RadNet Inc.
08/11/2025 | Press release | Distributed by Public on 08/11/2025 14:37
Quarterly Report for Quarter Ending June 30, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited condensed consolidated financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q (this "report") and with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission (the "SEC")(the "Annual Report").
As used in this Quarterly Report on Form 10-Q, the terms "RadNet," "we," "us," and "our" refer to RadNet, Inc., a Delaware corporation, and where appropriate, our consolidated subsidiaries.
Forward-Looking Statements
This report contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements reflect current views about future events and are based on our currently available financial, economic and competitive data and on current business plans. Actual events or results may differ materially depending on risks and uncertainties that may affect our operations, markets, services, prices and other factors.
In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue," "assumption" or the negative of these terms or other comparable terminology. Forward-looking statements in this report include, among others, statements we make regarding:
•expectations concerning domestic and global economic conditions, rates of inflation, or changes in interest rates;
•anticipated trends in our revenues, operating expenses or capital expenditures, and our financial guidance;
•expected timing and potential impact of regulatory changes affecting our business;
•expected future market acceptance for our products or services, and our competitive strengths in the markets we serve;
•our ability to successfully acquire and integrate new businesses, and achieve expected benefits, synergies or operating results from those acquisitions; and
•economics and cost savings anticipated to be derived from our investments in artificial intelligence and machine learning products and solutions.
Forward-looking statements are neither historical facts nor assurances of future performance. Because forward-looking statements relate to the future, they are inherently subject to known and unknown risks, uncertainties and other factors that are difficult to predict and out of our control. Our actual results, level of activity, performance or achievements may be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Important factors that could cause our actual results to differ materially from those indicated or implied in our forward-looking statements include the factors included in "Risk Factors," in our Annual Report as supplemented by the information in Part II- Item 1A below. You should consider the inherent limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements.
Any forward-looking statement in this report is based on information currently available to us and speaks only as of the date of this report. We do not undertake any responsibility to release publicly any revisions to these forward-looking statements to take into account events or circumstances that occur after the date of this report or any unanticipated events which may cause actual results to differ from those expressed or implied by the forward-looking statements contained in this report, except as required by law.
Overview
We are a national provider of diagnostic imaging services in the United States. At June 30, 2025, we operated directly or indirectly through joint ventures with hospitals, 405 centers located in Arizona, California, Delaware, Florida, Maryland, New Jersey, New York and Texas. Our centers provide physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders and may reduce unnecessary invasive procedures, often reducing the cost and amount of care for patients. Internationally, our subsidiary The HLH Imaging Group Limited, provides teleradiology services for remote interpretation of images on behalf of providers within the framework of the United Kingdom's National Health Service.
In addition to our imaging business, we have established a Digital Health business segment during our 2024 fiscal year, which combines our former Artificial Intelligence ("AI") business segment with our eRad, Inc. business. Our Digital Health segment develops and delivers AI-powered health informatics solutions to drive quality, efficiency, and outcomes in imaging and radiology. The portfolio of software solutions is anchored by eRad, Inc.'s RIS/PACS, informatics designed specifically for outpatient radiology and DeepHealth OS, a cloud-native operating system that helps operate all aspects of the radiology service line from scheduling and patient preparation to technologist workflow to interpretation and referral management.
In addition we are using AI to develop solutions that employ machine learning to assist radiologists and other clinicians in interpreting images and improving radiologist efficiency and patient care, initially in the fields of screening for breast, prostate, lung and colon cancers. Our DeepHealth, Inc. subsidiary has received clearance from the U.S. Food and Drug Administration ("FDA") for use of its SaigeQ "triage"/workflow products, the SaigeDX advanced diagnostic product and the Saige-Density breast density assessment software for screening breast mammography, which we have begun to roll out in certain markets as an Enhanced Breast Cancer Detection solution. Our Aidence Holding B.V. subsidiary is developing solutions for interpretation of chest and lung computed tomography ("CT") scans for lung cancer screening. It has received the CE mark for its solution and has existing customers in seven European countries, with its largest concentration in the United Kingdom, and plans to submit an application for FDA clearance to sell in the United States. Our Quantib B.V. subsidiary is primarily focused on interpretation of prostate magnetic resonance imaging ("MRI") for widespread prostate cancer screening. Quantib's prostate MRI post-processing software has both FDA clearances and European CE marking. Our Digital Health segment provides these solutions to RadNet and to over 400 customers in the United States, Europe, and Israel.
As part of our continued strategic expansion in Digital Health, we recently completed two acquisitions: iCAD, Inc., a provider of AI-powered breast health solutions, and See-Mode Technologies, a medical technology company focused on enhancing ultrasound-based diagnostics through artificial intelligence. We are currently in the process of integrating both businesses into our Digital Health segment.
Our operations comprise two segments for financial reporting purposes for this reporting period, Imaging Centers and Digital Health. For further financial information about these segments, see Note 5, Segment Reporting, in the notes accompanying our financial statements included in this report.
Recent Developments
The following table shows our imaging centers in operation and revenues for the six months ended June 30, 2025 and 2024:
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Centers in operation | 405 | 375 | |||||||||
| Net revenues (millions) | $ | 970 | $ | 891 | |||||||
Ourimaging services include MRI, CT, positron emission tomography ("PET"), nuclear medicine, mammography, ultrasound, diagnostic radiology ("X-ray"), fluoroscopy and other related procedures. The vast majority of our centers offer multi-modality imaging services, a key point of differentiation from our competitors. The multi-modality offering provides a "one-stop" solution for our customers and referral sources. It also diversifies our revenue base, and reduces our exposure to changes in reimbursement rates for certain imaging modalities.
Our revenue is derived from a diverse mix of payors, including private payors and commercial insurance companies, managed care capitated payors, and government payors, such as Medicare and Medicaid. We believe our payor diversity mitigates our exposure to possible unfavorable reimbursement trends within any one payor class. Our total service fee revenue, net of contractual allowances and discounts, and implicit price concessions for the three and six months ended June 30, 2025 and 2024 received from our various payors is summarized in the following table (in thousands):
|
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Commercial insurance | $ | 278,902 | $ | 256,517 | $ | 541,410 | $ | 497,145 | |||||||||||||||
| Medicare | 116,331 | 101,719 | 224,499 | 195,186 | |||||||||||||||||||
| Medicaid | 12,597 | 11,001 | 24,283 | 21,906 | |||||||||||||||||||
| Workers' compensation/personal injury | 10,642 | 10,997 | 21,114 | 22,837 | |||||||||||||||||||
| Other payors | 29,394 | 26,568 | 57,087 | 51,948 | |||||||||||||||||||
| Management fee revenue | 6688 | 6,106 | 12,967 | 12,014 | |||||||||||||||||||
| Other revenue | 13509 | 9,837 | 26,052 | 18,898 | |||||||||||||||||||
| Revenue under capitation arrangements | 30,167 | 36,969 | 62,217 | 71,487 | |||||||||||||||||||
| Total service revenue | $ | 498,230 | $ | 459,714 | $ | 969,629 | $ | 891,421 | |||||||||||||||
Our revenue is not always consistent across each quarter. We generally experience the lowest volumes of procedures and the lowest level of revenue during the first quarter of each year. This is primarily the result of two factors. First, our volumes and revenue are typically impacted by winter weather conditions in our northeastern operations. It is common for snowstorms and other inclement weather to result in patient appointment cancellations and, in some cases, imaging center closures. Second, in recent years, we have observed greater participation in high deductible health plans by patients. As these high deductibles reset in January for most of these patients, we have observed that patients utilize medical services less during the first quarter, when securing medical care will result in significant out-of-pocket expenditures.
Acquisitions
During the six months ended June 30, 2025, we completed the acquisition of certain assets of entities which engage directly in the practice of radiology or in associated businesses for an aggregate consideration of $16.4 million. These acquisitions include:
HALO Centers LLC: 1 imaging center in California;
Hillcroft Medical Clinic: 1 imaging center in Sugar Land, Texas;
North County Radiology Oceanside LLC: 1 imaging center in California;
Faculty Physicians and Surgeons of LLUSM (Palm Imaging): 1 imaging center in California;
California MSK MSO, LLC (OSS Burbank): 1 imaging center in California; and
HALO Centers LLC (Indian Wells): 1 imaging center in California
See Note 4, Business Combinations and Related Activity, in the notes accompanying our financial statements in this report for additional information, including the fair value determination of the acquired assets and assumed liabilities, associated with these acquisitions.
Joint Venture Activity
At June 30, 2025, 38% of our imaging centers were operating as joint ventures with large health care providers. We manage the day-to-day operations for these joint ventures and perform most management services in exchange for a management fee. We charged management service fees from the centers underlying these joint ventures of approximately $6.5 million and $6.1 million for the three months ended June 30, 2025 and 2024, respectively, and approximately $13.0 million and $12.0 million for the six months ended June 30, 2025 and 2024, respectively.
For information on our investment in unconsolidated joint ventures, key balance sheet data and income statement data for the unconsolidated joint ventures, see Note 2, Significant Accounting Policies - Investment in Joint Ventures in the notes accompanying our financial statements included in this report.
Critical Accounting Policies
The SEC defines critical accounting estimates as those that (a) are most important to the portrayal of a company's financial condition and results of operations and (b) require management's most difficult, subjective or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. In Note 2 of the notes accompanying our financial statements included in this report and in our Annual Report, we discuss our significant accounting policies, including those that do not require management to make difficult, subjective or complex judgments or estimates. The most significant areas involving management's judgments and estimates are described below.
Use of Estimates
The financial statements included in this report were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), which requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions affect various matters, including our reported amounts of assets and liabilities in our consolidated balance sheets at the dates of the financial statements; our disclosure of contingent assets and liabilities at the dates of the financial statements; and our reported amounts of revenues and expenses in our consolidated statements of operations during the reporting periods. These estimates involve judgments with respect to numerous factors that are difficult to predict and are beyond management's control. As a result, actual amounts could materially differ from these estimates.
Revenues
Our revenues generally relate to net patient fees received from various payors and patients themselves under contracts in which our performance obligations are to provide diagnostic services to the patients. Revenues are recorded during the period our obligations to provide diagnostic services are satisfied, which is generally over a period of less than one day. The contractual relationships with patients, in most cases, also involve a third-party payor (Medicare, Medicaid, managed care health plans and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payors. The payment arrangements with third-party payors for the services we provide to the related patients typically specify payments at amounts less than our standard charges and generally provide for payments based upon predetermined rates per diagnostic services or discounted fee-for-service rates. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations, changes in business and economic conditions, and the frequent changes in managed care contractual terms resulting from contract re-negotiations and renewals.
As it relates to the Consolidated Medical Group (as defined in Note 1 of the notes accompanying our financial statements included in this report), this service fee revenue includes payments for both the professional medical interpretation revenue recognized by them as well as the payment for all other aspects related to our providing the imaging services, for which we earn management fees. As it relates to others centers, this service fee revenue is earned through providing the use of our diagnostic imaging equipment and the provision of technical services as well as providing administration services such as clerical and administrative personnel, bookkeeping and accounting services, billing and collection, provision of medical and office supplies, secretarial, reception and transcription services, maintenance of medical records, and advertising, marketing and promotional activities.
Our service fee revenues are based upon our management's estimate of amounts we expect to be entitled to receive from patients and third-party payors. Estimates of contractual allowances under Medicare, Medicaid, managed care and commercial insurance plans are based upon historical collection experience of the payments received from such payors in
accordance with the underlying contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have price concessions applied. We also record estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenues at the estimated amounts we expect to collect.
Under capitation arrangements with various health plans, we earn a per-enrollee amount each month for making available diagnostic imaging services to all plan enrollees under the capitation arrangement. Revenue under capitation arrangements is recognized in the period in which we are obligated to provide services to plan enrollees under contracts with various health plans. Our estimates and assumptions related to revenue recognition did not change materially for the quarter ended June 30, 2025.
Accounts Receivable
Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with healthcare providers. Receivables generally are collected within industry norms for third-party payors. We continuously monitor collections from our payors and maintain an allowance for bad debts based upon specific payor collection issues that we have identified and our historical experience. Our estimates and assumptions for allowances on our account receivable did not change materially during the quarter ended June 30, 2025.
Business Combination
We evaluate all acquisitions in accordance with the accounting guidance under ASC 805, Business Combinations. Once a purchase has been determined to be the acquisition of a business, we are required to recognize the assets acquired and the liabilities assumed at their acquisition date fair values. Any portion of the purchase consideration transferred in excess of the net of the acquisition date fair values of the assets acquired and the liabilities assumed, is allocated to goodwill. The allocation requires our management to make estimates of the value of various assets acquired and liabilities assumed. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations.
Goodwill and Indefinite Lived Intangibles
Goodwill at June 30, 2025 totaled $751.5 million. Indefinite Lived Intangible Assets at June 30, 2025 were $18.5 million and are associated with the value of certain trade name intangibles and in process research and development ("IPR&D"). Goodwill, trade name intangibles and IPR&D are recorded as a result of business combinations. When we determine the carrying value of goodwill for a reporting unit exceeds its fair value, an impairment charge would be recognized which should not exceed the total amount of goodwill allocated to that reporting unit. We determined fair values for each of the reporting units using the market approach, when available and appropriate, or the income approach, or a combination of both. We assess the valuation methodology based upon the relevance and availability of the data at the time we perform the valuation. If multiple valuation methodologies are used, the results are weighted appropriately. Our annual impairment test of goodwill, IPR&D and trade name noted no impairment as of October 1, 2024, and we have not identified any other indicators of impairment through June 30, 2025.
Recent Accounting Standards
See Note 3, Recent Accounting and Reporting Standards to the financial statements included in this report for further information.
Results of Operations
Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024
Imaging Center Segment
We have developed our medical imaging centers segment through a combination of organic growth, acquisitions and joint venture formations. In the discussion below same center metrics are based on imaging centers that were in operation throughout the period of April 1, 2024 through June 30, 2025. Excluded amounts relate to imaging centers that were acquired or divested between April 1, 2024 through June 30, 2025.
Total Revenue
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Revenue | 2025 | 2024 | $ Increase | % Change | ||||||||||
| Total | $477,504 | $443,886 | $33,618 | 7.6% | ||||||||||
| Same Center | $457,794 | $438,622 | $19,172 | 4.4% | ||||||||||
| Excluded | $19,710 | $5,264 | - | - | ||||||||||
Our 4.4% increase in same center revenue over the same period last year was driven by increases in fees charged per imaging procedure and same center total procedure volume growth of 2.2%, inclusive of rises in routine and advanced modality imaging procedures of 0.8% and 6.2%, respectively. The increase in revenue was largely attributable to product mix, as advanced imaging represented a greater portion of overall procedures. Within advanced imaging, MRI increased by 6.5%, CT by 5.6%, and PET/CT by 17.6% on a same-store basis. The Enhanced Breast Cancer Detection program, an AI-powered diagnostic solution, also contributed to revenue growth.
Including non-consolidated joint ventures where we are a minority owner, same center total procedure volume increased approximately 2.7%, inclusive of rises in routine and advanced modality imaging procedures of 1.4% and 6.6%, respectively. We provide this additional information to reflect trends across all centers we operate or manage, consistent with how management evaluates overall business performance.
Operating Expenses
Total operating expenses for the three months ended June 30, 2025 increased approximately $33.3 million, or 8.2%, to $439.5 million for the three months ended June 30, 2025 from $406.2 million for the three months ended June 30, 2024. The following table breaks down our cost of operations and total operating expenses for the three months ended June 30, 2025 and 2024 (in thousands):
|
Three Months Ended June 30, |
|||||||||||
| 2025 | 2024 | ||||||||||
| Salaries and professional reading fees, excluding stock-based compensation | $ | 258,148 | $ | 243,354 | |||||||
| Stock-based compensation | 6,091 | 4,349 | |||||||||
| Building and equipment rental | 32,006 | 29,896 | |||||||||
| Medical supplies | 31,196 | 26,523 | |||||||||
| Lease abandonment charges | 123 | - | |||||||||
|
Other operating expenses *
|
76,883 | 69,327 | |||||||||
| Cost of operations | 404,447 | 373,449 | |||||||||
| Depreciation and amortization | 32,941 | 32,089 | |||||||||
| Loss on sale and disposal of equipment | 1,812 | 398 | |||||||||
| Severance costs | 309 | 225 | |||||||||
| Total operating expenses | $ | 439,509 | $ | 406,161 | |||||||
*Includes billing fees, office supplies, repairs and maintenance, insurance, business tax and license, outside services, telecom, utilities, marketing, travel and other expenses.
The discussion below provides additional information and analysis on changes in our various operating expenses for the three months ended June 30, 2025 and 2024 (in thousands):
Salaries and professional reading fees, excluding stock-based compensation and severance
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Salaries and Professional Fees | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $258,148 | $243,354 | $14,794 | 6.1% | ||||||||||
| Same Center | $250,135 | $241,046 | $9,089 | 3.8% | ||||||||||
| Excluded | $8,013 | $2,308 | - | - | ||||||||||
In response to higher procedure volumes, we increased staffing levels across clinical, administrative, and technical functions to support the influx of patients. Compensation-related expenses were further impacted by increased 401K match contributions and more vacation and paid time off taken during the period. We also continued to experience wage inflation across the board, driven by a competitive labor market and the October 2024 increase in California's minimum wage for healthcare workers. Additionally, higher workers' compensation insurance premiums contributed to the overall rise in staffing costs. Overall, the increase in compensation expenses remained generally in line with our same center revenue growth.
Stock-based compensation
Stock-based compensation for the three months ended June 30, 2025 increased approximately $1.7 million, or 40.1%, to $6.1 million from $4.3 million for the three months ended June 30, 2024. The increase is primarily due to a greater number of shares granted and higher grant-date fair values compared to prior-year period.
Building and equipment rental
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Building & Equipment Rental | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $32,006 | $29,896 | $2,110 | 7.1% | ||||||||||
| Same Center | $29,982 | $28,811 | $1,171 | 4.1% | ||||||||||
| Excluded | $2,024 | $1,085 | - | - | ||||||||||
Building and equipment rental expense on a same-center basis increased slightly, primarily due to higher rent and common area maintenance charges.
Medical supplies
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Medical Supplies Expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $31,196 | $26,523 | $4,673 | 17.6% | ||||||||||
| Same Center | $29,289 | $26,325 | $2,964 | 11.3% | ||||||||||
| Excluded | $1,907 | $198 | - | - | ||||||||||
Consistent with the shift in our procedural mix toward more advanced imaging, medical supplies expense increased at a higher rate than revenue growth. The growth in PET/CT procedures, particularly for prostate cancer and suspected Alzheimer's studies, drove higher utilization of high-cost isotope tracers, contributing to the increase. In addition, price increases for these tracers further elevated medical supplies expense compared to the prior year.
Other operating expenses
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Other Operating Expenses | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $76,883 | $69,327 | $7,556 | 10.9% | ||||||||||
| Same Center | $73,007 | $68,308 | $4,699 | 6.9% | ||||||||||
| Excluded | $3,876 | $1,019 | - | - | ||||||||||
Other operating expenses increased primarily due to a $5.4 million rise in outside services. This increase was driven by expanded contact center support related to acquisitions and growing patient demand, as well as higher legal and consulting costs associated with transaction activities and operational initiatives. The remaining increase was attributable to other operating expense categories. The investments reflect our continued focus on technology-driven enhancements aimed at supporting long-term operational efficiency across the organization.
Additional segment operating and non-operating expenses
| In Thousands | Three Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Depreciation and amortization | $32,941 | $32,089 | $852 | 2.7% | ||||||||||
| Loss on disposal of equipment and other | $1,812 | $398 | $1,414 | 355.3% | ||||||||||
| Non-cash change in fair value of interest rate hedge | $1,956 | $1,890 | 66 | 3.5% | ||||||||||
| Other income | ($7,768) | ($87) | (7,681) | 8828.7% | ||||||||||
| Severance | $309 | $225 | 84 | 37.3% | ||||||||||
The increase in depreciation expense was the result of our higher depreciable asset base.
Other income for the three months ended June 30, 2025 included $7.8 million of money market interest income.
Other income for the three months ended June 30, 2024 included money market interest income of $8.7 million and other income of $0.2 million, substantially offset by debt extinguishment and restructuring charges of $8.8 million, which related to refinancing of our credit facilities with Barclays Bank Plc ("Barclays").
| In Thousands | Three Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Interest income | (7,768) | (8,673) | $905 | (10.4)% | ||||||||||
| Debt restructuring and extinguishment expenses | 0 | 8,586 | $(8,586) | (100.0)% | ||||||||||
| Total other income | $(7,768) | $(87) | $(7,681) | 8828.7% | ||||||||||
Interest expense
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Interest expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total interest expense | $ | 17,189 | $ | 26,082 | $(8,893) | (34.1) | % | |||||||
| Interest related to derivatives* | (1,040) | 4,837 | ||||||||||||
| Interest expense related to amortization** | 743 | 793 | ||||||||||||
| Adjusted interest expense*** | 17,486 | 20,009 | (2,523) | (12.6) | % | |||||||||
*Includes payments from 2019 Swaps (as defined in the notes to our condensed consolidated financial statements) and Swaps amortization
**Includes noncash amortization of deferred loan costs and discount on issuance of debt
***Includes interest related to our term loans, revolving credit line, notes, and other
The decrease in interest expense was primarily due to the repricing transaction of our Barclays Revolving Credit Facility (as defined in the notes to our condensed consolidated financial statements) in the fourth quarter of 2024, which resulted in lower interest rates compared to the same period in the prior year. This benefit was partially offset by the $100.0 million of incremental term loan borrowings under our existing Barclays Revolving Credit Facility in the second quarter
of 2025. See Note 6 Credit Facilities and Notes Payable included in the notes to our condensed consolidated financial statements.
During the three months ended June 30, 2025, interest rates were above the arranged rates in our 2019 Swaps for most of the year, and we received payment of $2.4 million in cash payments from our 2019 Swaps counterparties, which was reported as a component of interest expense. See the Derivative Instruments section of Note 2, Significant Accounting Policies, in the notes accompanying in our Annual Report and Part 1, Item 3 - "Quantitative and Qualitative Disclosure About Market Risk" below for more details on our derivative transactions.
Non-cash change in fair value of interest rate hedge
In 2020, we determined that the cash flows from the 2019 Swaps did not match the cash flows of our Barclays Term Loan (as defined in the notes to our condensed consolidated financial statements) and were therefore ineffective as cash flow hedges. Since that time, in accordance with accounting guidelines, all changes in fair value are being recognized in other income and expense.
The fair value of the 2019 Swaps at June 30, 2025 was a net asset of $3.1 million compared to a net asset of $5.0 million at March 31, 2025, resulting in a loss of $2.0 million during the three months ended June 30, 2025. This change in fair value was driven by market expectations of continued declines in interest rates over the remaining term of the 2019 Swaps.
Equity in earnings from unconsolidated joint ventures
For the three months ended June 30, 2025 and 2024, we recognized equity in earnings from unconsolidated joint ventures in the amount of $4.4 million and $3.4 million, respectively, an increase of $1.0 million or 28.5%, respectively. The decrease was mainly due to the increase in earnings from Santa Monica Imaging Group, LLC and Arizona Diagnostic Radiology Group compared to the three months ended June 30, 2024.
Net income attributable to noncontrolling interests
At June 30, 2025, our consolidated subsidiaries operated 353 imaging centers of which 103 were not wholly-owned and thus a portion of their operating results were attributable to noncontrolling interests. At June 30, 2024, our consolidated subsidiaries included 344 centers of which 95 were not wholly-owned.
For the three months ended June 30, 2025, we recognized net income attributable to noncontrolling interests of $8.6 million versus $9.9 million for the three months ended June 30, 2024. A decrease in earnings from Beach Imaging Group, LLC and The New Jersey Imaging Network, LLC was partially offset by increased earnings from Ventura County Imaging Group, LLC.
As noncontrolling interests only represent a portion of our imaging center business, and excludes our Digital Health segment, which generated losses of $7.1 million for the three months ended June 30, 2024, we do not expect changes in net income attributable to noncontrolling interests to correlate with changes in consolidated operating income or pretax income.
Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024
In the discussion below, same center metrics are based on imaging centers that were in operation throughout the period of January 1, 2024 through June 30, 2025. Excluded amounts relate to imaging centers that were acquired or divested between January 1, 2024 through June 30, 2025.
Total Revenue
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Revenue | 2025 | 2024 | $ Increase | % Change | ||||||||||
| Total | $929,682 | $860,925 | $68,757 | 8.0% | ||||||||||
| Same Center | $895,046 | $851,339 | $43,707 | 5.1% | ||||||||||
| Excluded | $34,636 | $9,586 | - | - | ||||||||||
Our 5.1% increase in same center revenue over the same period last year was driven by increases in fees charged per imaging procedure and same center total procedure volume growth of 0.5% inclusive of rises in advanced modality imaging
procedures of 4.53%, partially offset by a 0.9% decrease in routine modality imaging. The increase in revenue was largely attributable to product mix product mix, as advanced imaging was a greater portion of overall procedures. Within advanced imaging, MR increased by 4.5%, CT by 4.0%, and PET/CT by 13.3% on a same-store basis. The increase in revenue was largely attributable to product mix, as advanced imaging comprised a greater portion of overall procedures. The Enhanced Breast Cancer Detection (EBCD) program, an AI-powered diagnostic solution, also contributed to revenue growth.
Including non-consolidated joint ventures in which we hold a minority interest, same-center total procedure volume increased approximately 1.1%, reflecting a slight decline of 0.2% in routine imaging procedures and a 4.9% increase in advanced modality imaging procedures. We provide this information to present trends across all centers we operate or manage, consistent with how management evaluates overall business performance.
Operating Expenses
Total operating expenses for the six months ended June 30, 2025 increased approximately $100.8 million, or 12.5%, to $909.7 million for the six months ended June 30, 2025 from $808.8 million for the six months ended June 30, 2024. The following table breaks down our cost of operations and total operating expenses for the six months ended June 30, 2025 and 2024 (in thousands):
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Salaries and professional reading fees, excluding stock-based compensation | $ | 528,839 | $ | 488,065 | |||||||
| Stock-based compensation | 31,319 | 15,418 | |||||||||
| Building and equipment rental | 62,930 | 58,722 | |||||||||
| Medical supplies | 60,922 | 48,478 | |||||||||
| Lease abandonment charges | 5,511 | - | |||||||||
|
Other operating expenses *
|
151,456 | 135,064 | |||||||||
| Cost of operations | 840,977 | 745,747 | |||||||||
| Depreciation and amortization | 65,480 | 62,063 | |||||||||
| Loss on sale and disposal of equipment | 2,211 | 586 | |||||||||
| Severance costs | 1,005 | 450 | |||||||||
| Total operating expenses | $ | 909,673 | $ | 808,846 | |||||||
*Includes billing fees, office supplies, repairs and maintenance, insurance, business tax and license, outside services, telecom, utilities, marketing, travel and other expenses.
Salaries and professional reading fees, excluding stock-based compensation and severance
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Salaries and Professional Fees | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $528,839 | $488,065 | $40,774 | 8.4% | ||||||||||
| Same Center | $513,978 | $484,083 | $29,895 | 6.2% | ||||||||||
| Excluded | $14,861 | $3,982 | - | - | ||||||||||
In response to higher procedure volumes, we increased staffing levels across clinical, administrative, and technical functions to support the influx of patients. This included permanent headcount growth as well as a significant number of temporary hires to keep our centers operating smoothly during the first quarter of 2025. Compensation-related expenses were further impacted by increased 401K match contributions and more vacation and paid time off taken during the period. We also continued to experience wage inflation across the board, driven by a competitive labor market and the October 2024 increase in California's minimum wage for healthcare workers. Additionally, higher workers' compensation insurance premiums contributed to the overall rise in staffing costs.
Stock-based compensation
Stock-based compensation for the six months ended June 30, 2025 increased approximately $15.9 million, or 103.1%, to $31.3 million from $15.4 million for the six months ended June 30, 2024. The increase is primarily due to a greater number of shares granted and higher grant-date fair values compared to prior-year period.
Building and equipment rental
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Building & Equipment Rental | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $62,930 | $58,722 | $4,208 | 7.2% | ||||||||||
| Same Center | $59,287 | $56,582 | $2,705 | 4.8% | ||||||||||
| Excluded | $3,643 | $2,140 | - | - | ||||||||||
Building and equipment rental expense on a same-center basis increased slightly, primarily due to higher rent and common area maintenance charges.
Medical supplies
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Medical Supplies Expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $60,922 | $48,478 | $12,444 | 25.7% | ||||||||||
| Same Center | $57,730 | $48,211 | $9,519 | 19.7% | ||||||||||
| Excluded | $3,192 | $267 | - | - | ||||||||||
Consistent with the shift in our procedural mix toward more advanced imaging, medical supplies expense increased at a higher rate than revenue growth. The growth in PET/CT procedures, particularly for prostate cancer and suspected Alzheimer's studies, drove higher utilization of high-cost isotope tracers, contributing to the increase. In addition, price increases for these tracers further elevated medical supplies expense compared to the prior year.
Lease abandonment charges
We closely monitor patient levels at our imaging centers and occasionally divest or shut down centers to maximize utilization rates. We may abandon low utilization leases and divert the patients to nearby centers. During the six months ended June 30, 2025, we closed several imaging centers with lower utilization and recognized lease abandonment charges of approximately $5.5 millionin our Imaging Center segment. Of these amounts, $4.8 millionwere related to right-of-use assets impairment and $0.7 millionwere related to the write-off of leasehold improvements for the six months ended June 30, 2025.
Other operating expenses
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Other Operating Expenses | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $151,456 | $135,064 | $16,392 | 12.1% | ||||||||||
| Same Center | $144,169 | $133,157 | $11,012 | 8.3% | ||||||||||
| Excluded Sites | $7,287 | $1,907 | - | - | ||||||||||
Other operating expenses increased primarily due to a $9.8 million rise in outside services. This increase was driven by expanded contact center support related to acquisitions and growing patient demand, as well as higher legal and consulting costs associated with transaction activities and operational initiatives. The remaining increase was attributable to other operating expense categories. The investments reflect our continued focus on technology-driven enhancements aimed at supporting long-term operational efficiency across the organization.
Additional segment operating and non-operating expenses:
| In Thousands | Six Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Depreciation and amortization | $65,480 | $62,063 | $3,417 | 5.5% | ||||||||||
| Loss on disposal of equipment and other | $2,211 | $586 | $1,625 | 277.3% | ||||||||||
| Non-cash change in fair value of interest rate hedge | $4,062 | $674 | $3,388 | 502.7% | ||||||||||
| Other income | $(15,484) | $(4,520) | $(10,964) | 242.6% | ||||||||||
| Severance | $1,005 | $450 | $555 | 123.3% | ||||||||||
The increase in depreciation expense was the result of our higher depreciable asset base.
The fair value of the 2019 Swaps at June 30, 2025 was a net asset of $3.1 million compared to a net asset of $7.1 million at December 31, 2024, resulting in a loss of $4.1 million during the six months ended June 30, 2025. This change in fair value was driven by market expectations of continued declines in interest rates over the remaining term of the 2019 Swaps.
Other income for the six months ended June 30, 2025, included money market interest income of $15.5 million. Other income for the six months ended June 30, 2024 included money market interest income of $13.1 million, partially offset by debt extinguishment and restructuring charges of $8.8 million, which related to refinancing of our credit facilities with Barclays. See Note 6 Credit Facilities and Notes Payable included in the notes to our condensed consolidated financial statements.
| In Thousands | Six Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Interest income | (15,484) | (13,101) | $(2,383) | 18.2% | ||||||||||
| Debt restructuring and extinguishment expenses | 0 | 8,581 | $(8,581) | (100.0)% | ||||||||||
| Total other income | $(15,484) | $(4,520) | $(10,964) | 242.6% | ||||||||||
Interest income for the six months ended June 30, 2025 increased approximately $2.4 million, or 18.2%, to $15.5 million from $13.1 million for the six months ended June 30, 2025. The increase is primarily due to higher average cash balance in our money market account for the six months ended June 30, 2025
Interest expense
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Interest Expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total Interest Expense | $ | 34,428 | $ | 42,349 | $(7,921) | (18.7) | % | |||||||
| Interest expense related to derivatives* | (2,058) | 2,844 | ||||||||||||
| Interest expense related to amortization** | 1,471 | 1,541 | ||||||||||||
| Adjusted Interest Expense*** | 35,015 | 37,964 | (2,949) | (7.8) | % | |||||||||
*Includes payments from 2019 Swaps and Swaps amortization
**Includes noncash amortization of deferred loan costs and discount on issuance of debt
***Includes interest related to our term loans, revolving credit line, notes, and other
The increase in interest expense was due to the general increase in term loan debt as a result of refinancing of our Barclays Revolving Credit Facility, partially offset by lower interest rates compared to the same period in the prior year.
During the six months ended June 30, 2025, interest rates were above the arranged rates in our 2019 Swaps for most of the year and we received payment of $4.8 million in cash payments from our 2019 swap counterparties, which was reported as a component of interest expense. See the Derivative Instruments section of Note 2, Significant Accounting Policies, in the notes accompanying in our annual report on Form 10-K for the fiscal year ended December 31, 2024 and Part 1, Item 3 - "Quantitative and Qualitative Disclosure About Market Risk" below for more details on our derivative transactions.
Equity in earnings from unconsolidated joint ventures
For the six months ended June 30, 2025 we recognized equity in earnings from unconsolidated joint ventures in the amount of $7.0 million compared to $7.7 million for the prior period, an decrease of $0.8 million or 9.8%. The decrease was mainly due to the decrease in earnings from Santa Monica Imaging Group, LLC and St. Joseph Medical Center, LLC compared to the six months ended June 30, 2024.
Net income attributable to noncontrolling interests
At June 30, 2025, our consolidated subsidiaries operated 353 imaging centers of which 103 were not wholly-owned and thus a portion of their operating results were attributable to noncontrolling interests. At June 30, 2024, our consolidated subsidiaries included 344 centers of which 95 were not wholly-owned.
For the six months ended June 30, 2025, we recognized net income attributable to noncontrolling interests of $16.8 million versus $18.1 million for the six months ended June 30, 2024, an decrease of $1.2 million. A decrease in earnings from Beach Imaging Group, LLC and The New Jersey Imaging Network, LLC was partially offset by increased earnings from Ventura County Imaging Group, LLC and Advanced Radiology at Capital Region, LLC.
As noncontrolling interests only represent a portion of our imaging center business, and excludes our Digital Health segment which generated losses of $13.2 million for the six months ended June 30, 2025, we do not expect changes in net income attributable to noncontrolling interests to correlate with changes in consolidated operating income or pretax income.
Digital Health Segment
The breakdown of revenue and expenses of the Digital Health segment for the three and six months ended June 30, 2025 and 2024 are as follows:
| In Thousands | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||
| 2025 | 2024 | $ Change | % Change | 2025 | 2024 | $ Change | % Change | |||||||||||||||||||
| Statement of Operations | ||||||||||||||||||||||||||
| Revenue | $ | 20,726 | $ | 15,828 | $ | 4,898 | 30.9 | % | $ | 39,947 | $ | 30,488 | $ | 9,459 | 31.0 | % | ||||||||||
| Salaries and Wages | 9,819 | 6,253 | 3,566 | 57.0 | % | 18,513 | 11,512 | 7,001 | 60.8 | % | ||||||||||||||||
| Stock Compensation | 2,649 | 399 | 2,250 | 563.9 | % | 5,916 | 1,227 | 4,689 | 382.2 | % | ||||||||||||||||
| Other operating | 7,506 | 6,306 | 1,200 | 19.0 | % | 14,321 | 12,187 | 2,134 | 17.5 | % | ||||||||||||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 4,787 | 3,317 | 1,470 | - | 8,349 | 6,632 | 1,717 | - | ||||||||||||||||||
| Depreciation & Amort. | 3,052 | 2,386 | 666 | 27.9 | % | 5,996 | 4,780 | 1,216 | 25.4 | % | ||||||||||||||||
| (Gain) loss on sale and disposal of equipment and other | (88) | 3 | (91) | (3033.3) | % | (85) | 1 | (86) | (8600.0) | % | ||||||||||||||||
| Severance | 117 | 43 | 74 | 172.1 | % | 168 | 43 | 125 | 290.7 | % | ||||||||||||||||
| Total operating expenses | $ | 27,842 | $ | 18,707 | $ | 9,135 | 48.8 | % | $ | 53,178 | $ | 36,382 | $ | 16,796 | 46.2 | % | ||||||||||
| Loss from Operations | $ | (7,116) | $ | (2,879) | $ | (4,237) | 147.2 | % | $ | (13,231) | $ | (5,894) | $ | (7,337) | 124.5 | % | ||||||||||
|
Other expense
|
4 | 949 | (945) | (99.6) | % | 8 | 2,448 | (2,440) | (99.7) | % | ||||||||||||||||
|
Loss before taxes
|
(7,120) | (3,828) | (3,292) | 86.0 | % | (13,239) | (8,342) | (4,897) | 58.7 | % | ||||||||||||||||
| Income taxes | $ | (2,249) | $ | 518 | $ | (2,767) | (534.2) | % | $ | (2,981) | $ | (310) | $ | (2,671) | 861.6 | % | ||||||||||
| Segment net loss | (4,871) | (4,346) | (525) | 12.1 | % | (10,258) | (8,032) | (2,226) | 27.7 | % | ||||||||||||||||
Revenues for the Digital Health segment increased compared to the prior year period, primarily due to growth in our AI and informatics product lines. For the six months ended June 30, 2025, AI-related revenue increased by approximately 27%, driven by continued growth across key clinical AI products, including a 27% increase in Lung, 19% in Prostate/Neuro, and 22% in Breast. The increase in Breast was partially driven by the ongoing commercialization of our Enhanced Breast Cancer Detection (EBCD) program. Informatics revenue increased by approximately 33%, primarily due to increased volume on our eRad PICS platform.
The increase in segment operating expenses was primarily attributable to higher headcount in engineering and executive roles, increased stock-based compensation, and higher non-capitalized research and development costs. These increases reflect continued investment in product development and in building implementation and commercial support functions to enable broader deployment to external customers. We expect the Digital Health segment to continue operating at a net loss in the near term as we expand these capabilities and scale adoption of our platforms.
In June 2025, we closed the acquisition of See-Mode Technologies, an AI company focused on ultrasound imaging solutions. Subsequent to June 30, 2025 quarter-end, on July 17, 2025, we also closed the acquisition of iCAD, Inc., a provider of AI solutions for breast cancer detection. We are currently in the process of integrating both companies into our Digital Health segment.
Non-GAAP Financial Measures
We use both U.S. generally accepted accounting principles ("GAAP") and non-GAAP metrics to measure our financial results. We believe that, in addition to GAAP metrics, non-GAAP metrics such as Adjusted EBITDA assist us in measuring our core operations from period to period.
Adjusted EBITDA
Our Adjusted EBITDA metric removes non-cash and non-recurring charges that occur in the affected period and provides a basis for measuring the Company's core financial performance against other periods.
We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, as adjusted to exclude income taxes, interest expense, severance costs, depreciation and amortization, non-cash employee stock-based compensation, loss on sale and disposal of equipment and other, non-cash change in fair value of interest rate hedge, other income, non-capitalized research and development expenses related to DeepHealth Cloud OS and Generative AI, lease abandonment charges, and acquisition transaction costs. Adjusted EBITDA includes equity earnings in unconsolidated operations and subtracts allocations of earnings to non-controlling interests in subsidiaries, and is adjusted for non-cash or one-time events that take place during the period.
Adjusted EBITDA is a non-GAAP financial measure used as an analytical indicator by us and the healthcare industry to assess business performance. Adjusted EBITDA should not be considered a measure of financial performance under GAAP, and Adjusted EBITDA should not be considered in isolation or as alternatives to net income, or other financial statement data presented in the consolidated financial statements as an indicator of financial performance. Adjusted EBITDA is not a measurement determined in accordance with GAAP and is therefore susceptible to varying methods of calculation and this metric, as presented, may not be comparable to other similarly titled measures of other companies.
The following is a reconciliation of the nearest comparable GAAP financial measure, net income, to Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024, respectively.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income (loss) attributable to RadNet, Inc. common stockholders | $ | 14,454 | $ | (2,982) | $ | (23,472) | $ | (5,761) | |||||||||||||||
| Income taxes | 820 | 2,456 | (2,578) | 592 | |||||||||||||||||||
| Interest expense | 17,189 | 26,082 | 34,428 | 42,349 | |||||||||||||||||||
| Severance costs | 426 | 268 | 1,173 | 493 | |||||||||||||||||||
| Depreciation and amortization | 35,993 | 34,475 | 71,476 | 66,843 | |||||||||||||||||||
| Non-cash employee stock-based compensation | 8,741 | 4,749 | 37,235 | 16,646 | |||||||||||||||||||
| Loss on sale and disposal of equipment and other | 1,724 | 401 | 2,126 | 587 | |||||||||||||||||||
| Non-cash change in fair value of interest rate hedge | 1,956 | 1,890 | 4,062 | 674 | |||||||||||||||||||
| Other income | (7,764) | (7,900) | (15,476) | (10,834) | |||||||||||||||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 4,787 | 3,317 | 8,349 | 6,632 | |||||||||||||||||||
| Lease abandonment charges | 123 | - | 5,511 | - | |||||||||||||||||||
| Non-cash change to contingent consideration | - | - | - | 1,974 | |||||||||||||||||||
| Non-operational rent expenses | 496 | 809 | 1,838 | 1,832 | |||||||||||||||||||
| Acquisition transaction costs | 2,301 | - | 2,973 | - | |||||||||||||||||||
|
Adjusted EBITDA - Total Company
|
$ | 81,246 | $ | 72,327 | $ | 127,645 | $ | 130,789 | |||||||||||||||
| NOTE | |||||||||||||||||||||||
|
Adjusted EBITDA - Imaging Center
|
$ | 77,843 | $ | 69,058 | $ | 120,531 | $ | 124,000 | |||||||||||||||
| Adjusted EBITDA - Digital Health Segment | $ | 3,403 | $ | 3,269 | $ | 7,114 | $ | 6,789 | |||||||||||||||
The following table is a reconciliation of GAAP net income for our Digital Health segment to Adjusted EBITDA for the three months ended June 30, 2025 and 2024, respectively.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Segment net loss | $ | (4,871) | $ | (4,346) | $ | (10,258) | $ | (8,032) | |||||||||||||||
| Stock Compensation | 2,650 | 399 | 5,916 | 1,227 | |||||||||||||||||||
| Depreciation & Amortization | 3,053 | 2,386 | 5,997 | 4,780 | |||||||||||||||||||
| Other operating (income) loss | (88) | 3 | (85) | 1 | |||||||||||||||||||
| Other expense | 4 | 949 | 8 | 2,448 | |||||||||||||||||||
| Severance | 117 | 43 | 168 | 43 | |||||||||||||||||||
| Income taxes | (2,249) | 518 | (2,981) | (310) | |||||||||||||||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 4,787 | 3,317 | 8,349 | 6,632 | |||||||||||||||||||
|
Adjusted EBITDA - Digital Health Segment
|
$ | 3,403 | $ | 3,269 | $ | 7,114 | $ | 6,789 | |||||||||||||||
Liquidity and Capital Resources
We expect our existing capital resources, anticipated cash from operations and our borrowing capacity under our credit facilities will be sufficient to sustain our operations for the next twelve months and the foreseeable future.
Our principal capital requirements are for the development of new diagnostic imaging centers, the acquisition of existing diagnostic imaging centers and the acquisition of new diagnostic imaging equipment. On a continuing basis, we evaluate various transactions to increase shareholder value and enhance our business results, including acquisitions, divestitures and joint ventures. We expect to fund any future acquisitions primarily with cash flow from operations and borrowings, including borrowing available under our secured credit facilities or through new equity or debt issuances.
We and our subsidiaries or affiliates may from time to time, in our sole discretion, purchase, repay, redeem or retire any of our outstanding debt or equity securities in privately negotiated or open market transactions, by tender offer or otherwise.
The following table summarizes key balance sheet data related to our liquidity as of June 30, 2025 and December 31, 2024 and income statement data for the six months ended June 30, 2025 and 2024 (in thousands):
| Balance Sheet Data: | June 30, 2025 | December 31, 2024 | |||||||||
| Cash and cash equivalents | $ | 833,152 | $ | 740,020 | |||||||
| Accounts receivable | 199,991 | 185,821 | |||||||||
| Working capital (exclusive of current operating lease liabilities) | 607,706 | 596,158 | |||||||||
| Stockholders' equity | 1,179,261 | 1,133,410 | |||||||||
|
Income statement data for the six months ended June 30,
|
2025 | 2024 | |||||||||
| Total net revenue | $ | 969,629 | $ | 891,421 | |||||||
|
Net loss attributable to RadNet common stockholders
|
(23,472) | (5,761) | |||||||||
Sources and Uses of Cash
The following table summarizes key components of our sources and uses of cash for the six months ended June 30, 2025 and 2024 (in thousands):
| Cash Flow Data | June 30, 2025 | June 30, 2024 | |||||||||
| Cash provided by (used in) operating activities | $ | 161,829 | $ | 133,090 | |||||||
| Cash provided by (used in) investing activities | (154,201) | (138,278) | |||||||||
| Cash provided by (used in) financing activities | 84,918 | 404,404 | |||||||||
Cash provided by operating activities for the six months ended June 30, 2025 increased by $28.7 million compared to June 30, 2024 primarily driven by a $16.0 million change in assets and liabilities, primarily due to the timing of payments for accounts payable and accrued expenses.
Cash used in investing activities for the three months ended June 30, 2025 increased $15.9 million compared to the six months ended June 30, 2024. The increase was primarily due to a $19.1 million increase in equity contributions to and purchases of interests in joint ventures, partially offset by a $2.3 million reduction in capital expenditures for property and equipment.
Cash provided financing activities for the six months ended June 30, 2025 decreased $319.5 million compared to the three months ended March 31, 2024. Financing activity in 2024 included a public equity offering that generated $218.4 million in net proceeds and a refinancing of the Barclays Revolving Credit Facility that resulted in an additional $167.9 million of cash. In 2025, financing activity primarily consisted of a $100.0 million incremental term loan under the Barclays Credit Agreement.
Secured Credit Facilities
We maintain secured credit facilities with Barclays and with Truist Bank.
On June 11, 2025, we entered into Incremental Amendment No. 2 to the Barclays Credit Agreement, pursuant to which Barclays, as lender, provided an additional $100.0 million of incremental term loan borrowings under our existing senior secured term loan facility, all other terms remained the same. $1.0 million recognized as discount and deferred finance cost. Amounts capitalized will be amortized over the remaining terms of the respective credit facilities under the Barclays Credit Agreement. Pursuant to the Second Amendment, we are required to make quarterly principal payments of approximately $2.4 million, compared to $2.2 million prior to the amendment.
On November 26, 2024, we entered into Amendment No. 1 to the Barclays Credit Agreement (the "First Amendment") with the Barclays Bank Plc and the lenders and financial institutions named therein. Pursuant to the First Amendment, the interest rates on the term loans and revolving credit facility provided under the Restated Credit Agreement have been reduced by 0.25%.
On April 18, 2024, we refinanced our Barclays Revolving Credit Facility, replacing the prior facility with an $875.0 million term loan and a $282.0 million revolving credit facility. The refinance transaction reduced our interest rates on the Barclays Term Loan and revolving credit facility and extended the maturity date for the term loan to April 18, 2031 and for the revolving credit facility to April 18, 2029. The new term loan calls for quarterly principal payments of $2.2 million, compared to $1.8 million under the prior credit facility.
Our condensed consolidated balance sheets at June 30, 2025 include $1,095.4 million of total term loan debt (exclusive of unamortized discounts of $13.5 million) in thousands:
| Face Value | Discount |
Total Carrying Value |
|||||||||||||||
| Barclays Term Loan | $ | 965,998 | $ | (12,879) | $ | 953,119 | |||||||||||
| Truist Term Loan | 129,375 | (594) | 128,781 | ||||||||||||||
| Total Term Loans | $ | 1,095,373 | $ | (13,473) | $ | 1,081,900 | |||||||||||
At June 30, 2025, we had no borrowings under our Barclays or Truist revolving credit facilities. After reserves for outstanding letters of credit of $7.4 million, we had $274.6 million available for borrowing under our Barclays Revolving Credit Facility and $50.0 million available under our Truist revolving credit facility.
Please see Note 6, Credit Facilities and Notes Payable in the notes accompanying our financial statements included in this report for more information on our secured credit facilities.
RadNet Inc. published this content on August 11, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on August 11, 2025 at 20:38 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]