Item 1. Financial Statements
Item 1 – Financial Statements
RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE DATA)
March 31,
2026 December 31,
2025
(unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 455,339 $ 767,215
Accounts receivable 209,090 200,317
Due from affiliates 11,033 12,592
Prepaid expenses and other current assets 65,313 52,003
Total current assets 740,775 1,032,127
PROPERTY, EQUIPMENT AND RIGHT-OF-USE ASSETS
Property and equipment, net 862,057 807,702
Operating lease right-of-use assets 760,975 690,250
Total property, equipment and right-of-use assets 1,623,032 1,497,952
OTHER ASSETS
Goodwill 1,094,699 907,663
Other intangible assets 253,481 148,508
Deferred financing costs 1,538 1,684
Investment in joint ventures 131,409 130,340
Deposits and other 40,455 40,289
Total assets $ 3,885,389 $ 3,758,563
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable, accrued expenses and other $ 454,602 $ 422,029
Due to affiliates 75,960 70,104
Deferred revenue 11,975 7,272
Current operating lease liability 66,591 61,934
Current portion of notes payable 26,506 25,424
Total current liabilities 635,634 586,763
LONG-TERM LIABILITIES
Long-term finance lease liability 4,016 —
Long-term operating lease liability 777,268 707,001
Notes payable, net of current portion 1,059,977 1,064,495
Deferred tax liability, net 34,150 21,903
Other non-current liabilities 21,632 22,515
Total liabilities 2,532,677 2,402,677
EQUITY
Common stock - $ 0.0001 par value, 200,000,000 shares authorized; 78,545,837 and 77,399,615 shares issued and outstanding at March 31, 2026 and December 31, 2025, respectively
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Additional paid-in-capital 1,211,912 1,180,434
Accumulated other comprehensive income (loss) ( 2,466 ) 4,885
Accumulated deficit ( 128,903 ) ( 95,437 )
Total RadNet, Inc.'s Stockholders' equity: 1,080,551 1,089,890
Noncontrolling interests 272,161 265,996
Total equity 1,352,712 1,355,886
Total liabilities and equity $ 3,885,389 $ 3,758,563
The accompanying notes are an integral part of these financial statements.
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
(unaudited)
Three Months Ended
March 31,
2026 2025
REVENUE
Service fee revenue $ 545,218 $ 439,349
Revenue under capitation arrangements 30,413 32,050
Total service revenue 575,631 471,399
OPERATING EXPENSES
Cost of operations, excluding depreciation and amortization 550,512 453,480
Lease abandonment charges — 5,388
Depreciation and amortization 44,967 35,483
Loss on sale and disposal of equipment and other 2,591 402
Severance costs 1,464 747
Total operating expenses 599,534 495,500
LOSS FROM OPERATIONS ( 23,903 ) ( 24,101 )
OTHER INCOME AND EXPENSES
Interest expense 17,657 17,239
Equity in earnings of joint ventures ( 3,825 ) ( 2,599 )
Non-cash change in fair value of interest rate swap — 2,106
Other income ( 4,907 ) ( 7,712 )
Total other expenses 8,925 9,034
LOSS BEFORE INCOME TAXES ( 32,828 ) ( 33,135 )
Benefit from income taxes 8,096 3,398
NET LOSS ( 24,732 ) ( 29,737 )
Net income attributable to noncontrolling interest 8,734 8,189
NET LOSS ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS $ ( 33,466 ) $ ( 37,926 )
BASIC AND DILUTED NET LOSS PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS $ ( 0.43 ) $ ( 0.51 )
WEIGHTED AVERAGE SHARES OUTSTANDING
Basic and Diluted 77,057,835 74,382,356
The accompanying notes are an integral part of these financial statements.
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(IN THOUSANDS)
(unaudited)
Three Months Ended March 31,
2026 2025
NET LOSS $ ( 24,732 ) $ ( 29,737 )
Foreign currency translation adjustments ( 7,518 ) 4,109
Change in fair value of cash flow hedge from prior periods reclassified to earnings, net of taxes — 1,033
COMPREHENSIVE LOSS ( 32,250 ) ( 24,595 )
Less net income attributable to noncontrolling interests 8,734 8,189
Less foreign currency translation adjustments attributable to noncontrolling interests ( 167 ) —
COMPREHENSIVE LOSS ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS $ ( 40,817 ) $ ( 32,784 )
The accompanying notes are an integral part of these financial statements.
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS EXCEPT SHARE DATA)
(unaudited)
The following table summarizes changes in the Company’s consolidated stockholders' equity, including noncontrolling interest, during the three months ended March 31, 2026 and March 31, 2025.
Common Stock
Shares Amount Additional Paid-In Capital Accumulated Other Comprehensive income (loss) Accumulated Deficit Total RadNet, Inc.'s Equity Noncontrolling Interests Total Equity
BALANCE - DECEMBER 31, 2025 77,399,615 $ 8 $ 1,180,434 $ 4,885 $ ( 95,437 ) $ 1,089,890 $ 265,996 $ 1,355,886
Issuance of common stock upon exercise of options 67,112 — 103 — — 103 — 103
Issuance of common stock under the equity compensation plan 892,960 — — — — — — —
Stock-based compensation expense — — 31,440 — — 31,440 — 31,440
Forfeiture of restricted stock and share cancellation ( 4,774 ) — ( 65 ) — — ( 65 ) — ( 65 )
Distributions paid to noncontrolling interests — — — — — — ( 2,402 ) ( 2,402 )
Issuance of common stock in connection with acquisitions 190,924 — — — — — — —
Change in cumulative foreign currency translation adjustment — — — ( 7,351 ) — ( 7,351 ) ( 167 ) ( 7,518 )
Net (loss) income — — — — ( 33,466 ) ( 33,466 ) 8,734 ( 24,732 )
BALANCE - MARCH 31, 2026 78,545,837 $ 8 $ 1,211,912 $ ( 2,466 ) $ ( 128,903 ) $ 1,080,551 $ 272,161 $ 1,352,712
BALANCE - DECEMBER 31, 2024 74,036,993 $ 7 $ 988,147 $ ( 9,061 ) $ ( 76,785 ) $ 902,308 $ 231,102 $ 1,133,410
Issuance of common stock upon exercise of options 11,956 — 121 — — 121 — 121
Issuance of common stock under the equity compensation plan 906,835 — — — — — — —
Issuance of common stock under the DeepHealth equity compensation plan 3,438 — — — — — — —
Stock-based compensation expense — — 28,514 — — 28,514 — 28,514
Forfeiture of restricted stock and share cancellation ( 2,656 ) — ( 20 ) — — ( 20 ) — ( 20 )
Distributions paid to noncontrolling interests — — — — — — ( 913 ) ( 913 )
Change in cumulative foreign currency translation adjustment — — — 4,109 — 4,109 — 4,109
Change in fair value of cash flow hedge from prior periods reclassified to earnings — — — 1,033 — 1,033 — 1,033
Net (loss) income — — — — ( 37,926 ) ( 37,926 ) 8,189 ( 29,737 )
BALANCE - MARCH 31, 2025 74,956,566 $ 7 $ 1,016,762 $ ( 3,919 ) $ ( 114,711 ) $ 898,139 $ 238,378 $ 1,136,517
The accompanying notes are an integral part of these financial statements.
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(unaudited)
Three Months Ended March 31,
2026 2025
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ ( 24,732 ) $ ( 29,737 )
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 44,967 35,483
Noncash operating lease expense 16,298 14,431
Equity in earnings of joint ventures, net of dividends ( 1,069 ) ( 2,599 )
Amortization of deferred financing costs and loan discount 779 728
Loss on sale and disposal of equipment 2,591 402
Lease abandonment charges — 5,388
Amortization of cash flow hedge — 1,033
Non-cash change in fair value of interest rate swap — 2,106
Stock-based compensation 31,375 28,494
Change in fair value of contingent consideration ( 2,764 ) —
Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions:
Accounts receivable 9,375 ( 14,306 )
Other current assets ( 6,172 ) ( 7,206 )
Other assets ( 660 ) ( 1,691 )
Deferred taxes ( 9,099 ) 5,137
Operating leases ( 13,299 ) ( 21,968 )
Deferred revenue 234 128
Accounts payable, accrued expenses and other 31,148 25,658
Net cash provided by operating activities 78,972 41,481
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of imaging facilities and other acquisitions, net of cash acquired ( 304,151 ) ( 3,794 )
Purchase of property and equipment and other ( 69,932 ) ( 48,833 )
Proceeds from sale of equipment 277 23
Equity contributions in existing and purchase of interest in joint ventures — ( 4,147 )
Collection of notes receivable 2,833 —
Net cash used in investing activities ( 370,973 ) ( 56,751 )
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on notes and leases payable ( 9,953 ) ( 1,718 )
Payments on term loan debt ( 5,252 ) ( 5,000 )
Distributions paid to noncontrolling interests ( 2,402 ) ( 913 )
Proceeds from issuance of common stock upon exercise of options 103 121
Net cash used in financing activities ( 17,504 ) ( 7,510 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH ( 2,371 ) 83
NET DECREASE IN CASH AND CASH EQUIVALENTS ( 311,876 ) ( 22,697 )
CASH AND CASH EQUIVALENTS, beginning of period 767,215 740,020
CASH AND CASH EQUIVALENTS, end of period $ 455,339 $ 717,323
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for interest $ 17,073 $ 18,010
Cash paid during the period for income taxes $ 519 $ 272
The accompanying notes are an integral part of these financial statements.
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(unaudited)
Supplemental Schedule of Non-Cash Investing and Financing Activities
We acquired equipment and certain leasehold improvements for approximately $ 68.9 million and $ 62.5 million during the three months ended March 31, 2026 and 2025, respectively, which were not paid for as of March 31, 2026 and 2025 , respectively. The amounts due were recorded in our condensed consolidated balance sheet under accounts payable, accrued expenses and other.
During the three months ended March 31, 2026, we acquired certain assets from entities engaged in the practice of radiology or related businesses. These acquisitions included contingent consideration and holdbacks totaling $ 9.0 million that we had not paid for as of March 31, 2026. The accrued amounts are reflected in our condensed consolidated balance sheets under accrued expenses and other non-current liabilities.
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RADNET, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1 – NATURE OF BUSINESS AND BASIS OF PRESENTATION
We are a national provider of freestanding, fixed-site outpatient diagnostic imaging services in the United States. At March 31, 2026, we operated directly or indirectly through joint ventures with hospitals, 435 centers located in Arizona, California, Delaware, Florida, Indiana, Maryland, New Jersey, New York and Texas. Our centers provide physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders. Our 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. The vast majority of our centers offer multi-modality imaging services. Our multi-modality strategy diversifies revenue streams, reduces exposure to reimbursement changes and provides patients and referring physicians one location to serve the needs of multiple procedures. In addition to our center operations, we have certain other subsidiaries that develop Artificial Intelligence ("AI") products and solutions that are designed to enhance interpretation of radiographic images. 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.
The consolidated financial statements include the accounts of RadNet, Inc. as well as its subsidiaries in which RadNet has a controlling financial interest. The consolidated financial statements also include certain variable interest entities in which we are the primary beneficiary (as described in more detail below). All material intercompany transactions and balances have been eliminated upon consolidation. All of these affiliated entities are referred to collectively as “RadNet,” “we,” “us,” “our” or the “Company” in this report.
Accounting regulations stipulate that generally any entity with a) insufficient equity to finance its activities without additional subordinated financial support provided by any parties, or b) equity holders that, as a group, lack the characteristics which evidence a controlling financial interest, is considered a Variable Interest Entity (“VIE”). We consolidate all VIEs in which we are the primary beneficiary. We determine whether we are the primary beneficiary of a VIE through a qualitative analysis that identifies which variable interest holder has the controlling financial interest in the VIE. The variable interest holder who has both of the following has the controlling financial interest and is the primary beneficiary: (1) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. In performing our analysis, we consider all relevant facts and circumstances, including: the design and activities of the VIE, the terms of the contracts the VIE has entered into, the nature of the VIE’s variable interests issued and how they were negotiated with or marketed to potential investors, and which parties participated significantly in the design or redesign of the entity.
VIEs that we consolidate as the primary beneficiary include professional corporations which are owned or controlled by individuals within our senior management and provide professional medical services for centers in Arizona, California, Delaware, Maryland, Florida and New York. These VIEs are collectively referred to as the “Consolidated Medical Group". RadNet provides non-medical, technical and administrative services to the Consolidated Medical Group for which it receives a management fee, pursuant to the related management agreements. Through the management agreements we have exclusive authority over all non-medical decision making related to the ongoing business operations and we determine the annual budget. The Consolidated Medical Group has insignificant operating assets and liabilities, and de minimis equity. Substantially all cash flows of the Consolidated Medical Group after expenses, including professional salaries, are transferred to us. We consolidate the revenue and expenses, assets and liabilities of the Consolidated Medical Group. The creditors of the Consolidated Medical Group do not have recourse to our general credit and there are no other arrangements that could expose us to losses on behalf of the Consolidated Medical Group. However, RadNet may be required to provide financial support to cover any operating expenses in excess of operating revenues.
The Consolidated Medical Group on a combined basis recognized $ 77.4 million and $ 58.2 million of revenue, net of management services fees to RadNet, for the three months ended March 31, 2026 and 2025, respectively. RadNet recognized $ 235.0 million and $ 238.6 million of total billed net service fee revenue for the three months ended March 31, 2026, and 2025, respectively, for management services provided to the Consolidated Medical Group relating primarily to the technical portion of billed revenue.
In our condensed consolidated balance sheets at March 31, 2026 and December 31, 2025, we have included approximately $ 161.0 million and $ 137.5 million, respectively, of accounts receivable and approximately $ 41.4 million and $ 34.9 million of accounts payable and accrued liabilities related to the Consolidated Medical Group, respectively. The cash flows of the Consolidated Medical Group are included in the accompanying condensed consolidated statements of cash flows. All intercompany balances and transactions have been eliminated in consolidation.
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At all of our centers not serviced by the Consolidated Medical Group, we have entered into long-term contracts with medical groups to provide professional services at those centers, including supervision and interpretation of diagnostic imaging procedures. The medical groups maintain full control over the physicians they employ. Through our management agreements, we make available to the medical groups the imaging centers, including all furniture, fixtures and medical equipment therein. The medical groups are compensated for their services from the professional component of the global net service fee revenue and after deducting management service fees paid to us, we have no economic controlling interest in these medical groups. As such, the financial results of these groups are not consolidated in our financial statements.
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and, therefore, do not include all information and footnotes necessary for conformity with U.S. generally accepted accounting principles for complete financial statements; however, in the opinion of management, all adjustments consisting of normal recurring adjustments necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods ended March 31, 2026 and 2025 have been made. The results of operations for any interim period are not necessarily indicative of the results for a full year. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes thereto contained in our annual report on Form 10-K for the year ended December 31, 2025.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
There have been no material changes to the significant accounting policies we use and have explained in our annual report on Form 10-K for the fiscal year ended December 31, 2025. The information below is intended only to supplement the disclosure in our annual report on Form 10-K for the fiscal year ended December 31, 2025.
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 when our obligations to provide diagnostic services are satisfied. Our performance obligations for diagnostic services are generally satisfied 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 fees 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 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 and the frequent changes in managed care contractual terms resulting from contract renegotiations 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 the Consolidated Medical Group 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 other 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 revenue is based upon the estimated amounts we expect to be entitled to receive from patients and third-party payors. Estimates of contractual allowances under managed care and commercial insurance plans are based upon the payment terms specified in the related contractual agreements. Revenue related to uninsured patients and copayment and deductible amounts for patients who have health care coverage may have discounts applied (uninsured discounts and contractual discounts). We also record estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenue 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 total revenues for the three months ended March 31, 2026 and 2025 are presented in the table below. Our patient service revenue is displayed as the estimated service fee, broken down by classification of insurance coverage type, along with revenue generated from our management services and other sources such as software and AI.
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In Thousands Three Months Ended
March 31,
2026 2025
Commercial insurance $ 315,869 $ 262,488
Medicare 137,179 108,199
Medicaid 13,991 11,690
Workers' compensation/personal injury 12,304 10,459
Other payors 33,590 27,691
Management fee revenue 7,481 6,279
Other revenue 24,804 12,543
Revenue under capitation arrangements 30,413 32,050
Total service revenue $ 575,631 $ 471,399
EQUITY BASED COMPENSATION – We have one long-term incentive plan, which has been amended and restated on April 20, 2015, March 9, 2017, April 15, 2021, April 27, 2023, and most recently following approval by our stockholders at our annual stockholders meeting on June 7, 2023 (the “Restated Plan”). We have reserved 20,100,000 shares of common stock for issuance under the Restated Plan which can be issued in the form of incentive and/or nonstatutory stock options, restricted and/or unrestricted stock, stock units, and stock appreciation rights. Terms and conditions of awards can be direct grants or based on achieving a performance metric. We evaluate performance-based awards to determine if it is probable that the vesting conditions will be met. We also consider probability of achievement of performance conditions when determining expense recognition. For the awards where vesting is probable, equity-based compensation is recognized over the related vesting period. Stock options generally vest over three years to five years and expire five years to ten years from date of grant. We determine the compensation expense for each stock option award using the Black Scholes, binomial lattice valuation or similar, valuation model. Those models require that our management make certain estimates concerning risk-free interest rates and volatility in the trading price of our common stock. The compensation expense recognized for all equity-based awards is recognized over the service periods. Equity-based compensation is classified in operating expenses within the same line item as the majority of the cash compensation paid to employees.
In connection with our acquisition of DeepHealth Inc. on June 1, 2020, we assumed the DeepHealth, Inc. 2017 Equity Incentive Plan, including outstanding options awards that can be exercised for our common stock (the "DeepHealth options"). No additional awards will be granted under the DeepHealth, Inc. 2017 Equity Incentive Plan.
In connection with our acquisition of iCAD, Inc. on July 17, 2025, we assumed the iCAD, Inc. 2016 Stock Incentive Plan, as amended, and the iCAD, Inc. 2012 Stock Incentive Plan, as amended by Amendment No. 1 (collectively, the “iCAD Plans”), including outstanding option awards that became exercisable for shares of our common stock. No additional awards will be granted under the iCAD Plans.
See Note 7, Stock-Based Compensation, for more information.
ACCOUNTS RECEIVABLE - The vast majority 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 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.
We have entered into factoring agreements with various institutions and sold certain accounts receivable under non-recourse agreements in exchange for notes receivable from the buyers. These transactions are accounted for as a reduction in accounts receivable as the agreements transfer effective control over and risk related to the receivables to the buyers. Proceeds on factoring agreements are reflected as operating activities on our statement of cash flows and on our balance sheet as prepaid expenses and other current assets for the current portion and deposits and other for the long-term portion. Amounts remaining to be collected on these agreements were $ 2.6 million and $ 3.5 million at March 31, 2026 and December 31, 2025, respectively. We do not utilize factoring arrangements as an integral part of our financing for working capital and assess the party's ability to pay upfront at the inception of the notes receivable and subsequently by reviewing their financial statements annually and reassessing any insolvency risk on a periodic basis.
DEFERRED FINANCING COSTS - Costs of financing are deferred and amortized using the effective interest rate method and are related to our revolving credit facilities. Deferred financing costs, net of accumulated amortization, were $ 1.5
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million and $ 1.7 million as of March 31, 2026 and December 31, 2025, respectively. See Note 6, Credit Facilities and Notes Payable for more information.
PROPERTY AND EQUIPMENT - Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation and amortization of property and equipment are provided using the straight-line method over their estimated useful lives, which range from 3 to 15 years. Leasehold improvements are amortized at the lesser of lease term or their estimated useful lives, which range from 3 to 15 years. Maintenance and repairs are charged to expense as incurred.
BUSINESS COMBINATIONS - When the qualifications for business combination accounting treatment are met, it requires us to recognize, separately from goodwill, the assets acquired and the liabilities assumed at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net of the acquisition date fair values of the assets acquired and the 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.
Acquisition-related costs are expensed as incurred and are included in Cost of operations, excluding depreciation and amortization, in the condensed consolidated statements of operations. For the three months ended March 31, 2026 and March 31, 2025, such costs totaled approximately $ 3.5 million and $ 0.7 million, respectively.
GOODWILL - Goodwill at March 31, 2026 totaled $ 1,094.7 million. Goodwill is recorded as a result of business combinations. If we determine the carrying value of a reporting unit exceeds its fair value an impairment charge would be recognized and should not exceed the total amount of goodwill allocated to that reporting unit. We tested goodwill and indefinite lived intangibles for impairment on October 1, 2025 noting no impairment, and we have not identified any indicators of impairment through March 31, 2026.
Activity in goodwill for the three months ended March 31, 2026 is provided below (in thousands):
Imaging Center segment Digital Health segment Total
Balance as of December 31, 2025 $ 741,893 $ 165,770 $ 907,663
Goodwill from acquisitions 17,159 170,846 188,005
Measurement period and other adjustments — 2,201 2,201
Currency translation ( 404 ) ( 2,766 ) ( 3,170 )
Balance as of March 31, 2026 $ 758,648 $ 336,051 $ 1,094,699
The amount of goodwill that is expected to be deductible for tax purposes as of March 31, 2026 is $ 224.8 million.
INTANGIBLE ASSETS - Intangible assets are primarily related to our business combinations and software development. They include the estimated fair value of such items as service agreements, customer lists, covenants not to compete, acquired technologies, and trade names. The components of intangible assets, both finite and indefinite lived, along with annual amortization expense that will be recorded over the next five years at March 31, 2026 and December 31, 2025 are as follows (in thousands):
As of March 31, 2026:
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2026* 2027 2028 2029 2030 Thereafter Total Weighted average amortization period remaining in years
Management service contracts $ 1,715 $ 2,287 $ 2,287 $ 2,287 $ 2,287 $ 2,098 $ 12,961 5.6
Covenant not to compete and other contracts 1,532 1,809 1,719 1,228 145 2 6,435 3.4
Customer lists 6,205 8,119 8,078 8,078 8,078 94,091 132,649 16.4
Patent and trademarks 480 385 321 66 43 82 1,377 3.3
Developed technology & software 9,925 12,712 12,712 7,578 6,859 16,567 66,353 6.0
Trade Names definite life 1,277 1,702 1,667 1,111 898 3,805 10,460 9.0
Certifications 2,536 250 — — — — 2,786 0.3
Others 328 438 438 219 — 657 2,080 2.2
Trade names indefinite life — — — — — 7,100 7,100 0.0
IPR&D — — — — — 11,280 11,280 0.0
Total annual amortization $ 23,998 $ 27,702 $ 27,222 $ 20,567 $ 18,310 $ 135,682 $ 253,481
*Excluding the three months ended March 31, 2026
As of December 31, 2025:
2026 2027 2028 2029 2030 Thereafter Total Weighted average amortization period remaining in years
Management Service Contracts $ 2,287 $ 2,287 $ 2,287 $ 2,287 $ 2,287 $ 2,096 $ 13,531 5.8
Covenant not to compete and other contracts 2,039 1,745 1,655 1,195 119 — 6,753 3.6
Customer Relationships 3,914 3,736 3,694 3,694 3,694 43,016 61,748 16.9
Patent and Trademarks 763 391 326 67 43 83 1,673 3.1
Developed Technology & Software 9,712 9,177 9,177 3,958 3,227 5,770 41,021 5.0
Trade Names definite life 394 394 359 252 127 336 1,862 5.6
Certifications 1,867 — — — — — 1,867 0.8
Others 438 438 438 219 — — 1,533 3.4
Trade Names indefinite life — — — — — 8,500 8,500
IPR&D — — — — — 10,020 10,020
Total Annual Amortization $ 21,414 $ 18,168 $ 17,936 $ 11,672 $ 9,497 $ 69,821 $ 148,508
Total intangible asset amortization expense was $ 6.8 million and $ 3.1 million for the three months ended March 31, 2026 and March 31, 2025, respectively. Intangible assets are amortized using the straight-line method over their useful life determined at acquisition. Management services agreements are amortized over 25 years using the straight-line method. Developed technology is capitalized and amortized over the useful life of the software when placed into service. Trade names and IPR&D are reviewed annually for impairment, or when indicators of impairment are presented.
INCOME TAXES - Income tax expense is computed using an asset and liability method and using expected annual effective tax rates. Under this method, deferred income tax assets and liabilities result from temporary differences in the financial reporting bases and the income tax reporting bases of assets and liabilities. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefit that, based on available evidence, is not expected to be realized. When it appears more likely than not that deferred taxes will not be realized, a valuation allowance is recorded to reduce the deferred tax asset to its estimated realizable value. For net deferred tax assets, we consider estimates of future taxable income in determining whether our net deferred tax assets are more likely than not to be realized.
On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law, which enacts significant changes to the U.S. Tax and related laws. Some of the provisions of the new tax law that affect corporations include, but are not limited to, reinstatement of immediate expensing of domestic specified research or experimental expenditures, restoration of EBITDA as the base for calculating deductible business interest expense, modifications to international tax regimes, and reenactment of one hundred percent bonus depreciation on eligible property acquired after January 19, 2025. The impact of the tax law changes from OBBBA with respect to periods prior to enactment were recognized by the Company in the third quarter of 2025, and has
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been applied prospectively based on the effective dates of the tax law. The enactment of the OBBBA did not have a material impact on the Company’s financial statements.
In 2021, the Organization for Economic Co-operation and Development ("OECD") announced an inclusive framework on base erosion and profit shifting including Pillar Two Model Rules defining the global minimum tax, which calls for taxation of large multinational corporations at a minimum rate of 15%. Subsequently, multiple sets of administrative guidance have been issued. Many non-US tax jurisdictions have either recently enacted legislation to support certain components of Pillar Two Model Rules beginning 2024 (including the European Union Member States) with the adoption of additional components in later years or announced their plans to enact legislation in future years. Though the model rules provide a framework for applying the minimum tax, countries may enact Pillar Two Model Rules slightly differently than the model rules and on different timelines and may adjust domestic tax incentives in response to Pillar Two Model Rules. On a long-term basis, we will continue to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in all countries applicable to us. For 2026, we expect that we will meet one or more transactional safe harbor rules, and as such, we do not believe Pillar Two model will have an impact on our annual effective tax rate for the year ending December 31, 2026.
We recorded an income tax provision of $ 8.1 million, or an effective tax rate of 24.7 %, for the three months ended March 31, 2026, compared to $ 3.4 million, or an effective tax rate of 10.3 % for the three months ended March 31, 2025. The income tax rates for the three months ended March 31, 2026 diverge from the federal statutory rate due to (i) state taxes; (ii) foreign rate differentials; (iii) officer compensation limitation under IRC Section 162(m); (iv) nondeductible stock-based compensation expense; (v) transaction costs and other nondeductible expenses; partially offset by (vi) noncontrolling interests and windfall benefits on the exercise of stock-based compensation.
LEASES - We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current operating lease liabilities, and long-term operating lease liability in our condensed consolidated balance sheets. Finance leases are included in property and equipment, accounts payable, accrued expenses and other, and long-term finance lease liability in our consolidated balance sheets. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. We include options to extend a lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. For a contract in which we are a lessee that contains fixed payments for both lease and non-lease components, we have elected to account for the components as a single lease component.
ROU assets are tested for impairment if circumstances suggest that the carrying amount may not be recoverable. Our ROU assets consist of facility and equipment assets on operating leases. No events have occurred such as fire, flood, or other acts which have impaired the integrity of our ROU assets as of March 31, 2026. Our facility leases require us to maintain insurance policies which would cover major damage to our facilities. We maintain business interruption insurance to cover loss of business due to a facility becoming non-operational under certain circumstances. Our equipment leases are covered by warranty and service contracts which cover repairs and provide regular maintenance to keep the equipment in functioning order.
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 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.
COMPREHENSIVE LOSS - Accounting guidance establishes rules for reporting and displaying other comprehensive income (loss) ("OCI") and its components. Our foreign currency translation adjustments and the amortization of balances associated with derivatives previously classified as cash flow hedges are included in OCI. The components of OCI for the three months ended March 31, 2026 and 2025 are included in the Condensed Consolidated Statements of Comprehensive Loss. The following is a reconciliation of Foreign Currency Translation amounts for the three months ended March 31, 2026 and 2025 is provided below (in thousands):
For the three months ended March 31, 2026
December 31, 2025 Balance Currency Translation Adjustments Balance March 31, 2026 Balance
Currency Translation Adjustments $ 7,384 $( 7,518 ) $ 33
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INTEREST ON SECURITIES - We recognized income from interest on securities of approximately $ 5.0 million and $ 7.7 million for the three months ended March 31, 2026 and 2025, respectively. This income is recorded within Other non-operating income in our Condensed Consolidated Statements of Operations .
COMMITMENTS AND CONTINGENCIES - We are party to various legal proceedings, claims, and regulatory, tax or government inquiries and investigations that arise in the ordinary course of business. With respect to these matters, we evaluate the developments on a regular basis and accrue a liability when we believe a loss is probable and the amount can be reasonably estimated. Based on current information, we do not believe that reasonably possible or probable losses associated with pending legal proceedings would either individually or in the aggregate, have a material adverse effect on our business and consolidated financial statements. However, the outcome of these matters is inherently uncertain. Therefore, if one or more of these matters were resolved against us for amounts in excess of management's expectations, our results of operations and financial condition, including in a particular reporting period in which any such outcome becomes probable and estimable, could be materially adversely affected.
CONTINGENT CONSIDERATION
See-Mode Technologies Pte. Ltd.
On June 2, 2025, the Company, through its wholly owned subsidiary DH AI International Holdings, B.V., completed the acquisition of all the equity interests of See-Mode Technologies Pte. Ltd., a Singapore-based AI company specializing in medical imaging. As part of the purchase agreement, we agreed to pay up to $ 12.7 million in contingent consideration in RadNet common stock and cash, based on the achievement of three clinical and regulatory milestones:
First Milestone ($ 4.3 million): Payable upon successful implementation of the company’s thyroid ultrasound detection product at four RadNet imaging centers, and execution of at least two new customer contracts totaling $ 150,000 in aggregate annual contract value by March 31, 2026. On November 3, 2025, we settled the first milestone by issuing 27,673 shares of our common stock at an ascribed value of $ 2.1 million and $ 2.2 million in cash.
Second Milestone ($ 4.2 million): Payable upon FDA 510(k) clearance of the company’s breast ultrasound detection product, with submission required by March 31, 2026 and approval by December 31, 2026.
Third Milestone ($ 4.2 million): Payable upon FDA 510(k) clearance of a new ultrasound product, with submission required by June 30, 2027 and approval by March 31, 2028.
Each contingent amount is payable 50 % in cash and 50 % in RadNet common shares. As of March 31, 2026, the fair value of the contingent consideration was assessed based on the probability of milestone achievement and was determined by management to be 90 % and 80 % for the Second and Third Milestone, respectively.
Kolb Radiology P.C
On July 1, 2025, the Company completed the acquisition of substantially all the assets of Kolb Radiology P.C., a New York-based diagnostic imaging practice. As part of the purchase agreement, we agreed to pay up to $ 8.0 million in contingent consideration (“Earnout Consideration”) payable based on the financial performance of the acquired business over three consecutive twelve-month periods following the closing date.
As of March 31, 2026, the fair value of the contingent consideration was estimated to be $ 4.1 million using a Monte Carlo simulation under a risk-neutral framework that modeled projected MRI revenues and discounted expected payments at term-matched U.S. Treasury rates plus RadNet’s credit spread. Key assumptions included a 2.3 % revenue risk premium, 15 % revenue volatility, 50 % operational leverage ratio, and 2.9 % credit spread.
CIMAR UK Limited
On November 10, 2025, the Company completed the acquisition of CIMAR (UK) Limited. The purchase agreement includes contingent consideration payable based on the achievement of specified recurring revenue targets.
The contingent consideration provides for aggregate payments of up to approximately $ 15.1 million and includes two performance-based milestones tied to recurring revenue generated during measurement periods between 2026 and 2028. Each milestone becomes payable only if at least 90 % of the applicable revenue target is achieved, with payments proportionately
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reduced for achievement between 90 % and 100 % of the target. Any contingent consideration earned is payable 50 % in cash and 50 % in RadNet common stock.
The fair value of the contingent consideration was estimated using a Monte Carlo simulation under a risk-neutral framework that projected revenue-based performance milestones, R&D Deferred Consideration, and discounted expected payments at term-matched U.S. Treasury rates plus RadNet's credit spread. Key assumptions as of March 31, 2026 included a 2.2 % revenue risk premium, 25 % revenue volatility, 60 % operational leverage ratio, and 3 % credit spread.
Gleamer SAS
On March 2, 2026, the Company, through our wholly owned subsidiary DH AI International Holdings, B.V., completed the acquisition of all the equity interests of Gleamer SAS. As part of the purchase agreement, we agreed to pay up to € 15.0 million in contingent consideration in cash, based upon the achievements of specified annual recurring revenue ("ARR") targets.
At the acquisition date, the Company recorded a contingent consideration liability of $ 8.6 million. The fair value of the contingent consideration was estimated using a Monte Carlo simulation model, which considered a range of potential ARR outcomes and calculated the present value of expected payments. Key assumptions as of March 31, 2026 included a 2 % ARR risk premium, 18 % ARR volatility, 75 % operational leverage ratio, and a 2 % credit spread.
The contingent consideration liability is remeasured at fair value each reporting period, with changes in fair value recognized in earnings. A tabular roll forward of contingent consideration is as follows (amounts in thousands):
For the three months ended March 31, 2026
Entity Account December 31, 2025 Balance Additions Change in valuation of contingent consideration Currency Translation March 31, 2026 Balance
See-Mode Technologies Pte. Ltd. Accrued expenses and other non-current liabilities $ 5,329 $ — $ 1,627 $ 6 $ 6,962
Kolb Radiology P.C. Accrued expenses and other non-current liabilities $ 3,900 $ — $ 200 $ — $ 4,100
CIMAR UK Limited Accrued expenses and other non-current liabilities $ 5,753 $ — $ 937 $ ( 74 ) $ 6,616
Gleamer SAS Accrued expenses $ — $ 8,618 $ — $ ( 194 ) $ 8,424
FAIR VALUE MEASUREMENTS – Assets and liabilities subject to fair value measurements are required to be disclosed within a fair value hierarchy. The fair value hierarchy ranks the quality and reliability of inputs used to determine fair value. Accordingly, assets and liabilities carried at, or permitted to be carried at, fair value are classified within the fair value hierarchy in one of the following categories based on the lowest level input that is significant to a fair value measurement:
Level 1—Fair value is determined by using unadjusted quoted prices that are available in active markets for identical assets and liabilities.
Level 2—Fair value is determined by using inputs other than Level 1 quoted prices that are directly or indirectly observable. Inputs can include quoted prices for similar assets and liabilities in active markets or quoted prices for identical assets and liabilities in inactive markets. Related inputs can also include those used in valuation or other pricing models such as interest rates and yield curves that can be corroborated by observable market data.
Level 3—Fair value is determined by using inputs that are unobservable and not corroborated by market data. Use of these inputs involves significant and subjective judgment.
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Contingent Consideration:
The table below summarizes the estimated fair values of contingencies relating to our acquisitions that are subject to fair value measurements and the classification of these liabilities on our condensed consolidated balance sheets, as follows (in thousands):
As of March 31, 2026
Level 1 Level 2 Level 3 Total
Accrued expenses and other non-current liabilities
See-Mode Technologies Pte. Ltd.
$ — $ — $ 6,962 $ 6,962
Kolb Radiology P.C. — — 4,100 4,100
CIMAR UK Limited — — 6,616 6,616
Gleamer SAS — — 8,424 8,424
Long Term Debt:
The table below summarizes the estimated fair value and carrying amount of our Barclays Term Loans and Truist Term Loan long-term debt as follows (in thousands):
As of March 31, 2026
Level 1 Level 2 Level 3 Total Fair Value Total Face Value
Barclays Term Loan and Truist Term Loan $ — $ 1,080,816 $ — $ 1,080,816 $ 1,079,617
As of December 31, 2025
Level 1 Level 2 Level 3 Total Fair Value Total Face Value
Barclays Term Loan and Truist Term Loan $ — $ 1,087,272 $ — $ 1,087,272 $ 1,084,869
We consider the carrying amounts of cash and cash equivalents, receivables, other current assets, and current liabilities to approximate their fair value because of the relatively short period of time between the origination of these instruments and their expected realization or payment. Additionally, we consider the carrying amount of our notes payable to approximate their fair value because the weighted average interest rate used to formulate the carrying amounts approximates current market rates.
EARNINGS PER SHARE - Earnings per share is based upon the weighted average number of shares of common stock and common stock equivalents outstanding, net of common stock held in treasury, as follows (in thousands except share and per share data):
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Three Months Ended March 31,
2026 2025
NET LOSS ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS $ ( 33,466 ) $ ( 37,926 )
BASIC AND DILUTED NET LOSS PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS
Weighted average number of common shares outstanding during the period 77,057,835 74,382,356
Basic and diluted net loss per share attributable to RadNet, Inc.'s common stockholders
$ ( 0.43 ) $ ( 0.51 )
Stock options and non-vested restricted awards excluded from the computation of diluted per share amounts as their effect would be antidilutive:
Non-vested restricted stock subject to service vesting 1,044,986 910,334
Shares issuable upon the exercise of stock options 927,262 894,169
INVESTMENTS IN EQUITY SECURITIES–Accounting guidance requires entities to measure equity investments at fair value, with any changes in fair value recognized in net income. If there is no readily determinable fair value, the guidance allows entities the ability to measure investments at cost, adjusted for observable price changes and impairments, with changes recognized in net income.
As of March 31, 2026 and December 31, 2025, we have five equity investments with an aggregate carrying value of $ 10.8 million.
No observable price changes or impairments in our investments were identified for the three months ended March 31, 2026.
INVESTMENT IN JOINT VENTURES – As of March 31, 2026, we have 12 unconsolidated joint ventures operating 50 diagnostic imaging centers that represent partnerships with hospitals, or health systems and were formed for the purpose of owning and operating diagnostic imaging centers. Professional services at the joint venture diagnostic imaging centers are performed by contracted radiology practices or a radiology practice that participates in the joint venture. Our investment in these joint ventures is accounted for under the equity method, as we do not have a controlling financial interest in such ventures. We evaluate our investment in joint ventures, including cost in excess of book value (equity method goodwill) for impairment whenever indicators of impairment exist. No indicators of impairment existed as of March 31, 2026 and December 31, 2025.
The table below summarizes our ownership interest in these unconsolidated joint ventures as of March 31, 2026:
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Joint Venture Percentage Ownership
Franklin Imaging, LLC 49 %
Greater Baltimore Diagnostic Imaging 50 %
Advanced Imaging at St. Joseph Medical Center, LLC 49 %
Carroll County Radiology, LLC 40 %
Baltimore Washington Imaging Center, LLC 35 %
Calvert Medical Imaging Centers, LLC 50 %
Montgomery Community Magnetic Imaging Ctr LP 49 %
Mt. Airy Imaging Center, LLC 40 %
Orange County Radiation Oncology, LLC 40 %
Arizona Diagnostic Radiology Group LLC 49 %
Glendale Advanced Imaging Center, LLC 55 %
Santa Monica Imaging Group LLC 49 %
Joint venture investment and financial information
The following table is a summary of our investment in joint ventures during the three months ended March 31, 2026 (in thousands):
Balance as of December 31, 2025 $ 130,340
Equity in earnings in joint ventures 3,825
Distribution of earnings ( 2,756 )
Balance as of March 31, 2026 $ 131,409
We charged management service fees from the imaging centers underlying these unconsolidated joint ventures of approximately $ 6.6 million and $ 6.1 million for the three months ended March 31, 2026 and 2025, respectively. These management fees are expenses of the unconsolidated joint ventures and are recognized as service fee revenue. These management fees are earned for providing, among other things, day-to-day operational oversight, revenue cycle, human resources, finance, accounting and information systems to the imaging centers. These unconsolidated joint ventures are considered related parties. Amounts transacted between us and the entities are in the ordinary course of business and are disclosed on our condensed consolidated balance sheet in the due from/to affiliate accounts.
The following table is a summary of key balance sheet data for these joint ventures as of March 31, 2026 and December 31, 2025 and income statement data for the three months ended March 31, 2026 and 2025 (in thousands):
Balance Sheet Data: March 31, 2026 December 31, 2025
Current assets $ 85,217 $ 79,220
Noncurrent assets 226,901 227,447
Current liabilities ( 12,271 ) ( 10,682 )
Noncurrent liabilities ( 73,278 ) ( 71,298 )
Total net assets $ 226,569 $ 224,687
Income statement data for the three months ended March 31,
2026 2025
Net revenue $ 73,330 $ 66,274
Operating expense, excluding depreciation and amortization 60,140 54,976
Depreciation and amortization 4,994 5,176
Non-operating expense 65 494
Net income 8,131 5,628
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Promissory Note from Joint Venture Member
On June 12, 2025, we executed a $ 17.0 million promissory note with Dignity Health, a related party and joint venture member of Arizona Diagnostic Radiology Group, LLC ("ADRG"). Monthly principal payments of $ 0.9 million began July 1, 2025, with interest accruing at the Wall Street Journal Prime Rate plus 2 %. Future distributions from ADRG to Dignity will be applied to the note balance until fully repaid. The note is expected to mature on December 1, 2026. As of March 31, 2026, the remaining balance of $ 8.6 million is entirely classified as current and recorded within Due from Affiliates.
NOTE 3 – RECENT ACCOUNTING AND REPORTING STANDARDS
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued Accounting Standards Update ("ASU") 2024-03 (“ASU 2024-03”), Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, to enhance the transparency of certain expense disclosures. The amendments in this Update require disclosure of specific expense categories in the notes to the financial statements for both interim and annual reporting periods. The Update also requires disaggregated information about certain prescribed expense categories underlying any relevant income statement expense caption. The amendments in this Update are effective for public entities for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted, and the amendments may be adopted either prospectively or retrospectively. We are currently evaluating the impact of this ASU on our consolidated financial statements.
In September 2025, the FASB issued ASU 2025-06 (“ASU 2025-06”), Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, to modernize the accounting for software development costs and enhance the operability of the guidance for different development methods. The amendments remove the prescriptive “project-stage” model and require capitalization of software costs once management has authorized and committed to funding a project and it is probable that the software will be completed and used as intended. The Update also introduces the concept of “significant development uncertainty,” requires application of the property, plant and equipment disclosure requirements to capitalized internal-use software costs, and incorporates website development guidance into Subtopic 350-40. The amendments are effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods. Early adoption is permitted. We are currently evaluating the impact of this ASU on our consolidated financial statements.
NOTE 4 – BUSINESS COMBINATIONS AND RELATED ACTIVITY
Acquisitions
Imaging Center Segment
During the three months ended March 31, 2026, we completed the acquisition of certain assets of the following entities, which either engage directly in the practice of radiology or associated businesses. The primary reason for these acquisitions was to strengthen our presence in the Indiana and Florida markets. These acquisitions are reported as part of our Imaging Center segment. As of March 31, 2026, we made a preliminary fair value determination of the acquired assets and assumed liabilities and the following were recorded (in thousands). The valuation of assets acquired and liabilities assumed has not yet been finalized and remains subject to change, primarily related to the completeness of accrued liabilities, the accuracy of fixed asset valuations, and other customary purchase accounting adjustments. The fair value determination is preliminary and may be updated as additional information becomes available.
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Entity Date Acquired Total Consideration Property & Equipment Right of Use Assets Goodwill Intangible Assets Accounts receivable Prepaid expenses and other current assets Accounts payable, accrued expenses and other Right of Use Liabilities Finance lease
Regional Radiology Center 1/6/2026 $ 58,315 43,834 59,951 16,970 4,335 10,489 2,407 ( 14,274 ) ( 61,151 ) ( 4,246 )
Northwest Radiology Network PC 2/2/2026 9,000 8,668 9,424 189 130 — 14 — ( 9,424 ) —
Total 67,315 52,502 69,375 17,159 4,465 10,489 2,421 ( 14,274 ) ( 70,575 ) ( 4,246 )
In connection with these Imaging Centers acquisitions, the aggregate consideration transferred consisted of approximately $ 66.5 million in cash, adjusted for approximately $ 0.6 million of acquired cash, net of debt assumed, and included approximately $ 0.4 million of holdback consideration and the settlement of a $ 1.0 million note payable owed to RadNet by the seller.
Digital Health Segment
Gleamer SAS
On March 2, 2026, we completed the acquisition of all of the outstanding shares of Gleamer SAS (“Gleamer”), an artificial intelligence-based medical imaging software company focused on the design, development, and commercialization of AI-driven diagnostic solutions. The acquisition enhances our Digital Health segment by expanding our AI capabilities in medical imaging and strengthens our position in global markets, including Europe and the United States.
The transaction was accounted for as the acquisition of a business and was completed pursuant to a share purchase agreement dated March 2, 2026. The total purchase consideration was approximately $ 264.1 million, consisting of (i) an upfront payment of approximately $ 255.5 million, subject to customary adjustments for cash, indebtedness, and working capital, and (ii) contingent consideration with an estimated fair value of $ 8.6 million as of the acquisition date, with a maximum potential payout of € 15.0 million based on the achievement of specified annual recurring revenue targets.
We have preliminarily allocated the purchase price to the assets acquired and liabilities assumed based on their estimated fair values. This resulted in the recognition of goodwill of approximately $ 170.8 million, primarily reflecting expected synergies from integrating Gleamer’s AI technology platform, established customer relationships, and assembled workforce. In addition, we recorded identifiable intangible assets of approximately $ 111.6 million, consisting of developed technology of $ 29.2 million, customer relationships of $ 76.0 million, trade names of $ 3.5 million, and other intangible assets of $ 2.8 million. The acquisition also included approximately $ 30.4 million of other operating assets and $ 0.3 million of other net tangible assets. Liabilities assumed included deferred tax liabilities of $ 21.5 million and debt and other liabilities of $ 27.5 million.
In connection with the acquisition, the Company identified and measured the fair values of acquired intangible assets, including developed technology, customer relationships, trade names, and other intangible assets. The valuations were performed using the income approach, consistent with market participant assumptions. The income approach incorporated assumptions such as projected revenues, estimated customer attrition, royalty rates, and discount rates reflecting market participant expectations. The identified intangible assets were assigned estimated useful lives as follows: developed technology — approximately 8 years; customer relationships — approximately 17 years; trade names — approximately 3 to 6 years; and other intangible assets — approximately 1 to 3 years.
As of March 31, 2026, the valuation of assets acquired and liabilities assumed is preliminary and subject to change during the measurement period, primarily with respect to the valuation of identifiable intangible assets, contingent consideration, and deferred taxes. The fair value of contingent consideration will be remeasured at each reporting period until the contingency is resolved. The Company expects to finalize the purchase price allocation within the measurement period as additional information becomes available.
NOTE 5 – SEGMENT REPORTING
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Our chief operating decision maker ("CODM"), who is also our CEO, evaluates the financial performance of our segments based upon their respective revenue and segmented internal profit and loss statements prepared on a basis not consistent with GAAP. The CODM considers actual to budget and current year actual to prior year actual for revenue and other profit and loss measures on a monthly basis for evaluating performance of each segment and making decisions about allocating capital and other resources to each segment. We do not report balance sheet information by segment since it is not reviewed by our CODM to evaluate segment performance or to make resource allocation decisions.
Our Imaging Center segment provides physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders. Services include MRI, CT, PET, nuclear medicine, mammography, ultrasound, X-ray, fluoroscopy and other related procedures. The vast majority of our centers offer multi-modality imaging services, a strategy that diversifies revenue streams, reduces exposure to reimbursement changes and provides patients and referring physicians one location to serve the needs of multiple procedures.
Our Digital Health segment develops and deploys clinical applications to enhance interpretation of medical images and improve patient outcomes with an emphasis on brain, breast, prostate, and pulmonary diagnostics. Included in the segment is our eRad subsidiary, which designs the underlying critical scheduling, data storage and retrieval systems necessary for imaging center operation.
In the normal course of business, our Imaging Center and Digital Health segments enter into transactions with each other. While intersegment transactions are treated like third-party transactions to determine segment performance, the revenues recognized by a segment and expenses incurred by the counterparty are eliminated in consolidation and do not affect consolidated results.
The following tables reflect certain financial data for each reportable segment:
Three Months Ended March 31, 2026
Imaging Center Digital health Total
Revenues from external customers $ 556,815 $ 18,816 $ 575,631
Intersegment revenues — 10,305 10,305
$ 556,815 $ 29,121 $ 585,936
Reconciliation of revenue
Elimination of intersegment revenues ( 10,305 )
Total consolidated revenues $ 575,631
Less:
Other segment items* $ 520,554 $ 40,263
Segment profit (loss) 36,260 ( 11,141 ) 25,119
Reconciliation of segment profit
Depreciation and amortization $ ( 44,967 )
Loss on sale and disposal of equipment and other ( 2,591 )
Severance costs ( 1,464 )
Interest expense ( 17,657 )
Equity in earnings of joint ventures 3,825
Other income 4,907
Loss before income taxes $ ( 32,828 )
*Other segment items include operating expenses, inclusive of cost of operations and lease abandonment charges.
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Three Months Ended March 31, 2025
Imaging Center Digital health Total
Revenues from external customers $ 461,378 $ 10,021 $ 471,399
Intersegment revenues — 9,200 9,200
$ 461,378 $ 19,221 $ 480,599
Reconciliation of revenue
Elimination of intersegment revenues ( 9,200 )
Total consolidated revenues $ 471,399
Less:
Other segment items* $ 445,731 $ 22,338
Segment profit (loss) 15,648 ( 3,117 ) 12,531
Reconciliation of segment profit
Depreciation and amortization $ ( 35,483 )
Loss on sale and disposal of equipment and other ( 402 )
Severance costs ( 747 )
Interest expense ( 17,239 )
Equity in earnings of joint ventures 2,599
Non-cash change in fair value of interest rate swaps ( 2,106 )
Other income 7,712
Loss before income taxes $ ( 33,135 )
*Other segment items include operating expenses, inclusive of cost of operations and lease abandonment charges.
NOTE 6 – CREDIT FACILITIES AND NOTES PAYABLE
At March 31, 2026, we had two principal secured credit facilities consisting of our Barclays Revolving Credit Facility (as defined below) and our Truist Revolving Credit Facility (as defined below). Each facility includes a term loan component and a revolving credit facility. At March 31, 2026, we were in compliance with all covenants under our credit facilities.
Barclays Credit Facility
On April 18, 2024, we entered into a Third Amended and Restated First Lien Credit and Guaranty Agreement (the “Barclays Credit Agreement”), with Barclays Bank Plc and the lenders and financial institutions named therein, which provides for $ 875.0 million of senior secured term loans (the “Barclays Term Loan”) and a $ 282.0 million senior secured revolving credit facility (the “Barclays Revolving Credit Facility”). Our borrowing under the Barclays Revolving Credit Facility is secured by a lien on all of our assets.
The proceeds from the April 18, 2024 restatement of the Barclays Credit Agreement were used to refinance the $ 678.7 million of term loans outstanding under the prior credit facility, to pay accrued interest through the date of closing, and to pay fees and expenses associated with the refinancing transaction. Total costs incurred in connection with the restatement amounted to approximately $ 19.9 million segregated as follows: $ 11.1 million recognized as discount and deferred finance cost, $ 2.1 million charged to loss on early extinguishment of debt and $ 6.7 million to related expenses. Amounts capitalized will be amortized over the remaining terms of the respective credit facilities under the Barclays Credit Agreement.
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 %. Total costs incurred in connection with the first amendment amounted to approximately $ 2.4
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million segregated as follows: $ 0.6 million recognized as discount, $ 1.8 million charged to loss on early extinguishment of debt and $ 0.1 million to related expenses. Amounts capitalized will be amortized over the remaining terms of the respective credit facilities under the Barclays Credit Agreement.
On June 11, 2025, we entered into Incremental Amendment No. 2 to the Barclays Credit Agreement (the “Second Amendment”), pursuant to which Barclays Bank Plc, as lender, provided an additional $ 100.0 million, net of a $ 1.0 million discount, of incremental term loan borrowings under our existing senior secured term loan facility, all other terms remained the same. 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. The remaining outstanding principal will be due as a lump-sum payment on April 18, 2031, the maturity date of the incremental term loan.
Barclays Term Loan:
The Barclays Term Loan provides for interest payments based on a base rate, plus an applicable margin. During the periods covered by this report, the base rates, margins and effective interest rates were as follows for the periods indicated:
Period Base Rate plus Margin Effective Rate
As of December 31, 2025
SOFR plus 2.25 %
Prime Rate plus 1.25 %
6.07 % (credit spread adjustment of 0.00 % )
8.0 %
As of March 31, 2026
SOFR plus 2.25 %
Prime Rate plus 1.25 %
5.9 % (credit spread adjustment of 0.00 %) 8.0 %
Barclays Revolving Credit Facility:
The Barclays Revolving Credit Facility is a $ 282.0 million senior secured revolving credit facility. Associated with the Barclays Revolving Credit Facility is deferred financing costs, net of accumulated amortization, of $ 1.3 million at March 31, 2026.
After we entered the first amendment on November 26, 2024, amounts borrowed under the Barclays Revolving Credit Facility bear interest at either SOFR plus 2.75 % or the Prime Rate plus 1.8 % (with step-downs based on attainment of certain first lien net leverage ratio benchmarks). As of March 31, 2026, the effective interest rate payable on revolving loans under the Barclays Revolving Credit Facility was 8.50 %. In addition, a commitment fee of 0.50 % per annum accrues on the unused revolver commitments under the Barclays Revolving Credit Facility.
We had no outstanding balance under our $ 282.0 million Barclays Revolving Credit Facility at March 31, 2026 and December 31, 2025. After reserves of $ 8.6 million for certain letters of credit, $ 273.4 million was available to draw upon as of March 31, 2026.
The Barclays Revolving Credit Facility terminates on April 18, 2029, unless otherwise accelerated under the terms of the Barclays Credit Agreement.
Truist Credit Facility
On October 7, 2022, our subsidiary New Jersey Imaging Network, Inc. ("NJIN") entered into Second Amended and Restated Revolving Credit and Term Loan Agreement (the “Truist Credit Agreement”), with Truist Bank and the lenders and financial institutions named therein, which provides for a $ 150.0 million term loan (the "Truist Term Loan") and a $ 50.0 million revolving credit facility (the “Truist Revolving Credit Facility”). The Truist Credit agreement is secured by the assets of NJIN.
Truist Term Loan:
The Truist Term Loan currently bears interest at SOFR or a Base Rate plus an applicable margin and fees which step down based on a leverage ratio. At March 31, 2026 the applicable margin for SOFR was 1.5 %.
We are required to make quarterly principal payments of $ 2.8 million, which increases by $ 0.9 million at scheduled intervals, with the remaining balance to be paid at maturity. The Truist Term Loan will mature on October 10, 2027 unless otherwise accelerated under the terms of the Truist Credit Agreement.
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Truist Revolving Credit Facility:
The Truist Revolving Credit Facility is a $ 50.0 million secured revolving credit facility. Associated with the Truist Revolving Credit Facility are deferred financing costs, net of accumulated amortization, of $ 0.2 million at March 31, 2026.
Amounts borrowed under the Truist Revolving Credit Facility bear interest at either SOFR or a Base Rate plus an applicable margin and fees which step down based on a leverage ratio. In addition, a commitment fee of 0.30 % per annum accrues on the unused revolver commitments under the Truist Revolving Credit Facility.
We had no balance outstanding under our $ 50.0 million Truist Revolving Credit Facility at March 31, 2026 and December 31, 2025. With no letters of credit reserved against the facility, the full $ 50.0 million was available to draw upon as of March 31, 2026.
The Truist Revolving Credit Facility terminates on October 7, 2027, unless otherwise accelerated under the terms of the Truist Credit Agreement.
Equipment Notes Payable
We have issued certain notes payable in connection with the purchase of equipment previously leased under operating leases.
Other Notes Payable
Other notes payables include obligations assumed in connection with government-sponsored innovation financing arrangements of acquired subsidiaries.
Debt Obligations
As of March 31, 2026 and December 31, 2025 our term loan debt and other obligations are as follows (in thousands):
March 31,
2026 December 31,
2025
Barclays Term Loans collateralized by RadNet's tangible and intangible assets $ 958,680 $ 961,119
Discount on Barclays Term Loans ( 11,199 ) ( 11,759 )
Truist Term Loan Agreement collateralized by NJIN's tangible and intangible assets 120,937 123,750
Discount on Truist Term Loan Agreement ( 396 ) ( 462 )
Equipment notes payable at 3.6 % to 7.2 %, due through 2029, collateralized by medical equipment
15,626 17,271
Other notes payable, due through 2034 2,835 —
Total debt obligations 1,086,483 1,089,919
Less: current portion ( 26,506 ) ( 25,424 )
Long term portion of debt obligations $ 1,059,977 $ 1,064,495
NOTE 7 – STOCK-BASED COMPENSATION
Stock Incentive Plans
We have one long-term equity incentive plan, the RadNet, Inc. Equity Incentive Plan, which has been amended and restated on April 20, 2015, March 9, 2017, April 15, 2021, April 27, 2023, and most recently following approval by our stockholders at our annual stockholders meeting on June 7, 2023 (the “Restated Plan”). We have reserved for issuance under the Restated Plan 20,100,000 shares of common stock for issuance under the Restated Plan which can be issued in the form of incentive and/or nonstatutory stock options, restricted and/or unrestricted stock, stock units and stock appreciation rights.
Our stock-based compensation consists of various types of awards, each accounted for separately. There is no overlap between our stock options, DeepHealth options, restricted stock awards ("RSAs") and restricted stock units ("RSUs"), performance stock units ("PSUs"), and performance stock options ("PSOs").
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Options
Certain options granted under the Restated Plan to employees are intended to qualify as incentive stock options under existing tax regulations. Stock options generally vest over 3 to 5 years and expire 5 to 10 years from the date of grant.
The following summarizes all of our option transactions for the three months ended March 31, 2026:
Outstanding Options
Under the 2006 Plan Shares Weighted Average
Exercise price
Per Common Share Weighted Average
Remaining
Contractual Life
(in years) Aggregate
Intrinsic
Value
(in thousands)
Balance, December 31, 2025 994,874 $ 19.11
Granted — —
Exercised ( 67,612 ) 1.57
Balance, March 31, 2026 927,262 20.38 5.3 $ 32,923
Exercisable at March 31, 2026 838,686 20.45 5.1 $ 29,724
Aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between our closing stock price on March 31, 2026 and the exercise price, multiplied by the number of in-the-money options as applicable) that would have been received by the holder had all holders exercised their options on March 31, 2026. As of March 31, 2026, total unrecognized stock-based compensation expense related to non-vested employee awards was $ 0.4 million which is expected to be recognized over a weighted average period of approximately 0.9 years .
Restricted Stock Awards ("RSAs") and Restricted Stock Units ("RSUs")
The Restated Plan permits the award of RSAs and RSUs. The following summarizes all unvested RSA and RSU activities for the three months ended March 31, 2026:
RSAs and RSUs Weighted-Average
Remaining
Contractual
Term (Years) Weighted-Average
Fair Value per Share
RSAs and RSUs unvested at December 31, 2025 893,385 $ 58.23
Granted 868,382 $ 72.58
Vested ( 694,166 ) $ 63.21
Forfeited or Canceled ( 22,615 ) $ 61.32
RSAs and RSUs unvested at March 31, 2026 1,044,986 1.41 $ 67.16
We determine the fair value of all RSAs and RSUs based on the closing price of our common stock on the grant date.
Performance based stock units ("PSUs")
In October 2024, we granted certain employees PSUs with a target award of 35,522 shares of our common stock. The PSUs vest in five equal annual installments on each anniversary of the grant date, subject to continued service and achievement of a performance condition established at the grant date. The performance condition will be measured over a performance period ending no later than the seventh anniversary of the grant date. The number of shares earned may range from 0 % to 100 % of the target award based on actual performance results. As of March 31, 2026, based on performance achieved to date, all 35,522 shares are expected to vest.
In January 2023, we granted certain employees PSUs with a target award of 60,685 shares of our common stock with a fair value of $ 18.64 . The PSUs will vest in two equal parts, starting three years from the grant date based on continuous service, with the number of shares earned ( 0 % to 200 % of the target award) depending upon the extent to which we achieve a performance condition as determined by the board of directors over the period from January 1, 2023 through December 31, 2023. In March of 2024, based on the performance condition being achieved, the board of directors issued 121,370 shares.
Shares available
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Of the 20,100,000 shares of common stock reserved for issuance under the Restated Plan, at March 31, 2026, there remain approximately 1,342,517 shares available under the Restated Plan for future issuance.
NOTE 8 – SUBSEQUENT EVENTS
On May 1, 2026, the Company acquired a 50 % membership interest in Intermountain Medical Imaging, LLC for purchase consideration of approximately $ 17.5 million, subject to customary adjustments. Intermountain Medical Imaging operates multi-modality imaging centers in Idaho.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.