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Item 2. Management’s Discussion and Analysis

2025-05-12 compared with 2024-11-12 · 140 added, 269 removed, 237 unchanged (63% of the section changed)

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 and with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the U.S.

Securities and Exchange Commission (the "SEC") on February 29, 2024.

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

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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 on Form 10-K for the fiscal year ended December 31, 2023 as supplemented by the information in Part II– Item 1A below.

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.

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We are a national provider of diagnostic imaging services in the United States.

At September 30, 2024, we operated directly or indirectly through joint ventures with hospitals, 399 centers located in Arizona, California, Delaware, Florida, Maryland, New Jersey, New York and Texas.

At March 31, 2025, we operated directly or indirectly through joint ventures with hospitals, 401 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 fka Heart and Lung Imaging 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 for our 2024 fiscal year, which combines our former Artificial Intelligence (“AI”) business segment with our eRad, Inc.

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.

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 are 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.

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 FDA clearance for use of its SaigeQ ”triage”/workflow product, SaigeDX advanced diagnostic product and 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.

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 CT scans for lung cancer screening.

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 MRI for widespread prostate cancer screening.

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.

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Recent Developments

The following table shows our imaging centers in operation and revenues for the nine months ended September 30, 2024 and 2023:

Nine Months Ended September 30,

The following table shows our imaging centers in operation and revenues for the three months ended March 31, 2025 and 2024:

Three Months Ended March 31,

Centers in operation 401 375

Net revenues (millions) $ 471 $ 432

Our imaging services include magnetic resonance imaging (MRI), computed tomography (CT), positron emission tomography (PET), nuclear medicine, mammography, ultrasound, diagnostic radiology (X-ray), fluoroscopy and other related procedures.

Our imaging 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.

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It also diversifies our revenue base, and reduces our exposure to changes in reimbursement rates for certain imaging modalities.

The following charts summarize our procedure volumes for various imaging modalities for the three months ended September 30, 2024 and 2023:

Our revenue is derived from a diverse mix of payors, including private, managed care capitated and government payors.

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 nine months ended September 30, 2024 and 2023 received from our various payors is summarized in the following table (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Our total service fee revenue, net of contractual allowances and discounts, and implicit price concessions for the three months ended March 31, 2025 and 2024 received from our various payors is summarized in the following table (in thousands):

Three Months Ended

Commercial insurance $ 262,488 $ 240,629

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Workers' compensation/personal injury 10,459 11,794

Other patient revenue 10,607 10,443 34,524 30,191

Other payors 27,691 25,385

Management fee revenue 6,279 5,908

Heart and lung

4,696 2,441 12,553 6,377

Other 10,314 3,768 18,918 14,248

Other revenue 12,543 9,061

Revenue under capitation arrangements 32,050 34,518

Imaging Center Segment Revenue 444,775 389,783 1,305,707 1,161,381

Digital Health Segment Revenue 16,367 12,185 46,856 34,866

Total service revenue $ 471,399 $ 431,707

During the nine months ended September 30, 2024, 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 $54.0 million.

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.

During the three months ended March 31, 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 $4.9 million.

These acquisitions include:

Antelope Valley Outpatient Imaging:

1 imaging center in California;

Providence Health System Southern California:

3 imaging centers in California;

Grossman Imaging Center of CMH, LLC:

HALO Centers LLC:

1 imaging centers in California;

Houston Medical Imaging, LLC:

9 imaging centers in Houston, Texas;

Imaging, Inc.:

6 imaging centers in Houston, Texas;

Stanislaus Surgical Hospital:

1 imaging center in Modesto, California;

Global Imaging LLP:

Hillcroft Medical Clinic:

1 imaging center in Sugar Land, Texas.

The purpose of these acquisitions was to expand our imaging business into Houston, Texas a new market, and to strengthen our presence in the California market.

With a population of approximately 7.3 million people, Houston is the fourth largest city in the United States.

See Note 4, Business Combinations and Related Activity to the financial statements in this report for additional information, including the fair value determination of the acquired assets and assumed liabilities, associated with these acquisitions.

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 September 30, 2024, 38% of our imaging centers were operating as joint ventures with large health care providers.

We have joint venture arrangements with 24 hospital and health system partners (inclusive of consolidated and unconsolidated joint ventures), including MemorialCare (24 centers), RWJ Barnabas (35 centers), Cedars Sinai (18 centers), Dignity Health (28 centers), and MedStar Health System (5 centers).

At March 31, 2025, 38% of our imaging centers were operating as joint ventures with large health care providers.

We have joint venture arrangements.

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 $5.9 million and $3.9 million for the three months ended September 30, 2024 and 2023, 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

to the financial statements included in this report.

We charged management service fees from the centers underlying these joint ventures of approximately $6.1 million and $5.9 million for the three months ended March 31, 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 Securities and Exchange Commission 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 to our financial statements included in this report and in our annual report on Form 10-K for the year ended December 31, 2023, we discuss our significant accounting policies, including those that do not require management to make difficult, subjective or complex judgments or estimates.

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.

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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, 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 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 revenues are based upon our management's estimate of amounts we expect to be entitled to receive from patients and third-party payors.

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.

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 September 30, 2024.

Our estimates and assumptions related to revenue recognition did not change materially for the quarter ended March 31, 2025.

Accounts Receivable

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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 September 30, 2024.

Our estimates and assumptions for allowances on our account receivable did not change materially during the quarter ended March 31, 2025.

Business Combination

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Goodwill and Indefinite Lived Intangibles

Goodwill at September 30, 2024 totaled $711.8 million.

Indefinite Lived Intangible Assets at September 30, 2024 were $20.2 million and are associated with the value of certain trade name intangibles and in process research and development ("IPR&D").

Goodwill at March 31, 2025 totaled $717.5 million.

Indefinite Lived Intangible Assets at March 31, 2025 were $13.0 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.

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If multiple valuation methodologies are used, the results are weighted appropriately.

Our annual impairment test of goodwill and trade name noted no impairment as of October 1, 2023, and we have not identified any other indicators of impairment through September 30, 2024.

Our annual impairment test of goodwill and trade name noted no impairment as of October 1, 2024, and we have not identified any other indicators of impairment through March 31, 2025.

Recent Accounting Standards

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Results of Operations

Three Months Ended September 30, 2024 Compared to the Three Months Ended September 30, 2023

Three Months Ended March 31, 2025 Compared to the Three Months Ended March 31, 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 July 1, 2023 through September 30, 2024.

Excluded amounts relate to imaging centers that were acquired or divested between July 1, 2023 through September 30, 2024.

In the discussion below same center metrics are based on imaging centers that were in operation throughout the period of January 1, 2025 through March 31, 2025.

Excluded amounts relate to imaging centers that were acquired or divested between January 1, 2025 through March 31, 2025.

Total Revenue

In Thousands Three Months Ended September 30,

In Thousands Three Months Ended March 31,

Revenue 2025 2024 $ Increase % Change

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Excluded $40,650 $10,595 — —

Our 10.8% increase in same center revenue over the same period last year was driven by increases in fees charged per imaging procedure and an increase in procedures volumes.

Same center total procedure volume grew at an overall rate of 4.0% which was comprised of a 2.55% increase in routine imaging and an 8.6% increase in advanced modality imaging procedures.

The increase in revenue was largely attributable to product mix, as advanced imaging was a greater portion of overall procedures.

A significant contributor to the change in product mix was the increase in PETHC procedures related to prostate cancer and suspect Alzheimer’s studies, which are included in advanced modality imaging procedures.

Same-center revenue increased 1.2% compared to the first quarter of 2024, primarily due to higher average fees per imaging procedure of approximately 2.2%, partially offset by a 0.9% decrease in procedure volume.

Routine imaging volume declined by 2.2%, driven by severe winter weather in our East Coast and Texas markets and fires in Southern California, which disrupted healthcare utilization.

Advanced modality imaging, which carries higher average fees, increased 3.0% and was less impacted by these events.

The higher contribution of advanced procedures helped offset the overall volume decline and contributed to the year-over-year revenue growth.

The procedural volume metrics presented herein reflect only those from consolidated centers.

These figures may differ from total procedural volumes discussed in other contexts, which may include volumes from non-consolidated joint ventures.

Operating Expenses

Total operating expenses for the three months ended September 30, 2024 increased approximately $57.6 million, or 16.5%, to $407.2 million for the three months ended September 30, 2024 from $349.7 million for the three months ended September 30, 2023.

The following table breaks down our cost of operations and total operating expenses for the three months ended September 30, 2024 and 2023 (in thousands):

Total operating expenses for the three months ended March 31, 2025 increased approximately $67.5 million, or 16.8%, to $470.2 million for the three months ended March 31, 2025 from $402.7 million for the three months ended March 31, 2024.

The following table breaks down our cost of operations and total operating expenses for the three months ended March 31, 2025 and 2024 (in thousands):

Three Months Ended

September 30,

Salaries and professional reading fees, excluding stock-based compensation $ 270,693 $ 244,732

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Medical supplies 29,726 21,955

Lease abandonment charges 5,388 —

Other operating expenses *

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Depreciation and amortization 32,539 29,973

Gain on contribution of imaging centers into joint venture — (16,811)

Loss on sale and disposal of equipment 399 188

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* 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 September 30, 2024 and 2023 (in thousands):

The discussion below provides additional information and analysis on changes in our various operating expenses for the three months ended March 31, 2025 and 2024 (in thousands):

Salaries and professional reading fees, excluding stock-based compensation and severance

In Thousands Three Months Ended September 30,

In Thousands Three Months Ended March 31,

Salaries and Professional Fees 2025 2024 $ Increase/(Decrease) % Change

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Excluded $17,704 $4,712 — —

Consistent with the higher procedure volumes noted above, our staffing levels were adjusted to support the influx of patients seeking radiology procedures.

We are continuing to face inflation in employee wage rates as we compete for talent in a tight labor market.

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 PTO 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 three months ended September 30, 2024 increased approximately $0.3 million, or 6.6%, to $4.2 million from $3.9 million for the three months ended September 30, 2023.

The increase is primarily due to higher fair value of stock awards granted in the first quarter of 2024.

Stock-based compensation for the three months ended March 31, 2025 increased approximately $14.2 million, or 127.9%, to $25.2 million from $11.1 million for the three months ended March 31, 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 September 30,

In Thousands Three Months Ended March 31,

Building & Equipment Rental 2025 2024 $ Increase/(Decrease) % Change

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Medical supplies

In Thousands Three Months Ended September 30,

In Thousands Three Months Ended March 31,

Medical Supplies Expense 2025 2024 $ Increase/(Decrease) % Change

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Excluded $3,825 $444 — —

The increase in medical supplies expense was driven by our higher patient volume and product shift towards more advanced imaging modalities.

The increase in PETHC procedures related to prostate cancer and suspected Alzheimer studies also raised medical supplies expense due to the requirement for high-cost isotope tracers.

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.

During the three months ended March 31, 2025, we closed several imaging centers with lower utilization and recognized lease abandonment charges of approximately $5.4 million in our Imaging Center segment.

Of these amounts, $4.8 million were related to right-of-use assets impairment and $0.6 million were related to the write-off of leasehold improvements for the three months ended March 31, 2025.

Other operating expenses

In Thousands Three Months Ended September 30,

In Thousands Three Months Ended March 31,

Other Operating Expenses 2025 2024 $ Increase/(Decrease) % Change

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Excluded $8,067 $1,697 — —

Other operating expenses was relatively unchanged compared to the same period in the prior year and lower as a percentage of overall revenues.

Other operating expenses increased primarily due to a $4.2 million rise in outside services and a $3.0 million increase in software license costs.

The increase in outside services was driven by expanded contact center support related to acquisitions and rising patient demand, as well as higher legal and consulting costs tied to transaction activities and operational initiatives.

The increase in software license costs reflects greater adoption of advanced medical AI technologies, cloud-based platforms, and performance optimization tools designed to improve clinical workflows and operational efficiency.

These initiatives represent upfront investments to support ongoing technology-driven enhancements across the organization.

Additional segment operating and non-operating expenses

In Thousands Three Months Ended September 30,

In Thousands Three Months Ended March 31,

2025 2024 $ Increase/(Decrease) % Change

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The increase in depreciation expense was the result of our higher depreciable asset base.

The fair value of the 2019 Swaps at September 30, 2024 was a net asset of $7.7 million compared to a net asset of $14.4 million June 30, 2024, resulting in a loss of $6.8 million during the three months ended September 30, 2024.

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 three months ended September 30, 2024 included money market interest income of $9.6 million, partially offset by a impairment of non-marketable securities of $1.2 million.

Interest income for the three months ended September 30, 2024 increased approximately $6.0 million, or 164.9%, to $9.6 million from $3.6 million for the three months ended September 30, 2023.

The increase is primarily due to higher average cash balance in our money market account for the three months ended September 30, 2023

In Thousands Nine Months Ended September 30,

Other income for the three months ended March 31, 2025 included $7.7 million of money market interest income, an increase of approximately $3.3 million, or 74.3%, compared to $4.4 million for the same period in 2024.

The increase was primarily due to a higher average cash balance in our money market account.

In Thousands Three Months Ended March 31,

2025 2024 $ Increase/(Decrease) % Change

Interest income (7,716) (4,428) $(3,288) 74.3%

Debt restructuring and extinguishment expenses 147 0 $147 nm

Other non-operating losses (income) 0 (5) $5 (100.0)%

Total other income $(7,716) $(4,433) $(3,283) 74.1%

In Thousands Three Months Ended September 30,

2024 2023 $ Increase/(Decrease) % Change

Total other income ($8,233) ($4,673) (3,560) 76.2%

Interest expense

In Thousands Three Months Ended September 30,

In Thousands Three Months Ended March 31,

Interest expense 2025 2024 $ Increase/(Decrease) % Change

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Adjusted interest expense*** 17,529 17,954 (426) (2.4) %

*Includes payments from 2019 Swaps

*Includes payments from four forward interest rate agreements entered into in 2019 ("2019 Swaps")

**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 the result in of refinancing of our Barclays credit facility, which added approximately $196.3 million in additional term loan debt to the facility.

The effect of the additional term loan was partially offset by lower interest rates compared to the same period in the prior year.

During the three months ended September 30, 2024, interest rates were above the arranged rates in our 2019 Swaps for most of the year and we received payment of $3.4 million in cash payments from our 2019 swap counterparties, which was reported as a component of interest expense.

Also, the 2019 Swaps for $100 million of notional value matured in October 2023, so they were in effect for the third quarter of 2023, but not 2024.

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, 2023 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 three months ended September 30, 2024 and 2023 we recognized equity in earnings from unconsolidated joint ventures in the amount of $3.6 million and $1.1 million, respectively, an increase of $2.5 million or 231.6%.

The increase was mainly due to the additional contribution made to Santa Monica Imaging Group, LLC in September 2023.

Santa Monica Imaging Group operated at a net income for the three months ended September 30, 2024, which positively impacted our equity in earnings from unconsolidated joint ventures during the period.

Additionally, we experienced improved earnings from our interest in the Arizona Diagnostic Radiology Group joint venture, which was established in the fourth quarter of 2020.

Net income attributable to noncontrolling interests

At September 30, 2024, our consolidated subsidiaries operated 345 imaging centers of which 98 were not wholly-owned and thus a portion of their operating results were attributable to noncontrolling interests.

At September 30, 2023, our consolidated subsidiaries included 320 centers of which 83 were not wholly-owned.

For the three months ended September 30, 2024, we recognized net income attributable to noncontrolling interests of $9.0 million versus $6.5 million for the three months ended September 30, 2023, an increase of $2.6 million.

The increase in net income attributable to noncontrolling interests was primarily due to the formation of a new majority owned subsidiary, Los Angeles Imaging Group, LLC in September 2023 and Tri Valley Imaging Group, LLC in March 2024.

We contributed the operations of three centers to Los Angeles Group, LLC and Cedars-Sinai Medical Center contributed cash.

Additionally, patient volumes for advanced modalities improved in 2024 and we closed two underperforming centers in a majority owned subsidiary, Beach Imaging Group, LLC in December 2023.

As noncontrolling interests only represent a portion of our imaging center business, and excludes our Digital Health Segment which generated losses of $3.6 million for the three months ended September 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.

Nine Months Ended September 30, 2024 Compared to the Nine Months Ended September 30, 2023

In the discussion below, same center metrics are based on imaging centers that were in operation throughout the period of January 1, 2023 through September 30, 2024.

Excluded amounts relate to imaging centers that were acquired or divested between January 1, 2023 through September 30, 2024.

Total Revenue

In Thousands Nine Months Ended September 30,

Revenue 2024 2023 $ Increase % Change

Total $1,305,707 $1,161,381 $144,326 12.4%

Same Center $1,224,946 $1,107,208 $117,738 10.6%

Excluded $80,761 $54,173 — —

Our 10.6% 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 3.3% inclusive of rises in routine and advanced modality imaging procedures of 1.82% and 7.76%, respectively.

The increase in revenue was largely attributable to product mix product mix, as advanced imaging was a greater portion of overall procedures.

A significant contributor to the change in product mix was the increase in PETHC procedures related to prostate cancer and suspected Alzheimer studies, which are included in advanced modality imaging procedures.

Operating Expenses

Total operating expenses for the nine months ended September 30, 2024 increased approximately $131.7 million, or 12.1%, to $1,216.1 million for the nine months ended September 30, 2024 from $1,084.4 million for the nine months ended September 30, 2023.

The following table breaks down our cost of operations and total operating expenses for the nine months ended September 30, 2024 and 2023 (in thousands):

Nine Months Ended September 30,

Salaries and professional reading fees, excluding stock-based compensation $ 731,134 $ 635,016

Stock-based compensation 19,614 19,484

Building and equipment rental 89,827 88,592

Medical supplies 75,146 63,829

Other operating expenses *

204,821 201,893

Cost of operations 1,120,542 1,008,814

Depreciation and amortization 94,095 89,743

Gain on contribution of imaging centers into joint venture — (16,808)

Loss on sale and disposal of equipment 739 1,185

Severance costs 720 1,417

Total operating expenses $ 1,216,096 $ 1,084,351

* 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 Nine Months Ended September 30,

Salaries and Professional Fees 2024 2023 $ Increase/(Decrease) % Change

Total $731,134 $635,016 $96,118 15.1%

Same Center $693,291 $611,204 $82,087 13.4%

Excluded $37,843 $23,812 — —

Staffing levels have been adjusted to support higher patient volumes with the corresponding rise in salaries and professional fee expense.

We are continuing to face inflation in employee wage rates as we compete for talent in a tight labor market.

Stock-based compensation

Stock-based compensation was relatively unchanged at $19.6 million for the nine months ended September 30, 2024 compared to $19.5 million for nine months ended September 30, 2023.

Building and equipment rental

In Thousands Nine Months Ended September 30,

Building & Equipment Rental 2024 2023 $ Increase/(Decrease) % Change

Total $89,827 $88,592 $1,235 1.4%

Same Center $79,558 $80,442 $(884) (1.1)%

Excluded $10,269 $8,150 — —

The decrease in building and equipment rental expense relates to reduced equipment rental relating to operating lease contracts which ended or were bought out during 2023.

Medical supplies

In Thousands Nine Months Ended September 30,

Medical Supplies Expense 2024 2023 $ Increase/(Decrease) % Change

Total $75,146 $63,829 $11,317 17.7%

Same Center $70,494 $60,931 $9,563 15.7%

Excluded $4,652 $2,898 — —

The increase in medical supplies expense was consistent with our higher patient volume and product shift towards more advanced imaging modalities.

The increase in PETHC procedures related to prostate cancer and suspected Alzheimer studies also raised medical supplies expense due to the requirement for high-cost isotope tracers.

Other operating expenses

In Thousands Nine Months Ended September 30,

Other Operating Expenses 2024 2023 $ Increase/(Decrease) % Change

Total $204,821 $201,893 $2,928 1.5%

Same Center $191,345 $193,385 $(2,040) (1.1)%

Excluded Sites $13,476 $8,508 — —

Other operating expenses was relatively unchanged compared to the same period in the prior year and lower as a percentage of overall revenues.

Additional segment operating and non operating expenses:

In Thousands Nine Months Ended September 30,

2024 2023 $ Increase/(Decrease) % Change

Depreciation and amortization $94,095 $89,743 $4,352 4.8%

Gain on contribution of imaging centers into joint venture $0 $(16,808) $16,808 nm

Loss on disposal of equipment and other $739 $1,185 $(446) (37.6)%

The decrease in interest expense was primarily due to the repricing transaction of our Barclays credit facility 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 refinancing transaction of our Barclays credit facility in the second quarter of 2024, which added $196.3 million in additional term loan debt to the facility.

During the three months ended March 31, 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

Other income $(12,753) $(6,323) $(6,430) 101.7%

Severance $720 $1,417 $(697) (49.2)%

The increase in depreciation expense was the result of our higher depreciable asset base.

The fair value of the 2019 Swaps at September 30, 2024 was a net asset of $7.7 million compared to a net asset of $15.1 million December 31, 2023, resulting in a loss of $7.4 million during the nine months ended September 30, 2024.

In 2020, we determined that the cash flows from the 2019 Swaps did not match the cash flows of our Barclays term loan 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 March 31, 2025 was a net asset of $5.0 million compared to a net asset of $7.1 million at December 31, 2024, resulting in a loss of $2.1 million during the three months ended March 31, 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 nine months ended September 30, 2024 included money market interest income of $22.7 million, partially offset by an impairment of non-marketable securities of $1.2 million and a debt extinguishment and restructuring charges of $8.9 million, which related to refinancing of our Barclays credit facility.

See Note 6 Credit Facilities and Notes Payable included in the notes to our condensed consolidated financial statements.

Interest income for the nine months ended September 30, 2024 increased approximately $16.4 million, or 260.2%, to $22.7 million from $6.3 million for the nine months ended September 30, 2024.

The increase is primarily due to higher average cash balance in our money market account for the nine months ended September 30, 2024

In Thousands Nine Months Ended September 30,

2024 2023 $ Increase/(Decrease) % Change

Interest income (22,681) (6,297) $(16,384) 260.2%

Debt restructuring and extinguishment expenses 8,909 0 $8,909 nm

Other non-operating losses (income) 1,019 (26) $1,045 (4019.2)%

Total other income $(12,753) $(6,323) $(6,430) 101.7%

nm= not meaningful

Interest expense

In Thousands Nine Months Ended September 30,

Interest Expense 2024 2023 $ Increase/(Decrease) % Change

Total Interest Expense $ 61,776 $ 47,876 $13,900 29.0 %

Interest expense related to derivatives* 776 (7,138)

Interest expense related to amortization** 2,336 2,240

Adjusted Interest Expense*** 58,664 52,774 5,890 11.2 %

*Includes payments from 2019 Swaps

**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 the result in the general increase in term loan debt as a result of refinancing of our Barclays credit facility, partially offset by lower interest rates compared to the same period in the prior year.

During the nine months ended September 30, 2024, interest rates were above the arranged rates in our 2019 Swaps for most of the year and we received payment of $10.2 million in cash payments from our 2019 swap counterparties, which was reported as a component of interest expense.

Also, the 2019 Swaps for $100 million of notional value matured in October 2023, so they were in effect for the third quarter of 2023, but not 2024.

Equity in earnings from unconsolidated joint ventures

For the nine months ended September 30, 2024 we recognized equity in earnings from unconsolidated joint ventures in the amount of $11.3 million compared to $3.9 million for the prior period, an increase of $7.4 million or 187.4%.

The increase was mainly due to the additional contribution made to SMIG in September 2023.

SMIG operated at a net income for the nine months ended September 30, 2024, which positively impacted our equity in earnings from unconsolidated joint ventures during

Additionally, the increase was supported by improved earnings from our interest in the Arizona Diagnostic Radiology Group joint venture, which was established in the fourth quarter of 2020.

Income tax expense

We recorded income tax expense of $4.9 million, or an effective tax rate of 16.7%, for the nine months ended September 30, 2024 and $7.7 million, or an effective tax rate of 24.1% for the nine months ended September 30, 2023.

The income tax rates for the nine months ended September 30, 2024 diverge from the federal statutory rate due to (i) effects of state income taxes ;

(ii) officer's compensation limitations;

(iii) partial valuation allowance on losses in foreign jurisdictions, partially offset by (iv) excess tax benefits attributable to share based compensation;

and (v) noncontrolling interests from controlled partnerships.

For the three months ended March 31, 2025 and 2024, we recognized equity in earnings from unconsolidated joint ventures in the amount of $2.6 million and $4.3 million, respectively, a decrease of $1.7 million or 39.9%, respectively.

The decrease was mainly due to the decrease in earnings from Santa Monica Imaging Group, LLC and Arizona Diagnostic Radiology Group compared to the three months ended March 31, 2024.

Net income attributable to noncontrolling interests

At September 30, 2023, our consolidated subsidiaries included 320 centers of which 83 were not wholly-owned.

For the nine months ended September 30, 2024, we recognized net income attributable to noncontrolling interests of $27.2 million versus $19.4 million for the nine months ended September 30, 2024, an increase of $7.8 million.

We contributed the operations of three centers to Los Angeles Imaging Group, LLC and Cedars-Sinai Medical Center contributed cash.

Net income attributable to noncontrolling interests was also impacted by an increase in patient volumes for advanced modalities in 2024 and the closure of two underperforming centers in a majority owned subsidiary, Beach Imaging Group, LLC in December 2023.

As noncontrolling interests only represent a portion of our imaging center business, and excludes our Digital Health Segment which generated losses of $9.5 million for the nine months ended September 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.

At March 31, 2025, our consolidated subsidiaries operated 401 imaging centers of which 154 were not wholly-owned and thus a portion of their operating results were attributable to noncontrolling interests.

At March 31, 2024, our consolidated subsidiaries included 323 centers of which 83 were not wholly-owned.

For the three months ended March 31, 2025, we recognized net income attributable to noncontrolling interests of $8.2 million versus $8.2 million for the three months ended March 31, 2024.

A decrease in earnings from Los Angeles Imaging Group, LLC and West Valley Imaging was substantially offset by increased earnings from The New Jersey Imaging Network, LLC and The HLH Imaging Group Limited.

Digital Health Segment

The breakdown of revenue and expenses of the segment for the three and nine months ended September 30, 2024 and 2023 are as follows:

In Thousands Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 $ Change % Change 2024 2023 $ Change % Change

The breakdown of revenue and expenses of the segment for the three months ended March 31, 2025 and 2024 are as follows:

In Thousands Three Months Ended March 31,

2025 2024 $ Change % Change

Statement of Operations

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Segment net loss (5,387) (3,670) (1,717) 46.8 %

Revenues for the Digital Health segment increased as a result of core growth in our eRad PICS business, the rollout in 2023 of our Deephealth OS, and continued rollout of our Enhanced Breast Cancer Detection solutions across additional facilities.

The increase in operating expenses was primarily related to salary expense as we increased headcount in connection with the commercialization of our initial AI products and higher non-capitalized research and development expenses with respect to our new DeepHealth cloud OS and generative AI.

In the three months ended September 30, 2023, we recognized a non-recurring gain of $7.2 million from change in fair value of contingent consideration, offsetting against other operating expense.

Aside from the effect of that one-time gain and increased non-capitalized research and development expenses, our net loss for the segment was consistent with the prior year.

We expect that our Digital Health segment will continue to generate net losses over the next several years.

Revenues for the Digital Health segment increased compared to the prior year period, primarily due to growth in our AI and informatics product lines.

AI-related revenue increased by approximately 33%, driven by continued growth in our clinical AI products and expanded use of the Enhanced Breast Cancer Detection solution, including direct-to-consumer offerings.

Informatics revenue increased by approximately 30%, 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.

Non-GAAP Financial Measures

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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 losses or gains on the disposal of equipment, other income or loss, loss on debt extinguishment, bargain purchase gains, loss on de-consolidation of joint ventures, gain on contribution of imaging centers into joint ventures, and non-cash equity compensation.

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.

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.

1 unchanged sentence

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 nine months ended September 30, 2024 and 2023, respectively.

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Net income attributable to RadNet, Inc.

The following is a reconciliation of the nearest comparable GAAP financial measure, net income, to Adjusted EBITDA for the three months ended March 31, 2025 and 2024, respectively.

Three Months Ended March 31,

Net loss attributable to RadNet, Inc.

common stockholders $ (37,926) $ (2,779)

4 unchanged sentences

Non-cash employee stock-based compensation 28,494 11,897

Loss (gain) on sale and disposal of equipment and other 148 527 735 1,183

Loss on sale and disposal of equipment and other 402 186

Non-cash change in fair value of interest rate hedge 2,106 (1,216)

Other expenses (5,414) (4,081) (16,248) (2,609)

Other income (7,712) (2,934)

Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI 3,562 3,315

Loss (gain) on contribution of imaging centers into joint venture — (16,808) — (16,808)

Loss (gain) on extinguishment of debt and related expenses 147 — 8,909 —

Lease abandonment charges 5,388 —

Non-cash change to contingent consideration — 1,974

Acquisition related non-cash intangible adjustment — 3,950 — 3,950

Non-operational rent expenses 1,342 1,023

2 unchanged sentences

$ 46,399 $ 58,462

Adjusted EBITDA - Digital Health Segment 3,229 2,279 10,018 3,689

Adjusted EBITDA - Imaging Center

$ 42,688 $ 54,942

The following table is a reconciliation of GAAP net income for our Digital Health Segment to Adjusted EBITDA for the three months ended September 30, 2024 and 2023, respectively.

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Adjusted EBITDA - Digital Health Segment $ 3,711 $ 3,520

The following table is a reconciliation of GAAP net income for our Digital Health Segment to Adjusted EBITDA for the three months ended March 31, 2025 and 2024, respectively.

Three Months Ended March 31,

Segment net loss $ (5,387) $ (3,686)

1 unchanged sentence

Depreciation & Amortization 2,944 2,394

Other operating loss (5) 3 (4) (2)

Other (income) expense 2,966 592 5,414 3,714

Other operating loss (income) 3 (2)

Other expense 4 1,499

Severance 51 —

1 unchanged sentence

Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI 3,562 3,315

Non-cash change to contingent consideration — (7,191) — (7,191)

Acquisition related to non-cash intangible adjustment — 3,950 — 3,950

Adjusted EBITDA - Digital Health Segment

6 unchanged sentences

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 September 30, 2024 and December 31, 2023 and income statement data for the nine months ended September 30, 2024 and 2023 (in thousands):

The following table summarizes key balance sheet data related to our liquidity as of March 31, 2025 and December 31, 2024 and income statement data for the three months ended March 31, 2025 and 2024 (in thousands):

Balance Sheet Data:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Cash and cash equivalents $ 717,323 $ 740,020

2 unchanged sentences

Stockholders' equity 1,136,517 1,133,410

Income statement data for the nine months ended September 30,

Income statement data for the three months ended March 31,

Total net revenue $ 471,399 $ 431,707

Net (loss) income attributable to RadNet common stockholders

Net loss attributable to RadNet common stockholders

(37,926) (2,779)

Sources and Uses of Cash

The following table summarizes key components of our sources and uses of cash for the nine months ended September 30, 2024 and 2023 (in thousands):

Cash Flow Data September 30, 2024 September 30, 2023

The following table summarizes key components of our sources and uses of cash for the three months ended March 31, 2025 and 2024 (in thousands):

Cash Flow Data March 31, 2025 March 31, 2024

Cash provided by (used in) operating activities $ 41,481 $ 17,088

1 unchanged sentence

Cash provided by (used in) financing activities (7,510) 228,296

Cash provided by operating activities for the nine months ended September 30, 2024 increased by $58.6 million compared to September 30, 2023 primarily driven by a $35.7 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 nine months ended September 30, 2024 increased from September 30, 2023 by $31.4 million.

Purchases of imaging centers during the period was $37.7 million, a $26.8 million increase from the prior period.

Capital expenditures for property and equipment during the period was $145.2 million, a $8.6 million increase from the prior period.

Cash provided by financing activities for the nine months ended September 30, 2024 resulted from a secondary public offering of our common stock and a refinancing of our Barclays credit facility.

Cash provided by operating activities for the three months ended March 31, 2025 decreased by $24.4 million compared to March 31, 2024 primarily driven by a $31.2 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 March 31, 2025 decreased $4.2 million compared to the three months ended March 31, 2024.

The decrease was primarily due to a $8.6 million reduction in capital expenditures for property and equipment, partially offset by a $4.1 million increase in equity contributions to and purchases of interests in joint ventures, and a $0.3 million increase in purchases of imaging centers.

Cash used in financing activities for the three months ended March 31, 2025 increased $235.8 million compared to the three months ended March 31, 2024, and mainly represented payments on notes and term loan debt.

In March 2024, we completed a public offering of 5,232,500 shares of our common stock, which included 682,500 shares sold pursuant to an underwriters overallotment option, at a price to the public of $44.00 per share, resulting in net proceeds after underwriting discounts, commissions, and expenses of $218.4 million.

In April 2024, we refinanced our Barclays credit facility replacing the prior facility with an $875 million term loan.

After paying off the balance on the prior facility, payment of accrued interest through the closing of the refinance transaction, and payment of transaction fees and expenses, we added approximately $167.9 million in cash to the balance sheet.

As a result, cash used in financing activities was significantly lower in 2025 compared to 2024.

Secured Credit Facilities

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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 September 30, 2024 include $1,009.7 million of total term loan debt (exclusive of unamortized discounts of $15.8 million) in thousands:

Our condensed consolidated balance sheets at March 31, 2025 include $1,000.6 million of total term loan debt (exclusive of unamortized discounts of $13.1 million) in thousands:

Face Value Discount Total Carrying

2 unchanged sentences

Total Term Loans $ 1,000,625 $ (13,072) $ 987,553

At September 30, 2024, we had no borrowings under our Barclays or Truist revolving credit facilities.

At March 31, 2025, we had no borrowings under our Barclays or Truist revolving credit facilities.

After reserves for outstanding letters of credit of $7.6 million, we had $274.4 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 to financial statements included in this report for more information on our secured credit facilities.

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.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis