talk about the international business for a little bit, how you should think about the top-line growth, whether it's M&A versus organic, and how you should think about margins within that segment?

Yeah. I think on international, generally, I would think about the growth both top-line and bottom-line as half M&A and half organic. We would expect the margins to continue to improve as they leverage kind of the fixed overhead both at the international level as well as in the existing market. So international has proven to be a good business for us, a relatively consistent performer, and a contributor of about a point to OI growth over the last few years. And we're expecting more of the same in 2026.

Okay. And then I'm going to ask Justin's question on IKC a little bit differently. But looking at the losses you guys had in 2022 and 2023 and 2024, and just refresh us on those if you could, I guess, why should we think about the rate of improvement in 2026 sort of slowing dramatically? It just seems as though the losses have compressed quite significantly as you've gotten scale. And so I'm curious why we wouldn't see the benefits grow sort of levels that we've seen in the last couple of years.

Yeah. So look, your math is right. I think if you go back over the last three years, the average OI improvement has been somewhere in the $40 million-$50 million per year. Now we're calling out a slowing of that. I think it's just a natural occurrence as a business matures and gets bigger. There's just less opportunity to continue to drive the margins up. We're not expecting a high-margin business here. So I think $20 million a year is a comfortable landing spot for us right now in terms of contribution to OI growth.

Okay. And then last question here, just about new starts. I think you talked about new starts in the fourth quarter and we're back-end loaded. But as you think about new starts for 2026, how do you model that? And specifically, how do you break out the payer mix of those new starts versus, say, previous years as it relates to commercial or HIX or government patients? Thanks.

Yeah. So we're not calling out any dramatic change in new starts for next year, similar to mortality and to some extent missed treatment rates. When we see those things improve, we'll start calling them out. But until then, we're comfortable with flattish. In terms of mix, look, new patients have always had a higher commercial mix than the average patient. It's just the natural evolution of a patient as they get older. They tend to migrate towards Medicare. I don't see any change to that pattern going forward.

Okay. So just to be super clear, the new starts that we're seeing coming in are the same commercial mix we've seen sort of for the last several years. Thank you.

Yeah. With the one callout around HIX and that changing. But other than that, I don't see any other new dynamic.

Thank you. Our next caller is Ryan Langston with TD Cowen. Your line is open.

Thanks. On the flu vaccine commentary and the prepared remarks, did you say that there was an actual change in the vaccination rates this fourth quarter versus other fourth quarters, or was that just more related to seasonal or seasonality sequentially?

I believe what we said in the opening remarks is that in our high, we were in the 90th percentile, and we aspired to get back to that. Just to give you a bit of sense, right now, we're at 80%, which is, from a national perspective, quite healthy, but we could do better.

Yeah. The only other thing I'd just point out is flu vaccines do go up in Q4 over Q3, and that does drive a little bit of RPT and a little bit of cost. So that's part of the Q4 over Q3 RPT dynamic as well.

Yeah. That makes sense. And then just last thing. I know the dialysis population is a bit different from individual MA population, but if the kind of flat advance notice holds for 2027 and the final notice, I guess, is there any maybe just directional change in what we could assume for outlook in terms of growth for 2027? Thanks.

Yeah. Thanks for the question, Ryan. One of the things that it's worthy of highlighting is that the ESRD population has its own funding pool in MA and that CMS has actually realized that there was an underfunding, so there was a catch-up. So the dialysis or ESKD population will receive a 6% increase in 2027, which, from our perspective, reflects the reality and would put an MA plan in a position to want to add these patients to the risk pool.

Ryan, the one thing I'd add to that is not only is the reimbursement different, but the whole coding regime is different. So the questions around V28 and rebasing and the higher coding intensity in a given year, those are not part of or they're a much smaller part of the math for ESRD MA rates. And if you look at the notice from last week, you'd see it in there all as well. So it's all spelled out.

Thank you. At this time, I'm showing no further questions, speakers. I'll turn the call back over to you for any closing comments.

Thank you, Michelle, and thank you all for joining. I hope it is 100% clear that our energy and excitement around clinical opportunities are absolutely off the charts to expand the lives of our patients. We have a powerful alignment between our clinical ambitions and our financial goals. By fulfilling our mission to deliver the best care for our patients, we can also deliver returns for our shareholders. Thank you for your interest, and thank you for joining the call today. Have a good day.

Thank you. This concludes today's conference call. You may go ahead and disconnect at this time.

DaVita (DVA) Q4 2025 Earnings Call Transcript

Company Participants