Pediatrix Medical Group Reports $458.4M Revenue in Q1 2025, Net Income Rises to $20.7M

Pediatrix Medical Group, Inc. reported a net revenue of $458.4 million for the first quarter of 2025, a decrease of 7.4% from $495.1 million in the same period of 2024. The decline in revenue was primarily attributed to non-same unit activity resulting from practice dispositions, although same-unit revenue increased by 6.2%, driven by a favorable shift in payor mix and increased patient service volumes. Operating expenses also decreased significantly, with total operating expenses falling to $426.3 million from $479.2 million year-over-year, leading to an operating income of $32.1 million, up 102% from $15.9 million in the prior year.

The company’s financial position showed a notable improvement, with net income rising to $20.7 million, compared to $4.0 million in the first quarter of 2024. This increase in profitability was supported by a reduction in practice salaries and benefits, which decreased by 8.7% to $337.0 million, and a significant drop in depreciation and amortization expenses. The effective income tax rate for the quarter was 26.2%, down from 48.4% in the previous year, contributing to the overall increase in net income.

Pediatrix has undergone strategic changes, including the exit from nearly all affiliated office-based practices, which was completed by the end of 2024. This decision was made to streamline operations and focus on hospital-based services and maternal-fetal medicine. The company’s operational metrics reflected these changes, with a decrease in accounts payable and accrued expenses, primarily due to performance-based incentive compensation payments. The company reported a decrease in cash and cash equivalents to $99.0 million as of March 31, 2025, down from $229.9 million at the end of 2024.

Looking ahead, Pediatrix anticipates that its current cash reserves, along with cash generated from operations and available credit under its amended credit agreement, will be sufficient to meet its working capital needs and fund anticipated acquisitions and capital expenditures over the next 12 months. The company remains focused on optimizing its service delivery model and adapting to changes in the healthcare landscape, including potential impacts from government-sponsored healthcare programs and ongoing healthcare reforms.