RadNet records rare decrease in imaging procedural volumes

RadNet Inc. recorded a rare decrease in same-center procedural volumes during the first quarter of 2025, leaders reported on Sunday.

When comparing only the centers it operated in both periods, the Los Angeles-based outpatient chain saw a 0.3% drop in volume compared to the first three months of 2024. This marks the first time since the pandemic of 2020 that RadNet has recorded a same-center decrease in imaging use. 

Leaders blamed the downturn on severe storms in Houston, along with wildfires in Southern California. Together, the two weather events led to a $22 million decline in quarterly revenues and $15 million decrease in earnings before interest, taxes, depreciation and amortization (EBITDA), the company first estimated in February.

“Thankfully, our business bounced back nicely in March, and we had a strong April and first part of May. So, it appears we are back on track,” Chief Financial Officer Mark Stolper told Radiology Business by email May 11. 

When viewing volume trends in aggregate—incorporating new imaging centers RadNet may have acquired or opened in the last year—the company saw a 3.6% year-over-year increase in procedural volumes. This included an 8.4% uptick in MRI volume compared to Q1 of 2024, an 8.4% increase in CT and 22.9% for PET/CT. Overall volume—considering routine exams such as X-ray, ultrasound and mammography—increased 3.6% compared to last year. Meanwhile, on a same-center basis, MRI volumes increased 3.4%, CT 3%, and PET/CT 12.2%, while routine imaging exams fell 0.3%.

Altogether, RadNet now operates 401 outpatient imaging centers concentrated in Arizona, California, Delaware, Florida, Maryland, New Jersey, New York and Texas. CEO Howard Berger, MD, highlighted continued growth in PET/CT, which he said was driven by demand for prostate and braining imaging. 

“Despite the challenges from the severe weather and Southern California fires during the first quarter, we advanced a number of important initiatives,” Berger said in a statement shared May 11. “The cumulative strength of these trends has provided us the confidence to increase 2025 guidance ranges for revenue and adjusted EBITDA,” he added later. 

Revenues climb

Total company revenues for RadNet increased by about 9.2% in Q1 when compared to the same three months in 2024, up to $471.4 million. This includes a 31.1% uptick in revenues from RadNet’s digital health segment— which offers artificial intelligence tools and workflow technology—up to $19.2 million. Total company adjusted earnings (before interest, taxes, depreciation and amortization) were about $46.4 million in Q1, a 20.6% drop compared to 2024. 

RadNet highlighted “unusual, one-time items” that negatively impacted its quarterly results. These included $2.1 million in expenses from interest-rate swaps, $1.3 million for leases on imaging centers that had not yet opened, $5.4 million more in “lease abandonment” charges, and $3.6 million of noncapitalized research and development expenses in its digital health segment. Unadjusted for these occurrences, RadNet recorded a $37.9 million net loss in Q1 compared to a $2.8 million net loss in 2024. With adjustments, the company’s net loss was roughly $26.2 million.

Given growth in imaging trends following the two weather events, RadNet is revising its financial guidance for the company’s imaging center segment in 2025. It now expects to collect upward of $1.885 billion in total net revenue (up from the top-line of $1.875 billion) with adjusted earnings at up to $276 million (revised from $273 million). RadNet also expects to record capital expenditures at upward of $155 million in 2025 (up from original estimates of $150 million).

“RadNet’s balance sheet continues to be among the strongest in the diagnostic imaging industry,” Berger said in the announcement, highlighting the company’s $717 million cash balance and 1x debt-to-earnings ratio. “Our operating capabilities, scale and digital health tools and initiatives give us a unique perspective in identifying and recognizing value in potential strategic targets. We are encouraged with the pipeline of opportunities we are seeing and are confident we will be able to invest RadNet’s capital in value-creating ways.” 

Berger and colleagues plan to host a quarterly earnings call at 10:30 a.m. Eastern Time on Monday, May 12. Those interested in attending can phone 844-826-3035 or view a live or archived web feed here. This is RadNet’s first quarterly earnings call since announcing its $103 million planned purchase of breast imaging AI firm iCAD Inc.