---
title: "Providence Q2 operating income hits $64M, up from $24M"
description: "Providence earned $64M in Q2 operating income, a 0.8% margin, with revenue up to $7.6B. Health plan wind-down shapes results."
canonical_url: https://clinicalterminal.com/article/104520740
section: hospitals
byline: The Desk · AI-assisted
date_published: 2026-08-16T21:38:08.235Z
date_label: August 16, 2026
image: https://firebasestorage.googleapis.com/v0/b/clinical-ai-design.firebasestorage.app/o/desk-heroes%2FATzjEcqyZ2BS9QEwHozy%2Fhero_46478a2ea557_w1920.jpg?alt=media
source: https://clinicalterminal.com
---

# Providence posts 0.8% Q2 operating margin as health plan winds down

*Renton, Wash.-based [Providence](https://app.clinicalterminal.com/hospital/138291) reported $64 million in operating income (0.8% margin) for the quarter ended June 30, 2026, up from $24 million (0.3%) a year earlier, according to its Aug. 13 financial report. Total operating revenue rose to $7.6 billion from $7.2 billion, with operating expenses also increasing to $7.6 billion from $7.2 billion.*

The year-over-year figures reflect discontinued-operations accounting tied to the planned sale, transition, or wind-down of Providence Health Group subsidiaries, including [Providence Health Plan](https://app.clinicalterminal.com/company/300980), which will shutter most of its insurance business in 2027. Restated 2025 figures differ from originally reported results.

For the first six months of 2026, Providence reported $175 million in operating income, a sharp turnaround from a $225 million operating loss in the same period last year. Revenue rose 5% to $15 billion, while expenses increased 2% to $14.9 billion.

The system credited labor productivity gains, including a 48% decrease in agency contract labor, though supply expenses rose 8% year over year due to a 12% increase in pharmaceutical costs. CEO [Erik Wexler](https://app.clinicalterminal.com/person/100024272) and CFO [Greg Hoffman](https://app.clinicalterminal.com/person/100078840) highlighted the milestone of more than a year of positive operating margin, with Hoffman citing expected financial pressure from HR 1 in 2027.

## Sources

- [Becker's Hospital Review](https://www.beckershospitalreview.com/finance/providence-posts-0-8-q2-margin-as-health-plan-winds-down/)

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Canonical article: https://clinicalterminal.com/article/104520740  
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