Financial Data and Key Metrics Changes - First quarter adjusted operating income was $439 million, adjusted EPS was $2, and free cash flow was negative $45 million, with adjusted operating income above guidance due to strong expense management and international performance [18][25] - Revenue per treatment increased by $4, with approximately $10 attributed to new reimbursement for phosphate binders, partially offset by a $5 decline due to seasonal patient responsibility [21][40] - Patient care cost per treatment increased by $7 sequentially, driven by new costs associated with phosphate binders [21] Business Line Data and Key Metrics Changes - Adjusted international operating income increased by $29 million compared to the previous quarter, with a strong performance across various markets [22] - Integrated Kidney Care (IKC) reported operating losses of $29 million, in line with expectations, with seasonally stronger performance anticipated in the second half of the year [22] Market Data and Key Metrics Changes - Treatments per day declined by 40 basis points year-over-year and were approximately 50 basis points below forecast, primarily due to a higher missed treatment rate from a severe flu season [19] - The company expects an approximately 50 basis point decline in treatments for the year, influenced by flu-related impacts and the cyber incident [20] Company Strategy and Development Direction - The company remains committed to investing available capital in innovation and high-return growth opportunities, including a recent acquisition in Latin America [13] - The capital allocation strategy includes returning capital to shareholders through share repurchases, with approximately $680 million repurchased since the last earnings call [13] Management's Comments on Operating Environment and Future Outlook - Management highlighted the resilience of operations despite a cybersecurity incident that disrupted parts of the business, with uninterrupted patient care maintained [9][10] - The company reiterated its 2025 guidance range for adjusted operating income and adjusted EPS, despite headwinds from the cyber incident and a challenging flu season [16][25] Other Important Information - The company launched a community-based collaboration with the YMCA to support chronic kidney disease education and prevention, with early results showing 30% of participants screened had previously undiagnosed CKD [6][7] - The company is addressing regulatory and legal follow-ups related to the cyber incident, with most costs expected to be one-time items recognized in the second quarter [10][31] Q&A Session Summary Question: Impact of flu and cyber attack on treatment volume - The flu had a significant impact on the full year treatment volume, accounting for more than half of the 50 basis point revision, while the cyber incident contributed to a loss of approximately 500 admissions [29][30] Question: Costs related to the cyber attack - Majority of costs from the cyber attack will be one-time items recognized in Q2, with some direct costs likely covered by insurance and not included in adjusted operating income [31] Question: Phosphate binders uptake and drug mix - The mix leaned towards iron-based binders, leading to an increase in guidance for operating income contribution from phosphate binders to the upper end of the previous range [32][33] Question: Revenue per treatment expectations - Revenue per treatment is expected to remain within the previously guided range of 4.5% to 5.5%, with half of the increase coming from core business and half from orals [43][44] Question: International market performance - International operations had a strong quarter, with a significant year-over-year increase, and the company feels positive about the new acquisition's performance [58]

Financial Data and Key Metrics Changes - First quarter adjusted operating income was $439 million, adjusted EPS was $2, and free cash flow was negative $45 million, with adjusted operating income above previous guidance due to strong expense management and international performance [18][25] - Revenue per treatment increased by $4, with approximately $10 attributed to new reimbursement for phosphate binders, partially offset by a $5 decline due to seasonal patient responsibility [21][39] - Patient care cost per treatment increased by $7 sequentially, driven by approximately $8 per treatment of new costs associated with phosphate binders [21] Business Line Data and Key Metrics Changes - Adjusted international operating income increased by $29 million compared to the fourth quarter, with strong performance across various markets [22] - Integrated Kidney Care (IKC) reported operating losses of $29 million, in line with expectations, with seasonally stronger performance anticipated in the second half of the year [22] Market Data and Key Metrics Changes - Treatments per day declined by 40 basis points compared to Q1 2024, primarily due to a higher missed treatment rate caused by a severe flu season [19] - The company expects an approximately 50 basis point decline in treatments for the year, influenced by flu-related impacts and a cyber incident [20] Company Strategy and Development Direction - The company remains committed to investing available capital in innovation and high-return growth opportunities, including a recent acquisition in Latin America [13] - The capital allocation strategy includes returning capital to shareholders through share repurchases, with approximately $680 million repurchased since the last earnings call [13] Management's Comments on Operating Environment and Future Outlook - Management highlighted the resilience of operations despite a cybersecurity incident that disrupted parts of the business, with uninterrupted patient care maintained [9][10] - The company reiterated its 2025 guidance range for adjusted operating income and adjusted EPS, despite headwinds from the cyber incident and a challenging flu season [16][25] Other Important Information - The company launched a community-based collaboration with the YMCA to support chronic kidney disease education and prevention, with early results showing 30% of participants screened had previously undiagnosed CKD [6][7] - The majority of costs related to the cyber incident are expected to be one-time items recognized in the second quarter [31] Q&A Session Summary Question: Impact of flu and cyber attack on treatment growth - Management indicated that the flu had a more significant impact on the full year guidance, with the census decline in Q1 affecting the full year [29] Question: Costs related to the cyber attack - Management clarified that some costs will be direct and non-GAAP, likely covered by insurance, while others will flow through the P&L and are included in guidance [31] Question: Phosphate binders uptake and drug mix - The mix leaned towards iron-based binders, leading to an adjustment in guidance to the upper end of the previous range [33] Question: Revenue per treatment and managed care increases - Management confirmed that revenue per treatment guidance remains unchanged, with increases expected from both core business and oral medications [42] Question: IKC patient treatment and competitive pricing - Management noted that the financials are playing out as expected, with a disciplined approach to patient care and financial modeling despite competitive pressures [51] Question: International performance outlook - International operations had a strong quarter, with positive contributions from various markets and a successful acquisition [57]

Core Insights - DaVita Inc. reported strong financial performance for Q1 2025, emphasizing the stability of its operating model and commitment to shareholder value [1][2]. Financial Performance - Net income for Q1 2025 was $163 million, down from $240 million in Q1 2024, with diluted earnings per share at $2.00 compared to $2.65 in the previous year [1][19]. - Operating income decreased to $439 million, with an operating margin of 13.6%, down from 17.2% in Q4 2024 and 15.8% in Q1 2024 [2][23]. - Total consolidated revenues reached $3.224 billion, an increase from $3.071 billion in Q1 2024 [19][23]. Cost and Expense Analysis - Patient care costs per treatment rose to $271.77, up from $255.13 in Q1 2024, while general and administrative expenses were $374 million, compared to $362 million in the same period last year [4][25]. - The increase in costs was primarily driven by higher pharmaceutical expenses, particularly for phosphate binders, and compensation expenses [5][6]. Dialysis Metrics - Total U.S. dialysis treatments for Q1 2025 were 7,040,519, averaging 91,793 treatments per day, reflecting a slight increase of 0.01% from Q4 2024 [3][24]. - Normalized non-acquired treatment growth was reported at (0.6)% compared to Q1 2024 [3][24]. Share Repurchase Activity - The company repurchased 3.7 million shares for $550 million at an average price of $148.94 per share during Q1 2025 [8][26]. - Subsequent to Q1, an additional 1.7 million shares were repurchased for $259 million [8]. Integrated Kidney Care Metrics - As of March 31, 2025, DaVita had approximately 62,100 patients in risk-based integrated care arrangements, representing an annualized medical spend of about $5.2 billion [12][24]. Cash Flow and Capital Structure - Operating cash flow for Q1 2025 was $180 million, a significant improvement from a cash outflow of $135 million in Q1 2024 [9][26]. - Free cash flow was reported at $(45) million, compared to $(327) million in the same period last year [9][26]. Outlook - The company provided guidance for 2025, projecting adjusted operating income between $2.010 billion and $2.160 billion, and adjusted diluted net income per share between $10.20 and $11.30 [14].

Group 1 - Chain Bridge Bancorp, Inc. (CBNA) has seen a 9.5% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Fresenius Medical Care AG (FMS) has experienced a 4.5% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Brenntag SE (BNTGY) has seen a 14.1% increase in the Zacks Consensus Estimate for its next year earnings over the last 60 days [2] - WidePoint Corporation (WYY) has experienced a significant 108.3% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2] - BioCryst Pharmaceuticals, Inc. (BCRX) has seen an impressive 285.7% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [3]

Core Viewpoint - DaVita experienced a ransomware attack, leading to a 10% decline in its stock price, causing investor concern due to the uncertainty surrounding the incident [1][5]. Group 1: Incident Details - DaVita disclosed the ransomware attack in a regulatory filing, stating it occurred on April 12, and activated its response protocols immediately [2]. - The company implemented containment measures to limit damage, including isolating targeted systems [2]. - DaVita emphasized that patient care continued without interruption, although some operations were impacted [3]. Group 2: Ongoing Response and Investigation - The company is conducting an investigation into the attack, with the full scope and impact on operations still unknown [4]. - Uncertainty regarding the attackers, ransom demands, and the overall effect on DaVita's operations has led to investor apprehension [5].

Core Viewpoint - The stock market is experiencing volatility due to U.S. tariffs and global trade tensions, with the S&P 500 down over 8% for the year [1] Group 1: Market Conditions - U.S. tariffs on imports from major partners like China have reached as high as 145%, while China has imposed 84% duties on U.S. products [1] - Ongoing inflation pressures and concerns about a potential recession or stagflation are contributing to market uncertainty [1] Group 2: Investment Strategy - Investors are encouraged to focus on relative price strength, identifying stocks that outperform their peers even in volatile conditions [2] - Stocks that have shown better performance than the S&P 500 over the last 1 to 3 months, combined with solid fundamentals, indicate potential for growth [6] Group 3: Recommended Stocks - IHS Holding Limited (IHS) is highlighted for its strong growth potential, with a Zacks Consensus Estimate indicating 114.7% growth for 2025 earnings and a market cap of $1.6 billion [10][11] - Atlanticus Holdings Corporation (ATLC) is noted for a 29.4% growth estimate for 2025 earnings and a significant share price increase of 110.5% over the past year [12][13] - REX American Resources Corporation (REX) has a market cap of $676.4 million and a 15.7% upward revision in earnings estimates for fiscal 2026, despite a 31.3% decline in share price over the past year [14][15] - Fresenius Medical Care AG (FMS) is recognized for a 27.1% growth estimate for 2025 earnings and a share price increase of 31.8% in the last year [16][17] Group 4: Screening Parameters - Stocks are screened based on relative price changes over 12 weeks, 4 weeks, and 1 week, as well as positive current-quarter estimate revisions [8] - Only Zacks Rank 1 (Strong Buy) stocks are considered, which have historically outperformed the S&P 500 [9]