Service Corp International (NYSE: SCI) boosts 2026 cash flow guidance
Rhea-AI Filing Summary
Service Corporation International reported second quarter 2026 revenue of $1,103.3 million, up 4% year over year, with diluted EPS of $0.90 versus $0.86. Net income attributable to common stockholders was $124.8 million, while operating income increased to $231.6 million.
Funeral segment revenue reached $604.8 million as average revenue per service rose to $5,985, though funeral gross margin declined to 18.2%. Cemetery revenue rose to $498.5 million, with gross profit of $163.2 million and a 32.7% margin, supported by 8.0% growth in comparable preneed cemetery sales production.
Operating cash flow for the quarter grew 43% to $238.7 million, and adjusted operating cash flow was $238.8 million. Management confirmed the 2026 adjusted EPS midpoint of $4.20 while raising the midpoint of 2026 adjusted operating cash flow guidance by $50 million to $1,085 million and increasing planned maintenance capital expenditures to $335 million.
Positive
- Operating cash flow strength and higher 2026 outlook: Q2 2026 net cash provided by operating activities rose 43% to $238.7 million, and the midpoint of 2026 net cash provided by operating activities excluding special items guidance increased by $50 million to $1,085 million.
Negative
- None.
Filing Explained
At June 30, 2026, SCI reported $260,411 thousand cash, $5,108,016 thousand long-term debt, and 136,619,474 common shares outstanding.
As a Form 8-K, this filing reports specified material events; it records completed second-quarter results and a forward-looking 2026 outlook, alongside June 30 cash, debt, share counts, and six-month capital returns.
At
For the six months ended
Common shares issued were 142,249,152 at June 30 versus 141,957,004 at December 31, 2025, while common shares outstanding were 136,619,474 versus 139,678,199, respectively.
The revised 2026 outlook excludes potential effects from items including hurricanes, asset divestitures, debt extinguishment, acquisitions, litigation, and certain tax matters; the next resolution path is the company's subsequent results against that outlook.
8-K Event Classification
5 items: 0.01, 0.2, 0.4, 2.02, 9.01
5 items
Item 0.01
Item 0.01
Item 0.2
Item 0.2
Item 0.4
Item 0.4
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 Revenue: $1,103.3 million
Q2 2026 Diluted EPS: $0.90
Q2 2026 Operating Cash Flow: $238.7 million
+5 more
8 metrics
Q2 2026 Revenue
$1,103.3 million
Consolidated revenue for the three months ended June 30, 2026
Q2 2026 Diluted EPS
$0.90
Diluted earnings per share for Q2 2026 versus $0.86 in Q2 2025
Q2 2026 Operating Cash Flow
$238.7 million
Net cash provided by operating activities in Q2 2026, up 43% year over year
Six-month 2026 Operating Cash Flow
$572.4 million
Net cash provided by operating activities for the six months ended June 30, 2026
2026 Adjusted EPS Guidance Range
$4.10 - $4.30
Revised 2026 diluted EPS excluding special items outlook
2026 Adjusted Operating Cash Flow Midpoint
$1,085 million
Midpoint of 2026 net cash provided by operating activities excluding special items guidance
2026 Maintenance Capital Expenditures Plan
$335 million
Total maintenance, cemetery development, and other capital expenditures outlook
Capital Returned to Shareholders YTD 2026
$363 million
Amount returned through dividends and share repurchases thus far in 2026
Key Terms
preneed sales production, cemetery perpetual care trust investments, non-GAAP financial measures, recognition rate, +1 more
5 terms
preneed sales production financial
"Comparable funeral preneed sales production increased 7% on a comparable basis"
cemetery perpetual care trust investments financial
"Cemetery perpetual care trust investments totaled 2,520,779 as of June 30, 2026"
non-GAAP financial measures financial
"Earnings excluding special items and adjusted operating cash flow are non-GAAP financial measures"
Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.
recognition rate financial
"Recognition rate represents core revenue as a percentage of preneed and atneed sales production"
core cremation rate financial
"The core cremation rate increased 60 basis points to 58.0%"
Earnings Snapshot
Q2 2026 revenue: $1,103.3 million · Guidance included
three and six months ended June 30, 2026
Q2 2026 revenue
$1,103.3 million
up 4% from Q2 2025
Q2 2026 diluted EPS
$0.90
up from $0.86 in Q2 2025
Q2 2026 operating cash flow
$238.7 million
up 43% from $166.5 million a year ago
Six-month 2026 diluted EPS
$1.87
up from $1.84 in the prior-year period
Guidance
For 2026, diluted EPS excluding special items is projected at $4.10 to $4.30 with a midpoint of $4.20, and net cash provided by operating activities excluding special items is guided to $1,055 to $1,115 million with a $1,085 million midpoint.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How did Service Corporation International (SCI) perform in Q2 2026?
SCI reported Q2 2026 revenue of $1,103.3 million, up 4% from 2025, with diluted EPS of $0.90 versus $0.86. Net income attributable to common stockholders was $124.8 million, and operating income rose to $231.6 million.
What were SCI (SCI) operating cash flow results for Q2 2026?
Net cash provided by operating activities in Q2 2026 was $238.7 million, up $72.2 million or 43% from $166.5 million a year earlier. Adjusted operating cash flow was $238.8 million, helped by lower cash taxes and strong preneed cemetery receipts.
What is Service Corporation International (SCI) 2026 earnings and cash flow guidance?
For 2026, SCI guides diluted EPS excluding special items to $4.10–$4.30, with a midpoint of $4.20. Net cash provided by operating activities excluding special items is guided to $1,055–$1,115 million, with a midpoint of $1,085 million.
How did SCI (SCI) funeral and cemetery segments perform in Q2 2026?
Funeral revenue was $604.8 million with a gross margin of 18.2% and average revenue per service of $5,985. Cemetery revenue reached $498.5 million, generating gross profit of $163.2 million and a 32.7% margin, supported by 8.0% preneed sales growth.
What capital spending is Service Corporation International (SCI) planning for 2026?
SCI expects total maintenance, cemetery development, and other capital expenditures of $335 million in 2026, including $140 million for existing field locations, $170 million for cemetery property development, and $25 million for digital investments and corporate projects.
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 | |||||
Form 8-K
| CURRENT REPORT | ||
| Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||
| Date of Report (Date of earliest event reported) | |||||
| (Exact name of registrant as specified in its charter) | ||
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
| (Address of principal executive offices) | (Zip Code) | ||||||||||
Registrant's telephone number, including area code | ||||||||
| (Former name or former address, if changed since last report.) | ||||||||
| Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | |||||
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter) . ☐ 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. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Item 2.02 Results of Operations and Financial Condition
On July 29, 2026 , Service Corporation International issued a press release reporting its financial results for the three and six months ended June 30, 2026. A copy of this press release, dated July 29, 2026 , is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information in this Current Report on Form 8-K, including Exhibit 99.1, is not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
(d) The following exhibits are included with this report
| Exhibit No. | Description | |||||||
99.1 | Press Release, dated July 29, 2026 reporting financial results for the three and six months ended June 30, 2026 | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| July 29, 2026 | Service Corporation International | ||||||||||
| By: | /s/ Eric D. Tanzberger | ||||||||||
| Eric D. Tanzberger | |||||||||||
Executive Vice President | |||||||||||
Chief Financial Officer | |||||||||||
EXHIBIT 99.1
 | SERVICE CORPORATION INTERNATIONAL | ||||
ANNOUNCES SECOND QUARTER 2026 FINANCIAL RESULTS, | |||||
CONFIRMS 2026 EARNINGS PER SHARE MIDPOINT GUIDANCE, | |||||
AND RAISES 2026 CASH FLOW GUIDANCE | |||||
Conference call on Thursday, July 30, 2026, at 8:00 a.m. Central Time.
HOUSTON, Texas, July 29, 2026 . . . Service Corporation International (NYSE: SCI), the largest provider of deathcare products and services in North America, today reported results for the second quarter of 2026.
Second Quarter Highlights:
–Consolidated revenue grew $37.8 million, or 4%, over the second quarter of 2025
–Comparable total funeral sales average grew 3% over the second quarter of 2025
–Comparable cemetery preneed sales production increased 8% in the current quarter
–Comparable funeral preneed sales production increased 7% in the current quarter
–GAAP earnings per share was $0.90 compared to $0.86 in the second quarter of 2025
–Adjusted earnings per share was $0.90 compared to $0.88 in the second quarter of 2025
–Net cash provided by operating activities increased $72.2 million, or 43%, to $238.7 million in the current quarter compared to $166.5 million in the prior-year quarter
–Adjusted cash provided by operating activities increased $70.5 million, or 42%, to $238.8 million in the current quarter compared to $168.3 million in the prior year
Tom Ryan, the Company's Chairman and CEO, commented on the second quarter performance:
"Today, we reported adjusted earnings per share of $0.90 and adjusted net cash provided by operating activities of $238.8 million, both ahead of the prior year and our expectations. Our funeral segment benefited from a continued strong average revenue per service which more than offset a better-than-expected 1% decline in funeral services performed. Our cemetery segment continued to perform well, generating 5% growth in comparable cemetery revenue. The growth was primarily driven by higher recognized preneed merchandise and service revenue, as well as higher other revenue, both of which reflected impressive earnings growth from our cemetery trust funds. Additionally, recognized preneed property revenue grew 2%, while preneed property production grew 7%. This dynamic puts temporary pressure on cemetery gross margins but expands our backlog with higher-margin deferred property sales, which will benefit us in future periods. Preneed funeral sales production also remained strong, increasing 7% on a comparable basis, reinforcing the long-term strength of our preneed strategy and helping to build our backlog of future revenue.
We remain focused on executing our long-term growth strategy by growing revenue, leveraging our scale, and allocating capital in a disciplined manner to create long-term shareholder value. Our consistent cash generation continues to provide the financial flexibility to invest in strategic acquisitions, expand and develop our cemetery portfolio, pursue attractive real estate opportunities, and construct new funeral homes. Thus far this year, we returned $363 million to shareholders through dividends and share repurchases, reflecting our continued commitment to balanced capital allocation. This balanced capital allocation strategy positions us to deliver sustainable growth and create long-term shareholder value.
Finally, I would like to thank our more than 25,000 associates for their unwavering commitment to serving client families with compassion, professionalism, and excellence. Their dedication is the foundation of our success and continues to distinguish SCI every day.”
Details of our second quarter 2026 financial results and the unaudited consolidated financial statements can be found in the Appendix at the end of this press release. The table below summarizes our key financial results.
| (Dollars in millions, except for per share amounts) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| Revenue | $ | 1,103.3 | $ | 1,065.4 | $ | 2,199.7 | $ | 2,139.6 | ||||||||||||||||||
| Operating income | $ | 231.6 | $ | 224.5 | $ | 475.4 | $ | 476.1 | ||||||||||||||||||
| Net income attributable to common stockholders | $ | 124.8 | $ | 122.9 | $ | 260.6 | $ | 265.7 | ||||||||||||||||||
| Diluted earnings per share | $ | 0.90 | $ | 0.86 | $ | 1.87 | $ | 1.84 | ||||||||||||||||||
Earnings excluding special items (1) | $ | 124.9 | $ | 125.5 | $ | 260.1 | $ | 265.1 | ||||||||||||||||||
Diluted earnings per share excluding special items (1) | $ | 0.90 | $ | 0.88 | $ | 1.87 | $ | 1.84 | ||||||||||||||||||
| Diluted weighted average shares outstanding | 138.3 | 143.0 | 139.1 | 144.1 | ||||||||||||||||||||||
| Net cash provided by operating activities | $ | 238.7 | $ | 166.5 | $ | 572.4 | $ | 477.6 | ||||||||||||||||||
Net cash provided by operating activities excluding special items (1) | $ | 238.8 | $ | 168.3 | $ | 573.3 | $ | 484.2 | ||||||||||||||||||
1 Service Corporation International
(1) Earnings excluding special items, diluted earnings per share excluding special items, and net cash provided by operating activities excluding special items are non-GAAP financial measures. These items are also referred to as "adjusted earnings per share" and "adjusted operating cash flow". A reconciliation from net income attributable to common stockholders, diluted earnings per share, and net cash provided by operating activities in accordance with generally accepted accounting principles in the United States (GAAP) can be found under the headings "Cash Flow and Capital Spending" and “Non-GAAP Financial Measures” in the Appendix at the end of this press release.
•Diluted earnings per share was $0.90 in the second quarter of 2026 compared to $0.86 in the second quarter of 2025. The current year quarter was impacted by $0.1 million of net losses on divestitures and impairment charges compared to $4.1 million of net gains in the prior year. The prior year also included a $6.4 million charge related to the settlement of certain legal matters and a $1.6 million restructuring charge. Diluted earnings per share, excluding special items, was $0.90 in the second quarter of 2026 compared to $0.88 in the second quarter of 2025. Higher cemetery gross profit combined with a lower share count more than offset lower funeral gross profit.
•Net cash provided by operating activities increased $72.2 million, or 43%, to $238.7 million in the second quarter of 2026. Adjusted cash provided by operating activities increased $70.5 million, or 42%, to $238.8 million in the current quarter compared to $168.3 million in the prior year primarily due to a reduction in cash taxes and strong operating cash receipts from increased preneed cemetery sales production.
CONFIRMED 2026 EPS GUIDANCE AND RAISED 2026 CASH FLOW GUIDANCE | ||
The $4.20 midpoint of our annual guidance range for 2026 detailed below is confirmed with a more narrow range expected for adjusted earnings per share of $4.10 to $4.30. Our cash flow outlook at the midpoint has increased $50 million from $1,035 million to $1,085 million due to stronger cemetery preneed cash receipts. Additionally, we increased our total maintenance capital expenditures by $10 million to $335 million. Our outlook for diluted earnings per share from continuing operations excluding special items, at the midpoint of our guidance range, is anticipated to be within our expected long-term growth framework of 8%-12%.
| (Dollars in millions, except per share amounts) | 2026 Outlook | Revised 2026 Outlook | |||||||||||||||||||||
Diluted earnings per share excluding special items (1) | $4.05 - $4.35 | $4.10 - $4.30 | |||||||||||||||||||||
Net cash provided by operating activities excluding special items and cash taxes (1) | $1,125 - $1,185 | $1,175 - $1,235 | |||||||||||||||||||||
Cash taxes expected in 2026 (at the midpoint of diluted earnings per share excluding special items guidance) | $120 | $120 | |||||||||||||||||||||
Net cash provided by operating activities excluding special items (1) | $1,005 - $1,065 | $1,055 - $1,115 | |||||||||||||||||||||
Midpoint of net cash provided by operating activities excluding special items (1) | $1,035 | $1,085 | |||||||||||||||||||||
| Capital improvements at existing field locations | $135 | $140 | |||||||||||||||||||||
| Development of cemetery property | $165 | $170 | |||||||||||||||||||||
| Digital investments and corporate | $25 | $25 | |||||||||||||||||||||
| Total maintenance, cemetery development, and other capital expenditures (Maintenance capital expenditures) | $325 | $335 | |||||||||||||||||||||
(1)Diluted earnings per share excluding special items, net cash provided by operating activities excluding special items and cash taxes, and net cash provided by operating activities excluding special items are non-GAAP financial measures. We normally reconcile these non-GAAP financial measures from diluted earnings per share and net cash provided by operating activities; however, diluted earnings per share and net cash provided by operating activities calculated in accordance with GAAP are not currently accessible on a forward-looking basis. Our outlook for 2026 excludes the following because this information is not currently available for 2026: Expenses net of insurance recoveries related to hurricanes, gains or losses associated with asset divestitures, gains or losses associated with the early extinguishment of debt, potential tax reserve adjustments and IRS payments and/or refunds, acquisition and integration costs, system implementation and transition costs, and potential costs associated with estimated litigation charges or legal settlements or the recognition of receivables for insurance recoveries associated with litigation, or deferred tax payments. The foregoing items could materially impact our forward-looking diluted earnings per share and/or our net cash provided by operating activities calculated in accordance with GAAP, consistent with the historical disclosures found in the Appendix at the end of this press release under the headings “Cash Flow and Capital Spending” and “Non-GAAP Financial Measures”.
CONFERENCE CALL AND WEBCAST
We will host a conference call on Thursday, July 30, 2026, at 8:00 a.m. Central Time. A question and answer session will follow prepared remarks made by management. The conference call dial-in numbers are (888) 317-6003 (US) or (412) 317-6061 (International) with the passcode of 7565620. The conference call will also be broadcast live via the Internet and can be accessed through our website at www.sci-corp.com. A replay of the conference call will be available through August 6, 2026 and can be accessed at (855) 669-9658 (US) or (412) 317-0088 (International) with the passcode of 1797873. Additionally, a replay of the conference call will be available on our website for approximately three months.
2 Service Corporation International
ABOUT SERVICE CORPORATION INTERNATIONAL
Service Corporation International (NYSE: SCI), headquartered in Houston, Texas, is North America's leading provider of funeral, cemetery and cremation services, as well as final-arrangement planning in advance, serving approximately 700,000 combined preneed and atneed families each year. Our diversified portfolio of brands provides families and individuals a full range of choices to meet their needs, from simple cremations to full life celebrations and personalized remembrances. Our Dignity Memorial® brand is the name families turn to for professionalism, compassion, and attention to detail that is second to none. At June 30, 2026, we owned and operated 1,495 funeral service locations and 505 cemeteries (of which 316 are combination locations) in 44 states, eight Canadian provinces, the District of Columbia, and Puerto Rico. For more information about Service Corporation International, please visit our website at www.sci-corp.com. For more information about Dignity Memorial®, please visit www.dignitymemorial.com.
| For additional information contact: InvestorRelations@sci-us.com | ||||||||||||||
| Investors: | Trey Bocage - Assistant Vice President - Treasury and Investor Relations | (713) 525-3454 | ||||||||||||
| Andrea Low - Director - Federal Tax and Investor Relations | (713) 525-2811 | |||||||||||||
| Media: | Jay Andrew - Assistant Vice President - Corporate Communications | (713) 525-3468 | ||||||||||||
3 Service Corporation International
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
The statements in this press release that are not historical facts are forward-looking statements made in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. These statements may be accompanied by words such as “believe”, “estimate”, “project”, “expect”, or “anticipate”, “predict” that convey the uncertainty of future events or outcomes. These statements are based on assumptions that we believe are reasonable; however, many important factors could cause our actual results in the future to differ materially from the forward-looking statements made herein and in any other documents or oral presentations made by, or on behalf of, the Company. These factors are discussed below. Except as required by applicable law, we assume no obligation and make no undertaking to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the Company, whether as a result of new information, future events, or otherwise.
•Our affiliated trust funds own investments in securities, which are affected by market conditions that are beyond our control.
•We may be required to replenish our affiliated funeral and cemetery trust funds to meet minimum funding requirements, which would have a negative effect on our earnings and cash flow.
•Our ability to execute our strategic plan depends on many factors, some of which are beyond our control.
•We may be adversely affected by the effects of inflation.
•Our results may be adversely affected by significant weather events, natural disasters, catastrophic events, or public health crises.
•Our credit agreements contain covenants that may prevent us from engaging in certain transactions.
•If we lost the ability to use surety bonding to support our preneed activities, we may be required to make material cash payments to fund certain trust funds.
•The financial condition of third-party insurance companies that fund our preneed contracts may impact our future revenue.
•Unfavorable publicity could affect our reputation and business.
•Our failure to attract and retain qualified sales personnel and licensed funeral professionals could have an adverse effect on our business and financial condition.
•We use a combination of insurance, self-insurance, and large deductibles in managing our exposure to certain inherent risks; therefore, we could be exposed to unexpected costs that could negatively affect our financial performance.
•Declines in overall economic conditions beyond our control could reduce future potential earnings and cash flows and could result in future impairments to goodwill and/or other intangible assets.
•Any failure to protect personal information relating to our customers, their loved ones, our associates, and our vendors could damage our reputation, could cause us to incur substantial additional costs and to become subject to litigation, and could adversely affect our operating results, financial condition, or cash flow.
•A failure of a key information technology system or process could disrupt and adversely affect our business.
•Our Canadian business exposes us to operational, economic, and currency risks.
•Our level of indebtedness could adversely affect our cash flows, our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, and may prevent us from fulfilling our obligations under our indebtedness.
•The funeral and cemetery industry is competitive.
•If the number of deaths in our markets declines, our cash flows and revenue may decrease. Changes in the number of deaths are not predictable from market to market or over the short term.
•If we are not able to respond effectively to changing consumer preferences, our market share, revenue, and/or profitability could decrease.
•The continuing upward trend in life expectancy and an increase in the number of cremations performed in North America could result in lower revenue, operating profit, and cash flows.
•Our funeral and cemetery businesses are high fixed-cost businesses.
•Risks associated with our supply chain, such as tariffs, could materially adversely affect our financial performance.
•Regulation and compliance could have a material adverse impact on our financial results.
•Unfavorable results of litigation could have a material adverse impact on our financial statements.
•Cemetery burial practice claims could have a material adverse impact on our financial results.
•The application of unclaimed property laws by certain states to our preneed funeral and cemetery backlog could have a material adverse impact on our liquidity, cash flows, and financial results.
•Changes in taxation, or the interpretation of tax laws or regulations, as well as the inherent difficulty in quantifying potential tax effects of business decisions could have a material adverse effect on the results of our operations, financial condition, or cash flows.
For further information on these and other risks and uncertainties, see our Securities and Exchange Commission filings, including our 2025 Annual Report on Form 10-K. Copies of this document as well as other SEC filings can be obtained from our website at www.sci-corp.com.
4 Service Corporation International
| SERVICE CORPORATION INTERNATIONAL | ||||
APPENDIX: RESULTS FOR THE SECOND QUARTER OF 2026 | |||||
Consolidated Statement of Operations (Unaudited)
| (Dollars in thousands, except per share amounts) | Three Months Ended | Six Months Ended | |||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenue | $ | 1,103,288 | $ | 1,065,444 | $ | 2,199,742 | $ | 2,139,611 | |||||||||||||||
| Cost of revenue | (829,787) | (794,006) | (1,639,790) | (1,576,756) | |||||||||||||||||||
| Gross profit | 273,501 | 271,438 | 559,952 | 562,855 | |||||||||||||||||||
| Corporate general and administrative expenses | (41,775) | (49,466) | (85,686) | (94,167) | |||||||||||||||||||
| Restructuring charge | — | (1,575) | — | (1,575) | |||||||||||||||||||
| (Losses) gains on divestitures and impairment charges, net | (138) | 4,062 | 1,136 | 9,033 | |||||||||||||||||||
| Operating income | 231,588 | 224,459 | 475,402 | 476,146 | |||||||||||||||||||
| Interest expense | (64,711) | (64,071) | (128,717) | (125,554) | |||||||||||||||||||
| Other (expense) income, net | (57) | 3,914 | 1,341 | 7,066 | |||||||||||||||||||
| Income before income taxes | 166,820 | 164,302 | 348,026 | 357,658 | |||||||||||||||||||
| Provision for income taxes | (41,943) | (41,378) | (87,276) | (91,807) | |||||||||||||||||||
| Net income | 124,877 | 122,924 | 260,750 | 265,851 | |||||||||||||||||||
| Net income attributable to noncontrolling interests | (52) | (59) | (117) | (106) | |||||||||||||||||||
| Net income attributable to common stockholders | $ | 124,825 | $ | 122,865 | $ | 260,633 | $ | 265,745 | |||||||||||||||
| Basic earnings per share: | |||||||||||||||||||||||
| Net income attributable to common stockholders | $ | 0.91 | $ | 0.87 | $ | 1.89 | $ | 1.86 | |||||||||||||||
| Basic weighted average number of shares | 137,519 | 141,897 | 138,268 | 143,001 | |||||||||||||||||||
| Diluted earnings per share: | |||||||||||||||||||||||
| Net income attributable to common stockholders | $ | 0.90 | $ | 0.86 | $ | 1.87 | $ | 1.84 | |||||||||||||||
| Diluted weighted average number of shares | 138,327 | 142,992 | 139,122 | 144,134 | |||||||||||||||||||
5 Service Corporation International
Consolidated Balance Sheet (Unaudited)
| (Dollars in thousands, except share amounts) | |||||||||||
| June 30, 2026 | December 31, 2025 | ||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 260,411 | $ | 243,581 | |||||||
Receivables, net of reserves of $3,602 and $3,944, respectively | 104,109 | 100,415 | |||||||||
| Inventories | 38,235 | 35,246 | |||||||||
| Other | 46,991 | 32,551 | |||||||||
| Total current assets | 449,746 | 411,793 | |||||||||
Preneed receivables, net of reserves of $33,925 and $34,680, respectively, and trust investments | 7,652,394 | 7,360,793 | |||||||||
| Cemetery property | 2,251,528 | 2,201,967 | |||||||||
| Property and equipment, net | 2,835,540 | 2,751,761 | |||||||||
| Goodwill | 2,174,837 | 2,169,055 | |||||||||
Deferred charges and other assets, net of reserves of $2,826 and $2,460, respectively | 1,329,669 | 1,360,530 | |||||||||
| Cemetery perpetual care trust investments | 2,520,779 | 2,398,613 | |||||||||
| Total assets | $ | 19,214,493 | $ | 18,654,512 | |||||||
| LIABILITIES & EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable and accrued liabilities | $ | 650,833 | $ | 685,156 | |||||||
| Current maturities of long-term debt | 195,149 | 56,847 | |||||||||
| Income taxes payable | 246 | 3,701 | |||||||||
| Total current liabilities | 846,228 | 745,704 | |||||||||
| Long-term debt | 5,108,016 | 5,082,970 | |||||||||
| Deferred revenue, net | 1,823,627 | 1,779,266 | |||||||||
| Deferred tax liability | 704,103 | 691,033 | |||||||||
| Other liabilities | 571,893 | 550,793 | |||||||||
| Deferred receipts held in trust | 6,116,618 | 5,784,398 | |||||||||
| Care trusts’ corpus | 2,506,248 | 2,381,507 | |||||||||
Commitments and contingencies | |||||||||||
| Equity: | |||||||||||
Common stock, $1 per share par value, 500,000,000 shares authorized, 142,249,152 and 141,957,004 shares issued, respectively, and 136,619,474 and 139,678,199 shares outstanding, respectively | 136,619 | 139,678 | |||||||||
| Capital in excess of par value | 976,452 | 987,210 | |||||||||
| Retained earnings | 427,900 | 498,958 | |||||||||
| Accumulated other comprehensive income | (3,720) | 12,425 | |||||||||
| Total common stockholders’ equity | 1,537,251 | 1,638,271 | |||||||||
| Noncontrolling interests | 509 | 570 | |||||||||
| Total equity | 1,537,760 | 1,638,841 | |||||||||
| Total liabilities and equity | $ | 19,214,493 | $ | 18,654,512 | |||||||
6 Service Corporation International
Consolidated Statement of Cash Flows (Unaudited)
| (Dollars in thousands) | Six months ended June 30, | ||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 260,750 | $ | 265,851 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 114,081 | 108,257 | |||||||||
| Amortization of intangibles | 7,038 | 8,441 | |||||||||
| Amortization of cemetery property | 48,581 | 48,195 | |||||||||
| Amortization of loan costs | 4,474 | 4,383 | |||||||||
| Provision for expected credit losses | 4,217 | 5,234 | |||||||||
| Provision for deferred income taxes | 13,307 | 4,621 | |||||||||
| Gains on divestitures and impairment charges, net | (1,136) | (9,033) | |||||||||
| Share-based compensation | 10,387 | 9,589 | |||||||||
| Change in assets and liabilities, net of effects from acquisitions and divestitures: | |||||||||||
| (Increase) decrease in receivables | (5,094) | 6,205 | |||||||||
| Decrease (increase) in other assets | 24,982 | (16,110) | |||||||||
| Increase in payables and other liabilities | 21,679 | 11,996 | |||||||||
| Effect of preneed sales production and maturities: | |||||||||||
| Decrease (increase) in preneed receivables, net and trust investments | 8,318 | (28,062) | |||||||||
| Increase in deferred revenue, net | 40,995 | 23,785 | |||||||||
| Increase in deferred receipts held in trust | 19,860 | 34,228 | |||||||||
| Net cash provided by operating activities | 572,439 | 477,580 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (175,593) | (161,201) | |||||||||
| Business acquisitions, net of cash acquired | (39,469) | (28,242) | |||||||||
| Real estate acquisitions | (12,835) | (5,422) | |||||||||
| Corporate headquarters | (56,334) | (26,759) | |||||||||
| Proceeds from divestitures and sales of property and equipment | 5,331 | 26,762 | |||||||||
| Payments for Company-owned life insurance policies | (124) | (130) | |||||||||
| Proceeds from Company-owned life insurance policies and other | — | 3,757 | |||||||||
| Tax credit equity investments | (40,737) | — | |||||||||
| Net cash used in investing activities | (319,761) | (191,235) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from issuance of long-term debt | 405,000 | 495,001 | |||||||||
| Scheduled payments of debt | (13,648) | (12,827) | |||||||||
| Early payments of debt | (295,000) | (305,000) | |||||||||
| Proceeds from corporate headquarters debt facility | 51,854 | 17,120 | |||||||||
| Principal payments on finance leases | (19,783) | (18,853) | |||||||||
| Proceeds from exercise of stock options | 6,599 | 4,040 | |||||||||
| Purchase of Company common stock | (266,377) | (324,023) | |||||||||
| Payments of dividends | (96,363) | (91,129) | |||||||||
| Bank overdrafts and other | (4,773) | (7,354) | |||||||||
| Net cash used in financing activities | (232,491) | (243,025) | |||||||||
| Effect of foreign currency | (4,938) | 5,800 | |||||||||
| Net increase in cash, cash equivalents, and restricted cash | 15,249 | 49,120 | |||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 246,468 | 221,399 | |||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 261,717 | $ | 270,519 | |||||||
7 Service Corporation International
Consolidated Segment Results
(See definitions of revenue line items later in this appendix.)
| (Dollars in millions, except funeral services performed and average revenue per service) | Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Consolidated funeral: | |||||||||||||||||||||||
| Atneed revenue | $ | 298.7 | $ | 296.1 | $ | 618.9 | $ | 625.2 | |||||||||||||||
| Matured preneed revenue | 196.5 | 183.5 | 401.9 | 389.3 | |||||||||||||||||||
| Core revenue | 495.2 | 479.6 | 1,020.8 | 1,014.5 | |||||||||||||||||||
| Non-funeral home revenue | 27.6 | 25.7 | 56.4 | 53.4 | |||||||||||||||||||
| Non-funeral home preneed sales revenue | 21.3 | 26.4 | 43.5 | 48.6 | |||||||||||||||||||
| Core general agency and other revenue | 60.7 | 59.7 | 114.7 | 114.4 | |||||||||||||||||||
| Total revenue | $ | 604.8 | $ | 591.4 | $ | 1,235.4 | $ | 1,230.9 | |||||||||||||||
| Gross profit | $ | 110.3 | $ | 116.0 | $ | 244.3 | $ | 270.0 | |||||||||||||||
| Gross profit percentage | 18.2 | % | 19.6 | % | 19.8 | % | 21.9 | % | |||||||||||||||
| Funeral services performed | 87,347 | 87,014 | 181,033 | 184,868 | |||||||||||||||||||
| Average revenue per service | $ | 5,985 | $ | 5,807 | $ | 5,950 | $ | 5,777 | |||||||||||||||
| (Dollars in millions) | Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Consolidated cemetery: | |||||||||||||||||||||||
| Atneed property revenue | $ | 37.5 | $ | 37.0 | $ | 74.0 | $ | 74.2 | |||||||||||||||
| Atneed merchandise and service revenue | 73.2 | 74.0 | 145.9 | 149.1 | |||||||||||||||||||
| Total atneed revenue | 110.7 | 111.0 | 219.9 | 223.3 | |||||||||||||||||||
| Recognized preneed property revenue | 225.4 | 220.4 | 435.0 | 409.1 | |||||||||||||||||||
| Recognized preneed merchandise and service revenue | 116.2 | 105.8 | 222.5 | 204.3 | |||||||||||||||||||
| Total recognized preneed revenue | 341.6 | 326.2 | 657.5 | 613.4 | |||||||||||||||||||
| Core revenue | 452.3 | 437.2 | 877.4 | 836.7 | |||||||||||||||||||
| Other cemetery revenue | 46.2 | 36.9 | 87.0 | 72.1 | |||||||||||||||||||
| Total revenue | $ | 498.5 | $ | 474.1 | $ | 964.4 | $ | 908.8 | |||||||||||||||
| Gross profit | $ | 163.2 | $ | 155.5 | $ | 315.7 | $ | 292.9 | |||||||||||||||
| Gross profit percentage | 32.7 | % | 32.8 | % | 32.7 | % | 32.2 | % | |||||||||||||||
8 Service Corporation International
Comparable Funeral Results
The table below details comparable funeral results of operations (“same store”) for the three months ended June 30, 2026 and 2025. We consider comparable funeral operations to be those businesses owned for the entire period beginning January 1, 2025 and ending June 30, 2026.
| (Dollars in millions, except average revenue per service and average revenue per contract sold) | Three months ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | Var | % | ||||||||||||||||||||
| Comparable funeral revenue: | |||||||||||||||||||||||
Atneed revenue (1) | $ | 290.2 | $ | 294.3 | $ | (4.1) | (1.4) | % | |||||||||||||||
Matured preneed revenue (2) | 194.0 | 182.8 | 11.2 | 6.1 | % | ||||||||||||||||||
Core revenue (3) | 484.2 | 477.1 | 7.1 | 1.5 | % | ||||||||||||||||||
Non-funeral home revenue (4) | 27.4 | 25.1 | 2.3 | 9.2 | % | ||||||||||||||||||
Non-funeral home preneed sales revenue (5) | 21.2 | 26.3 | (5.1) | (19.4) | % | ||||||||||||||||||
Core general agency and other revenue (6) | 60.1 | 59.3 | 0.8 | 1.3 | % | ||||||||||||||||||
| Total comparable revenue | $ | 592.9 | $ | 587.8 | $ | 5.1 | 0.9 | % | |||||||||||||||
| Comparable gross profit | $ | 109.8 | $ | 116.6 | $ | (6.8) | (5.8) | % | |||||||||||||||
| Comparable gross profit percentage | 18.5 | % | 19.8 | % | (1.3) | % | |||||||||||||||||
| Comparable funeral services performed: | |||||||||||||||||||||||
| Atneed | 44,482 | 45,873 | (1,391) | (3.0) | % | ||||||||||||||||||
| Matured preneed | 26,384 | 26,247 | 137 | 0.5 | % | ||||||||||||||||||
| Total core | 70,866 | 72,120 | (1,254) | (1.7) | % | ||||||||||||||||||
| Non-funeral home | 14,178 | 14,109 | 69 | 0.5 | % | ||||||||||||||||||
| Total comparable funeral services performed | 85,044 | 86,229 | (1,185) | (1.4) | % | ||||||||||||||||||
Core cremation rate | 58.0 | % | 57.4 | % | 0.6 | % | |||||||||||||||||
Total comparable cremation rate (7) | 64.8 | % | 64.3 | % | 0.5 | % | |||||||||||||||||
Comparable funeral average revenue per service: | |||||||||||||||||||||||
| Atneed | $ | 6,524 | $ | 6,416 | $ | 108 | 1.7 | % | |||||||||||||||
| Matured preneed | 7,353 | 6,965 | 388 | 5.6 | % | ||||||||||||||||||
| Total core | 6,833 | 6,615 | 218 | 3.3 | % | ||||||||||||||||||
| Non-funeral home | 1,933 | 1,779 | 154 | 8.7 | % | ||||||||||||||||||
| Total comparable average revenue per service | $ | 6,016 | $ | 5,824 | $ | 192 | 3.3 | % | |||||||||||||||
Comparable funeral preneed sales production: | |||||||||||||||||||||||
| Total preneed sales | $ | 323.3 | $ | 303.4 | $ | 19.9 | 6.6 | % | |||||||||||||||
| Core contracts sold | 38,642 | 36,232 | 2,410 | 6.7 | % | ||||||||||||||||||
| Non-funeral home contracts sold | 20,420 | 20,923 | (503) | (2.4) | % | ||||||||||||||||||
| Core average revenue per contract sold | 6,706 | 6,604 | 102 | 1.5 | % | ||||||||||||||||||
| Non-funeral home average revenue per contract sold | $ | 3,141 | $ | 3,068 | $ | 73 | 2.4 | % | |||||||||||||||
(1)Atneed revenue represents merchandise and services sold and delivered or performed once death has occurred.
(2)Matured preneed revenue represents merchandise and services sold on a preneed contract through our core funeral homes, which have been delivered or performed as well as the related merchandise and service trust fund income and other insurance benefits.
(3)Core revenue represents the sum of merchandise and services sold on an atneed contract or preneed contract, which were delivered or performed once death has occurred through our core funeral homes.
(4)Non-funeral home revenue represents services sold on a preneed or atneed contract through one of our non-funeral home sales channels (e.g. SCI Direct) and performed once death has occurred.
(5)Non-funeral home preneed sales revenue represents travel protection, net and merchandise sold on a preneed contract that is delivered before death has occurred and general agency revenue from our non-funeral home sales channel.
(6)Core general agency and other revenue primarily comprises core general agency revenue, which is commissions we receive from third-party insurance companies for life insurance policies sold to preneed customers for the purpose of funding preneed arrangements and core travel protection preneed sales, net.
(7)Total comparable cremation rate includes the impact of cremation services through our non-funeral sales channel (e.g. SCI Direct).
9 Service Corporation International
•Total comparable funeral revenue increased $5.1 million. Core funeral revenue increased $7.1 million, or 1.5%, primarily due to a 3.3% increase in core average revenue per service partially offset by a 1.7% decrease in core funeral services performed. The growth in the average revenue per service is primarily driven by consumer preferences for enhanced product and service offerings as well as an increase in trust fund income. The core cremation rate increased 60 basis points to 58.0%.
•Non-funeral home revenue increased $2.3 million, or 9.2%, due to an 8.7% increase in non-funeral home average revenue per service driven by increased matured preneed revenue from the backlog, combined with a 0.5% increase in non-funeral home services performed.
•Non-funeral home preneed sales revenue decreased $5.1 million, primarily due to an operational shift to defer the delivery of urns on preneed contracts to the time of need. This transition was completed late in 2025, and this decrease is short-term in nature as we will recognize deferred urn revenue from the backlog at the time of need as non-funeral home revenue in future periods.
•Core general agency and other revenue increased $0.8 million. Core general agency revenue benefited from higher insurance sales production which was largely offset by a lower general agency commission rate quarter over quarter. The current commission rate is stable and is trending in line with expectations.
•Comparable funeral gross profit decreased $6.8 million to $109.8 million, and the gross profit percentage declined 130 basis points from 19.8% to 18.5%. Gross profit was impacted by higher selling compensation associated with strong insurance-funded preneed sales production. Selling compensation costs associated with insurance-funded preneed sales production are expensed as incurred, while the benefit of these sales will be realized in future periods as the related funeral services are performed.
•Comparable funeral preneed sales production increased $19.9 million, or 6.6%, in the second quarter of 2026 compared to 2025, driven by an 8.3% increase in core preneed sales production.
Comparable Cemetery Results
The table below details comparable cemetery results of operations (“same store”) for the three months ended June 30, 2026 and 2025. We consider comparable cemetery operations to be those businesses owned for the entire period beginning January 1, 2025 and ending June 30, 2026.
| (Dollars in millions) | Three months ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | Var | % | ||||||||||||||||||||
| Comparable cemetery revenue: | |||||||||||||||||||||||
| Atneed property revenue | $ | 37.3 | $ | 37.0 | $ | 0.3 | 0.8 | % | |||||||||||||||
| Atneed merchandise and service revenue | 72.9 | 74.0 | (1.1) | (1.5) | % | ||||||||||||||||||
Total atneed revenue (1) | 110.2 | 111.0 | (0.8) | (0.7) | % | ||||||||||||||||||
| Recognized preneed property revenue | 225.2 | 220.4 | 4.8 | 2.2 | % | ||||||||||||||||||
| Recognized preneed merchandise and service revenue | 116.2 | 105.8 | 10.4 | 9.8 | % | ||||||||||||||||||
Total recognized preneed revenue (2) | 341.4 | 326.2 | 15.2 | 4.7 | % | ||||||||||||||||||
Core revenue (3) | 451.6 | 437.2 | 14.4 | 3.3 | % | ||||||||||||||||||
Other revenue (4) | 45.3 | 36.9 | 8.4 | 22.8 | % | ||||||||||||||||||
| Total comparable revenue | $ | 496.9 | $ | 474.1 | $ | 22.8 | 4.8 | % | |||||||||||||||
| Comparable gross profit | $ | 162.2 | $ | 155.5 | $ | 6.7 | 4.3 | % | |||||||||||||||
| Comparable gross profit percentage | 32.6 | % | 32.8 | % | (0.2) | % | |||||||||||||||||
Comparable cemetery preneed and atneed sales production: | |||||||||||||||||||||||
| Property | $ | 288.5 | $ | 271.2 | $ | 17.3 | 6.4 | % | |||||||||||||||
| Merchandise and services | 225.3 | 210.9 | 14.4 | 6.8 | % | ||||||||||||||||||
| Discounts and other | (5.4) | (3.7) | (1.7) | (45.9) | % | ||||||||||||||||||
| Preneed and atneed sales production | $ | 508.4 | $ | 478.4 | $ | 30.0 | 6.3 | % | |||||||||||||||
Preneed sales production | $ | 399.5 | $ | 369.8 | $ | 29.7 | 8.0 | % | |||||||||||||||
Recognition rate (5) | 88.8 | % | 91.4 | % | |||||||||||||||||||
(1)Atneed revenue represents property, merchandise, and services sold and delivered or performed once death has occurred.
(2)Recognized preneed revenue represents property, merchandise, and services sold on a preneed contract, which were delivered or performed as well as the related merchandise and service trust fund income.
(3)Core revenue represents the sum of property, merchandise, and services that have been delivered or performed as well as the related merchandise and service trust fund income.
10 Service Corporation International
(4)Other revenue is primarily related to endowment care trust fund income, royalty income, and interest and finance charges earned from customer receivables on preneed installment contracts.
(5)Represents the ratio of current period core revenue stated as a percentage of current period preneed and atneed sales production.
•Total comparable cemetery revenue increased $22.8 million, or 4.8%, in the second quarter of 2026 compared to the second quarter of 2025. The increase was due to higher core revenue of $14.4 million and higher other revenue of $8.4 million.
•The core revenue increase of $14.4 million was primarily due to a $15.2 million, or 4.7%, increase in total recognized preneed revenue, of which $4.8 million resulted from higher property revenue and $10.4 million from higher merchandise and service revenue. Merchandise and service revenue also reflects the positive impacts from increased trust fund income. Total recognized preneed revenue benefited from growth in comparable cemetery preneed sales production of $29.7 million, or 8.0%, a significant portion of which will benefit us in the future.
•Other revenue was $8.4 million higher, or 22.8%, compared to the prior-year quarter primarily from an increase in endowment care trust fund income based on market performance and higher total return distributions.
•Comparable cemetery gross profit increased $6.7 million to $162.2 million. The gross profit percentage decreased slightly from 32.8% to 32.6%. Gross profit was impacted by higher selling compensation, reflecting strong preneed sales production growth of 8.0%. While this strong production growth puts temporary pressure on cemetery gross margins, it grows our backlog with higher-margin deferred property sales which will benefit us in future periods.
•Comparable preneed cemetery sales production increased $29.7 million, or 8.0%, and was supported by an increase in the number of contracts sold and a higher sales average as well as an increase in large sales.
Other Financial Results
•Corporate general and administrative expenses were $41.8 million in the second quarter of 2026, compared to $49.5 million in the prior year. The prior year included a $6.4 million charge related to the settlement of certain legal matters. The remaining decrease is partially due to lower auto and general liability claims in the current year.
•Interest expense was $64.7 million in the second quarter of 2026 compared to $64.1 million in the prior year. The average balances on our floating-rate debt increased approximately $189.0 million, partially offset by lower average floating rates decreasing from 6.8% to 5.8%, resulting in the net $0.6 million increase in interest expense.
•The GAAP effective income tax rate for the second quarter of 2026 was 25.1%, down from 25.2% in the prior-year quarter. On an adjusted basis, the effective tax rate was 25.2%, down from 25.4% in the prior-year quarter. The lower effective tax rate in the current period was primarily due to non-taxable gains on the cash surrender value of certain life insurance policies.
Cash Flow and Capital Spending
| (Dollars in millions) | Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net cash provided by operating activities | $ | 238.7 | $ | 166.5 | $ | 572.4 | $ | 477.6 | |||||||||||||||
| Legal settlement payments | 0.1 | 0.5 | 0.3 | 0.7 | |||||||||||||||||||
| Restructuring charge payments | — | 1.3 | 0.6 | 5.9 | |||||||||||||||||||
| Net cash provided by operating activities excluding special items | $ | 238.8 | $ | 168.3 | $ | 573.3 | $ | 484.2 | |||||||||||||||
| Cash taxes included in net cash provided by operating activities excluding special items | $ | 30.0 | $ | 94.3 | $ | 34.4 | $ | 99.2 | |||||||||||||||
Net cash provided by operating activities excluding special items grew $70.5 million to $238.8 million in the second quarter of 2026 compared to $168.3 million in the second quarter of 2025. The increase is driven by higher operating income of $7.1 million, and a reduction in cash taxes of $64.3 million, due primarily to credits associated with a renewable energy investment. The related renewable energy investment resulted in a $40.7 million investing cash outflow in the current quarter. Working capital remained essentially flat overall; however, we saw an improvement of $36.4 million in preneed working capital. This improvement was primarily driven by collections associated with higher preneed cemetery sales production (for which revenue recognition was deferred) as well as higher collection rates compared to the prior year. This was offset by $37.3 million in higher accounts payable and other working capital uses due to the timing of an additional payroll cycle within the period compared to the prior year. We expect the favorable preneed cemetery collection rates to continue in the back half of 2026, resulting in our increasing cash flow guidance.
11 Service Corporation International
A summary of our capital expenditures is set forth below:
| (Dollars in millions) | Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Capital improvements at existing field locations | $ | 29.6 | $ | 29.1 | $ | 49.6 | $ | 49.8 | |||||||||||||||
Development of cemetery property | 44.5 | 34.7 | 85.4 | 76.0 | |||||||||||||||||||
Digital investments and corporate | 6.0 | 5.1 | 11.6 | 9.9 | |||||||||||||||||||
| Total maintenance, cemetery development, and other capital expenditures (Maintenance capital expenditures) | $ | 80.1 | $ | 68.9 | $ | 146.6 | $ | 135.7 | |||||||||||||||
| Growth capital expenditures/construction of new funeral service locations | 15.6 | 14.1 | 29.0 | 25.5 | |||||||||||||||||||
| Total capital expenditures | $ | 95.7 | $ | 83.0 | $ | 175.6 | $ | 161.2 | |||||||||||||||
Total capital expenditures increased $12.7 million in the current quarter, primarily due to the timing of spend on the development of high-returning cemetery property during the quarter.
Trust Fund Returns
Total trust fund returns include realized and unrealized gains and losses and dividends and are shown gross without netting of certain fees. A summary of our consolidated trust fund returns as of June 30, 2026 is set forth below:
| Three Months | Six Months | |||||||||||||
| Preneed funeral | 8.0% | 7.1% | ||||||||||||
| Preneed cemetery | 7.8% | 7.1% | ||||||||||||
| Cemetery perpetual care | 7.4% | 6.8% | ||||||||||||
| Combined trust funds | 7.7% | 7.0% | ||||||||||||
Non-GAAP Financial Measures
Earnings excluding special items, diluted earnings per share excluding special items, and net cash provided by operating activities excluding special items shown above are non-GAAP financial measures. We believe these non-GAAP financial measures provide a consistent basis for comparison between quarters and years, and better reflect the performance of our core operations by adjusting for the items listed below. We also believe these measures help facilitate comparisons to our competitors' operating results.
Set forth below is a reconciliation of our reported net income attributable to common stockholders to earnings excluding special items and our GAAP diluted earnings per share to diluted earnings per share excluding special items. See “Cash Flow and Capital Spending” in this press release for a reconciliation of net cash provided by operating activities to net cash provided by operating activities excluding special items. We do not intend for this information to be considered in isolation or as a substitute for other measures of performance prepared in accordance with GAAP.
| (Dollars in millions, except diluted EPS) | Three months ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Net Income | Diluted EPS | Net Income | Diluted EPS | ||||||||||||||||||||
| Net income attributable to common stockholders, as reported | $ | 124.8 | $ | 0.90 | $ | 122.9 | $ | 0.86 | |||||||||||||||
| Pre-tax reconciling items: | |||||||||||||||||||||||
| Losses (gains) on divestitures and impairment charges, net | 0.1 | — | (4.1) | (0.03) | |||||||||||||||||||
| Legal settlement | — | — | 6.4 | 0.04 | |||||||||||||||||||
Restructuring charge | — | — | 1.6 | 0.01 | |||||||||||||||||||
| Tax reconciling items: | |||||||||||||||||||||||
| Tax effect from significant items | — | — | (0.9) | — | |||||||||||||||||||
Change in non-recurring tax items | — | — | (0.4) | — | |||||||||||||||||||
| Earnings excluding special items and diluted earnings per share excluding special items | $ | 124.9 | $ | 0.90 | $ | 125.5 | $ | 0.88 | |||||||||||||||
| Diluted weighted average shares outstanding | 138.3 | 143.0 | |||||||||||||||||||||
12 Service Corporation International
| (Dollars in millions, except diluted EPS) | Six months ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| Net Income | Diluted EPS | Net Income | Diluted EPS | ||||||||||||||||||||
| Net income attributable to common stockholders, as reported | $ | 260.6 | $ | 1.87 | $ | 265.7 | $ | 1.84 | |||||||||||||||
| Pre-tax reconciling items: | |||||||||||||||||||||||
Gains on divestitures and impairment charges, net | (1.1) | (0.01) | (9.0) | (0.06) | |||||||||||||||||||
| Legal settlement | — | — | 6.4 | 0.04 | |||||||||||||||||||
Restructuring charge | — | — | 1.6 | 0.01 | |||||||||||||||||||
| Tax reconciling items: | |||||||||||||||||||||||
| Tax effect from significant items | 0.2 | 0.01 | 0.4 | 0.01 | |||||||||||||||||||
Change in non-recurring tax items | 0.4 | — | — | — | |||||||||||||||||||
| Earnings excluding special items and diluted earnings per share excluding special items | $ | 260.1 | $ | 1.87 | $ | 265.1 | $ | 1.84 | |||||||||||||||
| Diluted weighted average shares outstanding | 139.1 | 144.1 | |||||||||||||||||||||
13 Service Corporation International