Diversified Healthcare Trust (DHC) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue was $388.7 million, up from $373.6 million in Q3 2024, with adjusted EBITDA RE of $62.9 million and normalized FFO of $9.7 million or $0.04 per share.

• Net loss widened to $164.0 million for Q3 2025, compared to $98.7 million in Q3 2024, mainly due to $93.2 million in asset impairment charges.

• Transition of 116 AlerisLife-managed communities to new operators is nearly complete, with 85 transitioned as of early November and full completion expected by year-end.

• Operational improvements and portfolio optimization continued, supported by asset sales and refinancing activities.

• Portfolio as of September 30, 2025, includes 335 properties in 34 states and D.C., valued at $6.7 billion.

Financial highlights

• SHOP segment Q3 2025 revenue was $333.4 million (up 6.9%), NOI was $29.6 million (up 8.0%), and occupancy reached 81.5%.

• Medical Office and Life Science Portfolio Q3 2025 revenue was $48.2 million (down 8.9%), NOI was $26.7 million (down 4.1%), and occupancy rose to 86.6%.

• Same property cash-based NOI for SHOP was $32.0 million, down 1.2% year-over-year; Medical Office and Life Science Portfolio same property cash NOI was $23.8 million, up 1.6%.

• Interest expense decreased 17.8% in Q3 2025 due to debt redemptions and lower accretion.

• Declared a quarterly distribution of $0.01 per share.

Outlook and guidance

• Full-year SHOP NOI guidance reaffirmed at $132-$142 million, with SHOP occupancy expected to reach 82%-83% by year-end.

• 2025 CapEx guidance maintained at $140-$160 million; full-year 2025 Adjusted EBITDA RE expected in the $275-$285 million range.

• Management expects continued improvement in SHOP segment occupancy and rates, with labor expenses to normalize as operator transitions conclude.

• Sufficient liquidity is expected for at least the next 12 months, with $150 million in undrawn revolving credit.

• No debt maturities until 2028 after planned 2026 repayments.