Aug 13, 2026 earnings call — Rate wins and payer strategy drove growth
Q2 revenue rose to $670.5 million and adjusted EBITDA was $95.4 million, prompting higher full-year guidance above $2.68 billion.
Revenue $0.7B (est $0.6B) · EPS $0.22 (est $0.17)
Key quotes
"Aveanna's preferred payer strategy continues to gain momentum and allows us to invest in caregiver wages and recruitment efforts to accelerate hiring and staffing of nurses for our payer partners."
"We will continue to pass through wage improvements, and other benefits to our caregivers and the ongoing effort to better improve volumes."
"We closed the Family First Homecare acquisition in early June, and are progressing nicely in the early stages of integration."
Analyst Q&A 10
Will margins rise with higher revenue rates
Q (Brian Tanquilut · Jefferies): Analyst asked if raising revenue rates for long-range plans (LRPs) should lead to higher margins in those business segments, and about timing of wage pass-through before California rates take effect.
A: Management said gross margin percentage should stay pretty consistent even as gross margin dollars rise with revenue. They emphasized wage pass-through will be a key part of the plan and that they will begin passing through wages in the back half of the year to boost staffing ahead of the rate change.
"So from a gross margin standpoint, I would think about the gross margin percentage staying pretty consistent." — Jeffrey Shaner (CEO)
Was guidance raise from acquisition or core business?
Q (Raj Kumar · Stephens): Analyst asked whether the raised 2026 guidance came from the Family First Homecare acquisition or from core organic performance, and about M&A appetite and leverage comfort.
A: Management said the Family First impact was already included earlier and the new raise comes from strong core Aveanna operations across all three divisions. On M&A, they said they will pursue thoughtful deals that fit culture, stay disciplined on valuation, and aim to deleverage toward a sub-3x target.
"So we did previously increase our guidance for the Family First Homecare impact kind of in within the quarter itself." — Matthew Buckhalter (CFO)
Margin impact from higher long-term revenue
Q (Pito Chickering · Deutsche Bank): Analyst asked how the higher long-term revenue guide translates to EBITDA margin leverage and whether long-term EBITDA growth would rise into the high single digits.
A: Management said they still view gross margin as largely pass-through (driven by wages) and that SG&A leverage drives EBITDA, targeting roughly 13% to 14% EBITDA with possible modest upside. For PDS gross margin, they expect to remain around the high-20s percentage for the rest of the year.
"So 28.9% gross margin on the PDS segment really impressed with where it came in at and right where we expected to come in at." — Matthew Buckhalter (CFO)
Preferred payer mix and California impact
Q (Benjamin Rossi · JPMorgan): Analyst asked whether the 64% preferred payer mix in PDS will stay flat for the year and how cadence looks into 2027 with California's rate change; and where capacity expansion will come from.
A: Management differentiated MCO preferred volumes from Medi-Cal business in California, saying they expect to end 2026 slightly above current preferred-payer levels but still shy of 70%. They said California will unlock growth primarily by getting existing caregivers to work more hours first, then freeing unnecessary hospital days and helping families currently providing care themselves.
Need for new infrastructure for California growth
Q (Albert Rice · UBS): Analyst asked what percent of business is in California and whether new infrastructure is needed to scale there after the rate update.
A: Management said they have stayed in California for the long term and will first boost hours from current caregivers by paying them more, then unlock hospital days and support families providing care at home. They added the operational infrastructure is already in place and ready to scale.
"Going through the PDM modernization, the PDS modernization a few years ago, we have our targeted operating model in every single 1 of our place locations." — Matthew Buckhalter (CFO)
How high can preferred-payer mix go in PDS
Q (Sean Dodge · BMO): Analyst asked how high PDS MCO preferred payer mix can go and how that affects spreads, and whether home health episodic mix at 81% will stay high.
A: Management said their long-term goal is mid-80s to high-80s for PDS MCO volumes, likely 3 to 5 years away, and they expect 4% to 6% annual growth in preferred mix. On episodic home health, they are comfortable in the high-70s to low-80s and may raise their >75% target north as the 80% range has stabilized.
"I think as we have thought about long term is our ultimate goal is to kind of reach the mid-80s, maybe 1 day the high 80s of PDS MCO volumes." — Jeffrey Shaner (CEO)
Other ways to find and onboard caregivers besides higher pay
Q (Jared · William Blair): Analyst asked what other strategic or operational methods are helping find, onboard, train, and match caregivers besides wages, and whether there are synergies between PDS and home health.
A: Management said size and scale help through training, quicker onboarding, daily pay, and technology for documentation, which together benefit caregivers, though wages remain the biggest driver. They noted most synergies are back-office and billing/collection efficiencies rather than clinical nursing efficiencies.
"So whether it be your training that is put into place, your onboarding, your quickness to onboarding on top of your daily pay that you are being able to offer, the technology that is in there for, adding in notes, all of those really add up into a benefit of the caregiver." — Matthew Buckhalter (CFO)
How government affairs won rate gains in tight budgets
Q (Andrew Mok · Barclays): Analyst asked how the government affairs team secured better rates despite tight state budgets and whether OBBBA shifted Medicaid funding to PDN.
A: Management said a long-term advocacy approach and geographic diversity helped, and that PDN appears insulated and may even benefit from reallocations driven by OBBBA. They said payers value the large cost savings PDN provides and that after a year and a half of OBBBA, PDN looks to come out primarily in very good shape.
"I think we are far enough in you know, to the you know, being a year and a half into the OBBBA legislation to really be able to see that PDN is gonna come out of this you know, primarily in very good shape." — Jeffrey Shaner (CEO)
Quantitative starting point for California and historic effects
Q (Andrew Cooper · Raymond James): Analyst asked for a more quantitative starting point for California/PDS heading into 2027 and how prior state rate increases affected labor pool and volume.
A: Management said they do not give state-specific numbers and that California's impact had become less significant recently because of growth elsewhere, but they are excited about the enhancement for recruiting and retaining caregivers. They used Georgia as an example where a prior rate move and early wage pass-through quickly improved fill rates and freed hospital days.
"we previously said that California's impact on Aveanna has become a little bit less significant over the last few years." — Matthew Buckhalter (CFO)
Family First Homecare integration progress
Q (Grayson Joshua McAlister · Truist): Analyst asked how Family First Homecare integration is going versus expectations and what challenges remain for completion.
A: Management said integration is going as well or better than expected, leveraging prior integration playbooks, and they are in the front third of the work with back-office and EMR transitions being the largest upcoming tasks. They said the deal already strengthened markets like Florida and rural service distribution, and they expect to complete integration by the end of 2026.
"Family First Homecare is a little bit bigger, but very similar going as well or better than expected." — Jeffrey Shaner (CEO)