Healthcare services provider BrightSpring Health Services (NASDAQ:BTSG) reported Q2 CY2025 results exceeding the market’s revenue expectations, with sales up 15.3% year on year to $3.15 billion. The company expects the full year’s revenue to be around $12.4 billion, close to analysts’ estimates. Its non-GAAP profit of $0.22 per share was 17.6% above analysts’ consensus estimates.
Is now the time to buy BrightSpring Health Services? Find out by accessing our full research report, it’s free.
BrightSpring Health Services (BTSG) Q2 CY2025 Highlights:
- Revenue: $3.15 billion vs analyst estimates of $2.99 billion (15.3% year-on-year growth, 5.2% beat)
- Adjusted EPS: $0.22 vs analyst estimates of $0.19 (17.6% beat)
- Adjusted EBITDA: $142.5 million vs analyst estimates of $139.4 million (4.5% margin, 2.2% beat)
- The company lifted its revenue guidance for the full year to $12.4 billion at the midpoint from $12.25 billion, a 1.2% increase
- EBITDA guidance for the full year is $597.5 million at the midpoint, above analyst estimates of $579.8 million
- Operating Margin: 1.5%, in line with the same quarter last year
- Free Cash Flow was $42.28 million, up from -$38.97 million in the same quarter last year
- Market Capitalization: $3.63 billion
“Our focus on delivering high quality care, operational excellence, and investment in best practices across prioritized markets and services continues to underpin strong overall business performance,” said Jon Rousseau, Chairman, President, and Chief Executive Officer of the Company.
Company Overview
Founded in 1974, BrightSpring Health Services (NASDAQ:BTSG) offers home health care, hospice, neuro-rehabilitation, and pharmacy services.
Revenue Growth
A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Luckily, BrightSpring Health Services’s sales grew at an impressive 17.4% compounded annual growth rate over the last five years. Its growth beat the average healthcare company and shows its offerings resonate with customers.
Long-term growth is the most important, but within healthcare, a half-decade historical view may miss new innovations or demand cycles. BrightSpring Health Services’s annualized revenue growth of 21.3% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
BrightSpring Health Services also breaks out the revenue for its most important segment, Pharmacy. Over the last two years, BrightSpring Health Services’s Pharmacy revenue averaged 31.4% year-on-year growth. This segment has outperformed its total sales during the same period, lifting the company’s performance. 
This quarter, BrightSpring Health Services reported year-on-year revenue growth of 15.3%, and its $3.15 billion of revenue exceeded Wall Street’s estimates by 5.2%.
Looking ahead, sell-side analysts expect revenue to grow 9.1% over the next 12 months, a deceleration versus the last two years. We still think its growth trajectory is attractive given its scale and suggests the market is forecasting success for its products and services.
Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend.
Operating Margin
BrightSpring Health Services was profitable over the last five years but held back by its large cost base. Its average operating margin of 2.2% was weak for a healthcare business.
Looking at the trend in its profitability, BrightSpring Health Services’s operating margin decreased by 2.2 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. BrightSpring Health Services’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.
This quarter, BrightSpring Health Services generated an operating margin profit margin of 1.5%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
BrightSpring Health Services’s full-year EPS grew at an astounding 26.2% compounded annual growth rate over the last four years, better than the broader healthcare sector.
In Q2, BrightSpring Health Services reported adjusted EPS at $0.22, up from $0.10 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects BrightSpring Health Services’s full-year EPS of $0.74 to grow 33%.
Key Takeaways from BrightSpring Health Services’s Q2 Results
We were impressed by how significantly BrightSpring Health Services blew past analysts’ revenue expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Zooming out, we think this quarter featured some important positives. The stock remained flat at $20.80 immediately after reporting.
Sure, BrightSpring Health Services had a solid quarter, but if we look at the bigger picture, is this stock a buy? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.