DaVita Q3 2026 earnings: profit tops estimates, but a China write-down clouds the beat

October 29, 2026

DaVita beat revenue and profit estimates for Q3 2026, but a non-cash charge tied to its China business and a steep drop in free cash flow overshadowed the headline numbers.

Key takeaways

• DaVita’s revenue and adjusted profit both came in above what analysts were expecting for the quarter, a modest beat on both lines.
• The company’s reported (GAAP) profit per share was notably lower than its adjusted figure. The main reason was a roughly $62 million non-cash write-down tied to its dialysis operations in China, which pushed that international business into an operating loss for the quarter.
• Despite beating estimates, DaVita’s stock fell after the report — investors appeared more focused on the China charge and weaker cash generation than on the headline beat.
• Growth in dialysis treatments — DaVita’s core business — was modest: total U.S. treatments rose slightly from the prior quarter mainly because the quarter had more treatment days, while the underlying daily treatment volume was nearly flat, pointing to slow, steady patient growth rather than a surge in demand.
• The cost of caring for each patient rose, largely due to higher medical supply expenses, which was only partly offset by somewhat better reimbursement rates and a more favorable mix of insurance payors.
• DaVita nudged up the low end of its full-year 2026 profit outlook — now guiding to adjusted earnings per share of $14.30 to $15.20, versus $14.10 to $15.20 previously — while keeping the top of the range unchanged.
• Management raised its target for Integrated Kidney Care, a newer business that coordinates broader treatment for chronic kidney disease patients beyond dialysis itself, now expecting it to contribute at least $65 million to operating profit this year, partly offset by higher technology spending in the main U.S. dialysis business.
• Cash generated from operations was $519 million, but free cash flow (what’s left after running the business and capital spending) fell sharply from a year earlier to $276 million; DaVita still used part of that cash to buy back roughly 600,000 of its own shares.
• Looking at the trailing year, DaVita’s margins reflect a high-volume, thinner-margin business — a relatively small share of each revenue dollar flows through to net profit — while per-share profit grew much faster than revenue over the same period, a gap driven largely by share buybacks and cost discipline rather than a jump in patient volume.
• Management flagged that upcoming changes to Medicare’s dialysis reimbursement rules are expected to have a net negative impact of roughly 1.5% to 2% in 2027, an early signal for next year rather than this quarter’s results.

How the stock took it

DaVita Inc closed at $183.93 on Oct 28, 2026, the last session before the report, and at $187.50 on Oct 30, 2026, the first session after it — +1.9% across the report.

Closes from the market's daily record. Each figure spans the report date — from the last session that closed before it to the first that closed after — because a company may report before the open or after the close.

Fundamentals

Sources: company report · 247wallst.com · Seeking Alpha