Q1 2026 Pediatrix Medical Group Inc Earnings Call

May 5, 2026

Speaker #1: Hello and thank you for standing by. At this time, I would like to welcome everyone to the Q1 2026 Pediatrix Medical Group earnings conference call.

Operator: Hello, and thank you for standing by. At this time, I would like to welcome everyone to the Q1 2026 Pediatrix Medical Group Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, just press Star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press Star 1 again. Thank you. I would now like to turn the conference over to Mary Ann Moore, General Counsel. You may begin.

Speaker #1: The line has been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. If you would like to ask a question during this time, just press star followed by the number 1 on your telephone keypad.

Speaker #1: And if you would like to withdraw your question, press star 1 again. Thank you. I would now like to turn the conference over to Mary Ann Moore, General Counsel.

Speaker #1: You may begin.

Speaker #2: Thank you, Operator, and good morning. Certain statements and information during this conference call may be deemed to be forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995.

Mary Ann Moore: Thank you, operator, and good morning. Certain statements and information during this conference call may be deemed to be forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of nineteen ninety-five. These forward-looking statements are based on assumptions and assessments made by Pediatrix management in light of their experience and assessment of historical trends, current conditions, expected future developments, and other factors they believe to be appropriate. Any forward-looking statements made during this call are made as of today, and Pediatrix undertakes no duty to update or revise any such statements, whether as a result of new information, future events, or otherwise. Important factors that could cause actual results, developments, and business decisions to differ materially from forward-looking statements are described in the company's filings with the SEC, including the sections entitled Risk Factors. In today's remarks by management, we will be discussing non-GAAP financial metrics.

Speaker #2: These forward-looking statements are based on assumptions and assessments made by pediatrics management in light of their experience and assessment of historical trends, current conditions, expected future developments, and other factors they believe to be appropriate.

Speaker #2: Any forward-looking statements made during this call are made as of today. And pediatrics undertakes no duty to update or revise any such statements, whether as a result of new information, future events, or otherwise.

Any forward-looking statements made during this call are made as of today, and Pediatrix undertakes no duty to update or revise any such statements, whether as a result of new information, future events, or otherwise. Important factors that could cause actual results, developments, and business decisions to differ materially from forward-looking statements are described in the company's filings with the SEC, including the sections entitled Risk Factors. In today's remarks by management, we will be discussing non-GAAP financial metrics.

Mary Ann Moore: Any forward-looking statements made during this call are made as of today, and Pediatrix undertakes no duty to update or revise any such statements, whether as a result of new information, future events, or otherwise. Important factors that could cause actual results, developments, and business decisions to differ materially from forward-looking statements are described in the company's filings with the SEC, including the sections entitled Risk Factors. In today's remarks by management, we will be discussing non-GAAP financial metrics.

Speaker #2: Important factors that could cause actual results, developments, and business decisions to differ materially from forward-looking statements are described in the company's filings with the SEC, including the sections entitled Risk Factors.

Speaker #2: In today's remarks by management, we will be discussing non-GAAP financial metrics, a reconciliation of these non-GAAP financial measures to the most comparable GAAP measures can be found in this morning's press release, our quarterly and annual reports, and on our website at www.pediatrics.com.

Mary Ann Moore: A reconciliation of these non-GAAP financial measures to the most comparable GAAP measures can be found in this morning's press release, our quarterly and annual reports, and on our website at www.pediatrix.com. With that, I will turn the call over to Mark Ordan, our Chief Executive Officer.

Speaker #2: With that, I will turn the call over to Mark Ordan, our Chief Executive Officer.

Speaker #3: Thank you, Mary Ann, and good morning, everyone. Also with me today is Kasandra Rossi, our Chief Financial Officer. We were pleased with our strong first-quarter results driven by top-line growth with adjusted EBITDA coming in at $58 million.

Mark Ordan: Thank you, Mary Ann, and good morning, everyone. Also with me today is Cassandra Rossi, our Chief Financial Officer. We were pleased with our strong Q1 results, driven by top line growth with adjusted EBITDA coming in at $58 million. We saw strong pricing that outpaced a modest decline in same unit volumes across our service lines. Although recent volume results don't show a trend. Our payer mix continues to be strong, and we are comfortable with our decision to not have a headwind estimate for the potential effect of the tax subsidy lapse. We know that major hospital systems have seen a decline in patient volume and revenue, and we may see that in the future. Now this area is strong for us. We will continue to report on it as the year continues.

Speaker #3: We saw strong pricing that outpaced a modest decline in same-unit volumes across our service lines, although recent volume results don't show a trend. Our paramount continues to be strong, and we are comfortable with our decision to not have a headwind estimate for the potential effect of the tax subsidy lap.

Speaker #3: We know that major hospital systems have seen a decline in patient volume and revenue, and we may see that in the future. For now, this area is strong for us, and we will continue to report on it as the year continues.

Mark Ordan: We know that major hospital systems have seen a decline in patient volume and revenue, and we may see that in the future. Now this area is strong for us. We will continue to report on it as the year continues.

Speaker #3: Given the uncertainty of whether we will experience this headwind and since it's still early in the year, we are reaffirming our full 2026 outlook of $280 to $300 million in adjusted EBITDA.

Mark Ordan: Given the uncertainty of whether we will experience this headwind, and since it is still early in the year, we are reaffirming our full 2026 outlook of $280 to 300 million in adjusted EBITDA. Cassandra will now provide some additional details, and I will be back shortly.

Speaker #3: Kasandra will now shortly.

Speaker #4: Thanks, Mark, and good morning, everyone. Our consolidated revenue increase was driven by same-unit growth of just under non-same-unit activity of about $6 million including growth from recent acquisitions and organic growth, which was partially offset by decreases in revenue from our portfolio restructuring.

Cassandra Rossi: Thanks, Mark. Good morning, everyone. Our consolidated revenue increase was driven by same unit growth of just under 3% and net non-same unit activity of about $6 million, including growth from recent acquisitions and organic growth, which was partially offset by decreases in revenue from our portfolio restructuring. Pricing growth of 4% was driven by solid RCM cash collections, increases in contract administrative fees, favorable payer mix, and increased patient acuity in neonatology. While we saw volume declines across our service lines during the quarter, including NICU days that were down about 1%. Practice level SW&B expenses increased by $9 million year over year, primarily reflecting same unit increases in clinical salary expense. Net salary growth for Q1 was in line with the ranges we have seen over the past 18 months that have averaged around 3%.

Speaker #4: Pricing growth of 4% was driven by solid RCM cash collections, increases in contract administrative fees, favorable payer mix, and increased patient acuity in neonatology.

Speaker #4: While we saw volume declines across our service lines during the quarter, including NICU days that were down about 1%. Practice-level SWMB expenses increased by $9 million, year over year.

Cassandra Rossi: While we saw volume declines across our service lines during the quarter, including NICU days that were down about 1%. Practice level SW&B expenses increased by $9 million year over year, primarily reflecting same unit increases in clinical salary expense. Net salary growth for Q1 was in line with the ranges we have seen over the past 18 months that have averaged around 3%.

Speaker #4: Primarily reflecting same-unit increases in clinical, salary expense. Net salary growth for the first quarter was in line with the ranges we have seen over the past 18 months that have averaged around 3%.

Speaker #4: Our GNA expense increased slightly, year over year, driven by a modest increase in salary and incentive compensation expense, partially offset by decreases in professional services and IT expenses.

Cassandra Rossi: Our G&A expense increased slightly year over year, driven by a modest increase in salary and incentive compensation expense, partially offset by decreases in professional services and IT expenses. D&A expense increased slightly year over year, resulting from higher same-unit amortization expense and D&A related to our recent acquisitions. Other non-operating expense decreased year over year, driven by a decrease in interest expense on modestly lower average borrowing at slightly lower rates. Moving on to cash flow, as a reminder, we are a user of cash in Q1 of each year as we pay out incentive compensation and other benefits, namely 401(k) matching contributions.

Speaker #4: DNA expense increased slightly, year over year, resulting from higher same-unit amortization expense, and DNA-related to our recent acquisitions. Other non-operating expense decreased, year over year, driven by a decrease in interest expense on modestly lower average borrowings at slightly lower rates.

Speaker #4: Moving on to cash flow, as a reminder, we are a user of cash in the first quarter of each year, as we pay out incentive compensation and other benefits.

Speaker #4: Namely, 401(k) matching contributions. We used $130 million in operating cash flow in the first quarter, compared to $116 million in the prior year. With the differential related to decreases in cash flow from AP and accrued expenses, primarily related to incentive compensation payments.

Cassandra Rossi: We used $130 million in operating cash flow in Q1 compared to $116 million in the prior year, with the differential related to decreases in cash flow from AP and accrued expenses, primarily related to incentive compensation payments and decreases in cash flow from AR, partially offset by higher earnings. We also deployed $21 million of capital during the quarter to buy 1 million shares of our stock, leaving us with 82 million shares outstanding. We ended the quarter with cash of just over $200 million and net debt of just over $385 million. This reflects net leverage of just over 1.3x using the midpoint of our updated adjusted EBITDA outlook for 2026.

Speaker #4: And decreases in cash flow from AR, partially offset by higher earnings. We also deployed $21 million of capital during the quarter to buy a million shares of our stock, leaving us with $82 million shares outstanding.

Speaker #4: We ended the quarter with cash of just over $200 million and net debt of just over $385 million. This reflects net leverage of just over 1.3 times, using the midpoint of our updated adjusted EBITDA outlook for 2026.

Cassandra Rossi: This reflects net leverage of just over 1.3x using the midpoint of our updated adjusted EBITDA outlook for 2026.

Speaker #4: Our accounts receivable DSO at March 31st of $42.5 days, we're down slightly from December 31st, but we're down over five days year over year, driven by improved cash collections at our existing units.

Cassandra Rossi: Our accounts receivable DSO at 31 March of 42.5 days were down slightly from 31 December, but were down over 5 days year over year, driven by improved cash collections at our existing units. We are maintaining our previously issued outlook range for the full year of $280 million to $300 million in adjusted EBITDA. While our Q1 results represented about 20% of that annual expected range, we do expect that adjusted EBITDA for the remaining 3 quarters will be fairly ratable. I'll now turn the call back over to Mark Ordan.

Cassandra Rossi: Our accounts receivable DSO at 31 March of 42.5 days were down slightly from 31 December, but were down over 5 days year over year, driven by improved cash collections at our existing units. We are maintaining our previously issued outlook range for the full year of $280 to 300 million in adjusted EBITDA. While our Q1 results represented about 20% of that annual expected range, we do expect that adjusted EBITDA for the remaining three quarters will be fairly ratable. I'll now turn the call back over to Mark.

Speaker #4: We are maintaining our previously issued outlook range for the full year of $280 million to $300 million in adjusted EBITDA, and while our first quarter results represented about 20% of that annual expected range, we do expect that adjusted EBITDA for the remaining three quarters will be fairly radical.

Speaker #4: I'll now turn the call back over to Mark.

Speaker #3: Thank you, Kasandra. I've pounded the drum over the last few quarters that investments in care quality are always wise, hospital systems want to partner who will outperform, and our patients, of course, deserve nothing less.

Mark Ordan: Thank you, Cassandra. I've pounded the drum over the last few quarters that investments in care quality are always wise. Hospital systems want a partner who will outperform, and our patients, of course, deserve nothing less. In Q1, we announced that two extraordinary physician leaders from the top of academic medicine are joining Pediatrix Medical Group. Dr. James Barry as Chief Clinical Quality and Transformation Officer, and Dr. Jochen Profit as Chief Quality Advisor. James is nationally recognized for his contributions in neonatal critical care, artificial intelligence in medicine, patient safety, and healthcare leadership. He's co-founded two national organizations. One is a learning collaborative to neonatologists, data scientists, and clinical informationists to study the application of artificial intelligence in neonatal critical care and pediatric medicine.

Speaker #3: In the first quarter, we announced that two extraordinary physician leaders from the top of academic medicine are joining pediatrics. Dr. Jim Barry is Chief Clinical Quality and Transformation Officer and Dr. Jochen Profit is Chief Quality Advisor.

Speaker #3: Jim is a nationally recognized for his contributions in neonatal critical care, artificial intelligence in medicine, patient safety, and healthcare leadership. He has co-founded two national organizations, one as a learning collaborative to neonatologists, data scientists, and clinical informationists, to study the application of artificial intelligence in neonatal critical care and pediatric medicine, and the other is the Clinical Leaders Group of the American Academy of Pediatrics, which is a training, education, and collaboration resource for medical and quality directors of NICUs in the United States.

Mark Ordan: James is nationally recognized for his contributions in neonatal critical care, artificial intelligence in medicine, patient safety, and healthcare leadership. He's co-founded two national organizations. One is a learning collaborative to neonatologists, data scientists, and clinical informationists to study the application of artificial intelligence in neonatal critical care and pediatric medicine.

Mark Ordan: The other is the Clinical Leaders Group of the American Academy of Pediatrics, which is a training, education, and collaboration resource for medical and quality directors of NICUs in the United States. Dr. James Barry joins Pediatrix from the University of Colorado Health System, where he was Chair of Newborn Governance, as well as a professor of pediatrics neonatology at the University of Colorado School of Medicine. Obviously, James, who is an MD and an MBA, brings a full package of quality, data, AI, and business acumen. Jochen Profit brings nearly two decades of leadership in perinatal quality improvement as chair and principal investigator of the California Perinatal Quality Care Collaborative. He is a professor of pediatrics at Stanford Medicine.

Speaker #3: Dr. Barry joins pediatrics from the University of Colorado Health System where he was chair of newborn governance, as well as a professor of pediatrics and neonatology at the University of Colorado School of Medicine.

Speaker #3: Obviously, Jim, who is an MD and an MBA, brings a full package of quality, data, AI, and business acumen. Jochen Profit brings nearly two decades of leadership in perinatal quality improvement as chair and principal investigator of the California Perinatal and Maternal Quality Care Collaboratives.

Mark Ordan: Jochen Profit brings nearly two decades of leadership in perinatal quality improvement as chair and principal investigator of the California Perinatal Quality Care Collaborative. He is a professor of pediatrics at Stanford Medicine.

Speaker #3: He is a professor of pediatrics at Stanford Medicine. These individuals will respectively help lead and advise a team of extraordinary clinicians to continue to raise the bar on quality to analyzing clinical data reducing care variation and improving patient outcomes using evidence-based strategies.

Mark Ordan: These individuals will respectively help lead and advise a team of extraordinary clinicians to continue to raise the bar on quality through analyzing clinical data, reducing care variation, and improving patient outcomes using evidence-based strategies. Beyond the benefit to our core that our quality focus brings, our team is actively engaged in many opportunities to expand what we do. We have more hospital partnerships than any other organization in our core field, which provides great opportunities in neonatology, maternal fetal medicine, OB hospitalist, and pediatric intensive care. In addition to our leading in-house presence, we see a major opportunity to expand our teleservices and obstetrics presence nationwide. We believe that an organization like ours will continue to outperform if we stay laser-focused on care quality that is data-based.

Speaker #3: Beyond the benefit to our core that our quality focus brings, our team is actively engaged in many opportunities to expand what we do. We have more hospital partnerships than any other organization in our core fields, which provides great opportunities in neonatology, maternal-fetal medicine, OB hospitalists, and pediatric intensive care.

Speaker #3: And in addition to our leading in-house presence, we see a major opportunity to expand our tele-services and obstetrics presence nationwide. We believe that an organization like ours will continue to outperform if we stay laser-focused on care quality that is data-based.

Speaker #3: We see great opportunity to leverage our leading footprint both through our data and through tele and remote services. It is that insistence on quality that binds us to our patients and hospital partners.

Mark Ordan: We see great opportunity to leverage our leading footprint, both through our data and through tele and remote services. It is that insistence on quality that binds us to our patients and hospital partners, and we have the ability to use our strong balance sheet where there are opportunities to expand our core and emerging areas. On our last call, I spoke about a new program to integrate share price-based awards as part of our compensation program. We successfully rolled this out in last year's Q4 and in Q1 of this year. Included in this was welcoming 45 clinician leaders to our inaugural class of Pediatrix partners. This group is already actively helping us expand on the work we are known for by combining their superb clinical acumen with a spirit of ownership and alignment.

Speaker #3: And we have the ability to use our strong balance sheet where there are opportunities to expand our core and emerging areas. On our last call, I spoke about a new program to integrate share price-based awards as part of our compensation program.

Speaker #3: We successfully rolled this out in last year's fourth quarter and in Q1 of this year, including this was welcoming 45 clinician leaders to our inaugural class of pediatrics partners.

Mark Ordan: Included in this was welcoming 45 clinician leaders to our inaugural class of Pediatrix partners. This group is already actively helping us expand on the work we are known for by combining their superb clinical acumen with a spirit of ownership and alignment.

Speaker #3: This group is already actively helping us expand on the work we are known for by combining the superb clinical acumen with the spirit of ownership and alignment.

Speaker #3: We believe this is unique in our field, but so is pediatrics, and we can already see the tangible positives of this new initiative. As a matter of fact, Dr. Profit and Barry are joining us because of the really hard work that some of our doctors did to look for the really two top people in the field to join us.

Mark Ordan: We believe this is unique in our field, but so is Pediatrix, and we can already see the tangible positives of this new initiative. As a matter of fact, Doctors Jochen Profit and James Barry are joining us because of the really hard work that some of our doctors did to look to the really two top people in the field to join us, and I thank them for that. I'll close by speaking about our General Counsel and CAO, Mary Ann Moore. In our filing this morning, we announced that Mary Ann will be leaving her role and retiring before the end of the year. In 20 years with Pediatrix, Mary Ann has and continues to play a very important role in many areas of our operations, from legal administrative to overall supervision and guidance.

Speaker #3: And I thank them for that. I'll close by speaking about our general counsel and CIO, Mary Ann Moore, and our filing this morning. We announced that Mary Ann will be leaving her role and retiring before the end of the year.

Speaker #3: In 20 years with pediatrics, Mary Ann has and continues to play a very important role in many areas of our operations, from legal administrative to overall supervision and guidance.

Speaker #3: Mary Ann is a trusted colleague and advisor to the whole company and certainly to me and our board of directors. We will promptly begin a new search for a new general counsel.

Mark Ordan: Mary Ann is a trusted colleague and advisor to the whole company and certainly to me and our board of directors. We will promptly begin a new search for a new general counsel. Operator, let's open the call for questions.

Speaker #3: Operator, let's open the call for questions.

Speaker #5: We will now begin the question-and-answer session. If you would like to ask a question at this time, simply press star followed by the number one on your telephone keypad.

Operator: We will now begin the question-and-answer session. Our first question comes from the line of Ryan Daniels with William Blair. Ryan, please go ahead.

Speaker #5: And our first question comes from the line of Ryan Daniels with William Blair. Ryan, please go ahead.

Speaker #6: Hello, this is actually Matthew Mardula on for Ryan. Thank you for taking the questions. So, when I'm looking at pricing above 4%, are there any potential headwinds or impacts that we should be aware of, or maybe that you have internally, that could reduce the trajectory of this growth going forward?

Matthew Mardula: Hello, this is actually Matthew Mardula on for Ryan. Thank you for taking the questions. When I'm looking at pricing above 4%, are there any potential headwinds or impacts that we should be aware of or maybe that you have internally that could reduce the trajectory of this growth going forward? I know you a little bit touched on the tax subsidies, but any other details there? Are you still expecting pricing to be flat for the rest of the year given the Q1 results? If not, just how are you thinking about pricing for the rest of the year?

Speaker #6: And I know you're a little bit touched up on the tax subsidies, but any other details there? And then are you still expecting pricing to be flat for the rest of the year given the Q1 results?

Speaker #6: And if not, just how are you thinking about pricing for the rest of the year?

Speaker #7: Sure. So, on the pricing components, we've talked about really the same four factors that have driven pricing over the past several quarters. The first one of those is our RCM cash collections.

Cassandra Rossi: Sure. On the pricing components, you know, we've talked about really the same four factors that have driven pricing over the past several quarters. You know, the first one of those is our RCM cash collections. We mentioned in 2025 that we had almost kind of a hockey stick effect for those RCM cash collection impacts coming through pricing. We would expect the H1 of the year to still be strong, and then I think they'll start to lap, you know, as we move into the H2. The other three components that have driven, you know, positive pricing are contract revenue. That has continued to be strong.

Speaker #7: And we mentioned in 2025 that we had almost kind of a hockey stick effect for those RCM cash collection impacts coming through pricing. So we would expect the first half of the year to still be strong.

Speaker #7: And then I think it'll start to lap. As we move into the second half, the other three components that have driven positive pricing are contract revenue.

Speaker #7: Those have continued to be strong. We don't know that that will continue at this pace, but right now, we know hospitals are facing pressures in that area, but it continues to be strong for us.

Cassandra Rossi: We don't know that that will continue at this pace, but right now, you know, we know hospitals are facing, you know, pressures in that area, but it continues to be strong for us. The third item that we always talk about is payer mix, and I know you touched on the tax subsidies. That's an unknown for us. You know, that has continued to be an area of strength for us that has flowed through pricing. The final one, of course, is acuity. You know, we've seen really strong acuity primarily in neonatology, and these four factors, you know, have contributed to the last several quarters. Of course, coming in strong at over 4%, we would expect that to tick down a bit as we move through the year. I don't know of any other headwinds.

Speaker #7: The third item that we always talk about is payer mix. And I know you touched on the tax subsidies—that's an unknown for us.

Speaker #7: But that has continued to be an area of strength for us that has flowed through pricing. And the final one, of course, is acuity.

Speaker #7: We've seen really strong acuity primarily in neonatology and these four factors. Have contributed to the last several quarters? Of course, coming in strong at over 4%, we would expect that to hit down a bit as we move through the year.

Cassandra Rossi: Of course, coming in strong at over 4%, we would expect that to tick down a bit as we move through the year. I don't know of any other headwinds.

Speaker #7: But I don't know of any other headwinds.

Speaker #6: Great. Perfect. Thank you for that. And I do want to talk about how the last two kind of quarters, we've seen declining volume trends.

Matthew Mardula: Great. Perfect. Thank you for that. I do wanna talk about how the last two kinda quarters we've seen declining volume trends. I know last quarter was more because of the strong comp, but any thoughts on the continued decrease in volume and NICU days? I know it's difficult to, you know, to pinpoint a reason what is causing this, but just how are you thinking about volume going forward and maybe the potential improvements of it?

Speaker #6: And I know last quarter was more because of the strong top, but any thoughts on the continued decrease in volume? And Nick, your days.

Speaker #6: And I know it's difficult to pinpoint a reason. What is causing this? But just how are you thinking about volume going forward and maybe the potential improvements of it?

Mark Ordan: Well, as I said in my comments, while we saw that in those two quarters, in recent results, we haven't seen a continue of that trend. We don't have any different forecast there.

Speaker #4: Well, as I said in my comments while we saw what we saw that in those two quarters, in recent results, we haven't seen a continue of that trend.

Speaker #4: So we don't have any different forecast there.

Speaker #6: Great. Thank you for that.

Matthew Mardula: Great. Thank you for that.

Speaker #5: And our next question comes from the line of Jax Levin with Jeffery's Jack. Please go ahead.

Operator: Now our next question comes from the line of Jack Slevin with Jefferies. Jack, please go ahead.

Speaker #8: Hey, good morning. Appreciate the color so far. I just want to maybe double-click on a little bit on the pricing side. To understand two things.

Jack Slevin: Hey, good morning. Appreciate the color so far. I just wanna maybe double-click on a little bit on the pricing side to understand 2 things. The rev cycle piece is very clear. I guess maybe just taking it from a visibility perspective, and appreciate all the comments around HIX or the subsidies going away. Is there anything you can share on, like, what you're seeing on the ground right now as it relates to that continued strength in payer mix, or maybe things you're hearing out of your MFM practices that might tell you a little bit about, you know, how things might be shifting around?

Speaker #8: So the rev cycle piece is very clear. I guess maybe just taking it from a visibility perspective. And appreciate all the comments around Hicks or the subsidies going away.

Speaker #8: But is there anything you can share on what you're seeing on the ground right now as it relates to that continued strength in payer mix?

Speaker #8: Or maybe things you're hearing out of your MFM practices that might tell you a little bit about how things might be shifting around? We've started to obviously get some data points from payers and from hospitals on what they've seen from volumes or enrollments in Hicks.

Jack Slevin: We started to obviously get some data points from payers and from hospitals on what they've seen from volumes or enrollments in HIX. Just curious if there's anything, you know, additional you can share on that front. Then on the admin fee side, just if you can share, like, understand that can move around a little. The visibility to that for the rest of the year would be really helpful. Thank you.

Speaker #8: But just curious if there's anything additional you can share on that front. And then on the admin fee side, just if you can share understand that can move around a little, but the visibility to that for the rest of the year would be really helpful.

Speaker #8: Thank you.

Mark Ordan: Well, on the first part, we know the answer is we don't see any signs of weakness. We have looked carefully by geography, by type of line service, and we don't. I wouldn't say we're surprised. We're pleased. We've speculated that perhaps people are making a cost-benefit calculation when it comes to pregnancy that keeps them in the exchanges. We don't really know, but we haven't seen any negative. We expected, as I said on the last call, that there would be some negative around it. As I said in my comments earlier, we know that hospital systems broadly have experienced it. In no line of our business have we seen any weakness or any trend that would suggest any difference.

Speaker #4: Well, on the first part, we know the answer is we don't see any signs of weakness. And we have looked carefully. Geography, by type of line of service, and we don't.

Speaker #4: We are not I wouldn't say we're surprised. We're pleased. We've speculated that perhaps people are making a cost-benefit calculation when it comes to pregnancy that keeps them in.

Speaker #4: In the exchanges, we don't really know, but we haven't seen any negative. And we expected, as I said on the last call, that there would be some negative around it.

Speaker #4: And as I said in my comments earlier, we know that hospital systems broadly have experienced it. But in no line of our business have we seen any weakness or any trend that would suggest any difference.

Speaker #4: It could be that there'll be delayed effect, or it could be that we can get through this as we have been.

Mark Ordan: It could be that there'll be delayed e-effect, or it could be that we can, you know, get through this as we have been.

Speaker #8: Okay. Got it. Very helpful. I appreciate that. And then maybe one thing.

Jack Slevin: Okay. Got it. Very helpful. I appreciate that.

Mark Ordan: Oh, yeah. What was the-.

Speaker #7: Oh, yeah. I'm sorry, Jack. On the contract revenue, I think you had a question there.

Cassandra Rossi: Sorry, Jack, on the contract revenue, I think you had a question there.

Speaker #8: Yes. Yeah, yeah, absolutely. Appreciate that, Cassandra.

Jack Slevin: Yes. Yeah, absolutely. Appreciate that, Cassandra.

Cassandra Rossi: Sure. You know, on that, on that line, you know, one of the things we've talked about is there are sometimes salary increases in SW&B that we will only affect if we do get support from a hospital. There is some net effect there. Even though you're seeing a bit of growth on that top line, some of that is really going to pay for some of the salary increases on the SW&B line. But we do anticipate, again, continuing to have those conversations. They are getting tougher. We hope that it continues to stay strong. You know, it has, it has been anywhere from 10% to 20% of our pricing increase, you know, for the last few quarters. We expect that as we move through the year.

Speaker #7: Sure. So on that line, one of the things we've talked about is there are sometimes salary increases in SW&B that we will only affect if we do get support from a hospital.

Speaker #7: So there is some net effect there. So even though you're seeing a bit of growth on that top line, some of that is really going to pay for some of the salary increases on the SW&B line.

Speaker #7: But we do anticipate, again, continuing to have those conversations. They are getting tougher. So we hope that it continues to stay strong. It has been anywhere from 10 to 20 percent of our pricing increase for the last few quarters.

Speaker #7: And so we expect that as we move through the year. But if anything changes, of course, we'll let you know.

Cassandra Rossi: If anything changes, of course, we'll let you know.

Speaker #4: But don't misunderstand. We're not it may sound like we're a one-trick pony talking about quality. But the whole thesis of pediatrics business is to be a partner, an irreplaceable partner to our hospital partners.

Mark Ordan: Don't misunderstand, you know, It may sound like we're a one-trick pony talking about quality, but the whole thesis of Pediatrix business is to be a partner, an irreplaceable partner to our hospital partners. If we are providing superior quality and really being the leader in our field, you know, we think it justifies the kind of payments that we get. When Cassandra's right, that the environment for hospitals is tougher than it has been, which just makes us make sure that we're offering a service that hospitals provide, that hospitals find very valuable and irreplaceable.

Speaker #4: So if we are providing superior quality and really being the leader in our field, we think it justifies the kind of payments that we get.

Speaker #4: So Cassandra is right that the environment for hospitals is tougher than it has been, which just makes us make sure that we're offering a service that hospitals provide that hospitals find very valuable and irreplaceable.

Speaker #8: Got it. Okay. Appreciate that. And maybe I'll sneak two into one here just to wrap it on my end. The couple of deals you've done, obviously not massive in terms of dollar amounts, but sizable enough that it could have a little bit of impact.

Jack Slevin: Got it. Okay. Appreciate that. Maybe I'll sneak 2 into one here, just to wrap it on my end. The couple deals you've done, obviously not massive in terms of dollar amounts, but you know, sizeable enough that it could have a little bit of impact. Anything you can share in terms of what you're seeing on that front? Then just Cassandra, as it relates to Q2, are there any one-timers or things we should think about as we're looking at that for modeling purposes? Thanks.

Jack Slevin: Got it. Okay. Appreciate that. Maybe I'll sneak two into one here, just to wrap it on my end. The couple deals you've done, obviously not massive in terms of dollar amounts, but you know, sizeable enough that it could have a little bit of impact. Anything you can share in terms of what you're seeing on that front? Then just Cassandra, as it relates to Q2, are there any one-timers or things we should think about as we're looking at that for modeling purposes? Thanks.

Speaker #8: Anything you can share in terms of what you're seeing on that front? And then just Cassandra, as it relates to the second quarter, are there any one-timers or things we should think about as we're looking at that for modeling purposes?

Speaker #8: Thanks.

Speaker #4: Well, we don't be closing out material. We don't disclose the results. I could say that I will say that the recent acquisitions we've made have done better than our initial projections.

Mark Ordan: Well, we don't because they're not material, we don't disclose the results. I could say, I will say that the recent acquisitions we've made have done better than our initial projections, so we're very happy about that. As I said in my call, we are actively working on opportunities that we think could bear fruit and be great additions to Pediatrix.

Speaker #4: So we're very happy about that. And as I said in my call, we are actively working on opportunities that we think could bear fruit and be great additions to pediatrics.

Cassandra Rossi: No 1 time to call out for the quarter, Jack.

Speaker #7: And no one-times to call out for the quarter, Jack?

Cassandra Rossi: No 1 time to call out for the quarter, Jack.

Mark Ordan: No.

Speaker #4: No.

Speaker #8: Awesome. Thank you both. Appreciate it.

Jack Slevin: Awesome. Thank you both. Appreciate it.

Speaker #4: Thank you.

Mark Ordan: Thank you.

Speaker #5: Again, if you would like to ask a question, just press star followed by the number one on your telephone keypad. And your next question comes from the line of Peter Schickering with Deutsche Bank.

Operator: Your next question comes from the line of Philip Chickering with Deutsche Bank. Philip, please go ahead.

Speaker #5: Peter, please go ahead.

Philip Chickering: Hey, good morning, guys. Thanks. My question. One more pricing question here. I apologize. It's just so much stronger than expectations and obviously had a wonderful impact on the EBITDA here. Can you quantify how much of the pricing in the Q1 came from the cash collections? Just as you think about it sort of, you know, fading or copying out in the H2?

Pito Chickering: Hey, good morning, guys. Thanks. My question. One more pricing question here. I apologize. It's just so much stronger than expectations and obviously had a wonderful impact on the EBITDA here. Can you quantify how much of the pricing in the Q1 came from the cash collections? Just as you think about it sort of, you know, fading or copying out in the H2?

Speaker #8: Hey, good morning, guys. Hey, my question. One more pricing question here, and I apologize. It's just so much stronger than expectations. And obviously, I had a wonderful impact on EBITDA here.

Speaker #8: Can you quantify how much of the pricing in the first quarter came from the cash collections? Just as you think about it, sort of fading or copping out in the back half of the year?

Speaker #7: About a 25%.

Cassandra Rossi: About 25%.

Speaker #8: Okay. Okay. Fair enough. And then like you said, on the admin fees, again, that's about 10 to 20 percent as well, assuming that that was the same for this quarter?

Philip Chickering: Okay, fair enough. Then, like you said, on the admin fees, again, that's about 10% to 20% as well. Assume that that was the same for this quarter?

Pito Chickering: Okay, fair enough. Then, like you said, on the admin fees, again, that's about 10% to 20% as well. Assume that that was the same for this quarter?

Speaker #7: Yeah, that was around 20 on the higher end for the quarter.

Cassandra Rossi: Yeah. That was around $20 on the higher end for the quarter.

Speaker #8: Okay. And then what percent of the book has admin fees at this point? And kind of how has that changed year over year? And once you have an admin fee, is that a one-time and then that stops increasing, or does that increase at inflation levels once it's implemented?

Philip Chickering: Okay. What % of the book has admin fees at this point? Kinda how has that changed year over year? Once you have an admin fee, is that a one-time and then that stops increasing, or does that increase at inflation levels once it's implemented?

Pito Chickering: Okay. What % of the book has admin fees at this point? Kinda how has that changed year over year? Once you have an admin fee, is that a one-time and then that stops increasing, or does that increase at inflation levels once it's implemented?

Speaker #7: It depends on the contract. I mean, they vary. We have obviously a couple thousand of those contracts.

Cassandra Rossi: It depends on the contract. I mean, they vary. We have, you know, obviously a couple thousand of those contracts.

Speaker #8: Right. Okay. I mean, if I have half of those, are those increasing at inflation and half of them? Is there any ballpark in generally where those go?

Philip Chickering: Okay. I mean, do like, you know, about half of those are those increasing at inflation, and half of them, is there any ballpark in generally where, you know, where this go, you know, again, as we think about just how you're modeling?

Pito Chickering: Okay. I mean, do like, you know, about half of those are those increasing at inflation, and half of them, is there any ballpark in generally where, you know, where this go, you know, again, as we think about just how you're modeling?

Speaker #8: Again, as we think about just out your modeling.

Speaker #4: No, I know where you're going with that, but Cassandra said we have thousands of contracts and they're all very different. And we don't there's no if there was a trend in any way, we would call it out.

Mark Ordan: No, I know, I know where you're going with that, but as Cassandra said, we have thousands of contracts and they're all very different. If there was a trend in any way, we would call it out.

Speaker #8: Okay. Fair enough. And then last question, and maybe I missed this, but I think actually the lead-off question asked if you're going to maintain pricing being flat for the year.

Philip Chickering: Okay. Fair enough. Last question, and maybe I missed this, I think actually the lead ask question asked if you're gonna maintain pricing being flat for the year. Are you guys still maintaining that? Just looking at, you know, Q1 was 9% stack comp, and if that, if this is stable, this could lead to pricing of a couple percent this year versus guidance. I guess, are you still maintaining flat pricing guidance for the year?

Pito Chickering: Okay. Fair enough. Last question, and maybe I missed this, I think actually the lead ask question asked if you're gonna maintain pricing being flat for the year. Are you guys still maintaining that? Just looking at, you know, Q1 was 9% stack comp, and if that, if this is stable, this could lead to pricing of a couple percent this year versus guidance. I guess, are you still maintaining flat pricing guidance for the year?

Speaker #8: Are you guys still maintaining that? Just looking at the first quarter, it was 9% stacked comp, and if this is stable, this could lead to pricing of a couple percent this year versus guidance.

Speaker #8: So I guess are you still maintaining flat pricing guidance for the year?

Speaker #7: Yeah, I think we are. I mean, again, we do expect that that RCM cash collections, which has been really strong for us, will tail off as we move through the year.

Cassandra Rossi: Yeah, I think we are. I mean, again, we do expect that that RCM cash collections, which has been really strong for us, will tail off as we move through the year. We are maintaining our flat outlook. Again, it's early. If that does change as we move into the next quarter, you know, we'll update you on that. Right now, we are maintaining flat.

Speaker #7: And so we are maintaining our flat outlook. Again, it's early. If that does change, as we move into the next quarter, we'll update you on that.

Speaker #7: But right now, we are maintaining flat.

Speaker #8: All right. Great.

Philip Chickering: Great.

Pito Chickering: Great.

Mark Ordan: You know, after last quarter, we when we forecast the year at our last quarter call, people asked, Why didn't you put in some kind of hedge? I'd say, everything indicates that things continue to be strong. So it's hard to forecast something based on a fear or a possibility if there's no, if there's no data behind it. So that's.

Speaker #4: After last quarter, when we forecast the year in our last quarter call, people asked, "Why didn't you put in some kind of hedge?" And I'd say everything indicates that things continue to be strong.

Speaker #4: So it's hard to forecast something based on a fear or a possibility if there's no data behind it. So that's why we are.

Philip Chickering: Yeah

Pito Chickering: Yeah

Mark Ordan: why we are.

Speaker #8: Yeah. Fair enough. It's showing through. So I guess that's it for me. Thanks for the questions and a nice job in the quarter.

Philip Chickering: Fair enough. You know, it's showing through. I guess that's it for me. You know, thanks for the questions and a nice job in the quarter.

Pito Chickering: Fair enough. You know, it's showing through. I guess that's it for me. You know, thanks for the questions and a nice job in the quarter.

Speaker #7: Thank you.

Mark Ordan: Thanks, Randall.

Operator: There is no further question at this time. I will now turn the call back over to Mark Ordan for any closing remarks. Mark?

Speaker #5: There's no further question at this time. I will now turn the call back over to Mark Orden for any closing remarks. Mark?

Speaker #4: Thank you all very much for your support, and we look forward to keeping you updated as the year unfolds. Have a great day.

Mark Ordan: Thank you all very much for your support, and we look forward to keeping you updated as the year unfolds. Have a great day.

Operator: That concludes today's call. You may now disconnect.

More MD earnings call transcripts

Browse all earnings call transcripts

Q1 2026 Pediatrix Medical Group Inc Earnings Call

Request TrialDemo

Event Details

Pediatrix

Earnings

Q1 2026 Pediatrix Medical Group Inc Earnings Call

Tuesday, May 5th, 2026 at 1:00 PM

Open Event Documents

Search Transcript

Enter a search term to find quotes

Pediatrix

Earnings

Q1 2026 Pediatrix Medical Group Inc Earnings Call

Tuesday, May 5th, 2026 at 1:00 PM

Transcript

No Transcript Available

No transcript data is available for this event yet. Transcripts typically become available shortly after an earnings call ends.

Want AI-powered analysis? Try AllMind →

Earnings analysis guides

Methods for extracting KPIs and checking source support when reviewing an earnings call.

Q3 2025 Pediatrix Medical Group Inc Earnings CallNovember 3, 2025
Q4 2025 Pediatrix Medical Group Inc Earnings CallFebruary 19, 2026
Q2 2026 Pediatrix Medical Group Inc Earnings CallAugust 4, 2026
Q3 2026 Pediatrix Medical Group Inc Earnings CallOctober 29, 2026

Browse all earnings calls