Encompass Health (EHC) Earnings: Q3 2026 Results

The quarter ended September 30, 2026 and Encompass Health published the results on October 28, 2026. Revenue and diluted EPS are shown against Q3 2025, the same quarter a year earlier, which takes seasonal swings out of the comparison. Encompass Health reports EPS two ways: GAAP, under the accounting rules every US filer follows, and adjusted, which leaves out items the company considers outside its operating results. The release reconciles the two, and when they diverge, the reconciliation says why.

• EPS on this page is diluted EPS from continuing operations attributable to Encompass Health, the figure its release leads with. Diluted EPS on total net income, including discontinued operations, was $1.50 in Q3 2026 and $1.24 a year earlier.
• Discontinued operations relate to the home health and hospice business Encompass Health spun off on July 1, 2022. In Q1 2026 they added $0.16 to diluted EPS after a January 2026 agreement with defendants in litigation against former executives of that business.

Source: Encompass Health Q3 2026 results, October 28, 2026. Also in the Form 10-Q for the quarter ended September 30, 2026. Figures as reported; checked against the release on November 10, 2026.

How Encompass Health splits revenue in its own release, under its own labels, for Q3 2026 against Q3 2025. Indented lines are parts of the line above them.

• Encompass Health's Medicare revenue was $1.1 billion in Q3 2026, up 13% from $946 million in Q3 2025, 66% of total revenue.
• Encompass Health's Medicare Advantage revenue was $253 million in Q3 2026, up 3% from $246 million in Q3 2025, 16% of total revenue.
• Encompass Health's Managed care revenue was $173 million in Q3 2026, up 5% from $165 million in Q3 2025, 11% of total revenue.
• Encompass Health's Medicaid revenue was $49.6 million in Q3 2026, down 1% from $50.0 million in Q3 2025, 3% of total revenue.
• Encompass Health's Other third-party payors revenue was $11.9 million in Q3 2026, up 21% from $9.8 million in Q3 2025, under 1% of total revenue.
• Encompass Health's Workers' compensation revenue was $8.2 million in Q3 2026, down 4% from $8.5 million in Q3 2025, under 1% of total revenue.
• Encompass Health's Patients revenue was $8.0 million in Q3 2026, up 63% from $4.9 million in Q3 2025, under 1% of total revenue.
• Encompass Health's Other income revenue was $37.9 million in Q3 2026, down 21% from $47.9 million in Q3 2025, 2% of total revenue.

Segment lines are the figures writers cite most often, because they show where the growth in a quarter came from. Companies redraw their segments from time to time and restate the prior year to match, so a year-ago figure here can differ from the one printed a year ago. When that has happened, the note above says so.

From the earnings release

Encompass Health raised its full-year 2026 guidance on October 28, 2026: net operating revenue of $6,450 million to $6,500 million (previously $6,410 million to $6,490 million), Adjusted EBITDA of $1,395 million to $1,415 million (previously $1,365 million to $1,395 million) and adjusted EPS from continuing operations of $6.23 to $6.37 (previously $6.02 to $6.25). The quotes above are from its guidance considerations in the earnings slides filed with the release.

In its Q3 2026 release, Encompass Health said:

“Medicare pricing increase of approximately 2.3% for Q4”

“Bad debt reserves of 2.0% to 2.5% of revenue for Q4”

“8 new hospitals with a total of 389 beds”

“Tax rate of approximately 26%”

Source: Encompass Health Q3 2026 release, Oct 28, 2026.

This is the company's own guidance as of Oct 28, 2026, quoted as given. Walnut does not make forecasts of its own. Analyst estimates for the coming quarters are on the EHC forecast page.

Revenue and diluted EPS for the last 5 quarters. Each date links to that quarter's release.

Net operating revenues and diluted EPS from continuing operations attributable to Encompass Health, each as first reported in that quarter's release.

We do not hold a confirmed date for Encompass Health's next report. Companies post the date on their investor relations site a few weeks ahead, usually with the time of the conference call.

Each quarter keeps its own page with the figures as reported, so a link to one stays pointed at the same numbers after the next report.

• Q3 2026 (this page), reported Oct 28, 2026

Encompass Health earns almost all of its revenue from inpatient rehabilitation hospitals: $1,569.1 million of $1,609.5 million in Q3 2026 was inpatient, up 9.9%, and other revenue fell 19.5% to $40.4 million. The release describes it as the largest owner and operator of inpatient rehabilitation hospitals in the United States, with 179 hospitals in 39 states and Puerto Rico. (Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026; Encompass Health Q3 2026 release, Oct 28, 2026)

Medicare is the dominant payor. Traditional Medicare paid $1,067.7 million, 66.3% of net operating revenues, against 64.1% a year earlier, and Medicare Advantage paid $252.9 million, or 15.7%. Managed care was 10.8% and Medicaid 3.1%. Per the 10-K, 92% of Encompass Health's patients are admitted from acute-care hospitals following physician referrals. (Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026; Encompass Health Form 10-K, 2025, Feb 26, 2026)

Encompass Health attributes the 8.9% revenue increase to higher volumes and favorable pricing. Discharges rose 5.7% to 69,605, including 3.0% same-store growth, with new hospitals in places such as Amarillo, Texas, Loganville, Georgia, Irmo, South Carolina and Concordville, Pennsylvania adding the rest. (Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026; Encompass Health Q3 2026 release, Oct 28, 2026)

Net patient revenue per discharge rose 4.0% to $22,543 on higher reimbursement rates and patient mix, partly offset by bad debt. Revenue reserves related to bad debt rose to 2.7% of net operating revenues from 1.9%, which the 10-Q puts down to a billing and collecting disruption after a system conversion in the second quarter of 2026. (Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026)

On July 30, 2026, CMS released its final fiscal 2027 rule for inpatient rehabilitation facilities, a net 2.3% market basket increase for discharges from October 1, 2026 through September 30, 2027. (Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026)

Encompass Health's adjusted EPS of $1.52 was one cent above its GAAP diluted EPS from continuing operations of $1.51 in Q3 2026. The only Q3 adjustments were a state regulatory change impact ($0.01) and a change in the fair market value of marketable securities. Over nine months the bigger item was a $17.5 million pre-tax gain on selling its 50% interest in Gamma Knife Center at Barnes-Jewish Hospital, which adjusted EPS removes ($0.13). (Encompass Health Q3 2026 release, Oct 28, 2026; Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026)

Encompass Health consolidates joint-venture hospitals, so $53.7 million of Q3 net income went to noncontrolling interests, against $48.1 million a year earlier. Net income attributable to Encompass Health was $149.9 million. (Encompass Health Q3 2026 release, Oct 28, 2026)

Diluted shares fell to 99.7 million from 102.3 million. During the first nine months of 2026 Encompass Health repurchased 1.9 million shares for $203.7 million, and on July 23, 2026 its board raised the repurchase authorization to $1.0 billion, with approximately $955 million remaining at September 30. (Encompass Health Q3 2026 release, Oct 28, 2026; Encompass Health Form 10-Q, Q3 2026, Nov 3, 2026)

Diluted EPS divides net income by the weighted average number of shares outstanding in the quarter, plus the shares that options and other equity awards could add. Buybacks shrink that count and lift EPS for the same profit; share issuance and stock awards enlarge it.

Encompass Health publishes full-year guidance in its release and raised it on October 28, 2026: net operating revenue of $6,450 million to $6,500 million (from $6,410 million to $6,490 million), Adjusted EBITDA of $1,395 million to $1,415 million, and adjusted EPS from continuing operations of $6.23 to $6.37 (from $6.02 to $6.25). It gives no GAAP EPS guidance. (Encompass Health Q3 2026 release, Oct 28, 2026)

Its guidance considerations assume a Medicare pricing increase of approximately 2.3% for Q4, managed care pricing up 3.5% to 4.0%, bad debt reserves of 2.0% to 2.5% of revenue for Q4, 8 new hospitals with a total of 389 beds in 2026, a tax rate of approximately 26% and about 100 million diluted shares. (Encompass Health Q3 2026 earnings slides, Oct 28, 2026)

A consensus figure is the average of the models published by the analysts who cover Encompass Health, collected by a data provider and revised up to the day of the report. A quarter that lands above it says how expectations were set as much as how the business did, and the share price on the day also reflects the guidance and the lines no consensus covers.

The consensus figures on this page are Yahoo Finance's, as pulled on the date shown. Each comes with the number of analysts behind it; the smaller that number, the more one revised estimate can move the average.

The figures below are the ones Encompass Health's own release and filings put weight on for Q3 2026, with the latest reported value for each.

What the quarter means for a holding is a separate question from what it reported. The case for and against owning EHC is on is EHC a buy or a sell?, what analysts expect next is on the EHC forecast, and what the company does is on the Encompass Health (EHC) stock page.

Every number on this page can be traced to a document Encompass Health published. Checking one takes a couple of minutes, and it is worth doing before you quote a figure anywhere.

• The results release is the document linked in the source line above. Companies publish it on their investor relations site at the moment results go out, and it carries the headline tables: revenue, operating income, net income and EPS for the quarter and the year-ago quarter.
• The same release is filed with the SEC as Exhibit 99.1 to a Form 8-K under Item 2.02, usually on the day of the report. The SEC copy does not change after the fact, which makes it the safer thing to link when you cite a number.
• The quarterly report (Form 10-Q) follows within a few weeks and carries the full financial statements, the segment note and management's discussion of what changed. The fourth quarter is covered by the annual report (Form 10-K) instead.
• Restated comparisons are flagged in the notes on this page. When a company redraws its segments or changes how it adjusts EPS, it restates the year-ago column, so the year-ago figure in a new release can differ from the one printed a year ago. This page always uses the comparison in the newer release, because that is the like-for-like one.

A walk-through of every line in a release, with what each one tells you, is in how to read an earnings report.