[10-Q] RadNet, Inc. Quarterly Earnings Report
Filing Impact
Filing Sentiment
Form Type
10-Q
RadNet reported higher second-quarter revenue and a return to quarterly profitability, but a six-month operating loss left common shareholders with a year-to-date deficit. Total service revenue for the three months ended June 30, 2025 was $498,230,000, up from $459,714,000 a year earlier, driven by growth across commercial and Medicare payors. The company recorded quarterly net income of $23,034,000, with net income attributable to RadNet common stockholders of $14,454,000 and diluted EPS of $0.19.
For the six months ended June 30, 2025 RadNet reported a consolidated net loss of $(6,703,000), and a net loss attributable to RadNet common stockholders of $(23,472,000) (diluted EPS $(0.32)). Operating cash flow improved to $161,829,000 for the six months. The company completed acquisitions, including See-Mode Technologies for approximately $28.7 million with contingent consideration of $8.8 million, and goodwill totaled $751,514,000 at June 30, 2025. Total long-term debt was $1,077,251,000.
RadNet ha registrato ricavi del secondo trimestre in aumento e il ritorno alla redditività trimestrale, ma una perdita operativa sul periodo di sei mesi ha lasciato gli azionisti ordinari in deficit da inizio anno. I ricavi totali da servizi per i tre mesi chiusi il 30 giugno 2025 sono stati $498,230,000, in crescita rispetto a $459,714,000 dell'anno precedente, trainati dall'incremento tra pagatori commerciali e Medicare. La società ha riportato un utile netto trimestrale di $23,034,000, con utile netto attribuibile agli azionisti ordinari di RadNet di $14,454,000 e utile diluito per azione di $0.19.
Per i sei mesi chiusi il 30 giugno 2025 RadNet ha riportato una perdita netta consolidata di $(6,703,000), e una perdita netta attribuibile agli azionisti ordinari di RadNet di $(23,472,000) (EPS diluito $(0.32)). Il flusso di cassa operativo è migliorato a $161,829,000 per i sei mesi. La società ha completato acquisizioni, inclusa See-Mode Technologies per circa $28.7 milioni con una componente variabile di pagamento di $8.8 milioni, e l'avviamento ammontava a $751,514,000 al 30 giugno 2025. Il debito a lungo termine totale era $1,077,251,000.
RadNet registró mayores ingresos en el segundo trimestre y volvió a la rentabilidad trimestral, pero una pérdida operativa en los seis meses dejó a los accionistas comunes con un déficit en el año. Los ingresos totales por servicios para los tres meses terminados el 30 de junio de 2025 fueron $498,230,000, frente a $459,714,000 un año antes, impulsados por el crecimiento entre pagadores comerciales y Medicare. La compañía registró un ingreso neto trimestral de $23,034,000, con ingreso neto atribuible a los accionistas comunes de RadNet de $14,454,000 y ganancias diluidas por acción de $0.19.
Para los seis meses terminados el 30 de junio de 2025 RadNet reportó una pérdida neta consolidada de $(6,703,000), y una pérdida neta atribuible a los accionistas comunes de RadNet de $(23,472,000) (EPS diluido $(0.32)). El flujo de caja operativo mejoró a $161,829,000 en los seis meses. La compañía completó adquisiciones, incluida See-Mode Technologies por aproximadamente $28.7 millones con contraprestación contingente de $8.8 millones, y el goodwill totalizó $751,514,000 al 30 de junio de 2025. La deuda a largo plazo total fue $1,077,251,000.
RadNet은 2분기 매출이 증가하고 분기별 흑자로 복귀했지만, 6개월 누적 영업손실로 보통주주들의 연초 대비 적자가 발생했습니다. 2025년 6월 30일로 마감된 3개월의 총 서비스 매출은 $498,230,000로 전년의 $459,714,000에서 증가했으며, 상업 및 Medicare 지급자 전반의 성장에 힘입었습니다. 회사는 분기 순이익 $23,034,000을 기록했으며, RadNet 보통주주에게 귀속되는 순이익은 $14,454,000, 희석 주당순이익은 $0.19였습니다.
2025년 6월 30일로 마감된 6개월 동안 RadNet은 연결 순손실 $(6,703,000)을 보고했으며, RadNet 보통주주에게 귀속되는 순손실은 $(23,472,000) (희석 EPS $(0.32))였습니다. 영업 현금흐름은 6개월 동안 $161,829,000로 개선되었습니다. 회사는 See-Mode Technologies를 약 $28.7백만 달러에 인수했으며, 우발성 대가로 $8.8백만 달러가 책정되었고, 2025년 6월 30일 기준 총 영업권은 $751,514,000였습니다. 총 장기부채는 $1,077,251,000였습니다.
RadNet a enregistré des revenus du deuxième trimestre en hausse et un retour à la rentabilité trimestrielle, mais une perte d'exploitation sur six mois a laissé les actionnaires ordinaires avec un déficit depuis le début de l'année. Les revenus de services totaux pour les trois mois clos le 30 juin 2025 s'élèvent à $498,230,000, contre $459,714,000 un an plus tôt, portés par la croissance auprès des payeurs commerciaux et de Medicare. La société a enregistré un bénéfice net trimestriel de $23,034,000, dont $14,454,000 attribuables aux actionnaires ordinaires de RadNet et un BPA dilué de $0.19.
Pour les six mois clos le 30 juin 2025, RadNet a déclaré une perte nette consolidée de $(6,703,000), et une perte nette attribuable aux actionnaires ordinaires de RadNet de $(23,472,000) (BPA dilué $(0.32)). Les flux de trésorerie d'exploitation se sont améliorés à $161,829,000 sur six mois. La société a finalisé des acquisitions, notamment See-Mode Technologies pour environ $28.7 millions avec contrepartie conditionnelle de $8.8 millions, et le goodwill s'élevait à $751,514,000 au 30 juin 2025. La dette à long terme totale s'élevait à $1,077,251,000.
RadNet meldete im zweiten Quartal höhere Erlöse und kehrte zur Quartalsprofitabilität zurück, doch ein operativer Verlust über sechs Monate hinterließ bei den Stammaktionären ein Jahresdefizit. Die gesamten Dienstleistungsumsätze für die drei Monate zum 30. Juni 2025 beliefen sich auf $498,230,000, gegenüber $459,714,000 ein Jahr zuvor, getrieben durch Wachstum bei gewerblichen und Medicare-Zahlern. Das Unternehmen verzeichnete einen Quartalsnettogewinn von $23,034,000, wobei der auf RadNet-Stammaktionäre entfallende Nettogewinn $14,454,000 und das verwässerte Ergebnis je Aktie $0.19 betrug.
Für die sechs Monate zum 30. Juni 2025 meldete RadNet einen konsolidierten Nettoverlust von $(6,703,000) und einen auf RadNet-Stammaktionäre entfallenden Nettoverlust von $(23,472,000) (verwässertes EPS $(0.32)). Der operative Cashflow verbesserte sich auf $161,829,000 für die sechs Monate. Das Unternehmen schloss Übernahmen ab, darunter See-Mode Technologies für rund $28.7 Millionen mit bedingter Gegenleistung von $8.8 Millionen, und der Goodwill belief sich zum 30. Juni 2025 auf $751,514,000. Die langfristigen Gesamtverbindlichkeiten betrugen $1,077,251,000.
Positive
- Total service revenue increased to $498,230,000 in Q2 2025 from $459,714,000 in Q2 2024, an increase of approximately 8.4% year-over-year.
- Quarterly net income was $23,034,000 with $14,454,000 attributable to RadNet common stockholders and diluted EPS of $0.19 for Q2 2025.
- Operating cash flow improved to $161,829,000 for the six months ended June 30, 2025 versus $133,090,000 a year earlier.
- Completed acquisition of See-Mode Technologies (total consideration ~$28.7 million) to expand the Digital Health segment; contingent consideration was recognized with fair value.
- Cash and cash equivalents were $833,152,000 at June 30, 2025, providing substantial liquidity on the balance sheet.
Negative
- Year-to-date net loss attributable to RadNet common stockholders of $(23,472,000) for the six months ended June 30, 2025 (diluted EPS $(0.32)).
- Consolidated net loss of $(6,703,000) for the six months ended June 30, 2025, reversing prior-year six-month income of $12,355,000.
- Material contingent consideration related to the See-Mode acquisition of $8,766,000 recorded in accrued and non-current liabilities.
- Significant long-term indebtedness with total long-term debt of $1,077,251,000 as of June 30, 2025.
- Lease abandonment charges of $5,511,000 recognized in the six months ended June 30, 2025 related to closing lower-utilization imaging centers.
Insights
TL;DR: Q2 revenue growth and positive quarterly EPS contrast with a six-month loss and elevated leverage, producing mixed investor implications.
RadNet delivered a meaningful sequential and year-over-year revenue increase to $498.2 million in Q2 2025 (+8.4% vs prior year quarter) and produced quarterly net income attributable to common shareholders of $14.5 million (diluted EPS $0.19). These operational improvements supported stronger operating cash flow of $161.8 million for the six months. Offsetting these positives, the company reported a year-to-date consolidated net loss of $(6.7) million and a net loss to common shareholders of $(23.5) million, reflecting non-operating items and noncontrolling interest allocations. Balance sheet highlights include $833.2 million of cash and $1,077.3 million of long-term debt, and goodwill of $751.5 million. Overall, this filing is impactful for investors but presents mixed signals between improving operational cash generation and persistent leverage and year-to-date losses.
TL;DR: Strategic acquisitions, including See-Mode, add digital capabilities and produced identifiable contingent liabilities; transaction terms are material to Digital Health growth.
RadNet completed multiple small imaging center acquisitions during H1 2025 and the acquisition of See-Mode Technologies on June 2, 2025 for approximately $28.7 million of total consideration, including $8.8 million of contingent consideration tied to clinical and regulatory milestones. Management assigned milestone achievement probabilities (97.5%, 70%, 40%) which underpin the recorded contingent liability of $8.8 million classified across accrued and non-current liabilities. Goodwill increased by $40.9 million in H1 2025 to $751.5 million, driven by both Imaging Center and Digital Health transactions. These transactions are impactful to the company’s strategic positioning in AI-enabled imaging and are likely to materially affect future segment results as milestones and integrations progress.
RadNet ha registrato ricavi del secondo trimestre in aumento e il ritorno alla redditività trimestrale, ma una perdita operativa sul periodo di sei mesi ha lasciato gli azionisti ordinari in deficit da inizio anno. I ricavi totali da servizi per i tre mesi chiusi il 30 giugno 2025 sono stati $498,230,000, in crescita rispetto a $459,714,000 dell'anno precedente, trainati dall'incremento tra pagatori commerciali e Medicare. La società ha riportato un utile netto trimestrale di $23,034,000, con utile netto attribuibile agli azionisti ordinari di RadNet di $14,454,000 e utile diluito per azione di $0.19.
Per i sei mesi chiusi il 30 giugno 2025 RadNet ha riportato una perdita netta consolidata di $(6,703,000), e una perdita netta attribuibile agli azionisti ordinari di RadNet di $(23,472,000) (EPS diluito $(0.32)). Il flusso di cassa operativo è migliorato a $161,829,000 per i sei mesi. La società ha completato acquisizioni, inclusa See-Mode Technologies per circa $28.7 milioni con una componente variabile di pagamento di $8.8 milioni, e l'avviamento ammontava a $751,514,000 al 30 giugno 2025. Il debito a lungo termine totale era $1,077,251,000.
RadNet registró mayores ingresos en el segundo trimestre y volvió a la rentabilidad trimestral, pero una pérdida operativa en los seis meses dejó a los accionistas comunes con un déficit en el año. Los ingresos totales por servicios para los tres meses terminados el 30 de junio de 2025 fueron $498,230,000, frente a $459,714,000 un año antes, impulsados por el crecimiento entre pagadores comerciales y Medicare. La compañía registró un ingreso neto trimestral de $23,034,000, con ingreso neto atribuible a los accionistas comunes de RadNet de $14,454,000 y ganancias diluidas por acción de $0.19.
Para los seis meses terminados el 30 de junio de 2025 RadNet reportó una pérdida neta consolidada de $(6,703,000), y una pérdida neta atribuible a los accionistas comunes de RadNet de $(23,472,000) (EPS diluido $(0.32)). El flujo de caja operativo mejoró a $161,829,000 en los seis meses. La compañía completó adquisiciones, incluida See-Mode Technologies por aproximadamente $28.7 millones con contraprestación contingente de $8.8 millones, y el goodwill totalizó $751,514,000 al 30 de junio de 2025. La deuda a largo plazo total fue $1,077,251,000.
RadNet은 2분기 매출이 증가하고 분기별 흑자로 복귀했지만, 6개월 누적 영업손실로 보통주주들의 연초 대비 적자가 발생했습니다. 2025년 6월 30일로 마감된 3개월의 총 서비스 매출은 $498,230,000로 전년의 $459,714,000에서 증가했으며, 상업 및 Medicare 지급자 전반의 성장에 힘입었습니다. 회사는 분기 순이익 $23,034,000을 기록했으며, RadNet 보통주주에게 귀속되는 순이익은 $14,454,000, 희석 주당순이익은 $0.19였습니다.
2025년 6월 30일로 마감된 6개월 동안 RadNet은 연결 순손실 $(6,703,000)을 보고했으며, RadNet 보통주주에게 귀속되는 순손실은 $(23,472,000) (희석 EPS $(0.32))였습니다. 영업 현금흐름은 6개월 동안 $161,829,000로 개선되었습니다. 회사는 See-Mode Technologies를 약 $28.7백만 달러에 인수했으며, 우발성 대가로 $8.8백만 달러가 책정되었고, 2025년 6월 30일 기준 총 영업권은 $751,514,000였습니다. 총 장기부채는 $1,077,251,000였습니다.
RadNet a enregistré des revenus du deuxième trimestre en hausse et un retour à la rentabilité trimestrielle, mais une perte d'exploitation sur six mois a laissé les actionnaires ordinaires avec un déficit depuis le début de l'année. Les revenus de services totaux pour les trois mois clos le 30 juin 2025 s'élèvent à $498,230,000, contre $459,714,000 un an plus tôt, portés par la croissance auprès des payeurs commerciaux et de Medicare. La société a enregistré un bénéfice net trimestriel de $23,034,000, dont $14,454,000 attribuables aux actionnaires ordinaires de RadNet et un BPA dilué de $0.19.
Pour les six mois clos le 30 juin 2025, RadNet a déclaré une perte nette consolidée de $(6,703,000), et une perte nette attribuable aux actionnaires ordinaires de RadNet de $(23,472,000) (BPA dilué $(0.32)). Les flux de trésorerie d'exploitation se sont améliorés à $161,829,000 sur six mois. La société a finalisé des acquisitions, notamment See-Mode Technologies pour environ $28.7 millions avec contrepartie conditionnelle de $8.8 millions, et le goodwill s'élevait à $751,514,000 au 30 juin 2025. La dette à long terme totale s'élevait à $1,077,251,000.
RadNet meldete im zweiten Quartal höhere Erlöse und kehrte zur Quartalsprofitabilität zurück, doch ein operativer Verlust über sechs Monate hinterließ bei den Stammaktionären ein Jahresdefizit. Die gesamten Dienstleistungsumsätze für die drei Monate zum 30. Juni 2025 beliefen sich auf $498,230,000, gegenüber $459,714,000 ein Jahr zuvor, getrieben durch Wachstum bei gewerblichen und Medicare-Zahlern. Das Unternehmen verzeichnete einen Quartalsnettogewinn von $23,034,000, wobei der auf RadNet-Stammaktionäre entfallende Nettogewinn $14,454,000 und das verwässerte Ergebnis je Aktie $0.19 betrug.
Für die sechs Monate zum 30. Juni 2025 meldete RadNet einen konsolidierten Nettoverlust von $(6,703,000) und einen auf RadNet-Stammaktionäre entfallenden Nettoverlust von $(23,472,000) (verwässertes EPS $(0.32)). Der operative Cashflow verbesserte sich auf $161,829,000 für die sechs Monate. Das Unternehmen schloss Übernahmen ab, darunter See-Mode Technologies für rund $28.7 Millionen mit bedingter Gegenleistung von $8.8 Millionen, und der Goodwill belief sich zum 30. Juni 2025 auf $751,514,000. Die langfristigen Gesamtverbindlichkeiten betrugen $1,077,251,000.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-Q
(Mark One)
For the quarterly period ended June 30, 2025
or
For the transition period from to
Commission File Number 001-33307
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
(310 ) 478-7808
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Class Title | Trading Symbol | Registered Exchange | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Emerging growth company | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐ No ☒
The number of shares of the registrant’s common stock outstanding on August 8, 2025 was 76,916,062 shares.
Table of Contents
RADNET, INC.
TABLE OF CONTENTS
| Page | |||||
PART I – FINANCIAL INFORMATION | 1 | ||||
ITEM 1. Financial Statements | 1 | ||||
Condensed Consolidated Balance Sheets at June 30, 2025 and December 31, 2024 | 1 | ||||
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 | 2 | ||||
Condensed Consolidated Statements of Comprehensive income (loss) for the Three and Six Months Ended June 30, 2025 and 2024 | 3 | ||||
Condensed Consolidated Statement of Stockholders' Equity for the Three and Six Months Ended June 30, 2025 and 2024 | 4 | ||||
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 | 7 | ||||
Notes to Condensed Consolidated Financial Statements | 9 | ||||
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 30 | ||||
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk | 48 | ||||
ITEM 4. Controls and Procedures | 48 | ||||
PART II – OTHER INFORMATION | 49 | ||||
ITEM 1. Legal Proceedings | 49 | ||||
ITEM 1A. Risk Factors | 49 | ||||
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds | 49 | ||||
ITEM 3. Defaults Upon Senior Securities | 49 | ||||
ITEM 4. Mine Safety Disclosures | 49 | ||||
ITEM 5. Other Information | 49 | ||||
ITEM 6. Exhibits | 49 | ||||
SIGNATURES | 50 | ||||
i
Table of Contents
PART I - FINANCIAL INFORMATION
Item 1 – Financial Statements
RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE DATA)
| June 30, 2025 | December 31, 2024 | ||||||||||
| (unaudited) | |||||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Accounts receivable | |||||||||||
| Due from affiliates | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| PROPERTY, EQUIPMENT AND RIGHT-OF-USE ASSETS | |||||||||||
| Property and equipment, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Total property, equipment and right-of-use assets | |||||||||||
| OTHER ASSETS | |||||||||||
| Goodwill | |||||||||||
| Other intangible assets | |||||||||||
| Deferred financing costs | |||||||||||
| Investment in joint ventures | |||||||||||
| Deposits and other | |||||||||||
| Total assets | $ | $ | |||||||||
| LIABILITIES AND EQUITY | |||||||||||
| CURRENT LIABILITIES | |||||||||||
| Accounts payable, accrued expenses and other | $ | $ | |||||||||
| Due to affiliates | |||||||||||
| Deferred revenue | |||||||||||
| Current operating lease liability | |||||||||||
| Current portion of notes payable | |||||||||||
| Total current liabilities | |||||||||||
| LONG-TERM LIABILITIES | |||||||||||
| Long-term operating lease liability | |||||||||||
| Notes payable, net of current portion | |||||||||||
| Deferred tax liability, net | |||||||||||
| Other non-current liabilities | |||||||||||
| Total liabilities | |||||||||||
| EQUITY | |||||||||||
Common stock - $ | |||||||||||
| Additional paid-in-capital | |||||||||||
| Accumulated other comprehensive income (loss) | ( | ||||||||||
| Accumulated deficit | ( | ( | |||||||||
| Total RadNet, Inc.'s Stockholders' equity: | |||||||||||
| Noncontrolling interests | |||||||||||
| Total equity | |||||||||||
| Total liabilities and equity | $ | $ | |||||||||
The accompanying notes are an integral part of these financial statements.
1
Table of Contents
RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS EXCEPT SHARE AND PER SHARE DATA)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| REVENUE | |||||||||||||||||||||||
| Service fee revenue | $ | $ | $ | $ | |||||||||||||||||||
| Revenue under capitation arrangements | |||||||||||||||||||||||
| Total service revenue | |||||||||||||||||||||||
| OPERATING EXPENSES | |||||||||||||||||||||||
| Cost of operations, excluding depreciation and amortization | |||||||||||||||||||||||
| Lease abandonment charges | |||||||||||||||||||||||
| Depreciation and amortization | |||||||||||||||||||||||
| Loss on sale and disposal of equipment and other | |||||||||||||||||||||||
| Severance costs | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| INCOME FROM OPERATIONS | |||||||||||||||||||||||
| OTHER INCOME AND EXPENSES | |||||||||||||||||||||||
| Interest expense | |||||||||||||||||||||||
| Equity in earnings of joint ventures | ( | ( | ( | ( | |||||||||||||||||||
| Non-cash change in fair value of interest rate swap | |||||||||||||||||||||||
| Debt restructuring and extinguishment expenses | |||||||||||||||||||||||
| Other income | ( | ( | ( | ( | |||||||||||||||||||
| Total other expenses | |||||||||||||||||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | ( | ||||||||||||||||||||||
| (Provision for) benefit from income taxes | ( | ( | ( | ||||||||||||||||||||
| NET INCOME (LOSS) | ( | ||||||||||||||||||||||
| Net income attributable to noncontrolling interest | |||||||||||||||||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| BASIC NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| DILUTED NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||||||||||||||
| Basic | |||||||||||||||||||||||
| Diluted | |||||||||||||||||||||||
The accompanying notes are an integral part of these financial statements.
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(IN THOUSANDS)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| NET INCOME (LOSS) | $ | $ | $ | ( | $ | ||||||||||||||||||
| Foreign currency translation adjustments | ( | ( | |||||||||||||||||||||
| Change in fair value of cash flow hedge from prior periods reclassified to earnings, net of taxes | |||||||||||||||||||||||
| COMPREHENSIVE INCOME | |||||||||||||||||||||||
| Less comprehensive income attributable to noncontrolling interests | |||||||||||||||||||||||
| COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | $ | $ | ( | $ | ( | |||||||||||||||||
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 June 30, 2025 and June 30, 2024.
| Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total RadNet, Inc.'s Equity | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE - MARCH 31, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock upon exercise of options | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Forfeiture of restricted stock and share cancellation | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Distributions paid to noncontrolling interests | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contributions from noncontrolling interests | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of cash flow hedge from prior periods reclassified to earnings | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE - JUNE 30, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE - MARCH 31, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock upon exercise of options | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the DeepHealth equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Forfeiture of restricted stock and share cancellation | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Distributions paid to noncontrolling interests | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of cash flow hedge from prior periods reclassified to earnings | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE - JUNE 30, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS EXCEPT SHARE DATA)
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(unaudited)
The following table summarizes changes in the Company’s consolidated stockholders' equity, including noncontrolling interest, during the six months ended June 30, 2025 and June 30, 2024.
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| Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total RadNet, Inc.'s Equity | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE - DECEMBER 31, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock upon exercise of options | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the DeepHealth equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Forfeiture of restricted stock and share cancellation | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Distributions paid to noncontrolling interests | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contributions from noncontrolling interests | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of cash flow hedge from prior periods reclassified to earnings, net of taxes | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE-BALANCE - JUNE 30, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE - DECEMBER 31, 2023 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock upon exercise of options | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock under the DeepHealth equity compensation plan | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Sale of economic interests in majority owned subsidiary, net of taxes | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock in connection with acquisitions | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Forfeiture of restricted stock and share cancellation | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Distributions paid to noncontrolling interests | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contributions from noncontrolling interests | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in cumulative foreign currency translation adjustment | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Change in fair value of cash flow hedge from prior periods reclassified to earnings, net of taxes | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net loss (income) | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| BALANCE-JUNE 30, 2024 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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RADNET, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(unaudited)
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
| Net (loss) income | $ | ( | $ | ||||||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Noncash operating lease expense | |||||||||||
| Equity in earnings of joint ventures, net of dividends | ( | ( | |||||||||
| Amortization of deferred financing costs and loan discount | |||||||||||
| Loss on sale and disposal of equipment | |||||||||||
| Loss on extinguishment of debt | |||||||||||
| Lease abandonment charges | |||||||||||
| Amortization of cash flow hedge | |||||||||||
| Non-cash change in fair value of interest rate swap | |||||||||||
| Stock-based compensation | |||||||||||
| Change in fair value of contingent consideration | |||||||||||
| Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in purchase transactions: | |||||||||||
| Accounts receivable | ( | ( | |||||||||
| Other current assets | |||||||||||
| Other assets | ( | ( | |||||||||
| Deferred taxes | ( | ||||||||||
| Operating leases | ( | ( | |||||||||
| Deferred revenue | ( | ||||||||||
| Accounts payable, accrued expenses and other | |||||||||||
| Net cash provided by operating activities | |||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||
| Purchase of imaging facilities and other acquisitions, net of cash acquired | ( | ( | |||||||||
| Purchase of property and equipment and other | ( | ( | |||||||||
| Proceeds from sale of equipment | |||||||||||
| Equity contributions in existing and purchase of interest in joint ventures | ( | ( | |||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
| Principal payments on notes and leases payable | ( | ( | |||||||||
| Payments on Term Loan Debt | ( | ( | |||||||||
| Proceeds from issuance of new debt, net of issuing costs | |||||||||||
| Purchase of noncontrolling interests by third party | |||||||||||
| Payments on contingent consideration and holdbacks | ( | ||||||||||
| Distributions paid to noncontrolling interests | ( | ( | |||||||||
| Proceeds from sale of economic interests in majority owned subsidiary, net of taxes | |||||||||||
| Proceeds from issuance of common stock | |||||||||||
| Proceeds from issuance of common stock upon exercise of options | |||||||||||
| Net cash provided by financing activities | |||||||||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | ( | ||||||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | |||||||||||
| CASH AND CASH EQUIVALENTS, beginning of period | |||||||||||
| CASH AND CASH EQUIVALENTS, end of period | $ | $ | |||||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||||||||||
| Cash paid during the period for interest | $ | $ | |||||||||
| Cash paid during the period for income taxes | $ | $ | |||||||||
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 $74.5 million and $45.4 million during the six months ended June 30, 2025 and 2024, respectively, which were not paid for as of June 30, 2025 and 2024, respectively. The amounts due were recorded in our condensed consolidated balance sheet under accounts payable, accrued expenses and other.
During the six months ended June 30, 2025, we acquired certain assets from entities engaged in the practice of radiology or related businesses. These acquisitions included holdbacks, contingent liabilities and other liabilities totaling $12.8 million that we had not paid for as of June 30, 2025. The accrued amounts are reflected in our consolidated balance sheets under accrued expenses and other non-current liabilities.
On June 12, 2025, we entered into a $17.0 million promissory note with Dignity Health, a related party and joint venture member of Arizona Diagnostic Radiology Group, LLC, to reclassify a previously outstanding balance from due from affiliates to prepaid expenses and other current assets. As a result, a non-cash reclassification of $5.7 million was made from Other Current Assets to Other Assets to reflect the long-term portion of the note.
On April 1, 2024, we issued promissory notes in the amount of $6.3 million to acquire radiology equipment previously leased under operating leases.
On March 31, 2024, we issued an additional 12.5 % in noncontrolling interest in our Ventura County Imaging Group, LLC joint venture in exchange for $5.1 million which was not paid for as of March 31, 2024. The amounts due were recorded in our condensed consolidated balance sheet under accounts payable, accrued expenses and other.
On March 29, 2024, we received $0.6 million in fixed assets, imaging equipment, and $6.5 million in goodwill from our partner in Tri Valley Imaging Group, LLC. See Note 4, Business combinations and related activity contained herein.
On March 27, 2024, we issued 95,019 shares of common stock to settle the stock contingent liabilities as part of our purchase of Heart & Lung Imaging Limited. The shares were ascribed a value of $4.6 million.
On January 15, 2024, we issued promissory notes in the amount of $6.9 million to acquire radiology equipment previously leased under operating leases.
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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 June 30, 2025, we operated directly or indirectly through joint ventures with hospitals, 405 centers located in Arizona, California, Delaware, Florida, Maryland, New Jersey, New York and Texas. Our centers provide physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders. 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 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, New Jersey 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 $48.3 million and $54.9 million of revenue, net of management services fees to RadNet, for the three months ended June 30, 2025 and 2024, respectively and $48.3 million and $54.9 million of operating expenses for the three months ended June 30, 2025 and 2024, respectively. RadNet recognized $265.6 million and $231.1 million of total billed net service fee revenue for the three months ended June 30, 2025, and 2024, respectively, for management services provided to the Consolidated Medical Group relating primarily to the technical portion of billed revenue.
The Consolidated Medical Group on a combined basis recognized $106.5 million and $107.2 million of revenue, net of management services fees to RadNet, for the six months ended June 30, 2025 and 2024, respectively and $106.5 million and $107.2 million of operating expenses for the six months ended June 30, 2025 and 2024, respectively. RadNet recognized $504.1 million and $465.9 million of total billed net service fee revenue for the six months ended June 30, 2025, and 2024, 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 June 30, 2025 and December 31, 2024, we have included approximately $118.5 million and $103.0 million, respectively, of accounts receivable and approximately $32.1 million and $22.7 million of accounts payable and accrued liabilities related to the Consolidated Medical Group, respectively. The cash
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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.
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 June 30, 2025 and 2024 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, 2024.
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, 2024. 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, 2024.
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 others centers, this service fee revenue is earned through providing the use of our diagnostic imaging equipment and the provision of technical services as well as providing administration services such as clerical and administrative personnel, bookkeeping and accounting services, billing and collection, provision of medical and office supplies, secretarial, reception and transcription services, maintenance of medical records, and advertising, marketing and promotional activities.
Our service fee revenues are based upon 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. Revenues 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 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.
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Our total revenues for the three and six months ended June 30, 2025 and 2024 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.
| In Thousands | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Commercial insurance | $ | $ | $ | $ | |||||||||||||||||||
| Medicare | |||||||||||||||||||||||
| Medicaid | |||||||||||||||||||||||
| Workers' compensation/personal injury | |||||||||||||||||||||||
| Other payors | |||||||||||||||||||||||
| Management fee revenue | |||||||||||||||||||||||
| Other revenue | |||||||||||||||||||||||
| Revenue under capitation arrangements | |||||||||||||||||||||||
| Total service revenue | $ | $ | $ | $ | |||||||||||||||||||
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, 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 awards’ 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. No additional awards will be granted under the DeepHealth, Inc. 2017 Equity Incentive Plan. See Note 7, Stock-Based Compensation, for more information.
ACCOUNTS RECEIVABLE - Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with 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 receivables 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 notes receivables 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 $4.1 million and $4.2 million at June 30, 2025 and December 31, 2024, 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.
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PROPERTY AND EQUIPMENT - Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation of property and equipment is performed using the straight-line method over the estimated useful lives of the assets acquired, 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 consolidated statements of operations. For the three and six ended June 30, 2025, such costs totaled approximately $2.3 million and $3.0 million, respectively.
| Imaging Center segment | Digital Health segment | Total | |||||||||||||||
| Balance as of December 31, 2024 | $ | $ | |||||||||||||||
| Goodwill from acquisitions | |||||||||||||||||
| Measurement period and other adjustments | |||||||||||||||||
| Currency translation | |||||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | ||||||||||||||
The amount of goodwill that is expected to be deductible for tax purposes as of June 30, 2025 is $135.2 million.
INTANGIBLE ASSETS - Intangible assets are primarily related to our business combinations and software development. They include the estimated fair values 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 June 30, 2025 and December 31, 2024 are as follows (in thousands):
As of June 30, 2025:
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| 2025* | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | Weighted average amortization period remaining in years | ||||||||||||||||||||||||||||||||||||||||
| Management service contracts | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Covenant not to compete and other contracts | |||||||||||||||||||||||||||||||||||||||||||||||
| Customer lists | |||||||||||||||||||||||||||||||||||||||||||||||
| Patent and trademarks | |||||||||||||||||||||||||||||||||||||||||||||||
| Developed technology | |||||||||||||||||||||||||||||||||||||||||||||||
| Trade names amortized | |||||||||||||||||||||||||||||||||||||||||||||||
| Trade names indefinite life | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| IPR&D | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Total annual amortization | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
*Excluding the six months ended June 30, 2025
As of December 31, 2024:
| 2025 | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | Weighted average amortization period remaining in years | ||||||||||||||||||||||||||||||||||||||||
| Management service contracts | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Covenant not to compete and other contracts | |||||||||||||||||||||||||||||||||||||||||||||||
| Customer lists | |||||||||||||||||||||||||||||||||||||||||||||||
| Patent and trademarks | |||||||||||||||||||||||||||||||||||||||||||||||
| Developed technology | |||||||||||||||||||||||||||||||||||||||||||||||
| Trade names amortized | |||||||||||||||||||||||||||||||||||||||||||||||
| Trade names indefinite life | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| IPR&D | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
| Total annual amortization | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Total intangible asset amortization expense was $3.2 million and $6.3 million for the three and six months ended June 30, 2025, respectively. Total amortization expense was $3.1 million and $6.2 million for the three and six months ended June 30, 2024, 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 expensing of domestic specified research or experimental expenditures, increasing the limit of the deduction to thirty percent of EBITDA, and one hundred percent bonus depreciation on eligible property acquired after January 19, 2025. The Company is currently evaluating the impact that the new tax law will have on its financial condition and results of operations. The impact of the tax law changes from the OBBBA will be included in the Company's financial statements beginning in the nine months ending September 30, 2025, and applied prospectively based on the effective dates of the tax law.
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
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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. 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 2025, 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, 2025.
We recorded an income tax provision of $0.8 million, or an effective tax rate of 3.4 %, for the three months ended June 30, 2025, compared to $2.5 million, or an effective tax rate of 26.1 % for the three months ended June 30, 2024. We recorded an income tax benefit of $2.6 million, or an effective tax rate of 27.8 %, for the six months ended June 30, 2025 compared to an income tax provision of $0.6 million, or an effective tax rate of 4.6 % for the six months ended June 30, 2024. The income tax rates for the three and six months ended June 30, 2025 diverge from the federal statutory rate due to (i) officer's compensation limitations; (ii) nondeductible stock compensation expense; (iii) partial valuation allowance on losses in foreign jurisdictions, partially offset by (iv) noncontrolling interests from controlled partnerships.
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. 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 June 30, 2025. 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 six months ended June 30, 2025, we closed several imaging centers with lower utilization and recognized lease abandonment charges of approximately $5.5 million in our Imaging Center segment. Of these amounts, $4.8 million were related to right-of-use assets impairment and $0.7 million were related to the write-off of leasehold improvements for the six months ended June 30, 2025.
| For the three months ended June 30, 2025 | ||||||||||||||||||||
| March 31, 2025 Balance | Currency Translation Adjustments Balance | June 30, 2025 Balance | ||||||||||||||||||
| Currency Translation Adjustments | $( | $ | $ | |||||||||||||||||
| For the six months ended June 30, 2025 | ||||||||||||||||||||
| December 31, 2024 Balance | Currency Translation Adjustments Balance | June 30, 2025 Balance | ||||||||||||||||||
| Currency Translation Adjustments | $(5,697) | $ | $ | |||||||||||||||||
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INTEREST ON SECURITIES - We recognized income from interest on securities of approximately $7.8 million and $8.7 million for the three months ended June 30, 2025 and 2024, respectively, and $15.5 million and $13.1 million for the six months ended June 30, 2025 and 2024. This income is recorded within Other non-operating income in our 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. 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.
A tabular presentation of the effect of derivative instruments on our consolidated statement of comprehensive loss of the 2019 Swaps is as follows (amounts in thousands):
| For the three months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Account | March 31, 2025 Balance | Amount of comprehensive loss recognized on derivative net of taxes | Amount of loss reclassified out of accumulated OCI into income (prior period effective portion), net of taxes* | June 30, 2025 Balance | Location | |||||||||||||||||||||||||||
| Accumulated Other Comprehensive Loss, net of taxes | $( | $ | $ | $( | Equity | |||||||||||||||||||||||||||
*Net of taxes of $0.3 million for the three months ended June 30, 2025.
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| For the six months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Account | December 31, 2024 Balance | Amount of comprehensive loss recognized on derivative net of taxes | Amount of loss reclassified out of accumulated OCI into income (prior period effective portion), net of taxes* | June 30, 2025 Balance | Location | |||||||||||||||||||||||||||
| Accumulated Other Comprehensive Loss, net of taxes | $( | $ | $ | $( | Equity | |||||||||||||||||||||||||||
*Net of taxes of $0.7 million for the six months ended June 30, 2025.
A tabular presentation of the effect of derivative instruments on our statement of operations of the 2019 Swaps is as follows (amounts in thousands):
| For the three months ended June 30, 2025 | ||||||||||||||||||||||||||
| Ineffective interest rate swap | Amount recognized (current period ineffective portion) | Location recognized in profit and loss (current period ineffective portion) | Amount reclassified from accumulated OCI (prior period effective portion) | Location reclassified from accumulated OCI into profit and loss (prior period effective portion) | ||||||||||||||||||||||
| Interest rate contracts | $ | Other income (expense) | $ | Interest Expense | ||||||||||||||||||||||
| For the six months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Ineffective interest rate swap | Amount recognized (current period ineffective portion) | Location recognized in profit and loss (current period ineffective portion) | Amount reclassified from accumulated OCI (prior period effective portion) | Location reclassified from accumulated OCI into profit and loss (prior period effective portion) | ||||||||||||||||||||||||||||
| Interest rate contracts | $ | Other income (expense) | $ | Interest Expense | ||||||||||||||||||||||||||||
See Fair Value Measurements below for the fair value of the 2019 Swaps at June 30, 2025.
CONTINGENT CONSIDERATION -
See-Mode Technologies Pte. Ltd.
On June 2, 2025, we completed our 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.
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.
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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. The fair value of the contingent consideration will be assessed quarterly based on the probability of milestone achievement, which has been currently determined by management to be 97.5 %, 70 % and 40 % for the First, Second and Third Milestone, respectively.
A tabular roll forward of contingent consideration is as follows (amounts in thousands):
For the three months ended June 30, 2025 | ||||||||||||||||||||||||||||||||||||||||||||
| Entity | Account | March 31, 2025 Balance | Additions | Settlement of contingent consideration | Change in valuation of contingent consideration | June 30, 2025 Balance | ||||||||||||||||||||||||||||||||||||||
| See-Mode Technologies Pte. Ltd. | Accrued expenses | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
| See-Mode Technologies Pte. Ltd. | Other non-current liabilities | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
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.
Derivatives:
The tables below summarize the estimated fair values of certain of our financial assets that are subject to fair value measurements, and the classification of these assets on our condensed consolidated balance sheets, as follows (in thousands):
| As of June 30, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Current assets | |||||||||||||||||||||||
| 2019 Swaps - Interest Rate Contracts | $ | $ | $ | $ | |||||||||||||||||||
| As of December 31, 2024 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Current assets | |||||||||||||||||||||||
| 2019 Swaps - Interest Rate Contracts | $ | $ | $ | $ | |||||||||||||||||||
The estimated fair value of these contracts was determined using Level 2 inputs. More specifically, the fair value was determined by calculating the value of the difference between the fixed interest rate of the interest rate swaps and the counterparty’s forward SOFR curve. The forward SOFR curve is readily available in the public markets or can be derived from information available in the public markets.
Contingent Consideration:
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The table below summarizes the estimated fair values of contingent consideration relating to our See-Mode Technologies acquisition on June 2, 2025 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 June 30, 2025 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Accrued expenses and other non-current liabilities | |||||||||||||||||||||||
See-Mode Technologies | $ | $ | $ | $ | |||||||||||||||||||
Long Term Debt:
The table below summarizes the estimated fair value compared to the face value of our long-term debt as follows (in thousands):
| As of June 30, 2025 | |||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total Fair Value | Total Face Value | |||||||||||||||||||||||||
| Barclays Term Loan and Truist Term Loan | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| As of December 31, 2024 | |||||||||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total Fair Value | Total Face Value | |||||||||||||||||||||||||
| Barclays Term Loan and Truist Term Loan | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
The estimated fair value of our long-term debt, which is discussed in Note 6, Credit Facilities and Notes Payable, was determined using Level 2 inputs primarily related to comparable market prices.
We consider the carrying amounts of cash and cash equivalents, receivables, other current assets, current liabilities and other notes payables 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 other 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 June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| BASIC NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||
| Weighted average number of common shares outstanding during the period | |||||||||||||||||||||||
Basic net income (loss) per share attributable to RadNet, Inc.'s common stockholders | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| DILUTED NET INCOME (LOSS) PER SHARE ATTRIBUTABLE TO RADNET, INC. COMMON STOCKHOLDERS | |||||||||||||||||||||||
| Weighted average number of common shares outstanding during the period | |||||||||||||||||||||||
| Add non-vested restricted stock subject only to service vesting | |||||||||||||||||||||||
| Add additional shares issuable upon exercise of stock options and contingently issuable shares | |||||||||||||||||||||||
| Weighted average number of common shares used in calculating diluted net income per share | |||||||||||||||||||||||
Net income (loss) attributable to RadNet, Inc's common stockholders for diluted share calculation | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
Diluted net income (loss) income per share attributable to RadNet, Inc.'s common stockholders | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
| 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 | |||||||||||||||||||||||
| Shares issuable upon the exercise of stock options | |||||||||||||||||||||||
As of June 30, 2025, we have three equity investments with an aggregate carrying value of $8.3 million.
No other observable price changes or impairments in our investments were identified as of June 30, 2025.
INVESTMENT IN JOINT VENTURES – We have 12 unconsolidated joint ventures with ownership interests ranging from 35 % to 55 %. These joint ventures represent partnerships with hospitals, health systems or radiology practices 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, since RadNet does not have a controlling 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 June 30, 2025.
Joint venture investment and financial information
The following table is a summary of our investment in joint ventures during the six months ended June 30, 2025 (in thousands):
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| Balance as of December 31, 2024 | $ | ||||
| Equity in earnings in joint ventures | |||||
| Distribution of earnings | ( | ||||
| Equity contributions in existing joint ventures | |||||
| Balance as of June 30, 2025 | $ | ||||
We charged management service fees from the centers underlying these joint ventures of approximately $6.5 million and $6.1 million for the three months ended June 30, 2025 and 2024 and $12.6 million and $12.0 million for the six months ended June 30, 2025 and 2024, respectively. These joint ventures are considered related parties. Amounts transacted between ourselves and the entities are in the ordinary course of business and are disclosed on our 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 June 30, 2025 and December 31, 2024 and income statement data for the six months ended June 30, 2025 and 2024 (in thousands):
| Balance Sheet Data: | June 30, 2025 | December 31, 2024 | |||||||||
| Current assets | $ | $ | |||||||||
| Noncurrent assets | |||||||||||
| Current liabilities | ( | ( | |||||||||
| Noncurrent liabilities | ( | ( | |||||||||
| Total net assets | $ | $ | |||||||||
Income statement data for the six months ended June 30, | 2025 | 2024 | |||||||||
| Net revenue | $ | $ | |||||||||
| Net income | $ | $ | |||||||||
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 begin 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 June 30, 2025, we recorded $11.3 million of the current portion of the notes in Due from Affiliates and $5.7 million of the non-current portion in Deposits and Other on our Condensed Consolidated Balance Sheet.
NOTE 3 – RECENT ACCOUNTING AND REPORTING STANDARDS
Recently Issued Accounting Pronouncements
In November 2023, the FASB issued Accounting Standards Updates (ASUs) 2023-07 ("ASU 2023-07"), Segment Reporting (Topic 280) Improvements to Reportable Segment Disclosures. The guidance requires entities to provide enhanced disclosures about significant segment expenses. For entities that have adopted the amendments in ASU 2023-07, the updated guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and is applicable to the Company in fiscal 2024. Early adoption is permitted. We adopted this ASU for the year ended December 31, 2024, and applied the amendments retrospectively to all prior periods presented in our consolidated financial statements. The interim disclosure requirements became effective for us beginning January 1, 2025, and have been reflected in our current period reporting.
In December 2023, the FASB issued Accounting Standards Updates (ASUs) 2023-09 ("ASU 2023-09"), Income Tax (Topic 740) Improvements to Income Tax Disclosures primarily related to the rate reconciliation and income taxes paid information. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2024, and is applicable to the Company in fiscal 2025. Early adoption is permitted. We will adopt this ASU prospectively for the period ending December 31, 2025, and it will impact only our disclosures with no impacts to our financial condition and results of operations.
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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.
NOTE 4 – BUSINESS COMBINATIONS AND RELATED ACTIVITY
Acquisitions
Imaging Center Segment
During the six months ended June 30, 2025, 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 California and Texas markets. These acquisitions are reported as part of our Imaging Center segment. As of June 30, 2025, 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.
| Entity | Date Acquired | Total Consideration | Property & Equipment | Right of Use Assets | Goodwill | Intangible Assets | Other Assets | Right of Use Liabilities | |||||||||||||||||||||
| HALO Centers LLC | 1/2/2025 | $ | ( | ||||||||||||||||||||||||||
| Hillcroft Medical Clinic | 3/7/2025 | ||||||||||||||||||||||||||||
| North County Radiology Oceanside LLC | 4/1/2025 | ( | |||||||||||||||||||||||||||
| Faculty Physicians and Surgeons of LLUSM (Palm Imaging) | 5/1/2025 | ||||||||||||||||||||||||||||
| California MSK MSO, LLC (OSS Burbank) | 5/1/2025 | ||||||||||||||||||||||||||||
| HALO Centers LLC (Indian Wells) | 5/1/2025 | $ | ( | ||||||||||||||||||||||||||
| Total | ( | ||||||||||||||||||||||||||||
*Fair Value Determination is Final
Factors contributing to the recognition of goodwill were primarily based on anticipated strategic and synergistic benefits that are expected to be realized from the acquisition.
Digital Health Segment
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See-Mode Technologies
On June 2, 2025, we acquired all of the equity interest in See-Mode Technologies (“See-Mode”), a medical technology company focused on using artificial intelligence to enhance ultrasound-based diagnostics.
See-Mode’s operations are included in our Digital Health segment for reporting purposes. The transaction was accounted for as the acquisition of a business with a total purchase consideration of approximately $28.7 million, including: (i) cash of $17.9 million, (ii) a holdback of $2.0 million cash to be released 18 months after acquisition, and (iii) contingent consideration of $8.8 million. We recorded $0.2 million in other net assets, $5.5 million in developed technology, $5.4 million in IPR&D, $19.8 million in goodwill, and $2.2 million in deferred tax liabilities in connection with this transaction.
In performing the purchase price allocation, we considered, among other factors, the intended future use of the acquired assets, the historical financial performance, and estimates of the future performance of the See-Mode business. As of June 30, 2025, the valuation of assets acquired and liabilities assumed is preliminary and subject to change, primarily with respect to the valuation of contingent consideration and intangible assets, the completeness of accrued liabilities, the accuracy of fixed asset valuations, and other customary purchase accounting adjustments. The fair value determination will be updated as additional information becomes available during the measurement period.
Formation of majority owned subsidiary and sale of economic interest
On March 21, 2025, we formed Pacific Diagnostic Imaging Group, LLC (“PDRG”), a Delaware limited liability company. On April 1, 2025, we entered into a partnership with Tri-City Healthcare District (“Tri-City”) by selling a 20 % membership interest in PDRG for cash consideration of $337,500 . We retained an 80 % controlling interest in PDRG. The joint venture operates outpatient imaging centers in Southern California. The transaction did not result in a change of control, and no gain or loss was recognized.
NOTE 5 – SEGMENT REPORTING
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 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, 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:
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| Three Months Ended June 30, 2025 | |||||||||||
| Imaging Center | Digital health | Total | |||||||||
| Revenues from external customers | $ | $ | $ | ||||||||
| Intersegment revenues | |||||||||||
| $ | $ | $ | |||||||||
| Reconciliation of revenue | |||||||||||
| Elimination of intersegment revenues | ( | ||||||||||
| Total consolidated revenues | $ | ||||||||||
| Less: | |||||||||||
| Other segment items* | $ | $ | $ | ||||||||
| Segment profit (loss) | ( | ||||||||||
| Reconciliation of segment profit | |||||||||||
| Depreciation and amortization | $ | ( | |||||||||
| Loss on sale and disposal of equipment and other | ( | ||||||||||
| Severance costs | ( | ||||||||||
| Interest expense | ( | ||||||||||
| Equity in earnings of joint ventures | |||||||||||
| Non-cash change in fair value of interest rate swaps | ( | ||||||||||
| Other income | |||||||||||
| Income before income taxes | $ | ||||||||||
*Other segment items include operating expenses, inclusive of cost of operations and lease abandonment charges.
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| Three Months Ended June 30, 2024 | |||||||||||
| Imaging Center | Digital health | Total | |||||||||
| Revenues from external customers | $ | $ | $ | ||||||||
| Intersegment revenues | |||||||||||
| $ | $ | $ | |||||||||
| Reconciliation of revenue | |||||||||||
| Elimination of intersegment revenues | ( | ||||||||||
| Total consolidated revenues | $ | ||||||||||
| Less: | |||||||||||
| Other segment items* | $ | $ | $ | ||||||||
| Segment profit (loss) | ( | ||||||||||
| Reconciliation of segment profit | |||||||||||
| Depreciation and amortization | $ | ( | |||||||||
| Loss on sale and disposal of equipment and other | ( | ||||||||||
| Severance costs | ( | ||||||||||
| Interest expense | ( | ||||||||||
| Equity in earnings of joint ventures | |||||||||||
| Non-cash change in fair value of interest rate swaps | ( | ||||||||||
| Other income | |||||||||||
| Income before income taxes | $ | ||||||||||
*Other segment items include operating expenses, inclusive of cost of operations and lease abandonment charges.
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Six Months Ended June 30, 2025 | |||||||||||
| Imaging Center | Digital health | Total | |||||||||
| Revenues from external customers | $ | $ | $ | ||||||||
| Intersegment revenues | |||||||||||
| $ | $ | $ | |||||||||
| Reconciliation of revenue | |||||||||||
| Elimination of intersegment revenues | ( | ||||||||||
| Total consolidated revenues | $ | ||||||||||
| Less: | |||||||||||
| Other segment items* | $ | $ | $ | ||||||||
| Segment profit (loss) | ( | ||||||||||
| Reconciliation of segment profit | |||||||||||
| Depreciation and amortization | $ | ( | |||||||||
| Loss on sale and disposal of equipment and other | ( | ||||||||||
| Severance costs | ( | ||||||||||
| Interest expense | ( | ||||||||||
| Equity in earnings of joint ventures | |||||||||||
| Non-cash change in fair value of interest rate swaps | ( | ||||||||||
| Other income | |||||||||||
| Loss before income taxes | $ | ( | |||||||||
*Other segment items include operating expenses, inclusive of cost of operations and lease abandonment charges.
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Six Months Ended June 30, 2024 | |||||||||||
| Imaging Center | Digital health | Total | |||||||||
| Revenues from external customers | $ | $ | $ | ||||||||
| Intersegment revenues | |||||||||||
| Reconciliation of revenue | |||||||||||
| Elimination of intersegment revenues | ( | ||||||||||
| Total consolidated revenues | $ | ||||||||||
| Less: | |||||||||||
| Other segment items* | $ | $ | $ | ||||||||
| Segment profit (loss) | ( | ||||||||||
| Reconciliation of segment profit | |||||||||||
| Depreciation and amortization | ( | ||||||||||
| Loss on sale and disposal of equipment and other | ( | ||||||||||
| Severance costs | ( | ||||||||||
| Interest expense | ( | ||||||||||
| Equity in earnings of joint ventures | |||||||||||
| Non-cash change in fair value of interest rate swaps | ( | ||||||||||
| Other income | |||||||||||
| Income before income taxes | $ | ||||||||||
*Other segment items include operating expenses, inclusive of cost of operations and lease abandonment charges.
NOTE 6 – CREDIT FACILITIES AND NOTES PAYABLE
At June 30, 2025 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 June 30, 2025, 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 (without giving effect to our 2019 Swaps) were as follows for the periods indicated:
| Period | Base Rate plus Margin | Effective Rate | ||||||
| Before April 18, 2024 | SOFR plus Alternative Base Rate plus | |||||||
| After April 18, 2024 to November 26, 2024 | SOFR plus Prime Rate plus | |||||||
| After November 26, 2024 | SOFR plus Prime Rate plus | |||||||
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 $1.6 million at June 30, 2025.
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 June 30, 2025, the effective interest rate payable on revolving loans under the Barclays Revolving Credit Facility was 9.25 %. 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 282.0 7.4 million for certain letters of credit, $274.6 million was available to draw upon as of June 30, 2025.
The Barclays Revolving Credit Facility terminates on April 18, 2029, unless otherwise accelerated under the terms of the Barclays Credit Agreement.
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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 June 30, 2025 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.
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 $0.3 million at June 30, 2025.
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 50.0 million Truist Revolving Credit Facility at June 30, 2025 and December 31, 2024. With no letters of credit reserved against the facility, the full $50.0 million was available to draw upon as of June 30, 2025.
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.
Debt Obligations
As of June 30, 2025 and December 31, 2024 our term loan debt and other obligations are as follows (in thousands):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Barclays Term Loans collateralized by RadNet's tangible and intangible assets | $ | $ | |||||||||
| Discount on Barclays Term Loans | ( | ( | |||||||||
| Truist Term Loan Agreement collateralized by NJIN's tangible and intangible assets | |||||||||||
| Discount on Truist Term Loan Agreement | ( | ( | |||||||||
Equipment notes payable at | |||||||||||
| Total debt obligations | |||||||||||
| Less: current portion | ( | ( | |||||||||
| Long term portion of debt obligations | $ | $ | |||||||||
NOTE 7 – STOCK-BASED COMPENSATION
Stock Incentive Plans
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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 Options, DeepHealth options, Restricted stock awards (RSAs) and Restricted stock units (RSUs), performance stock units (PSUs), and performance stock options (PSOs).
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 six months ended June 30, 2025:
| 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, 2024 | $ | |||||||||||||||||||||||||
| Granted | ||||||||||||||||||||||||||
| Exercised | ( | |||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | |||||||||||||||||||||||||
| Exercisable at June 30, 2025 | $ | |||||||||||||||||||||||||
Aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between our closing stock price on June 30, 2025 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 June 30, 2025.
DeepHealth Options
During the second quarter of fiscal 2020, in connection with the completion of the DeepHealth acquisition, we granted options to acquire 412,434 shares at a grant date fair value of $16.93 per share unit to DeepHealth employees in replacement of their stock options that were outstanding as of the closing date. As of June 30, 2025, there were 65,208 stock options outstanding under the DeepHealth Plan, all of which were exercisable. These options had a weighted average remaining contractual life of 4.3 years and an aggregate intrinsic value of approximately $3.7 million.
Options issued in replacement of original DeepHealth options as a result of our acquisition are not included in the share count under the Restated Plan.
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's and RSU's activities during the six months ended June 30, 2025:
| RSAs and RSUs | Weighted-Average Remaining Contractual Term (Years) | Weighted-Average Fair Value per Share | |||||||||||||||
| RSAs and RSUs unvested at December 31, 2024 | $ | ||||||||||||||||
| Granted | $ | ||||||||||||||||
| Vested | ( | $ | |||||||||||||||
| Forfeited or Canceled | ( | $ | |||||||||||||||
| RSAs and RSUs unvested at June 30, 2025 | $ | ||||||||||||||||
We determine the fair value of all RSAs and RSUs based on the closing price of our common stock on the award date.
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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 will vest in five equal parts, on each anniversary of the grant date based on continuous service, with the number of shares earned (0 % to 100 % of the target award) depending on the level of achievement against a predefined performance condition, which must be evaluated by management no later than the seventh anniversary of the grant date. As of June 30, 2025, based on the performance 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.
Performance based stock options ("PSOs")
In January 2023, we granted certain employees PSOs with a potential to purchase a maximum of 235,227 shares of our common stock with a strike price of $18.64 . The PSOs will vest in three equal parts, starting three years from the grant date based on continuous service, with the number of shares earned (0 % to 100 % of the target award) depending upon the extent to which we achieve a performance condition as determined the board of directors over the period from January 1, 2023 through December 31, 2023. In March 2024, based on the performance condition being achieved, the board of directors issued 235,227 options.
Shares available
Of the 20,100,000 shares of common stock reserved for issuance under the Restated Plan, at June 30, 2025, there remain approximately 2,248,710 shares available under the Restated Plan for future issuance.
NOTE 8 – SUBSEQUENT EVENTS
Kolb Radiology P.C.,
On July 1, 2025, we acquired Kolb Radiology P.C., for purchase consideration of approximately $22.0 million. Kolb Radiology P.C., consists of five imaging centers located in New York. The purchase price is subject to increase by any earnout consideration, up to an additional $8.0 million.
iCAD, Inc
On July 17, 2025, we acquired iCAD, Inc ("iCAD"), a provider of AI-powered breast health solutions. As a result of the merger, iCAD became a wholly-owned subsidiary of RadNet. Each outstanding share of iCAD common stock was converted into 0.0677 shares of our common stock. In connection with the transaction, we issued approximately 1.8 million shares of our common stock.
In addition, we assumed certain outstanding iCAD stock options under its 2012 and 2016 Stock Incentive Plans. These options were converted into options to purchase RadNet common stock, with terms adjusted in accordance with the exchange ratio. No new awards will be granted under the iCAD plans, but they will remain in effect solely to govern the assumed awards.
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our unaudited condensed consolidated financial statements and notes thereto included in Part I, Item 1 of this Quarterly Report on Form 10-Q (this "report") and with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K, as amended, for the fiscal year ended December 31, 2024 filed with the U.S. Securities and Exchange Commission (the "SEC")(the "Annual Report").
As used in this Quarterly Report on Form 10-Q, the terms "RadNet," "we," "us," and "our" refer to RadNet, Inc., a Delaware corporation, and where appropriate, our consolidated subsidiaries.
Forward-Looking Statements
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This report contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements reflect current views about future events and are based on our currently available financial, economic and competitive data and on current business plans. Actual events or results may differ materially depending on risks and uncertainties that may affect our operations, markets, services, prices and other factors.
In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” “assumption” or the negative of these terms or other comparable terminology. Forward-looking statements in this report include, among others, statements we make regarding:
•expectations concerning domestic and global economic conditions, rates of inflation, or changes in interest rates;
•anticipated trends in our revenues, operating expenses or capital expenditures, and our financial guidance;
•expected timing and potential impact of regulatory changes affecting our business;
•expected future market acceptance for our products or services, and our competitive strengths in the markets we serve;
•our ability to successfully acquire and integrate new businesses, and achieve expected benefits, synergies or operating results from those acquisitions; and
•economics and cost savings anticipated to be derived from our investments in artificial intelligence and machine learning products and solutions.
Forward-looking statements are neither historical facts nor assurances of future performance. Because forward-looking statements relate to the future, they are inherently subject to known and unknown risks, uncertainties and other factors that are difficult to predict and out of our control. Our actual results, level of activity, performance or achievements may be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Important factors that could cause our actual results to differ materially from those indicated or implied in our forward-looking statements include the factors included in “Risk Factors,” in our Annual Report as supplemented by the information in Part II– Item 1A below. You should consider the inherent limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements.
Any forward-looking statement in this report is based on information currently available to us and speaks only as of the date of this report. We do not undertake any responsibility to release publicly any revisions to these forward-looking statements to take into account events or circumstances that occur after the date of this report or any unanticipated events which may cause actual results to differ from those expressed or implied by the forward-looking statements contained in this report, except as required by law.
Overview
We are a national provider of diagnostic imaging services in the United States. At June 30, 2025, we operated directly or indirectly through joint ventures with hospitals, 405 centers located in Arizona, California, Delaware, Florida, Maryland, New Jersey, New York and Texas. Our centers provide physicians with imaging capabilities to facilitate the diagnosis and treatment of diseases and disorders and may reduce unnecessary invasive procedures, often reducing the cost and amount of care for patients. Internationally, our subsidiary The HLH Imaging Group Limited, provides teleradiology services for remote interpretation of images on behalf of providers within the framework of the United Kingdom's National Health Service.
In addition to our imaging business, we have established a Digital Health business segment during our 2024 fiscal year, which combines our former Artificial Intelligence (“AI”) business segment with our eRad, Inc. business. Our Digital Health segment develops and delivers AI-powered health informatics solutions to drive quality, efficiency, and outcomes in imaging and radiology. The portfolio of software solutions is anchored by eRad, Inc.'s RIS/PACS, informatics designed specifically for outpatient radiology and DeepHealth OS, a cloud-native operating system that helps operate all aspects of the radiology service line from scheduling and patient preparation to technologist workflow to interpretation and referral management.
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In addition we are using AI to develop solutions that employ machine learning to assist radiologists and other clinicians in interpreting images and improving radiologist efficiency and patient care, initially in the fields of screening for breast, prostate, lung and colon cancers. Our DeepHealth, Inc. subsidiary has received clearance from the U.S. Food and Drug Administration ("FDA") for use of its SaigeQ ”triage”/workflow products, the SaigeDX advanced diagnostic product and the Saige-Density breast density assessment software for screening breast mammography, which we have begun to roll out in certain markets as an Enhanced Breast Cancer Detection solution. Our Aidence Holding B.V. subsidiary is developing solutions for interpretation of chest and lung computed tomography ("CT") scans for lung cancer screening. It has received the CE mark for its solution and has existing customers in seven European countries, with its largest concentration in the United Kingdom, and plans to submit an application for FDA clearance to sell in the United States. Our Quantib B.V. subsidiary is primarily focused on interpretation of prostate magnetic resonance imaging ("MRI") for widespread prostate cancer screening. Quantib’s prostate MRI post-processing software has both FDA clearances and European CE marking. Our Digital Health segment provides these solutions to RadNet and to over 400 customers in the United States, Europe, and Israel.
As part of our continued strategic expansion in Digital Health, we recently completed two acquisitions: iCAD, Inc., a provider of AI-powered breast health solutions, and See-Mode Technologies, a medical technology company focused on enhancing ultrasound-based diagnostics through artificial intelligence. We are currently in the process of integrating both businesses into our Digital Health segment.
Our operations comprise two segments for financial reporting purposes for this reporting period, Imaging Centers and Digital Health. For further financial information about these segments, see Note 5, Segment Reporting, in the notes accompanying our financial statements included in this report.
Recent Developments
The following table shows our imaging centers in operation and revenues for the six months ended June 30, 2025 and 2024:
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Centers in operation | 405 | 375 | |||||||||
| Net revenues (millions) | $ | 970 | $ | 891 | |||||||
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. The multi-modality offering provides a “one-stop” solution for our customers and referral sources. It also diversifies our revenue base, and reduces our exposure to changes in reimbursement rates for certain imaging modalities.
Our revenue is derived from a diverse mix of payors, including private payors and commercial insurance companies, managed care capitated payors, and government payors, such as Medicare and Medicaid. We believe our payor diversity mitigates our exposure to possible unfavorable reimbursement trends within any one payor class. Our total service fee revenue, net of contractual allowances and discounts, and implicit price concessions for the three and six months ended June 30, 2025 and 2024 received from our various payors is summarized in the following table (in thousands):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Commercial insurance | $ | 278,902 | $ | 256,517 | $ | 541,410 | $ | 497,145 | |||||||||||||||
| Medicare | 116,331 | 101,719 | 224,499 | 195,186 | |||||||||||||||||||
| Medicaid | 12,597 | 11,001 | 24,283 | 21,906 | |||||||||||||||||||
| Workers' compensation/personal injury | 10,642 | 10,997 | 21,114 | 22,837 | |||||||||||||||||||
| Other payors | 29,394 | 26,568 | 57,087 | 51,948 | |||||||||||||||||||
| Management fee revenue | 6688 | 6,106 | 12,967 | 12,014 | |||||||||||||||||||
| Other revenue | 13509 | 9,837 | 26,052 | 18,898 | |||||||||||||||||||
| Revenue under capitation arrangements | 30,167 | 36,969 | 62,217 | 71,487 | |||||||||||||||||||
| Total service revenue | $ | 498,230 | $ | 459,714 | $ | 969,629 | $ | 891,421 | |||||||||||||||
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Our revenue is not always consistent across each quarter. We generally experience the lowest volumes of procedures and the lowest level of revenue during the first quarter of each year. This is primarily the result of two factors. First, our volumes and revenue are typically impacted by winter weather conditions in our northeastern operations. It is common for snowstorms and other inclement weather to result in patient appointment cancellations and, in some cases, imaging center closures. Second, in recent years, we have observed greater participation in high deductible health plans by patients. As these high deductibles reset in January for most of these patients, we have observed that patients utilize medical services less during the first quarter, when securing medical care will result in significant out-of-pocket expenditures.
Acquisitions
During the six months ended June 30, 2025, we completed the acquisition of certain assets of entities which engage directly in the practice of radiology or in associated businesses for an aggregate consideration of $16.4 million. These acquisitions include:
HALO Centers LLC: 1 imaging center in California;
Hillcroft Medical Clinic: 1 imaging center in Sugar Land, Texas;
North County Radiology Oceanside LLC: 1 imaging center in California;
Faculty Physicians and Surgeons of LLUSM (Palm Imaging): 1 imaging center in California;
California MSK MSO, LLC (OSS Burbank): 1 imaging center in California; and
HALO Centers LLC (Indian Wells): 1 imaging center in California
See Note 4, Business Combinations and Related Activity, in the notes accompanying our financial statements in this report for additional information, including the fair value determination of the acquired assets and assumed liabilities, associated with these acquisitions.
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Joint Venture Activity
At June 30, 2025, 38% of our imaging centers were operating as joint ventures with large health care providers. We manage the day-to-day operations for these joint ventures and perform most management services in exchange for a management fee. We charged management service fees from the centers underlying these joint ventures of approximately $6.5 million and $6.1 million for the three months ended June 30, 2025 and 2024, respectively, and approximately $13.0 million and $12.0 million for the six months ended June 30, 2025 and 2024, respectively.
For information on our investment in unconsolidated joint ventures, key balance sheet data and income statement data for the unconsolidated joint ventures, see Note 2, Significant Accounting Policies – Investment in Joint Ventures in the notes accompanying our financial statements included in this report.
Critical Accounting Policies
The SEC defines critical accounting estimates as those that (a) are most important to the portrayal of a company’s financial condition and results of operations and (b) require management’s most difficult, subjective or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. In Note 2 of the notes accompanying our financial statements included in this report and in our Annual Report, we discuss our significant accounting policies, including those that do not require management to make difficult, subjective or complex judgments or estimates. The most significant areas involving management’s judgments and estimates are described below.
Use of Estimates
The financial statements included in this report were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), which requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions affect various matters, including our reported amounts of assets and liabilities in our consolidated balance sheets at the dates of the financial statements; our disclosure of contingent assets and liabilities at the dates of the financial statements; and our reported amounts of revenues and expenses in our consolidated statements of operations during the reporting periods. These estimates involve judgments with respect to numerous factors that are difficult to predict and are beyond management’s control. As a result, actual amounts could materially differ from these estimates.
Revenues
Our revenues generally relate to net patient fees received from various payors and patients themselves under contracts in which our performance obligations are to provide diagnostic services to the patients. Revenues are recorded during the period our obligations to provide diagnostic services are satisfied, which is generally over a period of less than one day. The contractual relationships with patients, in most cases, also involve a third-party payor (Medicare, Medicaid, managed care health plans and commercial insurance companies, including plans offered through the health insurance exchanges) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare and Medicaid) or negotiated with (managed care health plans and commercial insurance companies) the third-party payors. The payment arrangements with third-party payors for the services we provide to the related patients typically specify payments at amounts less than our standard charges and generally provide for payments based upon predetermined rates per diagnostic services or discounted fee-for-service rates. Management continually reviews the contractual estimation process to consider and incorporate updates to laws and regulations, changes in business and economic conditions, and the frequent changes in managed care contractual terms resulting from contract re-negotiations and renewals.
As it relates to the Consolidated Medical Group (as defined in Note 1 of the notes accompanying our financial statements included in this report), this service fee revenue includes payments for both the professional medical interpretation revenue recognized by them as well as the payment for all other aspects related to our providing the imaging services, for which we earn management fees. As it relates to others centers, this service fee revenue is earned through providing the use of our diagnostic imaging equipment and the provision of technical services as well as providing administration services such as clerical and administrative personnel, bookkeeping and accounting services, billing and collection, provision of medical and office supplies, secretarial, reception and transcription services, maintenance of medical records, and advertising, marketing and promotional activities.
Our service fee revenues are based upon our management's estimate of amounts we expect to be entitled to receive from patients and third-party payors. Estimates of contractual allowances under Medicare, Medicaid, managed care and commercial insurance plans are based upon historical collection experience of the payments received from such payors in
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accordance with the underlying contractual agreements. Revenues related to uninsured patients and uninsured copayment and deductible amounts for patients who have health care coverage may have price concessions applied. We also record estimated implicit price concessions (based primarily on historical collection experience) related to uninsured accounts to record self-pay revenues at the estimated amounts we expect to collect.
Under capitation arrangements with various health plans, we earn a per-enrollee amount each month for making available diagnostic imaging services to all plan enrollees under the capitation arrangement. Revenue under capitation arrangements is recognized in the period in which we are obligated to provide services to plan enrollees under contracts with various health plans. Our estimates and assumptions related to revenue recognition did not change materially for the quarter ended June 30, 2025.
Accounts Receivable
Substantially all of our accounts receivable are due under fee-for-service contracts from third party payors, such as insurance companies and government-sponsored healthcare programs, or directly from patients. Services are generally provided pursuant to one-year contracts with healthcare providers. Receivables generally are collected within industry norms for third-party payors. We continuously monitor collections from our payors and maintain an allowance for bad debts based upon specific payor collection issues that we have identified and our historical experience. Our estimates and assumptions for allowances on our account receivable did not change materially during the quarter ended June 30, 2025.
Business Combination
We evaluate all acquisitions in accordance with the accounting guidance under ASC 805, Business Combinations. Once a purchase has been determined to be the acquisition of a business, we are required to recognize the assets acquired and the liabilities assumed at their acquisition date fair values. Any portion of the purchase consideration transferred in excess of the net of the acquisition date fair values of the assets acquired and the liabilities assumed, is allocated to goodwill. The allocation requires our management to make estimates of the value of various assets acquired and liabilities assumed. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the acquisition date, our estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, we record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our consolidated statements of operations.
Goodwill and Indefinite Lived Intangibles
Goodwill at June 30, 2025 totaled $751.5 million. Indefinite Lived Intangible Assets at June 30, 2025 were $18.5 million and are associated with the value of certain trade name intangibles and in process research and development ("IPR&D"). Goodwill, trade name intangibles and IPR&D are recorded as a result of business combinations. When we determine the carrying value of goodwill for a reporting unit exceeds its fair value, an impairment charge would be recognized which should not exceed the total amount of goodwill allocated to that reporting unit. We determined fair values for each of the reporting units using the market approach, when available and appropriate, or the income approach, or a combination of both. We assess the valuation methodology based upon the relevance and availability of the data at the time we perform the valuation. If multiple valuation methodologies are used, the results are weighted appropriately. Our annual impairment test of goodwill, IPR&D and trade name noted no impairment as of October 1, 2024, and we have not identified any other indicators of impairment through June 30, 2025.
Recent Accounting Standards
See Note 3, Recent Accounting and Reporting Standards to the financial statements included in this report for further information.
Results of Operations
Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024
Imaging Center Segment
We have developed our medical imaging centers segment through a combination of organic growth, acquisitions and joint venture formations. In the discussion below same center metrics are based on imaging centers that were in operation throughout the period of April 1, 2024 through June 30, 2025. Excluded amounts relate to imaging centers that were acquired or divested between April 1, 2024 through June 30, 2025.
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Total Revenue
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Revenue | 2025 | 2024 | $ Increase | % Change | ||||||||||
| Total | $477,504 | $443,886 | $33,618 | 7.6% | ||||||||||
| Same Center | $457,794 | $438,622 | $19,172 | 4.4% | ||||||||||
| Excluded | $19,710 | $5,264 | — | — | ||||||||||
Our 4.4% increase in same center revenue over the same period last year was driven by increases in fees charged per imaging procedure and same center total procedure volume growth of 2.2%, inclusive of rises in routine and advanced modality imaging procedures of 0.8% and 6.2%, respectively. The increase in revenue was largely attributable to product mix, as advanced imaging represented a greater portion of overall procedures. Within advanced imaging, MRI increased by 6.5%, CT by 5.6%, and PET/CT by 17.6% on a same-store basis. The Enhanced Breast Cancer Detection program, an AI-powered diagnostic solution, also contributed to revenue growth.
Including non-consolidated joint ventures where we are a minority owner, same center total procedure volume increased approximately 2.7%, inclusive of rises in routine and advanced modality imaging procedures of 1.4% and 6.6%, respectively. We provide this additional information to reflect trends across all centers we operate or manage, consistent with how management evaluates overall business performance.
Operating Expenses
Total operating expenses for the three months ended June 30, 2025 increased approximately $33.3 million, or 8.2%, to $439.5 million for the three months ended June 30, 2025 from $406.2 million for the three months ended June 30, 2024. The following table breaks down our cost of operations and total operating expenses for the three months ended June 30, 2025 and 2024 (in thousands):
| Three Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Salaries and professional reading fees, excluding stock-based compensation | $ | 258,148 | $ | 243,354 | |||||||
| Stock-based compensation | 6,091 | 4,349 | |||||||||
| Building and equipment rental | 32,006 | 29,896 | |||||||||
| Medical supplies | 31,196 | 26,523 | |||||||||
| Lease abandonment charges | 123 | — | |||||||||
Other operating expenses * | 76,883 | 69,327 | |||||||||
| Cost of operations | 404,447 | 373,449 | |||||||||
| Depreciation and amortization | 32,941 | 32,089 | |||||||||
| Loss on sale and disposal of equipment | 1,812 | 398 | |||||||||
| Severance costs | 309 | 225 | |||||||||
| Total operating expenses | $ | 439,509 | $ | 406,161 | |||||||
*Includes billing fees, office supplies, repairs and maintenance, insurance, business tax and license, outside services, telecom, utilities, marketing, travel and other expenses.
The discussion below provides additional information and analysis on changes in our various operating expenses for the three months ended June 30, 2025 and 2024 (in thousands):
Salaries and professional reading fees, excluding stock-based compensation and severance
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| In Thousands | Three Months Ended June 30, | |||||||||||||
| Salaries and Professional Fees | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $258,148 | $243,354 | $14,794 | 6.1% | ||||||||||
| Same Center | $250,135 | $241,046 | $9,089 | 3.8% | ||||||||||
| Excluded | $8,013 | $2,308 | — | — | ||||||||||
In response to higher procedure volumes, we increased staffing levels across clinical, administrative, and technical functions to support the influx of patients. Compensation-related expenses were further impacted by increased 401K match contributions and more vacation and paid time off taken during the period. We also continued to experience wage inflation across the board, driven by a competitive labor market and the October 2024 increase in California’s minimum wage for healthcare workers. Additionally, higher workers’ compensation insurance premiums contributed to the overall rise in staffing costs. Overall, the increase in compensation expenses remained generally in line with our same center revenue growth.
Stock-based compensation
Stock-based compensation for the three months ended June 30, 2025 increased approximately $1.7 million, or 40.1%, to $6.1 million from $4.3 million for the three months ended June 30, 2024. The increase is primarily due to a greater number of shares granted and higher grant-date fair values compared to prior-year period.
Building and equipment rental
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Building & Equipment Rental | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $32,006 | $29,896 | $2,110 | 7.1% | ||||||||||
| Same Center | $29,982 | $28,811 | $1,171 | 4.1% | ||||||||||
| Excluded | $2,024 | $1,085 | — | — | ||||||||||
Building and equipment rental expense on a same-center basis increased slightly, primarily due to higher rent and common area maintenance charges.
Medical supplies
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Medical Supplies Expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $31,196 | $26,523 | $4,673 | 17.6% | ||||||||||
| Same Center | $29,289 | $26,325 | $2,964 | 11.3% | ||||||||||
| Excluded | $1,907 | $198 | — | — | ||||||||||
Consistent with the shift in our procedural mix toward more advanced imaging, medical supplies expense increased at a higher rate than revenue growth. The growth in PET/CT procedures, particularly for prostate cancer and suspected Alzheimer’s studies, drove higher utilization of high-cost isotope tracers, contributing to the increase. In addition, price increases for these tracers further elevated medical supplies expense compared to the prior year.
Other operating expenses
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Other Operating Expenses | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $76,883 | $69,327 | $7,556 | 10.9% | ||||||||||
| Same Center | $73,007 | $68,308 | $4,699 | 6.9% | ||||||||||
| Excluded | $3,876 | $1,019 | — | — | ||||||||||
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Other operating expenses increased primarily due to a $5.4 million rise in outside services. This increase was driven by expanded contact center support related to acquisitions and growing patient demand, as well as higher legal and consulting costs associated with transaction activities and operational initiatives. The remaining increase was attributable to other operating expense categories. The investments reflect our continued focus on technology-driven enhancements aimed at supporting long-term operational efficiency across the organization.
Additional segment operating and non-operating expenses
| In Thousands | Three Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Depreciation and amortization | $32,941 | $32,089 | $852 | 2.7% | ||||||||||
| Loss on disposal of equipment and other | $1,812 | $398 | $1,414 | 355.3% | ||||||||||
| Non-cash change in fair value of interest rate hedge | $1,956 | $1,890 | 66 | 3.5% | ||||||||||
| Other income | ($7,768) | ($87) | (7,681) | 8828.7% | ||||||||||
| Severance | $309 | $225 | 84 | 37.3% | ||||||||||
The increase in depreciation expense was the result of our higher depreciable asset base.
Other income for the three months ended June 30, 2025 included $7.8 million of money market interest income.
Other income for the three months ended June 30, 2024 included money market interest income of $8.7 million and other income of $0.2 million, substantially offset by debt extinguishment and restructuring charges of $8.8 million, which related to refinancing of our credit facilities with Barclays Bank Plc ("Barclays").
| In Thousands | Three Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Interest income | (7,768) | (8,673) | $905 | (10.4)% | ||||||||||
| Debt restructuring and extinguishment expenses | 0 | 8,586 | $(8,586) | (100.0)% | ||||||||||
| Total other income | $(7,768) | $(87) | $(7,681) | 8828.7% | ||||||||||
Interest expense
| In Thousands | Three Months Ended June 30, | |||||||||||||
| Interest expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total interest expense | $ | 17,189 | $ | 26,082 | $(8,893) | (34.1) | % | |||||||
| Interest related to derivatives* | (1,040) | 4,837 | ||||||||||||
| Interest expense related to amortization** | 743 | 793 | ||||||||||||
| Adjusted interest expense*** | 17,486 | 20,009 | (2,523) | (12.6) | % | |||||||||
*Includes payments from 2019 Swaps (as defined in the notes to our condensed consolidated financial statements) and Swaps amortization
**Includes noncash amortization of deferred loan costs and discount on issuance of debt
***Includes interest related to our term loans, revolving credit line, notes, and other
The decrease in interest expense was primarily due to the repricing transaction of our Barclays Revolving Credit Facility (as defined in the notes to our condensed consolidated financial statements) in the fourth quarter of 2024, which resulted in lower interest rates compared to the same period in the prior year. This benefit was partially offset by the $100.0 million of incremental term loan borrowings under our existing Barclays Revolving Credit Facility in the second quarter
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of 2025. See Note 6 Credit Facilities and Notes Payable included in the notes to our condensed consolidated financial statements.
During the three months ended June 30, 2025, interest rates were above the arranged rates in our 2019 Swaps for most of the year, and we received payment of $2.4 million in cash payments from our 2019 Swaps counterparties, which was reported as a component of interest expense. See the Derivative Instruments section of Note 2, Significant Accounting Policies, in the notes accompanying in our Annual Report and Part 1, Item 3 — "Quantitative and Qualitative Disclosure About Market Risk" below for more details on our derivative transactions.
Non-cash change in fair value of interest rate hedge
In 2020, we determined that the cash flows from the 2019 Swaps did not match the cash flows of our Barclays Term Loan (as defined in the notes to our condensed consolidated financial statements) and were therefore ineffective as cash flow hedges. Since that time, in accordance with accounting guidelines, all changes in fair value are being recognized in other income and expense.
The fair value of the 2019 Swaps at June 30, 2025 was a net asset of $3.1 million compared to a net asset of $5.0 million at March 31, 2025, resulting in a loss of $2.0 million during the three months ended June 30, 2025. This change in fair value was driven by market expectations of continued declines in interest rates over the remaining term of the 2019 Swaps.
Equity in earnings from unconsolidated joint ventures
For the three months ended June 30, 2025 and 2024, we recognized equity in earnings from unconsolidated joint ventures in the amount of $4.4 million and $3.4 million, respectively, an increase of $1.0 million or 28.5%, respectively. The decrease was mainly due to the increase in earnings from Santa Monica Imaging Group, LLC and Arizona Diagnostic Radiology Group compared to the three months ended June 30, 2024.
Net income attributable to noncontrolling interests
At June 30, 2025, our consolidated subsidiaries operated 353 imaging centers of which 103 were not wholly-owned and thus a portion of their operating results were attributable to noncontrolling interests. At June 30, 2024, our consolidated subsidiaries included 344 centers of which 95 were not wholly-owned.
For the three months ended June 30, 2025, we recognized net income attributable to noncontrolling interests of $8.6 million versus $9.9 million for the three months ended June 30, 2024. A decrease in earnings from Beach Imaging Group, LLC and The New Jersey Imaging Network, LLC was partially offset by increased earnings from Ventura County Imaging Group, LLC.
As noncontrolling interests only represent a portion of our imaging center business, and excludes our Digital Health segment, which generated losses of $7.1 million for the three months ended June 30, 2024, we do not expect changes in net income attributable to noncontrolling interests to correlate with changes in consolidated operating income or pretax income.
Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024
In the discussion below, same center metrics are based on imaging centers that were in operation throughout the period of January 1, 2024 through June 30, 2025. Excluded amounts relate to imaging centers that were acquired or divested between January 1, 2024 through June 30, 2025.
Total Revenue
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Revenue | 2025 | 2024 | $ Increase | % Change | ||||||||||
| Total | $929,682 | $860,925 | $68,757 | 8.0% | ||||||||||
| Same Center | $895,046 | $851,339 | $43,707 | 5.1% | ||||||||||
| Excluded | $34,636 | $9,586 | — | — | ||||||||||
Our 5.1% increase in same center revenue over the same period last year was driven by increases in fees charged per imaging procedure and same center total procedure volume growth of 0.5% inclusive of rises in advanced modality imaging
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procedures of 4.53%, partially offset by a 0.9% decrease in routine modality imaging. The increase in revenue was largely attributable to product mix product mix, as advanced imaging was a greater portion of overall procedures. Within advanced imaging, MR increased by 4.5%, CT by 4.0%, and PET/CT by 13.3% on a same-store basis. The increase in revenue was largely attributable to product mix, as advanced imaging comprised a greater portion of overall procedures. The Enhanced Breast Cancer Detection (EBCD) program, an AI-powered diagnostic solution, also contributed to revenue growth.
Including non-consolidated joint ventures in which we hold a minority interest, same-center total procedure volume increased approximately 1.1%, reflecting a slight decline of 0.2% in routine imaging procedures and a 4.9% increase in advanced modality imaging procedures. We provide this information to present trends across all centers we operate or manage, consistent with how management evaluates overall business performance.
Operating Expenses
Total operating expenses for the six months ended June 30, 2025 increased approximately $100.8 million, or 12.5%, to $909.7 million for the six months ended June 30, 2025 from $808.8 million for the six months ended June 30, 2024. The following table breaks down our cost of operations and total operating expenses for the six months ended June 30, 2025 and 2024 (in thousands):
| Six Months Ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Salaries and professional reading fees, excluding stock-based compensation | $ | 528,839 | $ | 488,065 | |||||||
| Stock-based compensation | 31,319 | 15,418 | |||||||||
| Building and equipment rental | 62,930 | 58,722 | |||||||||
| Medical supplies | 60,922 | 48,478 | |||||||||
| Lease abandonment charges | 5,511 | — | |||||||||
Other operating expenses * | 151,456 | 135,064 | |||||||||
| Cost of operations | 840,977 | 745,747 | |||||||||
| Depreciation and amortization | 65,480 | 62,063 | |||||||||
| Loss on sale and disposal of equipment | 2,211 | 586 | |||||||||
| Severance costs | 1,005 | 450 | |||||||||
| Total operating expenses | $ | 909,673 | $ | 808,846 | |||||||
*Includes billing fees, office supplies, repairs and maintenance, insurance, business tax and license, outside services, telecom, utilities, marketing, travel and other expenses.
Salaries and professional reading fees, excluding stock-based compensation and severance
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Salaries and Professional Fees | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $528,839 | $488,065 | $40,774 | 8.4% | ||||||||||
| Same Center | $513,978 | $484,083 | $29,895 | 6.2% | ||||||||||
| Excluded | $14,861 | $3,982 | — | — | ||||||||||
In response to higher procedure volumes, we increased staffing levels across clinical, administrative, and technical functions to support the influx of patients. This included permanent headcount growth as well as a significant number of temporary hires to keep our centers operating smoothly during the first quarter of 2025. Compensation-related expenses were further impacted by increased 401K match contributions and more vacation and paid time off taken during the period. We also continued to experience wage inflation across the board, driven by a competitive labor market and the October 2024 increase in California’s minimum wage for healthcare workers. Additionally, higher workers’ compensation insurance premiums contributed to the overall rise in staffing costs.
Stock-based compensation
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Stock-based compensation for the six months ended June 30, 2025 increased approximately $15.9 million, or 103.1%, to $31.3 million from $15.4 million for the six months ended June 30, 2024. The increase is primarily due to a greater number of shares granted and higher grant-date fair values compared to prior-year period.
Building and equipment rental
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Building & Equipment Rental | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $62,930 | $58,722 | $4,208 | 7.2% | ||||||||||
| Same Center | $59,287 | $56,582 | $2,705 | 4.8% | ||||||||||
| Excluded | $3,643 | $2,140 | — | — | ||||||||||
Building and equipment rental expense on a same-center basis increased slightly, primarily due to higher rent and common area maintenance charges.
Medical supplies
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Medical Supplies Expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $60,922 | $48,478 | $12,444 | 25.7% | ||||||||||
| Same Center | $57,730 | $48,211 | $9,519 | 19.7% | ||||||||||
| Excluded | $3,192 | $267 | — | — | ||||||||||
Consistent with the shift in our procedural mix toward more advanced imaging, medical supplies expense increased at a higher rate than revenue growth. The growth in PET/CT procedures, particularly for prostate cancer and suspected Alzheimer’s studies, drove higher utilization of high-cost isotope tracers, contributing to the increase. In addition, price increases for these tracers further elevated medical supplies expense compared to the prior year.
Lease abandonment charges
We closely monitor patient levels at our imaging centers and occasionally divest or shut down centers to maximize utilization rates. We may abandon low utilization leases and divert the patients to nearby centers. During the six months ended June 30, 2025, we closed several imaging centers with lower utilization and recognized lease abandonment charges of approximately $5.5 million in our Imaging Center segment. Of these amounts, $4.8 million were related to right-of-use assets impairment and $0.7 million were related to the write-off of leasehold improvements for the six months ended June 30, 2025.
Other operating expenses
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Other Operating Expenses | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total | $151,456 | $135,064 | $16,392 | 12.1% | ||||||||||
| Same Center | $144,169 | $133,157 | $11,012 | 8.3% | ||||||||||
| Excluded Sites | $7,287 | $1,907 | — | — | ||||||||||
Other operating expenses increased primarily due to a $9.8 million rise in outside services. This increase was driven by expanded contact center support related to acquisitions and growing patient demand, as well as higher legal and consulting costs associated with transaction activities and operational initiatives. The remaining increase was attributable to other operating expense categories. The investments reflect our continued focus on technology-driven enhancements aimed at supporting long-term operational efficiency across the organization.
Additional segment operating and non-operating expenses:
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| In Thousands | Six Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Depreciation and amortization | $65,480 | $62,063 | $3,417 | 5.5% | ||||||||||
| Loss on disposal of equipment and other | $2,211 | $586 | $1,625 | 277.3% | ||||||||||
| Non-cash change in fair value of interest rate hedge | $4,062 | $674 | $3,388 | 502.7% | ||||||||||
| Other income | $(15,484) | $(4,520) | $(10,964) | 242.6% | ||||||||||
| Severance | $1,005 | $450 | $555 | 123.3% | ||||||||||
The increase in depreciation expense was the result of our higher depreciable asset base.
The fair value of the 2019 Swaps at June 30, 2025 was a net asset of $3.1 million compared to a net asset of $7.1 million at December 31, 2024, resulting in a loss of $4.1 million during the six months ended June 30, 2025. This change in fair value was driven by market expectations of continued declines in interest rates over the remaining term of the 2019 Swaps.
Other income for the six months ended June 30, 2025, included money market interest income of $15.5 million. Other income for the six months ended June 30, 2024 included money market interest income of $13.1 million, partially offset by debt extinguishment and restructuring charges of $8.8 million, which related to refinancing of our credit facilities with Barclays. See Note 6 Credit Facilities and Notes Payable included in the notes to our condensed consolidated financial statements.
| In Thousands | Six Months Ended June 30, | |||||||||||||
| 2025 | 2024 | $ Increase/(Decrease) | % Change | |||||||||||
| Interest income | (15,484) | (13,101) | $(2,383) | 18.2% | ||||||||||
| Debt restructuring and extinguishment expenses | 0 | 8,581 | $(8,581) | (100.0)% | ||||||||||
| Total other income | $(15,484) | $(4,520) | $(10,964) | 242.6% | ||||||||||
Interest income for the six months ended June 30, 2025 increased approximately $2.4 million, or 18.2%, to $15.5 million from $13.1 million for the six months ended June 30, 2025. The increase is primarily due to higher average cash balance in our money market account for the six months ended June 30, 2025
Interest expense
| In Thousands | Six Months Ended June 30, | |||||||||||||
| Interest Expense | 2025 | 2024 | $ Increase/(Decrease) | % Change | ||||||||||
| Total Interest Expense | $ | 34,428 | $ | 42,349 | $(7,921) | (18.7) | % | |||||||
| Interest expense related to derivatives* | (2,058) | 2,844 | ||||||||||||
| Interest expense related to amortization** | 1,471 | 1,541 | ||||||||||||
| Adjusted Interest Expense*** | 35,015 | 37,964 | (2,949) | (7.8) | % | |||||||||
*Includes payments from 2019 Swaps and Swaps amortization
**Includes noncash amortization of deferred loan costs and discount on issuance of debt
***Includes interest related to our term loans, revolving credit line, notes, and other
The increase in interest expense was due to the general increase in term loan debt as a result of refinancing of our Barclays Revolving Credit Facility, partially offset by lower interest rates compared to the same period in the prior year.
During the six months ended June 30, 2025, interest rates were above the arranged rates in our 2019 Swaps for most of the year and we received payment of $4.8 million in cash payments from our 2019 swap counterparties, which was reported as a component of interest expense. See the Derivative Instruments section of Note 2, Significant Accounting Policies, in the notes accompanying in our annual report on Form 10-K for the fiscal year ended December 31, 2024 and Part 1, Item 3 — "Quantitative and Qualitative Disclosure About Market Risk" below for more details on our derivative transactions.
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Equity in earnings from unconsolidated joint ventures
For the six months ended June 30, 2025 we recognized equity in earnings from unconsolidated joint ventures in the amount of $7.0 million compared to $7.7 million for the prior period, an decrease of $0.8 million or 9.8%. The decrease was mainly due to the decrease in earnings from Santa Monica Imaging Group, LLC and St. Joseph Medical Center, LLC compared to the six months ended June 30, 2024.
Net income attributable to noncontrolling interests
At June 30, 2025, our consolidated subsidiaries operated 353 imaging centers of which 103 were not wholly-owned and thus a portion of their operating results were attributable to noncontrolling interests. At June 30, 2024, our consolidated subsidiaries included 344 centers of which 95 were not wholly-owned.
For the six months ended June 30, 2025, we recognized net income attributable to noncontrolling interests of $16.8 million versus $18.1 million for the six months ended June 30, 2024, an decrease of $1.2 million. A decrease in earnings from Beach Imaging Group, LLC and The New Jersey Imaging Network, LLC was partially offset by increased earnings from Ventura County Imaging Group, LLC and Advanced Radiology at Capital Region, LLC.
As noncontrolling interests only represent a portion of our imaging center business, and excludes our Digital Health segment which generated losses of $13.2 million for the six months ended June 30, 2025, we do not expect changes in net income attributable to noncontrolling interests to correlate with changes in consolidated operating income or pretax income.
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Digital Health Segment
The breakdown of revenue and expenses of the Digital Health segment for the three and six months ended June 30, 2025 and 2024 are as follows:
| In Thousands | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||
| 2025 | 2024 | $ Change | % Change | 2025 | 2024 | $ Change | % Change | |||||||||||||||||||
| Statement of Operations | ||||||||||||||||||||||||||
| Revenue | $ | 20,726 | $ | 15,828 | $ | 4,898 | 30.9 | % | $ | 39,947 | $ | 30,488 | $ | 9,459 | 31.0 | % | ||||||||||
| Salaries and Wages | 9,819 | 6,253 | 3,566 | 57.0 | % | 18,513 | 11,512 | 7,001 | 60.8 | % | ||||||||||||||||
| Stock Compensation | 2,649 | 399 | 2,250 | 563.9 | % | 5,916 | 1,227 | 4,689 | 382.2 | % | ||||||||||||||||
| Other operating | 7,506 | 6,306 | 1,200 | 19.0 | % | 14,321 | 12,187 | 2,134 | 17.5 | % | ||||||||||||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 4,787 | 3,317 | 1,470 | — | 8,349 | 6,632 | 1,717 | — | ||||||||||||||||||
| Depreciation & Amort. | 3,052 | 2,386 | 666 | 27.9 | % | 5,996 | 4,780 | 1,216 | 25.4 | % | ||||||||||||||||
| (Gain) loss on sale and disposal of equipment and other | (88) | 3 | (91) | (3033.3) | % | (85) | 1 | (86) | (8600.0) | % | ||||||||||||||||
| Severance | 117 | 43 | 74 | 172.1 | % | 168 | 43 | 125 | 290.7 | % | ||||||||||||||||
| Total operating expenses | $ | 27,842 | $ | 18,707 | $ | 9,135 | 48.8 | % | $ | 53,178 | $ | 36,382 | $ | 16,796 | 46.2 | % | ||||||||||
| Loss from Operations | $ | (7,116) | $ | (2,879) | $ | (4,237) | 147.2 | % | $ | (13,231) | $ | (5,894) | $ | (7,337) | 124.5 | % | ||||||||||
Other expense | 4 | 949 | (945) | (99.6) | % | 8 | 2,448 | (2,440) | (99.7) | % | ||||||||||||||||
Loss before taxes | (7,120) | (3,828) | (3,292) | 86.0 | % | (13,239) | (8,342) | (4,897) | 58.7 | % | ||||||||||||||||
| Income taxes | $ | (2,249) | $ | 518 | $ | (2,767) | (534.2) | % | $ | (2,981) | $ | (310) | $ | (2,671) | 861.6 | % | ||||||||||
| Segment net loss | (4,871) | (4,346) | (525) | 12.1 | % | (10,258) | (8,032) | (2,226) | 27.7 | % | ||||||||||||||||
Revenues for the Digital Health segment increased compared to the prior year period, primarily due to growth in our AI and informatics product lines. For the six months ended June 30, 2025, AI-related revenue increased by approximately 27%, driven by continued growth across key clinical AI products, including a 27% increase in Lung, 19% in Prostate/Neuro, and 22% in Breast. The increase in Breast was partially driven by the ongoing commercialization of our Enhanced Breast Cancer Detection (EBCD) program. Informatics revenue increased by approximately 33%, primarily due to increased volume on our eRad PICS platform.
The increase in segment operating expenses was primarily attributable to higher headcount in engineering and executive roles, increased stock-based compensation, and higher non-capitalized research and development costs. These increases reflect continued investment in product development and in building implementation and commercial support functions to enable broader deployment to external customers. We expect the Digital Health segment to continue operating at a net loss in the near term as we expand these capabilities and scale adoption of our platforms.
In June 2025, we closed the acquisition of See-Mode Technologies, an AI company focused on ultrasound imaging solutions. Subsequent to June 30, 2025 quarter-end, on July 17, 2025, we also closed the acquisition of iCAD, Inc., a provider of AI solutions for breast cancer detection. We are currently in the process of integrating both companies into our Digital Health segment.
Non-GAAP Financial Measures
We use both U.S. generally accepted accounting principles ("GAAP") and non-GAAP metrics to measure our financial results. We believe that, in addition to GAAP metrics, non-GAAP metrics such as Adjusted EBITDA assist us in measuring our core operations from period to period.
Adjusted EBITDA
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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 income taxes, interest expense, severance costs, depreciation and amortization, non-cash employee stock-based compensation, loss on sale and disposal of equipment and other, non-cash change in fair value of interest rate hedge, other income, non-capitalized research and development expenses related to DeepHealth Cloud OS and Generative AI, lease abandonment charges, and acquisition transaction costs. Adjusted EBITDA includes equity earnings in unconsolidated operations and subtracts allocations of earnings to non-controlling interests in subsidiaries, and is adjusted for non-cash or one-time events that take place during the period.
Adjusted EBITDA is a non-GAAP financial measure used as an analytical indicator by us and the healthcare industry to assess business performance. Adjusted EBITDA should not be considered a measure of financial performance under GAAP, and Adjusted EBITDA should not be considered in isolation or as alternatives to net income, or other financial statement data presented in the consolidated financial statements as an indicator of financial performance. Adjusted EBITDA is not a measurement determined in accordance with GAAP and is therefore susceptible to varying methods of calculation and this metric, as presented, may not be comparable to other similarly titled measures of other companies.
The following is a reconciliation of the nearest comparable GAAP financial measure, net income, to Adjusted EBITDA for the three and six months ended June 30, 2025 and 2024, respectively.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net income (loss) attributable to RadNet, Inc. common stockholders | $ | 14,454 | $ | (2,982) | $ | (23,472) | $ | (5,761) | |||||||||||||||
| Income taxes | 820 | 2,456 | (2,578) | 592 | |||||||||||||||||||
| Interest expense | 17,189 | 26,082 | 34,428 | 42,349 | |||||||||||||||||||
| Severance costs | 426 | 268 | 1,173 | 493 | |||||||||||||||||||
| Depreciation and amortization | 35,993 | 34,475 | 71,476 | 66,843 | |||||||||||||||||||
| Non-cash employee stock-based compensation | 8,741 | 4,749 | 37,235 | 16,646 | |||||||||||||||||||
| Loss on sale and disposal of equipment and other | 1,724 | 401 | 2,126 | 587 | |||||||||||||||||||
| Non-cash change in fair value of interest rate hedge | 1,956 | 1,890 | 4,062 | 674 | |||||||||||||||||||
| Other income | (7,764) | (7,900) | (15,476) | (10,834) | |||||||||||||||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 4,787 | 3,317 | 8,349 | 6,632 | |||||||||||||||||||
| Lease abandonment charges | 123 | — | 5,511 | — | |||||||||||||||||||
| Non-cash change to contingent consideration | — | — | — | 1,974 | |||||||||||||||||||
| Non-operational rent expenses | 496 | 809 | 1,838 | 1,832 | |||||||||||||||||||
| Acquisition transaction costs | 2,301 | — | 2,973 | — | |||||||||||||||||||
Adjusted EBITDA - Total Company | $ | 81,246 | $ | 72,327 | $ | 127,645 | $ | 130,789 | |||||||||||||||
| NOTE | |||||||||||||||||||||||
Adjusted EBITDA - Imaging Center | $ | 77,843 | $ | 69,058 | $ | 120,531 | $ | 124,000 | |||||||||||||||
| Adjusted EBITDA - Digital Health Segment | $ | 3,403 | $ | 3,269 | $ | 7,114 | $ | 6,789 | |||||||||||||||
The following table is a reconciliation of GAAP net income for our Digital Health segment to Adjusted EBITDA for the three months ended June 30, 2025 and 2024, respectively.
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| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Segment net loss | $ | (4,871) | $ | (4,346) | $ | (10,258) | $ | (8,032) | |||||||||||||||
| Stock Compensation | 2,650 | 399 | 5,916 | 1,227 | |||||||||||||||||||
| Depreciation & Amortization | 3,053 | 2,386 | 5,997 | 4,780 | |||||||||||||||||||
| Other operating (income) loss | (88) | 3 | (85) | 1 | |||||||||||||||||||
| Other expense | 4 | 949 | 8 | 2,448 | |||||||||||||||||||
| Severance | 117 | 43 | 168 | 43 | |||||||||||||||||||
| Income taxes | (2,249) | 518 | (2,981) | (310) | |||||||||||||||||||
| Non-Capitalized R&D - DeepHealth Cloud OS & Generative AI | 4,787 | 3,317 | 8,349 | 6,632 | |||||||||||||||||||
Adjusted EBITDA - Digital Health Segment | $ | 3,403 | $ | 3,269 | $ | 7,114 | $ | 6,789 | |||||||||||||||
Liquidity and Capital Resources
We expect our existing capital resources, anticipated cash from operations and our borrowing capacity under our credit facilities will be sufficient to sustain our operations for the next twelve months and the foreseeable future.
Our principal capital requirements are for the development of new diagnostic imaging centers, the acquisition of existing diagnostic imaging centers and the acquisition of new diagnostic imaging equipment. On a continuing basis, we evaluate various transactions to increase shareholder value and enhance our business results, including acquisitions, divestitures and joint ventures. We expect to fund any future acquisitions primarily with cash flow from operations and borrowings, including borrowing available under our secured credit facilities or through new equity or debt issuances.
We and our subsidiaries or affiliates may from time to time, in our sole discretion, purchase, repay, redeem or retire any of our outstanding debt or equity securities in privately negotiated or open market transactions, by tender offer or otherwise.
The following table summarizes key balance sheet data related to our liquidity as of June 30, 2025 and December 31, 2024 and income statement data for the six months ended June 30, 2025 and 2024 (in thousands):
| Balance Sheet Data: | June 30, 2025 | December 31, 2024 | |||||||||
| Cash and cash equivalents | $ | 833,152 | $ | 740,020 | |||||||
| Accounts receivable | 199,991 | 185,821 | |||||||||
| Working capital (exclusive of current operating lease liabilities) | 607,706 | 596,158 | |||||||||
| Stockholders' equity | 1,179,261 | 1,133,410 | |||||||||
Income statement data for the six months ended June 30, | 2025 | 2024 | |||||||||
| Total net revenue | $ | 969,629 | $ | 891,421 | |||||||
Net loss attributable to RadNet common stockholders | (23,472) | (5,761) | |||||||||
Sources and Uses of Cash
The following table summarizes key components of our sources and uses of cash for the six months ended June 30, 2025 and 2024 (in thousands):
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| Cash Flow Data | June 30, 2025 | June 30, 2024 | |||||||||
| Cash provided by (used in) operating activities | $ | 161,829 | $ | 133,090 | |||||||
| Cash provided by (used in) investing activities | (154,201) | (138,278) | |||||||||
| Cash provided by (used in) financing activities | 84,918 | 404,404 | |||||||||
Cash provided by operating activities for the six months ended June 30, 2025 increased by $28.7 million compared to June 30, 2024 primarily driven by a $16.0 million change in assets and liabilities, primarily due to the timing of payments for accounts payable and accrued expenses.
Cash used in investing activities for the three months ended June 30, 2025 increased $15.9 million compared to the six months ended June 30, 2024. The increase was primarily due to a $19.1 million increase in equity contributions to and purchases of interests in joint ventures, partially offset by a $2.3 million reduction in capital expenditures for property and equipment.
Cash provided financing activities for the six months ended June 30, 2025 decreased $319.5 million compared to the three months ended March 31, 2024. Financing activity in 2024 included a public equity offering that generated $218.4 million in net proceeds and a refinancing of the Barclays Revolving Credit Facility that resulted in an additional $167.9 million of cash. In 2025, financing activity primarily consisted of a $100.0 million incremental term loan under the Barclays Credit Agreement.
Secured Credit Facilities
We maintain secured credit facilities with Barclays and with Truist Bank.
On June 11, 2025, we entered into Incremental Amendment No. 2 to the Barclays Credit Agreement, pursuant to which Barclays, as lender, provided an additional $100.0 million of incremental term loan borrowings under our existing senior secured term loan facility, all other terms remained the same. $1.0 million recognized as discount and deferred finance cost. Amounts capitalized will be amortized over the remaining terms of the respective credit facilities under the Barclays Credit Agreement. Pursuant to the Second Amendment, we are required to make quarterly principal payments of approximately $2.4 million, compared to $2.2 million prior to the amendment.
On November 26, 2024, we entered into Amendment No. 1 to the Barclays Credit Agreement (the “First Amendment”) with the Barclays Bank Plc and the lenders and financial institutions named therein. Pursuant to the First Amendment, the interest rates on the term loans and revolving credit facility provided under the Restated Credit Agreement have been reduced by 0.25%.
On April 18, 2024, we refinanced our Barclays Revolving Credit Facility, replacing the prior facility with an $875.0 million term loan and a $282.0 million revolving credit facility. The refinance transaction reduced our interest rates on the Barclays Term Loan and revolving credit facility and extended the maturity date for the term loan to April 18, 2031 and for the revolving credit facility to April 18, 2029. The new term loan calls for quarterly principal payments of $2.2 million, compared to $1.8 million under the prior credit facility.
Our condensed consolidated balance sheets at June 30, 2025 include $1,095.4 million of total term loan debt (exclusive of unamortized discounts of $13.5 million) in thousands:
| Face Value | Discount | Total Carrying Value | |||||||||||||||
| Barclays Term Loan | $ | 965,998 | $ | (12,879) | $ | 953,119 | |||||||||||
| Truist Term Loan | 129,375 | (594) | 128,781 | ||||||||||||||
| Total Term Loans | $ | 1,095,373 | $ | (13,473) | $ | 1,081,900 | |||||||||||
At June 30, 2025, we had no borrowings under our Barclays or Truist revolving credit facilities. After reserves for outstanding letters of credit of $7.4 million, we had $274.6 million available for borrowing under our Barclays Revolving Credit Facility and $50.0 million available under our Truist revolving credit facility.
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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.
ITEM 3. Quantitative and Qualitative Disclosures about Market Risk
Foreign Currency Exchange Risk:
We are exposed to foreign exchange risk with respect to revenues and expenses denominated in the Pound Sterling, Euro, Canadian Dollar, Hungarian Forint and Indian Rupee. We provide radiological services in the United Kingdom, conduct AI operations in the Netherlands, and maintain research and development centers in Canada, Hungary and India. We do not have any foreign currency exchange contracts to mitigate this risk. At June 30, 2025, a hypothetical 1% decline in the currency exchange rates between the U.S. dollar against these currencies, would have resulted in an annual increase of approximately $0.4 million in operating expenses.
Interest Rate Sensitivity:
Our debt instruments, including borrowings under our Barclays Revolving Credit Facility and our Truist Revolving Credit Facility, bear interest at variable rates. Accordingly, our interest expense and our earnings are affected by changes in short term interest rates.
To mitigate our future floating rate interest expense exposure, we entered into the 2019 Swaps with a locked-in interest rate for one-month Term SOFR of 1.98% for $400 million of notional value. We are liable for premium payments to the 2019 swap counterparties if interest rates are below the arranged rate and receive payments from the counterparties if interest rates exceed the arranged rate. Payments under the 2019 Swaps are settled in cash on a monthly basis. The 2019 Swaps for the $400 million notional amount will expire in October 2025.
We can elect SOFR or Alternative Base Rate interest options on amounts outstanding under the Barclays Term Loan. At June 30, 2025, we had $966.0 million outstanding subject to an SOFR election on the Barclays Term Loan. At June 30, 2025, our effective SOFR interest rate plus applicable margin was 6.58%. The 2019 Swaps secure a $1.98% SOFR rate for a $400 million notional amount. After giving effect to our 2019 Swaps, we had $566.0 million outstanding under the Barclays Term Loan that is unprotected by the 2019 Swaps at June 30, 2025. Consequently, a hypothetical 1% increase in the SOFR rates under the Barclay's credit facility would result in an increase of $5.7 million in annual interest expense and a corresponding decrease in income before taxes. The 2019 Swaps will mature in October 2025.
We can elect SOFR or Base Rate interest rate options on amounts outstanding under the Truist Revolving Credit Facility. At June 30, 2025, we had $129.4 million outstanding subject to an adjusted SOFR election on the Truist Term Loan (as defined in the notes to our condensed consolidated financial statements). At June 30, 2025, our effective SOFR rate plus applicable margin was 5.90%. A hypothetical 1% increase in the adjusted Eurodollar rates under the Truist Revolving Credit Facility would result in an increase of approximately $1.3 million in annual interest expense and a corresponding decrease in income before taxes.
ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Under the supervision of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, as of June 30, 2025. Based on this evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2025 to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There has been no change in our internal control over financial reporting during three months ended June 30, 2025 that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.
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PART II – OTHER INFORMATION
ITEM 1. Legal Proceedings
From time to time we are engaged legal proceedings that arise in the ordinary course of our business. We do not believe that the outcome of any of our current legal proceedings will have a material adverse impact on our business, financial condition and results of operations.
ITEM 1A. Risk Factors
For information about the risks and uncertainties related to our business, please see the risk factors described in our Annual Report. The risks described in our Annual Report are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
ITEM 3. Defaults Upon Senior Securities
None.
ITEM 4. Mine Safety Disclosures
Not applicable.
ITEM 5. Other Information
Rule 10b5-1 Trading Plan.
During the fiscal quarter ended June 30, 2025, none of our directors or executive officers adopted terminated
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ITEM 6. Exhibits
| Exhibit Number | Description | |||||||
| 2.1 | Agreement and Plan of Merger, dated as of April 15, 2025, by and among RadNet, Inc., Trio Merger Sub, Inc. and iCAD, Inc. (incorporated by reference to Exhibit 2.1 filed with the Registration Statement on Form S-4 on May 6, 2025). | |||||||
| 10.1 | Amendment No. 2 to Credit and Guaranty Agreement, dated as of June 11, 2025, by and among Radnet Management, Inc., a California corporation, RadNet, Inc., a Delaware corporation, certain subsidiaries and affiliates of Radnet Management, Inc., as Guarantors, the Lenders and other financial institutions from time to time party thereto, and Barclays Bank PLC, as Administrative Agent and Collateral Agent (incorporated by reference to Exhibit 10.1 filed with Form 8-K on June 12, 2025). | |||||||
| 10.2 | Form of Voting and Support Agreement (incorporated by reference to Exhibit 10.1 filed with the Registration Statement on Form S-4 on May 6, 2025). | |||||||
| 31.1 | Certification of Howard G. Berger, M.D. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||||
| 31.2 | Certification of Mark D. Stolper pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||||||
| 32.1 | Certification of Howard G. Berger, M.D. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. * | |||||||
| 32.2 | Certification of Mark D. Stolper pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. * | |||||||
| 101 | The following financial information from RadNet, Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 formatted in Inline XBRL (Extensible Business Reporting Language) includes: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Operations, (iii) the Condensed Consolidated Statements of Comprehensive Income (Loss), (iv) the Condensed Consolidated Statements of Changes in Stockholders Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) Notes to the Condensed Consolidated Financial Statements. | |||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
* This certification is being furnished solely to accompany this report pursuant to 18 U.S.C. 1350, and is not being filed for purposes of Section 18 of the Exchange Act and is not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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| RADNET, INC. | ||||||||
| (Registrant) | ||||||||
| Date: August 11, 2025 | By: | /s/ Howard G. Berger, M.D. | ||||||
| Howard G. Berger, M.D., President and Chief Executive Officer (Principal Executive Officer) | ||||||||
| Date: August 11, 2025 | By: | /s/ Mark D. Stolper | ||||||
| Mark D. Stolper, Chief Financial Officer (Principal Financial and Accounting Officer) | ||||||||
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FAQ
What were RadNet (RDNT) total service revenues for Q2 2025?
RadNet reported $498,230,000 in total service revenue for the three months ended June 30, 2025.
Did RadNet report quarterly profit or loss in Q2 2025 and what was EPS?
RadNet reported net income of $23,034,000 in Q2 2025, with $14,454,000 attributable to common stockholders and diluted EPS of $0.19.
What is RadNet's six-month net result and EPS through June 30, 2025?
For the six months ended June 30, 2025 RadNet reported a consolidated net loss of $(6,703,000), and a net loss attributable to common stockholders of $(23,472,000) (diluted EPS $(0.32)).
What acquisition activity did RadNet disclose in this 10-Q (RDNT)?
RadNet completed acquisitions including See-Mode Technologies on June 2, 2025 (total purchase consideration ~$28.7 million, including contingent consideration up to $12.7 million).
How much long-term debt does RadNet have as of June 30, 2025?
RadNet reported $1,077,251,000 as the long-term portion of debt obligations at June 30, 2025.
What contingent liabilities related to acquisitions were recorded?
RadNet recorded contingent consideration for See-Mode of $8,766,000 (classified between accrued expenses and other non-current liabilities) and disclosed management probabilities for three milestones.
Radnet
NASDAQ:RDNT
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Aug 11, 2025
[8-K] RadNet, Inc. Reports Material Event
Jul 17, 2025
[8-K] RadNet, Inc. Reports Material Event
Jun 18, 2025
[Form 4] RadNet, Inc. Insider Trading Activity
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4.07B
66.77M
12.75%
92.03%
8.63%
Diagnostics & Research
Services-medical Laboratories
United States
LOS ANGELES