Addus HomeCare (NASDAQ:ADUS) reported fourth-quarter 2025 results that management described as a strong finish to the year, driven by organic growth in personal care, continued momentum in hospice, and contributions from recent acquisitions.
Fourth-quarter and full-year 2025 results
Chairman and CEO Dirk Allison said total revenue for the fourth quarter of 2025 was $373.1 million, up 25.6% from $297.1 million in the prior-year period. Adjusted earnings per share rose to $1.77 from $1.38, and adjusted EBITDA increased to $50.3 million from $37.8 million. Adjusted EBITDA margin was 13.6%, compared with 12.9% a year earlier, CFO Brian Poff said.
Segment performance and same-store trends
Excluding the impact of a New York accounts receivable settlement, Poff said quarterly net service revenue was $371.2 million. The revenue mix (excluding that New York impact) was:
- Personal care: $284.1 million (76.5% of revenue)
- Hospice: $70.0 million (18.9%)
- Home health: $17.1 million (4.6%)
On an organic basis, Allison said personal care same-store revenue grew 6.3% year over year (excluding Gentiva, which was not owned for all of fourth-quarter 2024). Same-store hours increased 2.4%, and management said the percentage of authorized hours served remained consistent with the third quarter. President and COO Heather Dixon noted a slight sequential dip in same-store billable census in the fourth quarter, which she attributed to holiday seasonality; she said admissions and starts of care continued to outpace discharges and that the company expects to see positive year-over-year census growth in the second half of 2026.
In hospice, same-store revenue increased 16% year over year, with average daily census rising to 3,885 from 3,472. Allison said median length of stay (including the Illinois JourneyCare operation) was 25 days in the fourth quarter, up from 22 days in the third quarter. Dixon later attributed length-of-stay improvement to efforts to diversify referral sources market by market and said the company saw improvement in its overall hospice CAP position in the quarter, including a benefit that she characterized as not material overall.
Home health same-store revenue declined 7.54% year over year, but management emphasized coordination benefits in overlapping markets. Allison highlighted that more than 25% of hospice admissions in New Mexico and Tennessee were coming from Addus’ operations where services overlap, and Dixon said the company expects similar collaboration to develop in Illinois, where it also has both home health and hospice.
Rates, reimbursement, and policy outlook
Management pointed to several reimbursement items affecting results and outlook. Poff said personal care organic performance was supported by stable hiring and state rate support, including a 9.9% rate increase in Texas effective Sept. 1, 2025. He also said Illinois approved a 3.9% increase effective Jan. 1, 2026, which management expects will add approximately $17.5 million in annualized revenue with margins “consistent in the low 20% range.”
On the call, Poff said New Mexico legislators had passed what the company estimates to be a 4% to 5% rate increase, pending the governor’s signature, which the company expects would benefit the back half of 2026. He added that New Mexico does not have a mandatory pass-through rule and the company was still assessing how much of any increase would be passed through to caregivers, while stating that “some portion” would be passed through.
In hospice, Poff cited an approximately 3.1% increase in the 2026 Medicare hospice reimbursement rate that became effective Oct. 1, 2025.
On regulatory matters, Allison reiterated the company’s view that the 80/20 provision of the Medicaid Access Rule will be eliminated, saying Addus has heard “good things” through its lobbyists and discussions with CMS, while cautioning that the situation is subject to change and the rule does not take effect for several years. Allison also said that while there are potential future Medicaid changes related to “OB3,” Addus believes states recognize its value proposition, arguing home-based care is substantially less costly than facility-based care.
Labor trends, compliance focus, and technology initiatives
Addus said hiring trends in personal care remained favorable. Allison reported 101 hires per business day during the fourth quarter, increasing to 107 hires per business day in the first two weeks of January, before weather disruptions later in the month. Dixon said February hiring rebounded as winter storms dissipated, and she characterized the labor environment as stable, with challenges primarily limited to “a few more challenging urban markets” on the clinical side.
Responding to a question about fraud, waste, and abuse scrutiny in personal care, Allison said the company built a strong compliance program over the past decade and welcomed increased focus, arguing that smaller providers may lack resources to make similar investments, potentially creating opportunities for Addus.
Management also discussed technology efforts, including Addus Connect. Dixon said Illinois has seen service-percentage performance in the “upper eightieth percentile” consistently during 2025 after the app rollout. The company began rolling Addus Connect into New Mexico in 2025 and said it is starting deployment in Texas in the first quarter of 2026, targeting completion by the end of the second quarter or early in the third quarter. Dixon said the company cannot directly quantify volume lift attributable solely to the app but monitors caregiver adoption, frequency of usage, and “flex hours” utilization.
Separately, management said it has more than 30 locations on the Homecare Homebase system today and expects a measured, market-by-market rollout across personal care through 2026 and into much of 2027. Poff also said the company has formed an internal AI committee led by its CIO, focusing on opportunities in revenue cycle/back office automation and scheduling logistics.
Cash flow, balance sheet, and acquisition posture
For the fourth quarter, Addus reported cash flow from operations of $18.8 million and ended the period with $81.6 million in cash. Poff said total bank debt was $124.3 million, down $30 million sequentially, and that the company reduced its revolver balance by $98.7 million during 2025. Management said net leverage was under 1x adjusted EBITDA.
Poff also said the company received $7.2 million in phase three ARPA funding from New Mexico in the fourth quarter and an additional $5.8 million in the first quarter of 2026, totaling $13 million; he said these are expected to be the last scheduled disbursements, leaving approximately $17.5 million in remaining funds to be utilized.
On working capital, Poff said days sales outstanding (DSO) ended the quarter at 38.2 days, up from 35 days in the third quarter, driven largely by timing in Illinois, where DSO increased to 54.7 days from 32.5 days; he said Illinois DSO returned to more typical levels early in the first quarter of 2026.
Management reiterated its acquisition strategy focused on geographic density and the full continuum of home-based care. Poff said 2025 included three acquisitions—Great Lakes Home Care (Michigan), Helping Hands Home Care Service (Pennsylvania), and Del Cielo’s personal care operations (Texas)—in addition to the previously completed Gentiva personal care acquisition. In Q&A, management said it is seeing pipeline opportunities similar to the deals closed in 2025 and is also monitoring potential larger personal care assets that may come to market around mid-year or the back half of 2026.
About Addus HomeCare (NASDAQ:ADUS)
Addus HomeCare (NASDAQ: ADUS) is a leading provider of home and community-based care services for elderly, disabled, and medically complex individuals across the United States. Through a network of company-owned and franchise locations, the company delivers a broad spectrum of non-medical personal care and licensed home health services designed to support clients’ independence and quality of life.
The company’s core offerings include personal care assistance—covering daily living activities, medication reminders, and light housekeeping—and skilled home health services delivered under the supervision of registered nurses and licensed therapists.
