Surgery Partners Reports 8.2% Revenue Growth but $37.7 Million Net Loss in Q1 2025

Surgery Partners, Inc. reported its financial results for the first quarter of 2025, revealing total revenues of $776.0 million, an increase of 8.2% from $717.4 million in the same period of 2024. The growth in revenue was attributed to a 5.2% increase in same-facility revenues, driven by a 6.5% rise in same-facility case volumes, despite a 1.2% decrease in revenue per case. However, the company experienced a net loss attributable to Surgery Partners of $37.7 million, compared to a loss of $12.4 million in the prior year, reflecting challenges in managing costs and interest expenses.

Operating expenses for the quarter rose to $714.1 million from $641.4 million year-over-year, with significant increases in salaries and benefits, supplies, and transaction costs associated with acquisitions. The cost of revenues was $614.1 million, representing 79.1% of total revenues, up from 78.4% in the previous year. General and administrative expenses also increased to $36.0 million from $33.2 million. The company’s interest expense rose sharply to $62.2 million from $47.3 million, further contributing to the net loss.

In terms of strategic developments, Surgery Partners acquired a controlling interest in four surgical facilities and one physician practice for a total cash consideration of $44.0 million during the quarter. This acquisition is part of the company's ongoing strategy to expand its network of surgical facilities, which now includes 164 locations across 30 states. The company also reported a total of 128.2 million shares outstanding as of March 31, 2025, reflecting a slight increase from the previous quarter.

Operationally, Surgery Partners reported a decrease in cash and cash equivalents to $229.3 million from $269.5 million at the end of 2024. The company had $388.9 million available under its revolving credit facility, indicating a solid liquidity position despite the net loss. The company’s Adjusted EBITDA for the quarter was $103.9 million, up 6.6% from $97.5 million in the prior year, highlighting improved operational efficiency despite the overall net loss.

Looking ahead, Surgery Partners aims to continue enhancing its same-facility performance while pursuing selective acquisitions and new facility developments. The company remains focused on managing costs and improving operational efficiencies to mitigate the impact of rising interest rates and other economic pressures. The management expressed confidence in the company’s ability to meet its short-term and long-term liquidity needs through operational cash flows and available credit facilities.