BrightSpring Health Services Q4 2025 Earnings Call - Strong 2025 Growth, Balance Sheet Repair, and 2026 Guidance Despite $600M Pharmacy Revenue Headwind

Ann Hynes, Analyst, Mizuho0: Day. Thank you for standing by. Welcome to the BrightSpring Health Services, Inc. fourth quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker’s presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising you your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, David Deuchler, Investor Relations. Please go ahead, sir.

David Deuchler, Investor Relations, BrightSpring Health Services, Inc.: Good morning. Thank you for participating in today’s conference call. My name is David Deuchler with Investor Relations for 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 and full year ending December 31st, 2025. 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 market conditions. Such forward-looking statements are not a guarantee 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 in our annual report and Form 10-K that we file with the SEC, including the specific risk factors and uncertainties discussed in our Form 10-K. 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 their 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 the investor relations website.

This webcast is being recorded and will be available for replay on our investor relations website. With that, I’ll turn the call over to Jon Rousseau, Chief Executive Officer.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Good morning, everyone, thank you for joining BrightSpring’s fourth quarter and full year 2025 earnings call. I’d like to begin by expressing my and the company’s appreciation to all of our BrightSpring teammates who work hard to deliver attentive and quality patient care and services to people in communities across the country. They drive the realization of our mission forward every day. 2025 was another productive and impactful year at BrightSpring in many ways. Overall, we saw continued success, delivering revenue and EBITDA growth while achieving many milestones, all underpinned by the delivery of high quality and compassionate services and care to patients. In the beginning of 2025, we announced our plan to divest the community living business, which will streamline the company’s operations and create more focus on core patient populations in prioritized markets.

Earlier this year, the community living divestiture transaction was approved by the FTC. At this time, we expect the transaction to close at the end of the first quarter. The transaction is expected to result in net after-tax cash proceeds of approximately $715 million, which we intend to primarily utilize for debt paydown to further improve our leverage and further strengthen the balance sheet. Additionally, the acquisition of Amedisys and LHC Home Health Assets closed in the fourth quarter of 2025 in a two-part transaction on December 1st and December 31st. BrightSpring acquired 107 branches at a purchase price of $239 million, which was fully funded from cash on hand. The assets generated full year pro forma revenue of $345 million in 2025, which includes the months throughout the year prior to the transaction close.

These assets are very complementary to our existing home health business from a geographic perspective, while also being in the same markets as our hospice locations in many cases. We are thrilled to have the Amedisys and LHC assets and colleagues integrated into BrightSpring, as we are already taking steps to bring new and improved company capabilities to these acquired operations. This is another example of thoughtful, logical, strategic, and accretive M&A that has defined our acquisitions history. Home health, of course, has a tremendous value proposition, given its impact on clinical outcomes and cost, as it is shown to reduce ER visits and hospitalizations by 15% and 25%, respectively, and reduce mortality rates by 30% relatively.

With an estimated 35% of patients referred to home health, but who do not end up receiving the service, home health should continue to be an important solution in the future of healthcare. Some other accomplishments of note in the pharmacy and provider business last year include continued LDD wins, strength in quality metrics, technology and people investments that resulted in ongoing efficiency gains across the organization, de novo expansions, and small tuck-in acquisitions. BrightSpring’s operational and financial performance exceeded the high end of our guidance range for the year. We believe that the company’s performance is a reflection of the value of our patient-centric, lower cost, timely, and proximal care, enabled by our people and culture, who maintain an ongoing commitment to providing excellent and leading services....

Moreover, our goal is to continue to build out a unique and scaled home and community healthcare platform that demonstrates leading quality outcomes and operational best practices, a platform that is best positioned to be a critical partner in solution in U.S. healthcare. Before discussing BrightSpring’s fourth quarter and full year performance, I would like to remind you that the company’s financial results and 2026 guidance pertain to continuing operations and do not include results from the community living business and the effects of any future closed acquisitions. For the fourth quarter, BrightSpring’s revenue grew approximately 29% and adjusted EBITDA grew approximately 41% versus last year’s comparable quarter, resulting in full year 2025 total revenue and adjusted EBITDA that were above expectations.

For the year, total company revenue was $12.9 billion, representing 28% year-over-year growth, which included pharmacy solutions revenue of $11.4 billion and provider services revenue of $1.5 billion, representing 31% and 11% year-over-year growth, respectively. Full year 2025 adjusted EBITDA was $618 million, which grew 34% year-over-year, and adjusted EBITDA margin for the company was 4.8%, a 20 basis point increase versus 2024, primarily driven by cost efficiencies from procurement and operational initiatives, along with generic revenue mix shift in pharmacy. On cash flow, the company realized $490 million of cash flow from operations in 2025, and leverage was 2.99 times as of December 31st, 2025, which declined from 4.16 times as of December 31st, 2024.

Overall, BrightSpring performed well in both the fourth quarter and full year 2025 across all business lines, we are very pleased with the position of the balance sheet and expanded cash flow profile of the company this year. Today, we are initiating total revenue and adjusted EBITDA guidance for 2026. We expect total revenue to grow approximately 14% year-over-year at the midpoint of the provided range, total adjusted EBITDA to grow approximately 25% year-over-year at the midpoint of the provided range. Included in total adjusted EBITDA guidance is an expected contribution of approximately $30 million from the Amedisys and LHC acquisition. We are excited for the year ahead, Jen will discuss our 2026 outlook in more detail shortly.

Before I discuss our business performance, I’d like to highlight BrightSpring’s commitment to our employees and the communities, individuals, populations, and therapeutic areas that we support. Whether our people, seniors, youth, or other specialty patient populations, at the company, we continue to lean into helping individuals and organizations with access to resources and opportunities. For example, in supporting employees through difficult, unforeseen circumstances through our SHARE Program, in college scholarships, in nursing school partnerships, and in partnering with many, many organizations, such as the Special Olympics, for one. We currently operate a foundation through our hospice service line, and we have now started an enterprise foundation that will more formally carry on all of our community and patient support activities. We are hopeful that this BrightSpring Health Foundation can positively impact lives for decades to come.

I’d also like to briefly highlight our strong patient satisfaction and high quality scores in the fourth quarter, which are driven by our delivery of attentive and skilled care to complex populations in a timely and relatively lower cost manner. In home health, we continue to see over 91% of our branches at four stars or greater, with timely initiation of care at an industry-leading level of 99.4%. In hospice, our metrics remain well above the national average, with a top 5% ranked hospice program in the U.S. and a CAHPS Overall Hospice rating of 87%. In rehab, our patient satisfaction scores remain very strong, with 100% outpatient satisfaction and 98.4% home and community rehab satisfaction.

In personal care, we have a client satisfaction score of 4.6 out of 5, compared to 4.5 in the 3rd quarter, along with strong internal client records and quality indicators audit scores. In home and community pharmacy, dispensing accuracy was 99.99%, order completeness was 99.3%, and on-time delivery was 96.8%. In infusion, our patient satisfaction score was 94%, and we were one of only two providers in the country to receive the ACHC IG Distinction Award based on our clinical and operational commitment to the IG patient population. Specialty Pharmacy demonstrated a consistently strong medication possession ratio of 92.4% in the quarter, along with time to first fill of 4.1 days, both much stronger than the national average.

In the second half of 2025, Onco360 ranked first and CareMed ranked second in the MMIT Physician and Office Staff Satisfaction Survey. BrightSpring continues to demonstrate very strong service and quality metrics across all businesses. Turning to BrightSpring’s financial results by segment. Total Pharmacy Solutions revenue grew 32% in the fourth quarter, and adjusted EBITDA grew 44% versus the prior year. Total Pharmacy script volume was 10.8 million in the quarter, driven by Total Pharmacy census growth. Total Pharmacy volumes declined 1% due to a slight decline in home and community pharmacy volumes from the previously mentioned unwinding of a large customer going through bankruptcy and our decision to exit specific uneconomic customers. Specialty and infusion script growth was 30% year-over-year in Q4.

In the specialty and infusion business, performance throughout the year exceeded expectations, with fourth quarter revenue growth of 43% year-over-year, driven by market adoption of existing LDDs, new LDD wins, fee for service growth, and strong commercial execution in the field. BrightSpring saw strength in the quarter from both brand LDDs and generic volumes. Our total LDD portfolio now standing at 149 LDDs, including five launches in the quarter and 24 total launches in 2025. Moving forward, we expect 16 to 20-plus limited distribution drug launches over the next 12 to 18 months. We believe that our growth will continue to be driven by new LDD launches, generic utilization, commercial execution with referral sources, and expanding fee for service.

We are excited to have been chosen as the preferred specialty partner for additional new innovative therapies this quarter, which include infusible LDD therapies to treat a range of oncology, rare, and complex diseases. In infusion, the business performed in line with expectations in the fourth quarter with solid script volume growth. Adjusted EBITDA in the quarter grew in double digits, driven by the benefits of operational initiatives and process improvements. We expect to continue to see improved profitability and infusion from our operational and growth initiatives moving forward. In home and community pharmacy, we are pleased with the progress throughout the year. We’ve executed consistently across several end markets, including in behavioral, assisted living, hospice, and skilled nursing.

As we’ve entered 2026, we continue to enhance our go-to-market strategy, invest in growth resources, and look forward to driving expansion in each of our end markets, while we execute against the 2026 set of process, technology, and automation work to drive ongoing efficiency improvements. Turning to provider services, we are very pleased with the overall performance in the quarter and the year. In the fourth quarter, segment revenue grew 13% year-over-year, and segment adjusted EBITDA grew 16% year-over-year, with an adjusted EBITDA margin of 16.4% in the fourth quarter, a 50 basis point expansion year-over-year, primarily driven by economies of scale and efficiency. Home healthcare, which represents approximately 55% of revenue in the provider segment, grew 19% year-over-year.

Average daily census grew 15% to almost 35,000 in the quarter, driven by strong quality metrics, de novos, execution on partnerships and preferred MA contracts, and strategic tuck-in acquisitions in target markets. In home-based primary care, we are excited by the large opportunity that exists, especially with ACO payment strategies. We continue to invest in resources in this strategic area, and we believe we can further expand our home-based primary care business to benefit payers and their members and better connect patients to other integrated services that they need. In rehab care, which represented approximately 20% of provider revenue in the fourth quarter, revenue growth was 8% year-over-year. We are pleased by strong person-served growth of 13% and hours billed growth in the core neuro rehab services of 17%.

Growth in the 4th quarter was driven by neuro rehab de novo additions and very high patient satisfaction scores, along with continued expansion of our Rehab in Motion program into ALF and home settings. We are excited by momentum in Rehab Part B for seniors and look forward to driving additional de novo locations this year. Turning to personal care, which represented approximately 25% of provider revenue in the 4th quarter, revenue remained steady to up and grew 4% year-over-year. Personal care person served grew 2% to 16,175 in the 4th quarter. In the quarter, and throughout 2025, we saw steady operational performance as we continue to provide high-quality supportive care to seniors and assist with activities of daily living in the home.

Overall, I’m pleased with our operational execution throughout 2025, leading to excellent business performance across BrightSpring’s enterprise. We now have a seven-year CAGR of 22% on revenue and 18% on adjusted EBITDA. 2026 is off to a consistent and good start as we remain focused on leveraging our leading, complementary, and differentiated service capabilities and leveraging our scale, operational efficiencies, and best practices to deliver high-quality, coordinated care to complex patients. We will be hosting an investor day on March 17th and look forward to discussing the BrightSpring platform and strategy that enables high quality, lower cost, timely care delivery to an approximately one-half million senior and complex patient individuals every day. We’ll provide information on the operations, end markets, and growth drivers of each of our business units, and we’ll discuss our long-term company vision and strategy.

The reasons why we’ve never been more excited about BrightSpring’s future. With that, I’ll turn the call over to Jenn.

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: Thank you, Jon. Before I discuss our financial results for the fourth quarter and full year of 2025, I’d like to remind you that in the first quarter of 2025, we began to record the community living business in discontinued operations, as indicated in the press release and 10-K to adhere to accounting standards required for annual reporting. All BrightSpring financial results and forecasts that I will discuss are related to continuing operations and exclude community living and any acquisitions that have not yet closed. Management believes the presentation of the non-GAAP financials from continuing operations is a useful reflection of our current business performance. In the fourth quarter of 2025, total company revenue was $3.6 billion, representing 29% growth from the prior year period. Pharmacy Solutions segment revenue in the quarter was $3.2 billion, achieving 32% year-over-year growth.

Within the pharmacy segment, infusion and specialty revenue was $2.6 billion, representing growth of 43% from prior year, and home and community pharmacy revenue was $593 million, representing a decline of 1% year-over-year. Home and community pharmacy revenue declined year-over-year due to the divestitures associated with a customer that declared bankruptcy and our decisions to exit specific uneconomic customers. This particular customer’s bankruptcy process is still ongoing, and our forward-year guidance contemplates a variety of scenarios. However, we do not anticipate any changes to the year under any scenario. In the Provider Services segment, we reported revenue of $394 million in the fourth quarter, which represented 13% growth compared to the prior year. Within the Provider Services segment, Home Health care reported $217 million in revenue, growing 19% versus last year.

Rehab revenue was $75 million, growing 8% versus last year, and personal care revenue was $102 million, representing growth of 4% year-over-year. For the full year of 2025, total company revenue was $12.9 billion, representing 28% growth from 2024. Pharmacy Solutions segment revenue was $11.4 billion, representing 31% growth from the prior year, and Provider Services segment revenue was $1.5 billion, representing 11% growth from the prior year. Moving down the P&L, 4th quarter company gross profit was $413 million, representing growth of 22% compared with the 4th quarter of last year. For full year 2025, company gross profit was $1.5 billion, representing growth of 20% compared to 2024.

Adjusted EBITDA for the total company was $184 million in the fourth quarter, an increase of 41% compared to the fourth quarter of 2024. For full year 2025, Adjusted EBITDA for the company was $618 million, representing 34% growth compared to 2024. Adjusted EPS for the total company was $0.33 for the fourth quarter and $1 for the full year. Throughout 2025, we continued to implement procurement initiatives and have invested in and deployed new technologies to enhance operational efficiencies across the company. This has contributed to ongoing people and growth investments, as well as net profitability, growth, and margin results for the fourth quarter and full year of 2025.

In 2026, we anticipate our procurement and operational programs to result in additional gains through cost efficiencies, best practices, and streamlining across all business lines. Turning back to segment performance, in the fourth quarter, Pharmacy Solutions gross profit was $255 million, growing 25% compared with the fourth quarter of last year. Adjusted EBITDA for Pharmacy Solutions was $162 million for the fourth quarter, an increase of 44% compared to last year, representing an Adjusted EBITDA margin of 5.1%, which was up approximately 40 basis points versus last year. Provider Services gross profit was $158 million, growing 17% versus the fourth quarter of last year.

Adjusted EBITDA for Provider Services was $64 million for the fourth quarter, growing 16% versus last year, representing an adjusted EBITDA margin of 16.4%, up approximately 50 basis points versus last year. Community Living continued to show strong operational and financial performance throughout the year, and we are pleased with the year-over-year revenue and EBITDA growth we achieved in this business in 2025. On a total company basis, cash flow from operations was $232 million in the fourth quarter and $490 million for 2025, exceeding our annual run rate operating cash flow expectations for the year.

Our adjusted EBITDA growth, combined with our cash flow generation during the quarter, has led to a leverage ratio of 2.99 times at December 31, 2025, which we successfully decreased from 4.16 times as of December 31, 2024. At the time we provided our fourth quarter 2024 results in March of last year, our leverage ratio target was 3.0-3.5 times pro forma for the community living transaction. As of year-end, we have now reached a leverage ratio of just under 3 times and below that expected range. Our view of year-end 2025 leverage pro forma for the community living transaction is 2.6 times. We are pleased to have exceeded our leverage target for the year, driven by both growth and very strong operating cash flows exiting the year.

BrightSpring is well positioned with a strong balance sheet, enabling increased capital allocation flexibility in 2026 and beyond. Longer term, with continued execution, growth, and cash flow generation, we remain on track towards a leverage target of 2.5x or below, which at current trends could be realized by mid-year, excluding acquisitions or other uses of cash. As of December 31st, net debt outstanding was approximately $2.5 billion. We continue to actively evaluate our capital structure to ensure that we are best positioned moving forward. As mentioned previously in January of last year, we expect to receive approximately $715 million of net cash proceeds from the $835 million of gross cash consideration in the pending Community Living sale, which at this time, we expect to close by the end of the 1st quarter.

Given various moving parts with regards to the use of community living proceeds, we are not providing interest expense guidance at this point in time. Turning to 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 $14.45 billion-$15.0 billion, including pharmacy solutions revenue of $12.6 billion-$13.1 billion, and provider services revenue of $1.85 billion-$1.9 billion. This revenue range reflects 11.9%-16.2% growth over full year 2025, excluding community living in both years. Total adjusted EBITDA is expected to be in the range of $760 million-$790 million for full year 2026.

This would reflect 23.1% to 27.9% growth over full year 2025, excluding community living in both years. Included in total adjusted EBITDA is expected contribution from the Amedisys and LHC acquisition of $30 million. I will now turn it back to Jon.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Thanks, Jen, and thank you for your time today to go through BrightSpring’s fourth quarter and full year 2025 results. We’ll now open up the call for questions. Operator?

Ann Hynes, Analyst, Mizuho0: Thank you. As a reminder, to ask a question, please press star one on your telephone and wait for your name to be announced. To withdraw your question, please press star one again. In fairness to all, we ask that you please limit yourself to one question and one follow-up. One moment for our first question. Our first question is going to come from the line of A.J. Rice with UBS. Your line is open. Please go ahead.

A.J. Rice, Analyst, UBS: Thanks. Hi, everybody. Obviously, a lot of things are going well for the company at this point. When you look at your 2026 outlook, I wonder if you could just maybe at a high level, talk through a little bit about where are the points of variability in your forecast, when you think about the greatest swing factor that could create upside or create challenges for you, and what would you highlight?

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah. Good morning, AJ. Hope you’re doing well. Thank you for the question. You know, as we sit here right now, you know, we see a lot of consistency just, that’s playing out in Q1, as we look at 2025. We don’t see a whole lot of changes and are continuing just to try to execute against the strategies that we’ve been driving for a while. I mean, as we look out for the year and try to ensure execution, you know, continuing to drive volume growth in each of the businesses is going to be important.

We’re making sales investments, you know, really, as always, in all of the businesses, in particular, in a couple of them, like home health, hospice, and infusion, and in home and community, and select markets like IDD and ALF. You know, seeing those sales investments take hold. As always, we have a wholesome list of Lean Six Sigma, tech, and now increasingly AI projects that are slated to roll out through the company this year. We expect benefit from those as well. Then as we integrate, you know, the Amedisys and LHC acquisitions, you know, those will be important to do well this year. Look, I think it’s just continued execution from a quality standpoint, and with that quality, investing more and more in sales to drive to our volume targets.

Then on the cost side, you know, continuing to drive lean initiatives through technology and through our procurement team. Obviously, there’s some margin expansion in what we’re expecting for this year. You know, all of those items are things we’ve been executing against for a long time. I think we want to take the consistency we’re seeing right now and just continue to execute from a volume and a margin perspective.

A.J. Rice, Analyst, UBS: Maybe for the follow-up, I know you said that over the next 12-18 months, you’re looking at 16-20 new LDD introductions. I wondered, give us some comments about the landscape from a generic conversion, biosimilar conversion, and what that looks like for you at this point.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, we actually had 24 LDDs we won last year. You know, 16-20 is our guidepost. We’ve been beating that the last year or two. You know, we feel like that’s a really good number as we look out 12-18 months. The team is just doing a great job. You know, again, from a quality and service level perspective, you know, that’s something we focus on immensely to try to be the best partner we can. You know, I think importantly, you know, we are winning rare and orphan and some LDDs outside of oncology as well. You know, we’ll have probably three or four infusion LDDs, for example, you know, that we’re going to be winning here in Q1 or early Q2, and that’s an area we’re really focusing on.

Even a, even a very meaningful cardiac drug here recently that you know, that we picked up, too. You know, our LDD and specialty strategy is continuing to, I would say, expand, leveraging on the core capabilities that we have in that society. You know, from a biosimilar perspective, you know, with Solara mostly in the rearview mirror, it’s a little bit of residual impact for us this year. But we really don’t have any exposure there, just given, you know, the nature of the therapies and the drugs that we supply.

Ann Hynes, Analyst, Mizuho2: Okay, thanks a lot.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question will come from the line of Whit Mayo with Leerink Partners. Your line is open. Please go ahead.

Ann Hynes, Analyst, Mizuho5: Hey, thanks. Good morning. Jon or Jen, can you talk about just EBITDA and margins for each of the segments expected for this year?

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, sure. I’ll go ahead and turn that over to Jen in a second. Yeah, I would just say, as you’re seeing EBITDA, you know, in our guide thus far for 2026, you know, outpace revenue, obviously, there’s some margin expansion there. You know, from a revenue perspective, some things that were expected, you’ve got IRA, you’ve got some branded generic conversions, you’ve got a little bit of residual impact from a customer or two in home and community pharmacy that, you know, we either fired or they went bankrupt. That’s at play in some of our revenue numbers, notwithstanding that really strong growth rate numbers for the year that we’re really confident in.

You know, I think some of the EBITDA drivers, as said before, is gonna be some product mix and then these operational efficiencies that we continue to drive. You know, providers got a really good growth number for 2026. That’s a 17% margin business as well. Jen, any other commentary at the segment level?

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: Yeah, I would say from a segment standpoint, we do expect broad-based margin expansion from the initiatives that we’ve deployed in late 2025 and continuing into 2026. We will see, you know, we do expect some of that. We have favorable mix, both in terms of products and services that is benefiting that. Jon mentioned some of the revenue impacts, that also is causing expansion from a margin perspective, from an EBITDA standpoint. Just with all of that, we continue to invest for future growth. In our plan for 2026, we will continue our investments in AI and technologies and other operational processes and sales investments, as Jon has mentioned. We are going to be covering that in this revenue guide as well.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, I think that’s an important point. I mean, even sort of with the EBITDA guide for 2026, which I think it’s 27%, 28% at the high end, you know, there’s a lot of continual investment we’re making in the company as we look out to 1, 3, and 5-year growth, which we’re really excited about.

Ann Hynes, Analyst, Mizuho5: Okay. I’m curious just your views on the future of the temporary and permanent behavioral adjustment cuts for home health. Now that you’ve, you know, really doubled down on the industry, there’s some debate whether or not CMS will in fact, move forward to implement any further cuts. I mean, you may have, you know, kind of called bottom here on the rate environment in some ways. I’m just curious how you’re looking at the rate environment.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, we like home health a lot. I mean, you know, that deal was such an incredible fit from a geographical perspective. You know, our baseline view of home health rates, just to be conservative, is flat. I think there’s been a lot of constructive conversations even here recently around the future and the value of home health. You know, we do remain optimistic and just given the landscape of what’s happened with some of the providers, I mean, we see an unbelievable runway in home health and hospice over the next 5 to 10 years. You know, our base case is flat. You know, I think if certain things occur in the future, there could be positivity there and back to normal and expected and justified rate increases.

You know, remember, home health for us is sort of still sitting around 10% or so of the company, you know. Hospice is obviously had a ton of support and has been a phenomenal performer for us. Both of those teams in our company have best-in-class management. We continue to add to sales, we continue to drive technology into those businesses, super excited about their prospects.

Ann Hynes, Analyst, Mizuho5: Thanks.

Ann Hynes, Analyst, Mizuho0: Thank you. Due to time, we ask that you please limit yourselves to one question. One moment for our next question. Our next question comes from the line of David Larsen with BTIG. Your line is open. Please go ahead.

David Larsen, Analyst, BTIG: Hi, congratulations on the great year. Can you talk a little bit about the earnings impact on specialty when drugs launch generic? It’s my understanding that even though the price can decline, your margins would improve. With generic launches, you’re able to negotiate better margins across product classes when that happens. Just any numbers around that would be very helpful if that’s the case. Thank you.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Hey, David. Yeah, look, in the specialty pharmacy business, that growth is multifactorial, and it’s been, you know, working for a decade now. You know, you’ve got brand LDDs. We continue to win about 20 of those a year. You know, we’re continuing to actually expand outside of oncology in a lot of rare and orphan conditions, which is exciting. You know, the pipeline out there in pharma continues to never be more innovative and bigger. Some of these therapeutics are amazing for what they can do for people. You’ve got brand LDDs, you’ve got a healthy stream of brands converting generic over time. You know, that’s a great thing for everybody. We drive generic utilization as much as we can. Obviously, the, you know, cost on the buy side and procurement, you know, comes down, and that’s helpful.

You know, we have a really growing fee-for-service business. You know, we have a lot of data agreements and other service agreements with pharma. You know, we’re up to over 30 hubs now, where we’re the hub for pharma. Just a terrific business in terms of the fee-for-service side, you know, and that’s obviously at a higher gross profit margin as well. You know, we like the, you know, the multifactorial nature of growth in that business, and, you know, we continue to lean into all of them.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question comes from the line of Charles Rhyee with TD Cowen. Your line is open. Please go ahead.

Charles Rhyee, Analyst, TD Cowen: Yeah, thanks for taking the questions, guys. Maybe just follow up from this question and just at least thinking through for the segments related to the overall EBITDA guidance. Obviously, with the provider segment, we’re going to add in sort of the $30 million contribution from the Amedisys transaction here. Beyond that, if we look at sort of either the 25 full year performance for the segments versus maybe fourth quarter, anything that would suggest that the trends that we’re seeing in either, you know, that we should take into account in our modeling as we think about how to proportion sort of the overall EBITDA between the segments?

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: We expect consistency with what we saw in 2025. We will continue to see volume growth and EBITDA growth is our expectation organically across both of our segments.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question will come from the line of Jared Haase with William Blair. Your line is open. Please go ahead.

Jared Haase, Analyst, William Blair: Yeah, hey, guys. Thanks for taking the questions, and good morning. Just wanted to drill in a little bit more. Just, I wanted to understand the margin profile of the Amedisys assets that you acquired. From your comments, it sounds like that’s a high single-digit margin if I use the pro forma revenues and then the $30 million EBITDA contribution, which I guess seems to be a little bit on the lower side compared to peers in the space and the rest of your legacy provider segment. Just wanted to kind of understand, make sure we’re thinking about margins for that asset correctly. I’m wondering if you’re sort of absorbing any integration or transformation-related costs post that acquisition in the near term.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Hey, hey, Jared. I’ll let Jen speak in a second. Good morning. No, look, I think you’re largely doing that math correctly in terms of what we acquired. You know, it is what it is. You know, as we look out for the year, you know, that would be something that we would hope to integrate very soundly, and as we step through the year, we’ll see how it’s going. You know, we have a margin that’s higher than that, and our goals will be to drive to our margin over time, I think we will look to see how quickly we can do that.

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: I would agree. There’s a lot of integration work, some technology investments that we’re making, ensuring everyone’s on consistent platforms and systems, a number of travel initiatives and other things. We’re really excited about that asset and what that will bring. Again, as Jon mentioned, we are very excited about moving that towards our overall profile.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, I think the only question hopefully will be the timeline of that. you know, if it moves up, it moves up, and that’s a good thing.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question comes from the line of Brian Tanquilut with Jefferies. Your line is open. Please go ahead.

Brian Tanquilut, Analyst, Jefferies: Hey, good morning, and congrats on the quarter, guys. Maybe, Jen, as I think through the year, any call-outs, especially with the Amedisys transaction coming in and kind of like a margin ramp expectation there, any call-out on how we should think about the cadence of the quarters for 2026?

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: Yeah, really great question, Brian. Thank you. Just as a reminder, Q1 is the shortest quarter from a days perspective, so that tends to be, from a, from an annualized perspective, our lowest quarter. We would expect sequential growth in each of our quarters throughout 2026, consistent with what we saw in 2025. You know, from a margin perspective, that will be driven really kind of throughout the year as well as we, as we, have different products coming online. We have a generic launch that will happen in Q2, so that will increase throughout the year from a margin perspective.

Ann Hynes, Analyst, Mizuho0: Thank you. And one moment for our next question. Our next question will come from the line of Pito Chickering with Deutsche Bank. Your line is open. Please go ahead.

Ann Hynes, Analyst, Mizuho1: Hey, good morning, guys. Great quarter here. Looking at the 2026 pharmacy revenue guidance, can you give us the moving parts between sort of core growth of existing drugs, plus new LDD wins, and then the offsets from generic conversions? Obviously, generics is obviously revenue and obviously not EBITDA, but if you can just give us, you know, how we think about core growing plus LDD wins minus generics to help get to the pharmacy revenue guidance. Thank you.

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: Maybe I’ll just start with a couple of unfavorable impacts. I think that’ll be helpful context. As you think about IRA in specialty and infusion, we do have a revenue headwind of approximately $200 million, brand to generic conversions. As we’ve talked throughout 2025, we typically are trying to increase our sales in advance of a launch. As we know, when there’s a brand to generic conversion, revenue does come down, ultimately, that is good for everyone. It is beneficial from an EBITDA standpoint for us. The total impact in specialty and infusion is a little over $400 million between those two items. Home and community IRA impact from a revenue standpoint is approximately $175 million.

We do have headwinds of approximately $600 million in 2026. Despite that, we obviously have strong growth. We do expect growth across all of our different business lines. We will absolutely have LDD growth, that is the, you know, that and specialty. We have strong script growth in home infusion and specialty plans. We mentioned in Q3 that home and community script growth will be challenged because of the year-over-year lapping of some of the customers that we off-boarded or the branches associated with that customer that went through bankruptcy and those locations. In home and community, we will have script challenges until about Q3, but we will, outside of that, we are having really strong volume growth across each of our pharmacy businesses.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question comes from the line of Ann Hynes with Mizuho. Your line is open. Please go ahead.

Ann Hynes, Analyst, Mizuho: Great, thank you. Can you provide an update on the infusion business? I know it’s been a big focus of investment and growth. Maybe how much that grew within specialty, what the margin profile is, and maybe what it contributes now as a % of total specialty. Thanks.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, hey, Ann, good morning. We’re pleased with where the infusion business is at. You know, we have really high aspirations for it this year and going forward. The acute business, you know, we’re really a top two provider in the country there, and in a lot of markets, have a leading market share. You know, that growth has been in the double digits, and, you know, we’re optimistic that’ll occur again this year. You know, on the specialty side is, I think, where we have, you know, a big opportunity. You know, we’ve been underweight on specialty. We’re creating specialty hubs right now, and, you know, really separating those two businesses out to create the focus that we want. You know, we’ve invested in a lot of resources there.

We’re going to be further investing in resources. you know, we have plans to significantly expand our AIS presence. We’ve got about 30 right now. We’re going to be retrofitting those and upgrading them and moving locations all this year and trying to make them extremely consumer-friendly in all the right kind of strip malls and places. you know, super excited about it. you know, as you look at our balance sheet, that gives us a lot more flexibility in the future as well.

Just kind of broadly, just touching back on Pito Chickering, when you think about the numbers, Jen, you know, put out there, sort of those one-time impacts, you know, that otherwise is, you know, calculating to, you know, a revenue outlook at this time for 2026 of at 20% or a little bit over 20% when you adjust for those items. Really robust broadly outside of a couple of those external items. I just wanted to circle back on Brian’s note on the cadence for the year. It’s a great question. I mean, as Jen said, we do expect, you know, the quarters to increase throughout the year.

As I, you know, sort of mentioned to AJ, the continual sales investments we’re making all in the back of quality, de novos that we’re investing in, and then our operational projects, these things are all ongoing throughout the year. As such, you know, those are some of the growth drivers we see throughout the year, as we sit here today.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question will come from the line of Matthew Gillmor with KeyBanc. Your line is open. Please go ahead.

Matthew Gillmor, Analyst, KeyBanc: Thanks for the question. I wanted to ask about the Onco360 sales force. It seems like a pretty unique asset within the specialty pharmacy platform. Can you remind us the role they play, especially with LDD launches or with generic conversions, and what are the priorities for that part of the business as you’re thinking about 2026?

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, no, that’s an area that we’ve continued to invest in. A lot of long-standing relationships, both with pharma and with prescribers, which we are extremely, you know, take extremely seriously and are very honored to have. It’s an area that, you know, we give a lot of attention. We’ve increased our investments in that field force every year. We’ll do it again this year. You know, we’re essentially at this point, covering, you know, I think every geography in the United States from a referral standpoint. Again, it’s the service levels that, you know, are really pulled through behind the commitments by the field force that are so important.

Those are all reflected in the Net Promoter Scores that we have, you know, which typically range between 95, you know, to 100. Everything starts with service, and from there, it’s just trying to offer the best education and support, you know, for all of the stakeholders out there in the market that we can.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question will come from the line of Joanna Gajuk with Bank of America. Your line is open. Please go ahead.

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: Oh, yes. Hi, good morning. If I may ask, the same question a little bit differently about the segment work. I so appreciate the $600 million revenue headwind in the pharmacy segment. If I look at, you know, 2025 pharmacy segment margins, right, they improved actually a little bit year-over-year, the 4.7%, call it in 2025. Like, is that the, you know, the way to think about 2026 margins for that segment? You know, how, I guess, these revenue headwinds translating into the margin for that segment? Thank you. Yeah. Thank you, Joanna.

It would be mix shift, it would be operational improvements and offset by the investments that we’re going to be making, you know, as we had mentioned in each of the different segments and at corporate in those areas. Again, we would absolutely expect, you know, an improvement in margins. You see that coming through and you start to see that in Q4, you see that margin move up. We’ll expect, you know, a small improvement of that’s continuing through 2026, and, you know, again, for those particular reasons.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: In addition to the mix shift and the operational initiatives, you know, you’ve got, you’ve got economies of scale just from, you know, really robust, just core growth.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question will come from the line of Raj Kumar with Stephens. Your line is open. Please go ahead.

Ann Hynes, Analyst, Mizuho2: Hi, good morning. Maybe just kind of expanding upon the kind of the integration milestones with AmerisourceBergen, LHCG, and thinking about that, you know, beyond 2026. Maybe kind of fleshing out the embedded value you see with the asset integration and then cross integration of services and products between both segments, considering the deeper kind of geographical overlap post deal. Kind of would be helpful to kind of see or frame the overall kind of story there.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: You know, I think, I think there was an earlier question about the margin structure that we acquired. You know, our provider margins, you know, you can look at what they are. You know, that’s, that’s what our hope is for the business. You know, I think we just have to see how quickly we can get there. You know, I would say, you know, we’re, you know, we’re very optimistic about the top line growth and the volume in ADC growth as well, and the potential that we have in the business. You know, the assimilation so far has gone incredibly well. You know, from a cultural standpoint, fantastic. So we’re really excited about it.

You know, there’s margin opportunity there, we’re as excited and even more excited about what we can do from a growth perspective in some of these really terrific markets. You know, I would say that there’s also overlap with our hospice branches, you know, there’s gonna be a lot of integrated care opportunities there as well, and, you know, benefits for our hospice business too. Yeah, I would note that we funded that deal entirely with cash on hand, I think that’s, you know, just a little bit of a call-out to where our balance sheet and our cash profile is today. You know, we ended up the year at almost $500 million of operating cash flow. You know, we also, you know, did a repurchase, you know, later in the year.

As we look at our balance sheet, under 3x now in pro forma for the community living closed 2.6x. You know, it’s, I think the ability to execute against that transaction, entirely funded with cash on hand, you know, was a, was a helpful benefit of where we’ve come as a company from a balance sheet perspective and where we sit today. As mentioned, you know, I think that’s gonna give us some flexibility as we go forward, particularly later in the year and certainly into 2027 and 2028.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question comes from the line of Stephen Baxter with Wells Fargo. Your line is open. Please go ahead.

Ann Hynes, Analyst, Mizuho4: Yeah. Hi, yeah, some strong growth rates here, and I think that actually includes potentially stepping over a fairly large headwind in the LTC business that’s coming off the changes that are being made around the IRA. I was wondering if you could update us maybe on the magnitude of the headwind there that you’re stepping over, and then any update on your efforts to maybe offset that headwind through, you know, reimbursement changes or additional fees or things like that. Thank you.

Jen Phipps, Chief Financial Officer, BrightSpring Health Services, Inc.: Yeah. As we discussed last quarter, we continue to work and continue through Q4 to work productively with our payers regarding an enhanced dispensing fee that we have worked to achieve, which has helped us to mitigate some of the impact. There, we absolutely do have an impact, we continue to work through that from a payer perspective, through all of the other growth initiatives, the volume growth, the operational efficiencies, we have growth planned, as we had discussed, healthy growth planned in the home and community business. We continue to work again, productively with our payers to ensure that we have an appropriate enhanced dispensing fee. Our government relations team is also active, making sure that everyone understands the impacts to the pharmacy business.

again, our scale platform and our operational improvements that we that are hallmark really to how we are approaching every single year, I think have helped us in this year for 2026.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, I think, you know, hopefully, we’ve been clear on the growth drivers for specialty across LDDs, brand generic, fee for service, infusion. You’ve got acute, you’ve got specialty, you’ve got a growing LDD business there, rollout of more AISs. You know, in home and community pharmacy, you know, outside of this IRA, which we’ll work through constructively, you know, you’ve got one or two customer situations, unfortunately, which will be in the rearview mirror, probably by about Q3 or Q4. I mean, you know, the name of the game in that business is driving as much volume as you can in these other attractive end markets and being the most efficient scale provider in the industry.

You know, you look at assisted living, you look at hospice, you look at behavioral, you look at the PACE market we’re entering, and then the skilled nursing market, you know, with a segment of that market, all extremely attractive. I mean, we’re adding some 30 reps this year to grow and penetrate across all those markets further. This is where we are leaning into AI and technology the most for starters. You look at the whole pharmacy intake and revenue cycle project process, and there’s some 7 or 8 projects this year. Super excited about continuing to build out, you know, the biggest scaled independent provider in that space.

attractive end markets and providing a set of operations, you know, that produce the highest service levels possible and with a continued focus on cost per script there.

Ann Hynes, Analyst, Mizuho0: Thank you. One moment for our next question. Our next question comes from the line of Sean Dodge with BMO Capital Markets. Your line is open. Please go ahead.

Ann Hynes, Analyst, Mizuho3: Yeah, thanks. Good morning. Maybe just going back to the margin comments on the pharmacy side. You mentioned some of the key drivers having been your efficiency efforts and then product mix. Could you just give us a sense of the margin expansion you drove over the last year, how much of that was from generics versus how much of that was from those cost initiatives? We think about the 2026 guidance, the improving margins you’re embedding there, is that proportionality expected to change at all? How big of a role do you expect incremental efficiencies to play into that again, versus lift from the generics? Thanks.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Yeah, I mean, well, look, the good news on operational efficiencies, you know, is a lot of them occurred in the back half of last year, so they’re just sort of flowing through at this point and will be year-over-year tailwinds. In addition to that, you know, we’re always looking at the next thing and launching new projects. I would say on the pharmacy side, home and community and infusion is where we have the most projects from an operational excellence perspective going on and will be going on this year. From a margin perspective, I mean, yeah, economies of scale from, you know, pretty aggressive growth targets that we like to put out there and go try to achieve.

You know, look, across all the different businesses, you’ve got brands and generics, and each you’ve got a lot of different end markets, a lot of different payers. I mean, you know, there’s just a lot going on. The net effect of it every year, if you focus on, you know, strong double-digit growth, market share gains, targeting the most attractive therapeutic areas, and doing all of that with the best quality and the most operational efficiency, you know, that’s always net out to a really good place. You know, the hallmarks of the company now for 10 years has been volume and efficiency and then accretive M&A. That story has really never been more intact, and you see all that play through in 2026, we think, as we sit here today.

Ann Hynes, Analyst, Mizuho0: Thank you. Showing no further questions, I would like to hand the conference back over to Jon Rousseau for closing remarks.

Jon Rousseau, Chief Executive Officer, BrightSpring Health Services, Inc.: Thank you, everybody, for joining. We really appreciate it. Appreciate your questions, as always, and have a great day, and we look forward to talking with you soon.

Ann Hynes, Analyst, Mizuho0: This concludes today’s conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.