Healthcare Services Group, Inc. (NASDAQ: HCSG) reported financial results for the three months ended September 30, 2026, and announced an updated growth outlook for the following year. The company reported revenue of $479.6 million for the third quarter, a decrease compared to the $464.3 million reported for the same period in the prior year. Despite the revenue decline, the company reported net income of $24.9 million and diluted earnings per share of $0.36.
For the nine months ended September 30, 2026, the company reported revenue of $1.413 billion, compared to $1.370 billion in the prior year. Net income for the nine months was $73.6 million, and diluted EPS was $1.05.
On the balance sheet, the company reported cash and cash equivalents of $134.6 million and marketable securities of $34.2 million as of September 30, 2026. The company also reported an unutilized revolving credit facility of $300.0 million.
In terms of operational metrics, the company reported cost of services at $399.2 million, or 83.2% of revenue. The company stated a goal to manage cost of services in the 86% range. Selling, general, and administrative (SG&A) expenses were reported at $48.5 million, or 10.2% of revenue. The company stated a goal to manage SG&A in the 9.5% to 10.5% range.
The company also announced an update regarding the Genesis Bankruptcy case. As a result of a court-approved sale of Genesis to 101 W. State Street on October 14, 2026, the company recorded an estimated recovery of $6.1 million. The company noted that there remains a substantially higher potential upper-range recovery, subject to certain variables and contingencies.
On October 6, 2026, the company completed the acquisition of NEXDINE Hospitality for an upfront purchase price of $93.5 million, funded with cash on hand. The company stated that NEXDINE is expected to contribute over $150 million in annual revenue at comparable margins to the Company’s while being immediately accretive to earnings.
The company also announced that it has raised its 2027 revenue growth outlook from mid single-digits to low double-digits. The company stated that it expects fourth quarter revenue in the range of $535 to $545 million.
Under its February 2026 plan to repurchase $75.0 million of common stock through January 2027, the company repurchased $11.7 million of common stock during the third quarter. Year to date, the company has repurchased $56.6 million of common stock and has 7.7 million shares remaining under its authorization.
