Group 1 - Warren Buffett's Berkshire Hathaway reported a significant asset write-down of $3.8 billion on its investment in Kraft Heinz, reducing its book value to $8.4 billion from over $17 billion at the end of 2017 [4] - Despite the apparent loss, an analysis revealed that Buffett had secured nearly 60% profit due to favorable terms negotiated during the transaction, showcasing his ability to turn a perceived failure into a profitable outcome [4][5] - Buffett's investment philosophy emphasizes long-term value and strategic positioning, which has allowed him to navigate market fluctuations effectively [5] Group 2 - Buffett's cautious outlook on the current U.S. stock market is evident, as he believes the S&P 500's price-to-earnings ratio exceeding 30 indicates inflated growth expectations, suggesting potential historical investment opportunities in the next five years [16] - Berkshire Hathaway's cash reserves reached a record high of $344 billion, providing a robust buffer against market volatility as Buffett prepares to pass the reins to his successor, Greg Abel [21] - The company holds a diversified portfolio, with significant investments in Apple, American Express, and Coca-Cola, which together account for over 50% of its stock investment portfolio [18][19] Group 3 - Buffett's investment strategy includes a focus on companies with strong fundamentals, as evidenced by his long-term holdings in Coca-Cola and Apple, which have shown resilience and growth despite market challenges [27][29] - The investment approach is characterized by a preference for businesses with a competitive edge and sustainable cash flow, avoiding speculative trends such as AI investments that do not align with his expertise [20][32] - Buffett's principles emphasize the importance of understanding the intrinsic value of investments, advocating for a long-term perspective rather than short-term speculation [28][30] Group 4 - Buffett's philanthropic efforts include significant donations to charitable causes, particularly the Gates Foundation, reflecting his belief in responsible wealth distribution and opposition to hereditary wealth [36] - His lifestyle remains modest despite immense wealth, highlighting a commitment to simplicity and frugality, which has become a notable aspect of his public persona [36]

Core Insights - DaVita Inc. reported adjusted earnings per share (EPS) of $2.95 for Q2 2025, reflecting a year-over-year increase of 13.9% and exceeding the Zacks Consensus Estimate by 9.3% [1][9] - Total revenues reached $3.38 billion, marking a 6.1% increase year-over-year and surpassing the Zacks Consensus Estimate by 1.3% [2][9] - The company experienced a decline in normalized non-acquired treatments, which decreased by 0.8% year-over-year [5][14] Financial Performance - The gross profit for the quarter increased by 7% year-over-year to $1.12 billion, with a gross margin expansion of 31 basis points to 33.1% [8][9] - General and administrative expenses rose by 12.2% year-over-year to $412.8 million [8] - Adjusted operating profit was $705.2 million, reflecting a 4.2% increase from the prior year, although the adjusted operating margin contracted by 36 basis points to 20.9% [8][9] Revenue Breakdown - Dialysis patient service revenues amounted to $3.21 billion, up 4.8% year-over-year, while other revenues surged by 37.4% to $172.7 million [4][9] - Revenue per treatment was $404.6 million, an increase of 3.7% year-over-year [2] Operational Highlights - DaVita provided dialysis services to approximately 283,100 patients across 3,175 outpatient dialysis centers as of June 30, 2025 [5] - The company opened three new dialysis centers and closed two in the U.S., while internationally, it opened six and closed five centers during the same period [6] Cash Flow and Debt - DaVita ended Q2 2025 with cash and cash equivalents of $739.4 million, an increase from $511.9 million at the end of Q1 2025 [10] - Total debt rose to $10.26 billion from $9.74 billion at the end of Q1 2025 [10] - Cumulative net cash provided by operating activities was $504.2 million, down from $664 million a year ago [11] Guidance - The company reiterated its adjusted EPS outlook for 2025, projecting a range of $10.20 to $11.30, with the Zacks Consensus Estimate currently at $10.76 [12]

Core Viewpoint - DaVita HealthCare reported quarterly earnings of $2.95 per share, exceeding the Zacks Consensus Estimate of $2.7 per share, and showing an increase from $2.59 per share a year ago, indicating a positive earnings surprise of +9.26% [1][2] Financial Performance - The company achieved revenues of $3.38 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.31% and up from $3.19 billion year-over-year [2] - Over the last four quarters, DaVita has exceeded consensus EPS estimates three times and topped revenue estimates four times [2] Stock Performance - DaVita HealthCare shares have declined approximately 6.7% since the beginning of the year, contrasting with the S&P 500's gain of 7.6% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $3.21 on revenues of $3.42 billion, and for the current fiscal year, it is $10.76 on revenues of $13.48 billion [7] - The outlook for the Medical - Outpatient and Home Healthcare industry is positive, ranking in the top 27% of over 250 Zacks industries, suggesting potential for outperformance [8]

Financial Data and Key Metrics Changes - Adjusted operating income for Q2 2025 was $551 million, and adjusted earnings per share were $2.95, with free cash flow at $157 million [16][15] - The company reaffirmed its guidance for adjusted operating income between $2.01 billion and $2.16 billion and adjusted earnings per share between $10.20 and $11.30 for the full year [14][15] Business Line Data and Key Metrics Changes - US treatments per day declined by 1.1% year-over-year, primarily due to a higher than expected mistreatment rate, which was influenced by the cyber incident [17][30] - Revenue per treatment (RPT) increased by approximately $4.5 compared to Q1, but was negatively impacted by the cyber incident and lower dispensing volumes of binders [18][19] - Patient care costs per treatment decreased by approximately $3.5 sequentially, attributed to higher treatment counts, improved labor productivity, and lower binder dispensing volumes [20][21] Market Data and Key Metrics Changes - The company anticipates a year-over-year decline in treatment volume of 75 to 100 basis points, revised from a previous estimate of down 50 basis points [17][18] - International adjusted operating income increased by $6 million compared to Q1, primarily due to a one-time benefit [21] Company Strategy and Development Direction - The company is focused on clinical innovation and improving patient outcomes through advanced technologies and pharmaceuticals, including new drug classes and next-generation devices [6][7] - The company is committed to maintaining operational excellence and cost control, which is expected to continue even as treatment volumes normalize [76][77] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about entering a new wave of clinical innovation that could improve patient care and outcomes [6][7] - The company acknowledged the ongoing impact of the cyber incident but believes that the effects on adjusted results will be limited moving forward [11][30] Other Important Information - The company repurchased 3.1 million shares during Q2 and an additional 2.7 million shares since the end of the quarter [23] - The company raised $1 billion in senior unsecured debt and repriced its term loan, reducing the spread by 25 basis points [23] Q&A Session Summary Question: How did census and treatments track following the cyber attack? - Management indicated that while there were initial challenges, operations have normalized since the incident, but mistreatment rates spiked unexpectedly [30][31] Question: Can you provide phosphate binder contribution to RPT and CPT in the quarter? - The RPT contribution was in the low eights, and CPT was in the high sixes, with lower dispensing volumes attributed to adherence issues rather than a mix problem [34][35] Question: How is the company maintaining guidance despite treatment growth challenges? - The company is managing costs effectively, particularly in labor, and has seen better-than-expected performance in international operations [41][42] Question: What is the reason for the elevated mortality rates? - Management believes the elevated mortality is a holdover from COVID, with delays in care and sicker patients contributing to the trend [71][72] Question: What is the expected impact of new technologies on patient care? - The company is actively monitoring and conducting studies on new technologies, with a focus on improving patient outcomes through better clearance of middle-sized molecules [90][91]

Financial Data and Key Metrics Changes - Adjusted operating income for the second quarter was $551 million, and adjusted earnings per share were $2.95, with free cash flow at $157 million [14][22] - The company reaffirmed its guidance range for adjusted operating income of $2.01 billion to $2.16 billion and adjusted earnings per share of $10.20 to $11.30 for the year [23] Business Line Data and Key Metrics Changes - US treatments per day declined by 1.1% year-over-year, primarily due to a higher than expected mistreatment rate, which was influenced by the cyber incident [15][16] - Revenue per treatment increased by approximately $4.5 compared to the first quarter, but was negatively impacted by the cyber incident and lower dispensing volumes of binders [17][18] - Patient care costs per treatment declined by approximately $3.5 sequentially, attributed to higher treatment counts, improved labor productivity, and lower binder dispensing volumes [19][20] Market Data and Key Metrics Changes - International adjusted operating income increased by $6 million compared to the first quarter, primarily due to a one-time benefit [21] - Integrated Kidney Care (IKC) had adjusted operating income of $26 million in the second quarter, benefiting from approximately $40 million of revenue expected to be recognized later in the year [21] Company Strategy and Development Direction - The company is focused on clinical innovation and improving patient outcomes through advanced technologies and new drug classes [6][14] - The management emphasized the importance of operational excellence and cost management to navigate challenges and maintain financial performance [22][76] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about entering a new wave of clinical innovation that could improve patient care and outcomes [5][6] - The company acknowledged the ongoing impact of the cyber incident but believes the effects on adjusted results will be limited moving forward [11][52] Other Important Information - The company reported a leverage ratio of 3.34 times consolidated EBITDA, which is within its target range [22] - The management highlighted the need for better clearance of middle-sized molecules and increased patient adherence to medications as key areas for improving patient outcomes [46][70] Q&A Session Summary Question: How did census and treatments track following the cyber attack? - Management indicated that while there were initial challenges, operations have normalized since the incident, but mistreatment rates spiked unexpectedly [26][28] Question: What contributed to the lower dispensing volumes of phosphate binders? - The reduction was attributed to a decrease in the number of prescriptions rather than a mix issue, with some patients obtaining binders through other means [30][31] Question: How is the company maintaining operating income guidance despite treatment growth challenges? - The primary driver is cost per treatment, particularly labor dynamics in US dialysis, along with better-than-expected international performance [38][39] Question: What is the outlook for Integrated Kidney Care (IKC) in the back half of the year? - IKC is expected to be roughly breakeven for the first half of the year, with guidance for a negative $20 million in the back half [95] Question: What is the impact of the cyber incident on revenue per treatment? - The cyber incident affected revenue for treatments done in Q2 due to manual processes and delays, which are not expected to impact the second half of the year [51][52] Question: What are the expectations for patient care costs moving forward? - The main driver for performance is productivity, with improved retention and training effectiveness contributing to lower costs [79] Question: How does the company plan to address elevated mortality rates? - Management believes the elevated mortality is a holdover from COVID, and they are implementing strategies to improve patient outcomes gradually [70][72]

PART I. FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements](index=2&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) Presents DaVita Inc.'s unaudited condensed consolidated financial statements and notes, detailing financial performance, balance sheet, and cash flows [Consolidated Statements of Income](index=3&type=section&id=Consolidated%20Statements%20of%20Income) Consolidated Statements of Income (in thousands of dollars, except EPS) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | |:---|:---|:---|:---|:---| | Total Revenues | $3,379,526 | $3,186,722 | $6,603,055 | $6,257,277 | | Operating Income | $537,841 | $506,398 | $976,778 | $990,243 | | Net Income Attributable to DaVita Inc. | $199,337 | $222,676 | $362,254 | $462,325 | | Diluted EPS | $2.58 | $2.50 | $4.57 | $5.15 | [Consolidated Statements of Comprehensive Income](index=4&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Consolidated Statements of Comprehensive Income (in thousands of dollars) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | |:---|:---|:---|:---|:---| | Net Income | $275,220 | $299,752 | $507,436 | $605,732 | | Unrealized (losses) gains on interest rate cap agreements | $(6,405) | $5,919 | $(14,940) | $19,236 | | Unrealized gains (losses) on foreign currency translation | $94,001 | $(78,853) | $184,857 | $(118,573) | | Total comprehensive income attributable to DaVita Inc. | $288,467 | $127,701 | $535,212 | $319,319 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheets (in thousands of dollars) | Metric | June 30, 2025 | December 31, 2024 | |:---|:---|:---| | Total Assets | $17,492,958 | $17,285,268 | | Total Liabilities | $15,939,935 | $15,193,917 | | Total DaVita Inc. Shareholders' Equity (Deficit) | $(369,633) | $121,122 | | Goodwill | $7,465,769 | $7,375,216 | | Long-term debt | $10,078,805 | $9,175,903 | [Consolidated Statements of Cash Flow](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flow) Consolidated Statements of Cash Flow (in thousands of dollars) | Metric | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | |:---|:---|:---| | Net cash provided by operating activities | $504,245 | $664,010 | | Net cash used in investing activities | $(229,303) | $(376,964) | | Net cash used in financing activities | $(378,094) | $(243,976) | | Net (decrease) increase in cash, cash equivalents and restricted cash | $(82,866) | $38,612 | [Consolidated Statements of Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Equity) Consolidated Statements of Equity (in thousands of dollars) | Metric | June 30, 2025 | December 31, 2024 | |:---|:---|:---| | Total DaVita Inc. shareholders' equity (deficit) | $(369,633) | $121,122 | | Treasury stock (Amount) | $(2,485,654) | $(1,389,072) | | Retained earnings | $1,896,884 | $1,534,630 | | Accumulated other comprehensive loss | $(137,838) | $(310,796) | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [Note 1. Condensed consolidated interim financial statements](index=9&type=section&id=Note%201.%20Condensed%20consolidated%20interim%20financial%20statements) - The interim financial statements are unaudited and prepared by management, reflecting necessary adjustments for fair presentation[24](index=24&type=chunk) - Significant estimates and assumptions are made for revenue recognition, accounts receivable, fair value, income taxes, and loss contingencies[24](index=24&type=chunk) [Note 2. Revenue recognition](index=9&type=section&id=Note%202.%20Revenue%20recognition) Segment Revenues by Primary Payor Source (3 Months Ended June 30, in thousands of dollars) | Revenue Source | 2025 | 2024 | |:---|:---|:---| | U.S. dialysis patient service revenues (Medicare & Medicare Advantage) | $1,659,607 | $1,587,198 | | U.S. dialysis patient service revenues (Commercial) | $947,015 | $952,625 | | Other revenues (Medicare & Medicare Advantage) | $140,149 | $97,433 | | Total Consolidated Revenues | $3,379,526 | $3,186,722 | Segment Revenues by Primary Payor Source (6 Months Ended June 30, in thousands of dollars) | Revenue Source | 2025 | 2024 | |:---|:---|:---| | U.S. dialysis patient service revenues (Medicare & Medicare Advantage) | $3,268,625 | $3,118,696 | | U.S. dialysis patient service revenues (Commercial) | $1,871,903 | $1,878,455 | | Other revenues (Medicare & Medicare Advantage) | $239,103 | $200,542 | | Total Consolidated Revenues | $6,603,055 | $6,257,277 | - IKC revenues from performance obligations satisfied in previous years were **$95,911 thousand** for the six months ended June 30, 2025, up from **$31,309 thousand** in 2024, due to measurement limitations and recognition constraints on complex VBC contracts[31](index=31&type=chunk) [Note 3. Earnings per share](index=11&type=section&id=Note%203.%20Earnings%20per%20share) Earnings per Share (in thousands of dollars, except per share amounts) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | |:---|:---|:---|:---|:---| | Net income attributable to DaVita Inc. | $199,337 | $222,676 | $362,254 | $462,325 | | Basic net income per share | $2.62 | $2.56 | $4.67 | $5.29 | | Diluted net income per share | $2.58 | $2.50 | $4.57 | $5.15 | | Diluted shares | 77,362 | 88,950 | 79,309 | 89,749 | [Note 4. Short-term and long-term investments](index=11&type=section&id=Note%204.%20Short-term%20and%20long-term%20investments) Short-term and Long-term Investments (in thousands of dollars) | Investment Type | June 30, 2025 | December 31, 2024 | |:---|:---|:---| | Debt securities | $31,783 | $44,158 | | Equity securities | $37,953 | $40,566 | | Total Investments | $69,736 | $84,724 | - Equity investments are primarily held within a trust to fund existing obligations associated with the Company's non-qualified deferred compensation plans[36](index=36&type=chunk) [Note 5. Goodwill](index=12&type=section&id=Note%205.%20Goodwill) Goodwill by Segment (in thousands of dollars) | Segment | Balance at Dec 31, 2024 | Acquisitions | Foreign currency and other adjustments | Balance at June 30, 2025 | |:---|:---|:---|:---|:---| | U.S. dialysis | $6,517,220 | $5,384 | — | $6,522,604 | | Other — Ancillary services | $857,996 | $(4,715) | $89,884 | $943,165 | |

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) This section provides a high-level overview of DaVita Inc.'s financial performance, key operational metrics, strategic events, and future outlook [Q2 2025 Financial Highlights](index=1&type=section&id=Q2%202025%20Financial%20Highlights) DaVita Inc. reported Q2 2025 consolidated revenues of **$3.380 billion**, with **$538 million** operating income and **$2.95** adjusted diluted EPS Key Financial Metrics (Q2 2025 vs Q1 2025 & Q2 2024) | Metric | Q2 2025 | Q1 2025 | Q2 2025 (YTD) | Q2 2024 (YTD) | | :-------------------------------- | :------ | :------ | :------------ | :------------ | | Net income attributable to DaVita Inc. (millions) | $199 | $163 | $362 | $462 | | Diluted per share | $2.58 | $2.00 | $4.57 | $5.15 | | Adjusted net income (millions) | $228 | $163 | $391 | $434 | | Adjusted diluted per share | $2.95 | $2.00 | $4.93 | $4.84 | | Operating income (millions) | $538 | $439 | $977 | $990 | | Adjusted operating income (millions) | $551 | $439 | $990 | $955 | | Consolidated revenues (billions) | $3.380 | - | - | - | | Operating cash flow (millions) | $324 | - | - | - | | Free cash flow (millions) | $157 | - | - | - | [U.S. Dialysis Operational Metrics](index=2&type=section&id=U.S.%20Dialysis%20Operational%20Metrics) U.S. dialysis treatments increased by **0.4%** per day quarter-over-quarter, with revenue per treatment rising and patient care costs per treatment decreasing - Total U.S. dialysis treatments for Q2 2025 were **7,186,217**, with an average of **92,131** treatments per day, representing a **0.4%** per day increase compared to Q1 2025[7](index=7&type=chunk) - Normalized non-acquired treatment growth in Q2 2025 compared to Q2 2024 was **(0.8)%**[7](index=7&type=chunk) U.S. Dialysis Per Treatment Metrics (Q2 2025 vs Q1 2025 & YTD) | Metric | Q2 2025 | Q1 2025 | Quarter Change | YTD 2025 | YTD 2024 | YTD Change | | :-------------------------------- | :------ | :------ | :------------- | :------- | :------- | :--------- | | Revenue per treatment | $404.58 | $400.14 | $4.44 | $402.38 | $387.40 | $14.98 | | Patient care costs per treatment | $268.36 | $271.77 | $(3.41) | $270.05 | $255.19 | $14.86 | | General and administrative (millions) | $312 | $283 | $29 | $595 | $556 | $39 | - The quarter change in revenue was primarily due to normal seasonal improvements, including patients meeting co-insurance and deductibles, partially offset by decreased volume of phosphate binders[8](index=8&type=chunk) - The quarter change in patient care costs was primarily due to decreased compensation expense and pharmaceutical costs (principally related to phosphate binders volume), partially offset by increases in health benefit and insurance costs[9](index=9&type=chunk) - The quarter change in general and administrative expenses was primarily due to costs related to a cybersecurity incident, a gain recognized in Q1 2025, and increased compensation expenses[10](index=10&type=chunk) [Key Events and Impacts](index=2&type=section&id=Key%20Events%20and%20Impacts) DaVita incurred **$13.5 million** in cybersecurity remediation charges, issued **$1 billion** in senior notes, and repurchased **3.1 million** shares for **$446 million** in Q2 2025 - A cybersecurity incident in Q2 2025 resulted in approximately **$13.5 million** in charges, increasing patient care costs by **$1.0 million** and general and administrative expenses by **$12.5 million** for remediation and system restoration[11](index=11&type=chunk) - In May 2025, DaVita issued **$1 billion** aggregate principal amount of **6.75%** senior notes due 2033, using a portion of the proceeds to prepay its revolving line of credit[12](index=12&type=chunk) - During Q2 2025, the company repurchased **3.1 million** shares of common stock for **$446 million** at an average price of **$144.00** per share. Post-quarter, an additional **2.7 million** shares were repurchased for **$393 million**[13](index=13&type=chunk) [Integrated Kidney Care (IKC) Metrics](index=3&type=section&id=Integrated%20Kidney%20Care%20(IKC)%20Metrics) As of June 30, 2025, DaVita managed **64,400** risk-based IKC patients, representing **$5.3 billion** in annualized medical spend, plus **9,300** other integrated care patients - As of June 30, 2025, DaVita had approximately **64,400** patients in risk-based integrated care arrangements[17](index=17&type=chunk) - These risk-based arrangements represent approximately **$5.3 billion** in annualized medical spend[17](index=17&type=chunk) - An additional **9,300** patients were in other integrated care arrangements, whose medical spend is not included in the annualized estimate[17](index=17&type=chunk) [2025 Financial Outlook](index=3&type=section&id=2025%20Financial%20Outlook) DaVita projects 2025 adjusted operating income between **$2,010 million** and **$2,160 million**, with adjusted diluted EPS from **$10.20** to **$11.30** and free cash flow from **$1,000 million** to **$1,250 million** 2025 Guidance | Metric | Low (millions) | High (millions) | | :------------------------------------------ | :------------- | :-------------- | | Adjusted operating income | $2,010 | $2,160 | | Adjusted diluted net income per share attributable to DaVita Inc. | $10.20 | $11.30 | | Free cash flow | $1,000 | $1,250 | - The company does not provide GAAP guidance for operating income or diluted net income per share due to the inability to predict certain items without unreasonable efforts[18](index=18&type=chunk) [Forward-Looking Statements & Risk Factors](index=4&type=section&id=Forward-Looking%20Statements%20%26%20Risk%20Factors) This section outlines the nature of forward-looking statements and identifies key risk factors that could impact future financial results [Nature of Forward-Looking Statements](index=4&type=section&id=Nature%20of%20Forward-Looking%20Statements) All non-historical statements in the release are forward-looking, covered by PSLRA safe harbor, and subject to risks, with no obligation for public updates except as legally required - All statements in the release, other than statements of historical fact, are forward-looking statements intended to be covered by the safe harbor provisions of the PSLRA[20](index=20&type=chunk) - Forward-looking statements are based on current expectations and information available as of the release date, and DaVita undertakes no obligation to update or revise them, except as legally required[20](index=20&type=chunk) [Key Risk Factors](index=4&type=section&id=Key%20Risk%20Factors) The company identifies various factors that could cause actual results to differ materially from forward-looking statements, including external conditions, regulatory changes, strategic implementation challenges, and cybersecurity risks - External conditions: General economic, marketplace, and global health conditions; impact of domestic political environment; COVID-19 pandemic; supply chain challenges and disruptions; new market entrants and innovative technologies; elevated teammate turnover or labor costs; increased competition[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Concentration of profits from higher-paying commercial payor plans: Downward pressure on payment rates; reduction in commercially insured patients due to legislative efforts or restrictive plan designs[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Regulatory changes: Potential changes in or new laws/regulations (e.g., OBBBA) related to healthcare, privacy, antitrust, and labor matters, impacting coverage, reimbursement rates, or patient enrollment in commercial plans[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Strategic implementation challenges: Ability to successfully implement IKC, VBC, and home-based dialysis initiatives in a complex and regulated environment[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Government payment rates: Reductions under Medicare ESRD, state Medicaid, or other government programs, and impact of MA benchmark structure[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Reliance on suppliers: Dependence on significant suppliers, service providers, and third-party vendors for key support and clinical products[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Cybersecurity and compliance risks: Noncompliance with privacy/security laws, security breaches (like the recent incident), and evolving government regulations[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Labor market: Ability to attract, retain, and motivate teammates, including key leadership, and manage disruptions from labor market volatility or skilled personnel shortages[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Pharmaceutical changes: Changes in practice patterns, reimbursement, payment policies, or pricing, particularly for oral phosphate binders[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Physician and hospital relationships: Ability to develop and maintain relationships, changing affiliation models, and emergence of new care models[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Strategic transactions: Ability to complete and integrate acquisitions, mergers, dispositions, joint ventures, or expand international operations[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Cash flow variability: Extended billing/collections cycles, impact of cybersecurity incident on billing systems, and ability to service debt or fund liquidity needs[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) - Other factors: Natural disasters, public health crises, stock repurchase program impacts, and ESG matters[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=Consolidated%20Financial%20Statements) This section presents DaVita Inc.'s consolidated statements of income, comprehensive income, cash flows, and balance sheets for the reported periods [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) For Q2 2025, DaVita reported total revenues of **$3,379,526 thousand**, operating income of **$537,841 thousand**, and diluted net income per share of **$2.58** Consolidated Statements of Income (Three Months Ended June 30) | Metric (thousands) | 2025 | 2024 | | :----------------------------------- | :--------- | :--------- | | Dialysis patient service revenues | $3,206,871 | $3,061,102 | | Other revenues | $172,655 | $125,620 | | **Total revenues** | **$3,379,526** | **$3,186,722** | | Patient care costs | $2,261,540 | $2,142,299 | | General and administrative | $412,805 | $367,845 | | Depreciation and amortization | $174,704 | $175,661 | | Equity investment income, net | $(7,364) | $(5,481) | | **Total operating expenses** | **$2,841,685** | **$2,680,324** | | **Operating income** | **$537,841** | **$506,398** | | Debt expense | $(146,062) | $(97,747) | | Income before income taxes | $368,928 | $371,440 | | Income tax expense | $93,708 | $71,688 | | Net income | $275,220 | $299,752 | | Net income attributable to DaVita Inc. | $199,337 | $222,676 | | Diluted net income per share | $2.58 | $2.50 | [Consolidated Statements of Comprehensive Income](index=7&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) For Q2 2025, total comprehensive income was **$364,350 thousand**, significantly higher than the prior year, driven by unrealized gains on foreign currency translation Consolidated Statements of Comprehensive Income (Three Months Ended June 30) | Metric (thousands) | 2025 | 2024 | | :------------------------------------------------ | :--------- | :--------- | | Net income | $275,220 | $299,752 | | Unrealized (losses) gains on interest rate cap agreements | $(6,405) | $5,919 | | Reclassifications of net realized losses (gains) into net income | $1,534 | $(22,041) | | Unrealized gains (losses) on foreign currency translation | $94,001 | $(78,853) | | **Other comprehensive income (loss)** | **$89,130** | **$(94,975)** | | **Total comprehensive income** | **$364,350** | **$204,777** | | Comprehensive income attributable to DaVita Inc. | $288,467 | $127,701 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash provided by operating activities was **$504,245 thousand**, while net cash used in financing activities increased to **$378,094 thousand** due to debt payments and share repurchases Consolidated Statements of Cash Flows (Six Months Ended June 30) | Metric (thousands) | 2025 | 2024 | | :------------------------------------------ | :--------- | :--------- | | Net cash provided by operating activities | $504,245 | $664,010 | | Net cash used in investing activities | $(229,303) | $(376,964) | | Net cash used in financing activities | $(378,094) | $(243,976) | | Effect of exchange rate changes on cash | $20,286 | $(4,458) | | Net (decrease) increase in cash | $(82,866) | $38,612 | | Cash, cash equivalents and restricted cash at end of period | $796,959 | $503,246 | - Operating cash flow decreased primarily due to changes in operating assets and liabilities, notably a significant increase in accounts receivable[29](index=29&type=chunk) - Financing activities saw increased borrowings but also higher payments on long-term debt and other purchases of treasury stock[29](index=29&type=chunk) [Consolidated Balance Sheets](index=9&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to **$17,492,958 thousand**, total liabilities rose to **$15,939,935 thousand**, and shareholders' equity shifted to a **$(369,633) thousand** deficit Consolidated Balance Sheets (As of June 30, 2025 vs December 31, 2024) | Metric (thousands) | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :-------------- | :---------------- | | Total current assets | $4,087,828 | $3,746,072 | | Property and equipment, net | $2,854,468 | $2,940,916 | | Goodwill | $7,465,769 | $7,375,216 | | **Total Assets** | **$17,492,958** | **$17,285,268** | | Total current liabilities | $2,933,540 | $2,973,410 | | Long-term debt | $10,078,805 | $9,175,903 | | **Total Liabilities** | **$15,939,935** | **$15,193,917** | | Treasury stock | $(2,485,654) | $(1,389,072) | | Total DaVita Inc. shareholders' equity (deficit) | $(369,633) | $121,122 | | **Total Equity (deficit)** | **$(107,967)** | **$395,868** | - Accounts receivable increased significantly from **$2,146,975 thousand** to **$2,441,259 thousand**[31](index=31&type=chunk) - Long-term debt increased by approximately **$900 million**, reflecting the recent senior notes issuance[31](index=31&type=chunk) [Supplemental Financial Data](index=10&type=section&id=Supplemental%20Financial%20Data) This section provides detailed consolidated business metrics, segment-specific financials, IKC metrics, cash flow details, and debt structure information [Consolidated Business Metrics](index=10&type=section&id=Consolidated%20Business%20Metrics) Consolidated operating margin improved to **15.9%** in Q2 2025, with adjusted operating margin at **16.3%** and effective income tax rate on adjusted income at **25.5%** Consolidated Business Metrics (Q2 2025 vs Q1 2025 & YTD) | Metric | Q2 2025 | Q1 2025 | YTD 2025 | | :------------------------------------------------ | :------ | :------ | :------- | | Operating margin | 15.9 % | 13.6 % | 14.8 % | | Adjusted operating margin excluding certain items | 16.3 % | 13.6 % | 15.0 % | | General and administrative expenses as a percent of consolidated revenues | 12.2 % | 11.6 % | 11.9 % | | Effective income tax rate on income | 25.4 % | 18.9 % | 22.6 % | | Effective income tax rate on adjusted income attributable to DaVita Inc. | 25.5 % | 24.9 % | 25.2 % | [Summary of Financial Results by Segment](index=10&type=section&id=Summary%20of%20Financial%20Results%20by%20Segment) U.S. dialysis revenues were **$2,913 million** with **$523 million** operating income, while IKC revenues reached **$152 million** with **$26 million** operating income in Q2 2025 Revenues by Segment (Q2 2025 vs Q1 2025 & YTD) | Segment | Q2 2025 (millions) | Q1 2025 (millions) | YTD 2025 (millions) | | :-------------------------------- | :----------------- | :----------------- | :------------------ | | U.S. dialysis patient services and other | $2,913 | $2,823 | $5,737 | | Integrated kidney care | $152 | $105 | $258 | | Other U.S. ancillary | $8 | $7 | $16 | | International dialysis patient service and other | $325 | $302 | $627 | | **Total consolidated revenues** | **$3,380** | **$3,224** | **$6,603** | Operating Income (Loss) by Segment (Q2 2025 vs Q1 2025 & YTD) | Segment | Q2 2025 (millions) | Q1 2025 (millions) | YTD 2025 (millions) | | :-------------------------------- | :----------------- | :----------------- | :------------------ | | U.S. dialysis | $523 | $476 | $999 | | Integrated kidney care | $26 | $(29) | $(3) | | Other U.S. ancillary | $(5) | $(4) | $(10) | | International | $36 | $30 | $67 | | Corporate administrative support expenses | $(42) | $(34) | $(76) | | **Total consolidated operating income** | **$538** | **$439** | **$977** | [U.S. Dialysis Segment Financials and Metrics](index=11&type=section&id=U.S.%20Dialysis%20Segment%20Financials%20and%20Metrics) The U.S. dialysis segment reported **$2,913 million** in revenues and **$523 million** in operating income for Q2 2025, with **7,186,217** treatments and **$404.58** average revenue per treatment U.S. Dialysis Segment Financials (Q2 2025 vs Q1 2025 & YTD) | Metric (millions) | Q2 2025 | Q1 2025 | YTD 2025 | | :-------------------------------- | :------ | :------ | :------- | | Total operating revenues | $2,913 | $2,823 | $5,737 | | Patient care costs | $1,928 | $1,913 | $3,842 | | General and administrative | $312 | $283 | $595 | | Segment operating income | $523 | $476 | $999 | | Adjusted segment operating income | $536 | $476 | $1,012 | U.S. Dialysis Segment Metrics (Q2 2025 vs Q1 2025 & YTD) | Metric | Q2 2025 | Q1 2025 | YTD 2025 | | :------------------------------------------ | :---------- | :---------- | :----------- | | Treatments | 7,186,217 | 7,040,519 | 14,226,736 | | Average treatments per day | 92,131 | 91,793 | 91,963 | | Per day year-over-year change | (1.1)% | (0.4)% | (0.7)% | | Normalized year-over-year non-acquired treatment growth | (0.8)% | (0.6)% | - | | Average patient service revenue per treatment | $404.58 | $400.14 | $402.38 | | Patient care costs per treatment | $268.36 | $271.77 | $270.05 | | General and administrative expenses per treatment | $43.43 | $40.15 | $41.81 | | Accounts receivable (millions) | $1,838 | $1,722 | - | | DSO | 58 | 55 | - | [Integrated Kidney Care (IKC) Metrics_detailed](index=11&type=section&id=Integrated%20Kidney%20Care%20(IKC)%20Metrics_detailed) IKC metrics show **64,400** risk-based patients as of June 30, 2025, with **$5,300 million** in annualized aggregate risk-based spend, alongside **9,300** other integrated care patients IKC Metrics (As of June 30, 2025 vs March 31, 2025) | Metric | June 30, 2025 | March 31, 2025 | | :-------------------------------- | :------------ | :------------- | | Risk-based patients | 64,400 | 62,100 | | Other patients | 9,300 | 9,300 | | Annualized aggregate risk-based spend (millions) | $5,300 | $5,200 | [Cash Flow Details](index=12&type=section&id=Cash%20Flow%20Details) Q2 2025 operating cash flow was **$324 million**, resulting in **$157 million** free cash flow, with **$90 million** in maintenance and **$32 million** in development capital expenditures Cash Flow (Q2 2025 vs Q1 2025 & YTD) | Metric (millions) | Q2 2025 | Q1 2025 | YTD 2025 | | :------------------------ | :------ | :------ | :------- | | Operating cash flow | $324 | $180 | $504 | | Free cash flow | $157 | $(45) | $112 | | Maintenance capital expenditures | $90 | $95 | $185 | | Development capital expenditures | $32 | $48 | $80 | | Acquisition expenditures | $0 | $10 | $11 | | Proceeds from sale of self-developed properties | $12 | $9 | $21 | - Operating cash flow for the last twelve months was **$1,862 million**, and free cash flow for the last twelve months was **$947 million**[14](index=14&type=chunk) [Debt and Capital Structure](index=12&type=section&id=Debt%20and%20Capital%20Structure) As of June 30, 2025, total debt was **$10,330 million**, net debt **$9,622 million**, and a leverage ratio of **3.34x**, with **97%** of debt at fixed or capped rates Debt and Capital Structure (As of June 30, 2025 vs March 31, 2025) | Metric | June 30, 2025 | March 31, 2025 | | :------------------------------------------------ | :------------ | :------------- | | Total debt (millions) | $10,330 | $9,799 | | Net debt, net of cash and cash equivalents (millions) | $9,622 | $9,361 | | Leverage ratio | 3.34x | 3.27x | | Weighted average effective interest rate (during quarter) | 5.71 % | 5.60 % | | Debt with fixed and capped rates as a percentage of total debt | 97 % | 92 % | | Amount spent on share repurchases (millions) | $446 | $550 | | Number of shares repurchased (thousands) | 3,067 | 3,660 | [Non-GAAP Financial Measures & Reconciliations](index=13&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section defines and reconciles non-GAAP financial measures used by management to evaluate performance and provide additional insights to investors [Note on Non-GAAP Financial Measures](index=14&type=section&id=Note%20on%20Non-GAAP%20Financial%20Measures) This section defines non-GAAP financial measures like adjusted income and free cash flow, which management uses for performance evaluation and investor insights, though they are not GAAP substitutes - Adjusted measures exclude certain items like cybersecurity costs, impairment charges, gain/loss on ownership changes, restructuring charges, legal accruals, and debt extinguishment/modification costs[45](index=45&type=chunk) - Management uses adjusted operating income, adjusted net income, and adjusted diluted EPS to compare performance, analyze trends, establish budgets, and for incentive compensation[47](index=47&type=chunk) - Free cash flow is defined as net cash provided by operating activities less distributions to noncontrolling interests, development and maintenance capital expenditures, plus contributions from noncontrolling interests and proceeds from property sales[49](index=49&type=chunk) [Calculation of Leverage Ratio](index=13&type=section&id=Calculation%20of%20Leverage%20Ratio) The leverage ratio, calculated as funded debt minus unrestricted cash divided by 'Consolidated EBITDA', was **3.34x** as of June 30, 2025, well below the **5.00x** maximum permitted - The leverage ratio is defined as (a) all funded debt, minus unrestricted cash and cash equivalents (not to exceed **$750 million**) divided by (b) 'Consolidated EBITDA' for the last **12 months**[40](index=40&type=chunk) Leverage Ratio Calculation (Twelve Months Ended) | Metric (millions) | June 30, 2025 | March 31, 2025 | | :------------------------------------------------ | :------------ | :------------- | | "Consolidated EBITDA" | $2,871 | $2,840 | | Total debt, excluding debt discount and other deferred financing costs | $10,330 | $9,799 | | Less: Cash and cash equivalents including short-term investments | $(737) | $(508) | | Consolidated net debt | $9,594 | $9,292 | | **Leverage ratio** | **3.34x** | **3.27x** | | Maximum leverage ratio permitted under the Credit Agreement | 5.00x | 5.00x | [Adjusted Net Income and EPS Reconciliation](index=15&type=section&id=Adjusted%20Net%20Income%20and%20EPS%20Reconciliation) Q2 2025 net income of **$199 million** was adjusted to **$228 million** (or **$2.95** adjusted diluted EPS) by accounting for **$13 million** in cybersecurity charges and **$19 million** in tax impact from a prior legal matter Adjusted Net Income and Diluted EPS Reconciliation (Three Months Ended June 30) | Metric | Q2 2025 (Dollars in millions) | Q2 2025 (Per share) | Q1 2025 (Dollars in millions) | Q1 2025 (Per share) | | :------------------------------------------ | :---------------------------- | :------------------ | :---------------------------- | :------------------ | | Net income attributable to DaVita Inc. | $199 | $2.58 | $163 | $2.00 | | Cybersecurity incident-related charges | $13 | $0.17 | — | — | | Income tax impact related to prior legal matter | $19 | $0.24 | — | — | | Related income tax | $(3) | $(0.04) | — | — | | **Adjusted net income attributable to DaVita Inc.** | **$228** | **$2.95** | **$163** | **$2.00** | [Adjusted Operating Income Reconciliation](index=15&type=section&id=Adjusted%20Operating%20Income%20Reconciliation) Q2 2025 consolidated operating income of **$538 million** was adjusted to **$551 million** after adding back **$13 million** in cybersecurity incident-related charges, primarily impacting the U.S. dialysis segment Adjusted Operating Income Reconciliation (Three Months Ended June 30, 2025) | Segment | Operating income (loss) (millions) | Cybersecurity incident-related charges (millions) | Adjusted operating income (loss) (millions) | | :-------------------------- | :--------------------------------- | :---------------------------------------------- | :------------------------------------------ | | U.S. dialysis | $523 | $13 | $536 | | U.S. IKC | $26 | — | $26 | | U.S. Other | $(5) | — | $(5) | | International | $36 | — | $36 | | Ancillary services Total | $57 | — | $57 | | Corporate administration | $(42) | — | $(42) | | **Consolidated Total** | **$538** | **$13** | **$551** | [Effective Income Tax Rates Reconciliation](index=16&type=section&id=Effective%20Income%20Tax%20Rates%20Reconciliation) The effective income tax rate on income attributable to DaVita Inc. was **31.9%** for Q2 2025, adjusting to **25.5%** on adjusted income after accounting for cybersecurity and prior legal matter impacts Effective Income Tax Rates Reconciliation (Three Months Ended June 30) | Metric | Q2 2025 | Q1 2025 | YTD 2025 | | :------------------------------------------------ | :------ | :------ | :------- | | Effective income tax rate on income attributable to DaVita Inc. | 31.9 % | 24.9 % | 28.9 % | | Effective income tax rate on adjusted income attributable to DaVita Inc. | 25.5 % | 24.9 % | 25.2 % | - Adjustments to income before income taxes attributable to DaVita Inc. include adding back cybersecurity incident-related charges and subtracting noncontrolling owners' income[57](index=57&type=chunk) [Free Cash Flow Reconciliation](index=17&type=section&id=Free%20Cash%20Flow%20Reconciliation) Q2 2025 net cash from operating activities was **$324 million**, resulting in **$157 million** free cash flow after adjustments, a significant recovery from Q1 2025's **$(45) million** Free Cash Flow Reconciliation (Three Months Ended) | Metric (millions) | June 30, 2025 | March 31, 2025 | June 30, 2024 | | :------------------------------------------ | :------------ | :------------- | :------------ | | Net cash provided by operating activities | $324 | $180 | $799 | | Distributions to noncontrolling interests | $(58) | $(93) | $(30) | | Contributions from noncontrolling interests | — | $2 | $4 | | Maintenance capital expenditures | $(90) | $(95) | $(86) | | Development capital expenditures | $(32) | $(48) | $(39) | | Proceeds from sale of self-developed properties | $12 | $9 | $6 | | **Free cash flow** | **$157** | **$(45)** | **$654** | - For the twelve months ended June 30, 2025, free cash flow was **$947 million**, compared to **$1,038 million** for the twelve months ended June 30, 2024[61](index=61&type=chunk)

Core Insights - DaVita Inc. reported strong financial results for the quarter ended June 30, 2025, highlighting a focus on patient care and operational efficiency [1] Financial Performance - Net income attributable to DaVita Inc. for Q2 2025 was $199 million, compared to $163 million in Q1 2025 and $362 million in Q2 2024 [2] - Diluted earnings per share increased to $2.58 from $2.00 in Q1 2025, but decreased from $5.15 in Q2 2024 [2] - Adjusted net income for Q2 2025 was $228 million, up from $163 million in Q1 2025, but down from $434 million in Q2 2024 [2] - Consolidated revenues for Q2 2025 reached $3.380 billion, compared to $3.224 billion in Q1 2025 and $3.186 billion in Q2 2024 [9] Operating Metrics - Operating income for Q2 2025 was $538 million, with an operating margin of 15.9%, compared to 13.6% in Q1 2025 [3][29] - Adjusted operating income was $551 million, reflecting an adjusted operating margin of 16.3% [3] - Total U.S. dialysis treatments in Q2 2025 were 7,186,217, averaging 92,131 treatments per day, a 0.4% increase from Q1 2025 [4][31] Cost Analysis - Revenue per treatment increased to $404.58 in Q2 2025 from $400.14 in Q1 2025, while patient care costs per treatment decreased to $268.36 from $271.77 [5][31] - General and administrative expenses rose to $312 million in Q2 2025 from $283 million in Q1 2025, primarily due to cybersecurity incident-related costs [5][7] Cybersecurity Incident - The company incurred approximately $13.5 million in charges related to a cybersecurity incident, impacting patient care costs by $1 million and general administrative expenses by $12.5 million [10] Share Repurchase and Debt Management - DaVita repurchased 3.1 million shares for $446 million at an average price of $144.00 per share during Q2 2025 [12] - The company issued $1 billion in senior notes to repay outstanding debt and enhance liquidity [11] Patient Care and Center Activity - As of June 30, 2025, DaVita provided dialysis services to approximately 283,100 patients across 3,175 outpatient dialysis centers [15] - The company had about 64,400 patients in risk-based integrated care arrangements, representing approximately $5.3 billion in annualized medical spend [16]

Group 1 - Berkshire Hathaway increased its stake in Sirius XM by approximately $106 million, acquiring 5,030,425 shares, bringing total holdings to over 124.8 million shares [1] - Sirius XM is a North American radio entertainment company that provides live and curated content through satellite broadcasting, focusing on in-car scenarios for stable profitability [1] - Berkshire Hathaway's repeated purchases of Sirius XM shares may indicate a strategic move to enhance its media and technology asset portfolio [1] Group 2 - Berkshire Hathaway sold 1,635,962 shares of DaVita at a price of $140.6, realizing approximately $230 million [1] - DaVita specializes in providing dialysis services for patients with kidney failure and does not manufacture dialysis medications or medical devices [2] - As of March 31, Berkshire Hathaway held 42.25% of DaVita's shares, having increased its stake in the secondary market since 2012 [2]

Core Insights - DaVita Inc. (DVA) is set to report its second-quarter 2025 results on August 5, with previous earnings per share (EPS) of $2.00 exceeding estimates by 14.3% [1] - The company has shown a mixed performance over the last four quarters, beating estimates three times and missing once, with an average earnings surprise of 3.6% [1] Factors Influencing Performance - DaVita's performance in the first quarter of 2025 was bolstered by strong sales of phosphate binders, which are essential for dialysis patients [2] - The transition of phosphate binders from Medicare Part D to the dialysis benefit by the Centers for Medicare & Medicaid Services (CMS) is expected to continue benefiting DaVita's revenues [2] - However, the company is facing challenges with new patient starts due to supply constraints in peritoneal dialysis solutions, which may negatively impact volume growth in 2025 [3][16] Financial Estimates - The Zacks Consensus Estimate for DaVita's second-quarter 2025 revenues is $3.30 billion, reflecting a 3.5% increase from the previous year [4] - The consensus estimate for EPS is $2.70, indicating a 4.3% rise from the prior-year period [4] Earnings Prediction - DaVita is predicted to beat earnings estimates, supported by a positive Earnings ESP of +6.67% and a Zacks Rank of 3 (Hold) [5][6] Share Price Performance - Over the past three months, DaVita's shares have increased by 1.1%, outperforming the Medical - Outpatient and Home Healthcare sector's decline of 2.8% [7] - The company's shares have also outperformed the Zacks Medical sector's decrease of 1.6%, but lagged behind the S&P 500's growth of 13.9% [7] Valuation Metrics - DaVita's forward 12-month price-to-sales (P/S) ratio is 0.8X, significantly lower than the industry average of 2.6X [11] - The company is trading at a discount compared to peers like Encompass Health and Elanco Animal Health, which have P/S ratios of 1.8X and 1.5X, respectively [12] Long-Term Investment Outlook - Management anticipates variability in drug mix, particularly with iron-based binders, which could impact operating income from phosphate binders, projected to be at the upper end of $0 to $50 million for the year [15] - Despite challenges, DaVita's core business strength and financial stability present a favorable long-term investment opportunity [17][18]