UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

Or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-11239

HCA Healthcare, Inc.

(Exact name of registrant as specified in its charter)

Delaware	27-3865930
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One Park Plaza Nashville, Tennessee	37203
(Address of principal executive offices)	(Zip Code)

(615) 344-9551

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Voting common stock, $.01 par value	HCA	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.

Class of Common Stock	Outstanding at July 31, 2023
Voting common stock, $.01 par value	271,988,000 shares

HCA HEALTHCARE, INC.

Form 10-Q

June 30, 2023

		Page of Form 10-Q
Part I.	Financial Information
Item 1.	Financial Statements (Unaudited):
	Condensed Consolidated Income Statements — for the quarters and six months ended June 30, 2023 and 2022	3
	Condensed Consolidated Comprehensive Income Statements — for the quarters and six months ended June 30, 2023 and 2022	4
	Condensed Consolidated Balance Sheets — June 30, 2023 and December 31, 2022	5
	Condensed Consolidated Statements of Stockholders’ Equity (Deficit) — for the quarters and six months ended June 30, 2023 and 2022	6
	Condensed Consolidated Statements of Cash Flows — for the six months ended June 30, 2023 and 2022	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29
Part II.	Other Information
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 5.	OOther Information	30
Item 6.	Exhibits	30
Signatures		31

2

HCA HEALTHCARE, INC.

CONDENSED CONSOLIDATED INCOME STATEMENTS

FOR THE QUARTERS AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022

Unaudited

(Dollars in millions, except per share amounts)

	Quarter						Six Months
	2023			2022			2023		2022
Revenues	$	15,861		$	14,820		$	31,452	$	29,765
Salaries and benefits		7,277			6,792			14,361		13,731
Supplies		2,478			2,301			4,901		4,622
Other operating expenses		3,043			2,693			5,937		5,445
Equity in losses (earnings) of affiliates		7			(8	)		25		(19	)
Depreciation and amortization		763			738			1,519		1,470
Interest expense		485			434			964		842
Losses (gains) on sales of facilities		(1	)		32			14		22
Losses on retirement of debt		—			78			—		78
		14,052			13,060			27,721		26,191
Income before income taxes		1,809			1,760			3,731		3,574
Provision for income taxes		397			381			776		730
Net income		1,412			1,379			2,955		2,844
Net income attributable to noncontrolling interests		219			224			399		416
Net income attributable to HCA Healthcare, Inc.	$	1,193		$	1,155		$	2,556	$	2,428
Per share data:
Basic earnings	$	4.35		$	3.95		$	9.27	$	8.16
Diluted earnings	$	4.29		$	3.90		$	9.14	$	8.05
Shares used in earnings per share calculations (in millions):
Basic		274.494			292.527			275.695		297.459
Diluted		278.198			296.061			279.573		301.690

The accompanying notes are an integral part of the condensed consolidated financial statements.

3

HCA HEALTHCARE, INC.

CONDENSED CONSOLIDATED COMPREHENSIVE INCOME STATEMENTS

FOR THE QUARTERS AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022

Unaudited

(Dollars in millions)

	Quarter						Six Months
	2023			2022			2023		2022
Net income	$	1,412		$	1,379		$	2,955	$	2,844
Other comprehensive income (loss) before taxes:
Foreign currency translation		20			(71	)		38		(105	)
Unrealized (losses) gains on available-for-sale securities		(5	)		(16	)		2		(42	)
Losses included in other operating expenses		—			1			—		1
		(5	)		(15	)		2		(41	)
Defined benefit plans		—			—			—		—
Pension costs included in salaries and benefits		—			3			—		5
		—			3			—		5
Change in fair value of derivative financial instruments		—			1			—		5
Interest costs included in interest expense		—			2			—		4
		—			3			—		9
Other comprehensive income (loss) before taxes		15			(80	)		40		(132	)
Income taxes (benefits) related to other comprehensive income items		1			(12	)		6		(21	)
Other comprehensive income (loss)		14			(68	)		34		(111	)
Comprehensive income		1,426			1,311			2,989		2,733
Comprehensive income attributable to noncontrolling interests		219			224			399		416
Comprehensive income attributable to HCA Healthcare, Inc.	$	1,207		$	1,087		$	2,590	$	2,317

The accompanying notes are an integral part of the condensed consolidated financial statements.

4

HCA HEALTHCARE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

Unaudited

(Dollars in millions)

	June 30, 2023			December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	862		$	908
Accounts receivable		8,713			8,891
Inventories		2,050			2,068
Other		2,263			1,776
		13,888			13,643
Property and equipment, at cost		56,667			54,757
Accumulated depreciation		(30,023	)		(29,182	)
		26,644			25,575
Investments of insurance subsidiaries		384			381
Investments in and advances to affiliates		731			823
Goodwill and other intangible assets		9,641			9,653
Right-of-use operating lease assets		2,110			2,065
Other		196			298
	$	53,594		$	52,438
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	3,823		$	4,239
Accrued salaries		1,776			1,712
Other accrued expenses		3,551			3,581
Long-term debt due within one year		2,395			370
		11,545			9,902
Long-term debt, less debt issuance costs and discounts of $349 and $301		36,537			37,714
Professional liability risks		1,554			1,528
Right-of-use operating lease obligations		1,806			1,752
Income taxes and other liabilities		1,691			1,615
Stockholders’ equity (deficit):
Common stock $0.01 par; authorized 1,800,000,000 shares; outstanding 272,931,700 shares — 2023 and 277,378,300 shares — 2022		3			3
Accumulated other comprehensive loss		(456	)		(490	)
Retained deficit		(1,850	)		(2,280	)
Stockholders’ deficit attributable to HCA Healthcare, Inc.		(2,303	)		(2,767	)
Noncontrolling interests		2,764			2,694
		461			(73	)
	$	53,594		$	52,438

The accompanying notes are an integral part of the condensed consolidated financial statements.

5

HCA HEALTHCARE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE QUARTERS AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022

Unaudited

(Dollars in millions)

	Equity (Deficit) Attributable to HCA Healthcare, Inc.
						Capital			Accumulated						Equity
	Common Stock					in Excess			Other						Attributable to
	Shares			Par		of Par			Comprehensive			Retained			Noncontrolling
	(in millions)			Value		Value			Loss			Deficit			Interests			Total
Balances, December 31, 2021		305.477		$	3	$	—		$	(404	)	$	(532	)	$	2,422		$	1,489
Comprehensive income (loss)										(43	)		1,273			192			1,422
Repurchase of common stock		(8.375	)										(2,101	)					(2,101	)
Share-based benefit plans		1.879											(57	)					(57	)
Cash dividends declared    ($0.56 per share)													(171	)					(171	)
Distributions																(171	)		(171	)
Other													(1	)		4			3
Balances, March 31, 2022		298.981			3		—			(447	)		(1,589	)		2,447			414
Comprehensive income (loss)										(68	)		1,155			224			1,311
Repurchase of common stock		(12.230	)				(111	)					(2,571	)					(2,682	)
Share-based benefit plans		0.253					118												118
Cash dividends declared    ($0.56 per share)													(163	)					(163	)
Distributions																(162	)		(162	)
Other							(7	)								29			22
Balances, June 30, 2022		287.004			3		—			(515	)		(3,168	)		2,538			(1,142	)
Comprehensive income (loss)										(77	)		1,134			210			1,267
Repurchase of common stock		(3.361	)				(113	)					(585	)					(698	)
Share-based benefit plans		0.261					116												116
Cash dividends declared    ($0.56 per share)													(162	)					(162	)
Distributions																(217	)		(217	)
Other							(3	)