CommonSpirit Posts Breakeven Margin in Q2

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CommonSpirit Health, a major nonprofit health system based in Chicago, reported an operating income of $2 million (0% operating margin) in the second quarter of fiscal 2026, down significantly from $135 million (1.3% margin) in the same period last year. The system saw total revenue increase to $10.5 billion, but operating expenses also rose to $10.5 billion, driven by higher salaries, benefits, supply costs, and purchased services.

Why it matters

CommonSpirit's breakeven quarter highlights the ongoing financial pressures facing large healthcare providers, with rising costs outpacing revenue growth. The system's decision to exit its Conifer Health Solutions joint venture and bring revenue cycle operations in-house also signals a broader industry trend toward greater operational integration and efficiency.

The details

CommonSpirit reported total revenue of $10.5 billion during the three months ended Dec. 31, up from $10.1 billion a year earlier. Net patient revenue was $9.9 billion, up from $9.3 billion. However, total operating expenses also rose to $10.5 billion, up from $10 billion, with increases in salaries and benefits ($5.3 billion vs. $5.1 billion), supply costs ($1.7 billion vs. $1.6 billion), and purchased services ($3 billion vs. $2.8 billion). The system recorded a net income of $456 million in the quarter, up from $100 million last year.

• CommonSpirit reported its Q2 fiscal 2026 results on February 13, 2026.

What’s next

CommonSpirit is developing a comprehensive transition plan to bring its revenue cycle operations in-house and minimize disruption as it exits the Conifer Health Solutions joint venture.