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DALLAS--(BUSINESS WIRE)--Tenet Healthcare Corporation (NYSE: THC) reported net income from continuing operations available to Tenet common shareholders of $24 million in the second quarter of 2018 compared to a $56 million net loss from continuing operations in the second quarter of 2017. Adjusted EBITDA was $634 million in the second quarter of 2018 compared to $570 million in the second quarter of 2017.

“We are becoming a more agile and decisive organization and are pleased with our strong financial results for the third quarter in a row,” said Ronald A. Rittenmeyer, Executive Chairman and CEO. “We have demonstrated our ability to appropriately minimize costs, which will be an ongoing fundamental part of how we do business. Our top priorities remain strengthening our portfolio, delivering more consistent organic growth and taking additional steps to enhance our margins and free cash flow.”

Hospital Operations and Other Segment

Net operating revenues in the Hospital Operations and other segment were $3.733 billion, down 8.6 percent from the second quarter of 2017, primarily due to hospital divestitures and the wind-down of our health plan business.

On a same-hospital basis, net patient revenues after implicit price concessions were $3.432 billion, up 3.2 percent from the second quarter of 2017. Adjusted admissions were down 0.2 percent in the second quarter of 2018 and would have been up approximately 1.1 percent on a same-hospital basis excluding service line closures and declines in Detroit and Chicago. The Company’s decision to discontinue certain services at selected hospitals lowered same-hospital adjusted admissions by approximately 40 basis points in the second quarter of 2018. In addition, volume declines in Chicago (which the Company is divesting) and Detroit lowered same-hospital adjusted admissions by approximately 90 basis points. Revenue per adjusted admission increased 3.5 percent on a same-hospital basis. Same-hospital revenue included $63 million from the California Provider Fee Program in the second quarter of 2018 compared to no revenue in the second quarter of 2017 since the 2017 program was not approved until December 2017; excluding timing differences related to the California Provider Fee, same-hospital revenue per adjusted admission increased 1.6 percent.

Adjusted EBITDA in Tenet’s hospital segment was $345 million, a decrease of $1 million or 0.3 percent as compared to $346 million in the second quarter of 2017. Key items impacting the year-over-year comparison in Adjusted EBITDA include: (i) a $63 million increase in California Provider Fee revenue, (ii) a $41 million decline in EBITDA due to divestitures; (iii) a $23 million gain in the second quarter of 2017, primarily from the sale of the Company’s home health and hospice assets, which was recorded as a reduction to the Company’s other operating expenses, and (iv) a $6 million decline in electronic health record incentives. After normalizing for these items, Adjusted EBITDA in the hospital segment increased by $6 million, or approximately 2 percent.

Tenet’s health plan business recognized no revenue and $1 million of Adjusted EBITDA in the second quarter of 2018 versus $25 million of revenue and negative $19 million of Adjusted EBITDA in the second quarter of 2017. The revenue and expenses associated with the Company’s health plan operations are included in Tenet’s consolidated statements of operations; however, the results are excluded from Adjusted EBITDA in both periods.

Selected operating expenses in the hospital segment, defined as the sum of salaries, wages and benefits, supplies and other operating expenses, increased 2.2 percent on a per adjusted admission basis in the second quarter of 2018 or just 1.5 percent after normalizing for the aforementioned $23 million gain in the 2017 period.

Exchanges

Tenet’s same-hospital exchange outpatient visits increased 0.6 percent to 51,845 in the second quarter of 2018. Same-hospital exchange admissions were 4,725 in the second quarter of 2018, down 5.6 percent from the second quarter of 2017.

Ambulatory Care Segment

During the second quarter of 2018, the Ambulatory segment produced net operating revenues of $531 million, representing an increase of 12.5 percent as compared to $472 million in the second quarter of 2017. In addition, the Ambulatory segment generated Adjusted EBITDA of $198 million, up 20.7 percent from $164 million in the second quarter of 2017 and Adjusted EBITDA less facility-level noncontrolling interest was $128 million, up 20.8 percent from $106 million in the second quarter of 2017.

The results of many of the facilities in which the Ambulatory segment has an investment are not consolidated by Tenet. To help analyze the segment’s results of operations, management uses system-wide measures, which include revenues and cases of both consolidated and unconsolidated facilities. On a same-facility system-wide basis, revenue in the Ambulatory segment increased 6.9 percent, with cases increasing 4.3 percent and revenue per case increasing 2.4 percent. In the surgical business, which represents the majority of the revenue in the Ambulatory segment, same-facility system-wide revenue grew 6.6 percent, with cases up 3.4 percent and revenue per case up 3.1 percent, reflecting growth in higher-acuity surgical procedures. In the non-surgical business, same-facility system-wide revenue grew 13.6 percent, with visits up 5.8 percent and revenue per visit up 7.4 percent.

Conifer Segment

During the second quarter of 2018, as a result of divestiture activity at Tenet and other customers, Conifer’s revenue decreased 3.5 percent to $386 million, down from $400 million in the second quarter of 2017. Revenue from third party customers was down 1.2 percent to $242 million. Conifer’s revenue in the second quarter of 2018 included $7 million of contract termination fees from two health systems that acquired hospitals from Tenet and another Conifer customer and subsequently decided to insource revenue cycle management.

Conifer generated $91 million of Adjusted EBITDA in the second quarter of 2018, up 51.7 percent from $60 million in the second quarter of 2017. After normalizing for the aforementioned $7 million of contract termination fee revenue and $3 million of incentive revenue from customers in the second quarter of 2018, Adjusted EBITDA grew by 35 percent, primarily driven by improvements in Conifer’s cost structure.

Net Income and Earnings Per Share

Tenet reported net income from continuing operations available to Tenet common shareholders of $24 million, or $0.23 per diluted share, in the second quarter of 2018 compared to a net loss of $56 million, or $0.56 per diluted share, in the second quarter of 2017.

As shown on Table #2 at the end of this release, net income from continuing operations available to Tenet common shareholders of $24 million included: (i) $30 million of pre-tax impairment and restructuring charges, including $9 million of employee severance, $4 million of impairment charges to write-down assets held for sale in the United Kingdom to their estimated fair value, $4 million of contract and lease termination fees, and $13 million of other items; (ii) $13 million of pre-tax litigation and investigation costs; (iii) $8 million of pre-tax net gains on sales, consolidation and deconsolidation of facilities, primarily related to a $12 million pre-tax gain on the sale of Des Peres Hospital offset by $4 million of other items, and, (iv) other offsetting items. These items collectively lowered pre-tax income by $35 million, after-tax income by $27 million and diluted earnings per share by $0.26.

After adjusting for the items listed above and on Table #2, Tenet produced Adjusted net income from continuing operations available to Tenet common shareholders of $51 million, or $0.49 per diluted share, during the second quarter of 2018, as compared to an Adjusted net loss from continuing operations attributable to Tenet common shareholders of $17 million, or $0.17 per diluted share, in the second quarter of 2017.

A reconciliation of GAAP net income available (loss attributable) to Tenet common shareholders to Adjusted net income available (loss attributable) from continuing operations and Adjusted diluted earnings (loss) per share from continuing operations is contained in Table #2 at the end of this release.

Cash Flow and Liquidity

Cash and cash equivalents were $403 million at June 30, 2018 compared to $974 million at March 31, 2017. The Company had no outstanding borrowings on its $1 billion credit line as of June 30, 2018. Accounts receivable days outstanding from continuing operations were 55.1 at June 30, 2018 compared to 54.3 at March 31, 2018 and 55.8 at December 31, 2017.

Net cash provided by operating activities was $461 in the first half of 2018, representing a $60 million increase compared to $401 million in the first half of 2017. After subtracting $268 million and $348 million of capital expenditures in the first half of 2018 and 2017, respectively, Free Cash Flow was $193 million in the first half of 2018, an increase of $140 million compared to $53 million in the first half of 2017. Adjusted Free Cash Flow was $259 million in the first half of 2018, representing a $142 million increase from $117 million in the first half of 2017.

Net cash provided by investing activities was $225 million in the first half of 2018 compared to $308 million of net cash used in investing activities in the first half of 2017. The 2018 period included $624 million of proceeds from the sales of facilities, long-term investments and other assets, primarily from the sale of the Company’s two hospitals in the Philadelphia area, MacNeal Hospital, Des Peres Hospital, and the Company’s minority interests in four Dallas-area hospitals. The 2018 period also included $126 million of purchases of businesses, joint ventures and equity investments, primarily related to USPI’s acquisition program.

Net cash used in financing activities was $894 million in the first half of 2018 compared to $334 million of net cash used in financing activities in the first half of 2017. The 2018 period included $642 million in purchases of noncontrolling interests, including approximately $630 million in the second quarter of 2018 to increase Tenet’s ownership in USPI to 95 percent, and $78 million of debt retirement through open market purchases.

Reconciliations of net cash provided by operating activities to both Free Cash Flow and Adjusted Free Cash Flow are contained in Table #3 at the end of this release.

Outlook

The Company’s Outlook for 2018 includes:

• Revenue of $17.9 billion to $18.3 billion,
• Net income from continuing operations available to Tenet common shareholders of $115 million to $186 million,
• Adjusted EBITDA of $2.550 billion to $2.650 billion,
• Net cash provided by operating activities of $1.220 billion to $1.525 billion,
• Adjusted Free Cash Flow of $725 million to $925 million,
• Diluted earnings per share from continuing operations of $1.11 to $1.79, and
• Adjusted diluted earnings per share from continuing operations of $1.54 to $1.88.

The Outlook for 2018 assumes equity in earnings of unconsolidated affiliates of $160 million to $170 million, net income available to noncontrolling interests of $390 million to $410 million and an average diluted share count of 104 million.

The Company’s Outlook for the third quarter of 2018 includes:

• Revenue of $4.300 billion to $4.500 billion,
• Net income available (loss attributable) from continuing operations to Tenet common shareholders ranging from a loss of $10 million to income of $5 million,
• Adjusted EBITDA of $575 million to $625 million,
• Diluted earnings per share from continuing operations ranging from a loss of $0.10 to earnings of $0.05, and
• Adjusted diluted earnings per share from continuing operations ranging from $0.10 to $0.24.

The Outlook for the third quarter assumes equity in earnings of unconsolidated affiliates of $40 million to $45 million, net income available to noncontrolling interests of $90 million to $100 million, and an average diluted share count of 104 million.

Additional details on Tenet’s Outlook for both the third quarter and calendar year 2018 are available in Tables #4, #5 and #6 at the end of this press release and in an accompanying slide presentation that is accessible through the Company’s website at www.tenethealth.com/investors.

Management’s Webcast Discussion of Second Quarter Results

Tenet management will discuss the Company’s second quarter 2018 results on a webcast scheduled for 10:00 a.m. Eastern Time (9:00 a.m. Central Time) on August 7, 2018. Investors can access the webcast through the Company’s website at www.tenethealth.com/investors. A set of slides, which will be referred to on the conference call, is available on the Quarterly Results section of the Company’s website.

Additional information regarding Tenet’s quarterly results of operations is contained in its Form 10-Q report for the period ended June 30, 2018, which will be filed with the Securities and Exchange Commission and posted on the Company’s website.

This press release includes certain non-GAAP measures, such as Adjusted EBITDA, Adjusted net income available (loss attributable) from continuing operations to Tenet common shareholders, Adjusted diluted earnings (loss) per share from continuing operations, Free Cash Flow and Adjusted Free Cash Flow. Reconciliations of these measures to the most comparable GAAP measures are contained in the tables at the end of this release.

Tenet Healthcare Corporation is a diversified healthcare services company with approximately 115,000 employees united around a common mission: to help people live happier, healthier lives. Through its subsidiaries, partnerships and joint ventures, including United Surgical Partners International, the Company operates general acute care and specialty hospitals, ambulatory surgery centers, urgent care centers and other outpatient facilities in the United States and the United Kingdom. Tenet’s Conifer Health Solutions subsidiary provides technology-enabled performance improvement and health management solutions to hospitals, health systems, integrated delivery networks, physician groups, self-insured organizations and health plans. For more information, please visit www.tenethealth.com.

The terms “THC,” “Tenet Healthcare Corporation,” “the Company,” “we,” “us” or “our” refer to Tenet Healthcare Corporation or one or more of its subsidiaries or affiliates as applicable.

This release contains “forward-looking statements” - that is, statements that relate to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance and financial condition, and often contain words such as “expect,” “assume,” “anticipate,” “estimate,” “intend,” “plan,” “project” “believe,” “seek,” “see,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that could cause our actual results to be materially different than those expressed in our forward-looking statements include, but are not limited to, the factors disclosed under “Forward-Looking Statements” and “Risk Factors” in our Form 10-K for the year ended December 31, 2017, and subsequent Form 10-Q filings and other filings with the Securities and Exchange Commission.

Tenet uses its Company website to provide important information to investors about the Company including the posting of important announcements regarding financial performance and corporate developments.

TENET HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in millions except per share amounts)		Three Months Ended June 30,
		2018				%			2017				%			Change
Net operating revenues:
Net operating revenues before provision for doubtful accounts									$	5,173
Less: Provision for doubtful accounts										371
Net operating revenues		$	4,506			100.0	%			4,802			100.0	%		(6.2	)%
Equity in earnings of unconsolidated affiliates			39			0.9	%			28			0.6	%		39.3	%
Operating expenses:
Salaries, wages and benefits			2,135			47.4	%			2,346			48.9	%		(9.0	)%
Supplies			748			16.6	%			780			16.2	%		(4.1	)%
Other operating expenses, net			1,027			22.8	%			1,159			24.1	%		(11.4	)%
Electronic health record incentives			—			—	%			(6	)		(0.1	)%		(100.0	)%
Depreciation and amortization			194			4.3	%			222			4.6	%
Impairment and restructuring charges, and acquisition-related costs			30			0.7	%			41			0.9	%
Litigation and investigation costs			13			0.3	%			1			0.0	%
Net gains on sales, consolidation and deconsolidation of facilities			(8	)		(0.2	)%			(23	)		(0.5	)%
Operating income			406			9.0	%			310			6.5	%
Interest expense			(254	)						(260	)
Other non-operating expense, net			(1	)						(5	)
Loss from early extinguishment of debt			(1	)						(26	)
Income from continuing operations, before income taxes			150							19
Income tax benefit (expense)			(44	)						12
Income from continuing operations, before discontinued operations			106							31
Discontinued operations:
Income from operations			2							2
Income tax benefit (expense)			—							(1	)
Income from discontinued operations			2							1
Net income			108							32
Less: Net income available to noncontrolling interests			82							87
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	26						$	(55	)
Amounts available (attributable) to Tenet Healthcare Corporation common shareholders
Income (loss) from continuing operations, net of tax		$	24						$	(56	)
Income from discontinued operations, net of tax			2							1
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	26						$	(55	)
Earnings (loss) per share available (attributable) to Tenet Healthcare Corporation common shareholders:
Basic
Continuing operations		$	0.23						$	(0.56	)
Discontinued operations			0.02							0.01
		$	0.25						$	(0.55	)
Diluted
Continuing operations		$	0.23						$	(0.56	)
Discontinued operations			0.02							0.01
		$	0.25						$	(0.55	)
Weighted average shares and dilutive securities outstanding (in thousands):
Basic			102,147							100,612
Diluted*			104,177							100,612

*Had we generated income from continuing operations in the three months ended June 30, 2017 the effect of employee stock options, restricted stock units and deferred compensation units on the diluted shares calculation would have been an increase of 682 thousand shares.

TENET HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in millions except per share amounts)		Six Months Ended June 30,
		2018				%			2017				%			Change
Net operating revenues:
Net operating revenues before provision for doubtful accounts									$	10,369
Less: Provision for doubtful accounts										754
Net operating revenues		$	9,205			100.0	%			9,615			100.0	%		(4.3	)%
Equity in earnings of unconsolidated affiliates			64			0.7	%			57			0.6	%		12.3	%
Operating expenses:
Salaries, wages and benefits			4,362			47.5	%			4,726			49.2	%		(7.7	)%
Supplies			1,522			16.5	%			1,545			16.1	%		(1.5	)%
Other operating expenses, net			2,087			22.7	%			2,346			24.4	%		(11.0	)%
Electronic health record incentives			(1	)		—	%			(7	)		(0.1	)%		(85.7	)%
Depreciation and amortization			398			4.3	%			443			4.6	%
Impairment and restructuring charges, and acquisition-related costs			77			0.8	%			74			0.8	%
Litigation and investigation costs			19			0.2	%			6			0.1	%
Net gains on sales, consolidation and deconsolidation of facilities			(118	)		(1.3	)%			(38	)		(0.4	)%
Operating income			923			10.0	%			577			6.0	%
Interest expense			(509	)						(518	)
Other non-operating expense, net			(2	)						(10	)
Loss from early extinguishment of debt			(2	)						(26	)
Income from continuing operations, before income taxes			410							23
Income tax benefit (expense)			(114	)						45
Income from continuing operations, before discontinued operations			296							68
Discontinued operations:
Income (loss) from operations			3							—
Income tax benefit (expense)			—							—
Income (loss) from discontinued operations			3							—
Net income			299							68
Less: Net income available to noncontrolling interests			174							176
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	125						$	(108	)
Amounts available (attributable) to Tenet Healthcare Corporation common shareholders
Income (loss) from continuing operations, net of tax		$	122						$	(108	)
Income (loss) from discontinued operations, net of tax			3							—
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	125						$	(108	)
Earnings (loss) per share available (attributable) to Tenet Healthcare Corporation common shareholders:
Basic
Continuing operations		$	1.20						$	(1.08	)
Discontinued operations			0.03							—
		$	1.23						$	(1.08	)
Diluted
Continuing operations		$	1.18						$	(1.08	)
Discontinued operations			0.03							—
		$	1.21						$	(1.08	)
Weighted average shares and dilutive securities outstanding (in thousands):
Basic			101,770							100,306
Diluted*			103,416							100,306

*Had we generated income from continuing operations in the six months ended June 30, 2017 the effect of employee stock options, restricted stock units and deferred compensation units on the diluted shares calculation would have been an increase of 766 thousand shares.

TENET HEALTHCARE CORPORATION CONSOLIDATED BALANCE SHEETS (Unaudited)
		June 30,				December 31,
(Dollars in millions)		2018				2017
ASSETS
Current assets:
Cash and cash equivalents		$	403			$	611
Accounts receivable, less allowance for doubtful accounts			2,483				2,616
Inventories of supplies, at cost			298				289
Income tax receivable			28				5
Assets held for sale			452				1,017
Other current assets			1,041				1,035
Total current assets			4,705				5,573
Investments and other assets			1,416				1,543
Deferred income taxes			348				455
Property and equipment, at cost, less accumulated depreciation and amortization			6,863				7,030
Goodwill			7,218				7,018
Other intangible assets, at cost, less accumulated amortization			1,793				1,766
Total assets		$	22,343			$	23,385
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt		$	663			$	146
Accounts payable			1,047				1,175
Accrued compensation and benefits			711				848
Professional and general liability reserves			230				200
Accrued interest payable			243				256
Liabilities held for sale			393				480
Other current liabilities			1,067				1,227
Total current liabilities			4,354				4,332
Long-term debt, net of current portion			14,204				14,791
Professional and general liability reserves			630				654
Defined benefit plan obligations			515				536
Deferred income taxes			36				36
Other long-term liabilities			599				631
Total liabilities			20,338				20,980
Commitments and contingencies
Redeemable noncontrolling interests in equity of consolidated subsidiaries			1,429				1,866
Equity:
Shareholders’ equity:
Common stock			7				7
Additional paid-in capital			4,722				4,859
Accumulated other comprehensive loss			(243	)			(204	)
Accumulated deficit			(2,222	)			(2,390	)
Common stock in treasury, at cost			(2,418	)			(2,419	)
Total shareholders’ equity (deficit)			(154	)			(147	)
Noncontrolling interests			730				686
Total equity			576				539
Total liabilities and equity		$	22,343			$	23,385

TENET HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited)
		Six Months Ended
(Dollars in millions)		June 30,
		2018				2017
Net income		$	299			$	68
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			398				443
Provision for doubtful accounts			—				754
Deferred income tax expense (benefit)			108				(81	)
Stock-based compensation expense			20				29
Impairment and restructuring charges, and acquisition-related costs			77				74
Litigation and investigation costs			19				6
Net gains on sales, consolidation and deconsolidation of facilities			(118	)			(38	)
Loss from early extinguishment of debt			2				26
Equity in earnings of unconsolidated affiliates, net of distributions received			10				4
Amortization of debt discount and debt issuance costs			22				22
Pre-tax income from discontinued operations			(3	)			—
Other items, net			(1	)			(25	)
Changes in cash from operating assets and liabilities:
Accounts receivable			(13	)			(673	)
Inventories and other current assets			144				160
Income taxes			(18	)			(7	)
Accounts payable, accrued expenses and other current liabilities			(371	)			(345	)
Other long-term liabilities			(48	)			48
Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements			(63	)			(62	)
Net cash used in operating activities from discontinued operations, excluding income taxes			(3	)			(2	)
Net cash provided by operating activities			461				401
Cash flows from investing activities:
Purchases of property and equipment — continuing operations			(268	)			(348	)
Purchases of businesses or joint venture interests, net of cash acquired			(89	)			(26	)
Proceeds from sales of facilities and other assets			481				74
Proceeds from sales of marketable securities, long-term investments and other assets			143				16
Purchases of equity investments			(37	)			(2	)
Other long-term assets			3				(12	)
Other items, net			(8	)			(10	)
Net cash provided by (used in) investing activities			225				(308	)
Cash flows from financing activities:
Repayments of borrowings under credit facility			(360	)			(100	)
Proceeds from borrowings under credit facility			360				100
Repayments of other borrowings			(161	)			(1,029	)
Proceeds from other borrowings			14				837
Debt issuance costs			—				(29	)
Distributions paid to noncontrolling interests			(140	)			(123	)
Proceeds from sale of noncontrolling interests			7				14
Purchases of noncontrolling interests			(642	)			(5	)
Proceeds from exercise of stock options and employee stock purchase plan			14				3
Other items, net			14				(2	)
Net cash used in financing activities			(894	)			(334	)
Net decrease in cash and cash equivalents			(208	)			(241	)
Cash and cash equivalents at beginning of period			611				716
Cash and cash equivalents at end of period		$	403			$	475
Supplemental disclosures:
Interest paid, net of capitalized interest		$	(501	)		$	(468	)
Income tax refunds (payments), net		$	(21	)		$	(44	)

TENET HEALTHCARE CORPORATION SELECTED STATISTICS – CONTINUING TOTAL HOSPITALS(1) (Unaudited)
(Dollars in millions except per adjusted patient day		Three Months Ended June 30,												Six Months Ended June 30,
and per adjusted patient admission amounts)		2018				2017				Change				2018				2017				Change
Admissions, Patient Days and Surgeries
Number of hospitals (at end of period)			68				76			(8	)	*			68				76			(8	)	*
Total admissions			168,453				190,394			(11.5	)%				350,759				387,301			(9.4	)%
Adjusted patient admissions			306,063				342,439			(10.6	)%				626,931				689,589			(9.1	)%
Paying admissions (excludes charity and uninsured)			158,216				179,889			(12.0	)%				330,706				366,537			(9.8	)%
Charity and uninsured admissions			10,237				10,505			(2.6	)%				20,053				20,764			(3.4	)%
Admissions through emergency department			115,036				121,807			(5.6	)%				240,112				248,280			(3.3	)%
Paying admissions as a percentage of total admissions			93.9	%			94.5	%		(0.6	)%	*			94.3	%			94.6	%		(0.3	)%	*
Charity and uninsured admissions as a percentage of total admissions			6.1	%			5.5	%		0.6	%	*			5.7	%			5.4	%		0.3	%	*
Emergency department admissions as a percentage of total admissions			68.3	%			64.0	%		4.3	%	*			68.5	%			64.1	%		4.4	%	*
Surgeries — inpatient			46,274				52,083			(11.2	)%				93,497				103,883			(10.0	)%
Surgeries — outpatient			63,805				71,366			(10.6	)%				126,813				140,970			(10.0	)%
Total surgeries			110,079				123,449			(10.8	)%				220,310				244,853			(10.0	)%
Patient days — total			766,519				874,930			(12.4	)%				1,625,167				1,798,269			(9.6	)%
Adjusted patient days			1,373,480				1,552,302			(11.5	)%				2,859,619				3,156,000			(9.4	)%
Average length of stay (days)			4.55				4.60			(1.1	)%				4.63				4.64			(0.2	)%
Licensed beds (at end of period)			18,314				20,435			(10.4	)%				18,314				20,435			(10.4	)%
Average licensed beds			18,362				20,435			(10.1	)%				18,523				20,437			(9.4	)%
Utilization of licensed beds			45.9	%			47.0	%		(1.1	)%	*			48.5	%			48.6	%		(0.1	)%	*
Outpatient Visits
Total visits			1,749,847				1,981,848			(11.7	)%				3,592,386				4,021,790			(10.7	)%
Paying visits (excludes charity and uninsured)			1,633,372				1,849,697			(11.7	)%				3,359,348				3,757,909			(10.6	)%
Charity and uninsured visits			116,475				132,151			(11.9	)%				233,038				263,881			(11.7	)%
Emergency department visits			643,036				724,785			(11.3	)%				1,340,037				1,457,836			(8.1	)%
Paying visits as a percentage of total visits			93.3	%			93.3	%		—	%	*			93.5	%			93.4	%		0.1	%	*
Charity and uninsured visits as a percentage of total visits			6.7	%			6.7	%		—	%	*			6.5	%			6.6	%		(0.1	)%	*
Total emergency department admissions and visits			758,072				846,592			(10.5	)%				1,580,149				1,706,116			(7.4	)%
Revenues
Net patient revenues(3)		$	3,443			$	3,719			(7.4	)%			$	7,086			$	7,447			(4.8	)%
Revenues on a Per Adjusted Patient Admission and Per Adjusted Patient Day
Net patient revenue(3) per adjusted patient admission		$	11,249			$	10,860			3.6	%			$	11,303			$	10,799			4.7	%
Net patient revenue(3) per adjusted patient day		$	2,507			$	2,396			4.6	%			$	2,478			$	2,360			5.0	%
Total selected operating expenses (salaries, wages and benefits, supplies and other operating expenses) per adjusted patient admission(2)		$	10,619			$	10,394			2.2	%			$	10,590			$	10,342			2.4	%
Net Patient Revenues (3) from:
Medicare			20.4	%			22.0	%		(1.6	)%	*			20.9	%			22.6	%		(1.7	)%	*
Medicaid			9.1	%			7.5	%		1.6	%	*			9.0	%			7.4	%		1.6	%	*
Managed care			66.0	%			65.9	%		0.1	%	*			65.5	%			65.6	%		(0.1	)%	*
Self-pay			0.2	%			0.5	%		(0.3	)%	*			0.6	%			0.4	%		0.2	%	*
Indemnity and other			4.3	%			4.1	%		0.2	%	*			4.0	%			4.0	%		—	%	*

(1) Represents the consolidated results of Tenet’s acute care hospitals and related outpatient facilities included in the Hospital Operations and other segment.

(2) Excludes operating expenses from Tenet's health plans.

(3) Less implicit price concessions and provision for doubtful accounts.

* This change is the difference between the 2018 and 2017 amounts shown.

TENET HEALTHCARE CORPORATION SELECTED STATISTICS – CONTINUING SAME HOSPITALS(1) (Unaudited)
(Dollars in millions except per adjusted patient day		Three Months Ended June 30,											Six Months Ended June 30,
and per adjusted patient admission amounts)		2018				2017				Change			2018				2017				Change
Admissions, Patient Days and Surgeries
Number of hospitals (at end of period)			68				68			—				68				68			—		*
Total admissions			168,135				172,048			(2.3	)%			346,324				349,672			(1.0	)%
Adjusted patient admissions			305,541				306,278			(0.2	)%			617,838				616,415			0.2	%
Paying admissions (excludes charity and uninsured)			157,904				162,630			(2.9	)%			326,458				331,153			(1.4	)%
Charity and uninsured admissions			10,231				9,418			8.6	%			19,866				18,519			7.3	%
Admissions through emergency department			114,945				110,486			4.0	%			237,867				225,253			5.6	%
Paying admissions as a percentage of total admissions			93.9	%			94.5	%		(0.6	)%			94.3	%			94.7	%		(0.4	)%	*
Charity and uninsured admissions as a percentage of total admissions			6.1	%			5.5	%		0.6	%			5.7	%			5.3	%		0.4	%	*
Emergency department admissions as a percentage of total admissions			68.4	%			64.2	%		4.2	%			68.7	%			64.4	%		4.3	%	*
Surgeries — inpatient			46,057				47,288			(2.6	)%			91,997				94,188			(2.3	)%
Surgeries — outpatient			63,615				63,642			—	%			124,664				125,754			(0.9	)%
Total surgeries			109,672				110,930			(1.1	)%			216,661				219,942			(1.5	)%
Patient days — total			765,659				792,160			(3.3	)%			1,606,445				1,625,921			(1.2	)%
Adjusted patient days			1,372,048				1,390,154			(1.3	)%			2,820,404				2,824,012			(0.1	)%
Average length of stay (days)			4.55				4.60			(1.1	)%			4.64				4.65			(0.2	)%
Licensed beds (at end of period)			17,946				17,980			(0.2	)%			17,946				17,980			(0.2	)%
Average licensed beds			17,946				17,980			(0.2	)%			17,946				17,972			(0.1	)%
Utilization of licensed beds			46.9	%			48.4	%		(1.5	)%			49.5	%			50.0	%		(0.5	)%	*
Outpatient Visits
Total visits			1,748,312				1,766,625			(1.0	)%			3,542,213				3,577,426			(1.0	)%
Paying visits (excludes charity and uninsured)			1,631,963				1,652,532			(1.2	)%			3,312,212				3,351,449			(1.2	)%
Charity and uninsured visits			116,349				114,093			2.0	%			230,001				225,977			1.8	%
Emergency department visits			642,623				645,803			(0.5	)%			1,325,226				1,296,580			2.2	%
Paying visits as a percentage of total visits			93.3	%			93.5	%		(0.2	)%			93.5	%			93.7	%		(0.2	)%	*
Charity and uninsured visits as a percentage of total visits			6.7	%			6.5	%		0.2	%			6.5	%			6.3	%		0.2	%	*
Total emergency department admissions and visits			757,568				756,289			0.2	%			1,563,093				1,521,833			2.7	%
Revenues
Net patient revenues(2)		$	3,432			$	3,325			3.2	%		$	7,002			$	6,668			5.0	%
Revenues on a Per Adjusted Patient Admission and Per Adjusted Patient Day
Net patient revenue(2) per adjusted patient admission		$	11,233			$	10,856			3.5	%		$	11,333			$	10,817			4.8	%
Net patient revenue(2) per adjusted patient day		$	2,501			$	2,392			4.6	%		$	2,483			$	2,361			5.2	%
Net Patient Revenues (2) from:
Medicare			20.4	%			22.3	%		(1.9	)%			20.8	%			22.9	%		(2.1	)%	*
Medicaid			9.1	%			7.1	%		2.0	%			9.0	%			7.1	%		1.9	%	*
Managed care			66.1	%			65.8	%		0.3	%			65.5	%			65.4	%		0.1	%	*
Self-pay			0.1	%			0.6	%		(0.5	)%			0.7	%			0.5	%		0.2	%	*
Indemnity and other			4.3	%			4.2	%		0.1	%			4.0	%			4.1	%		(0.1	)%	*

(1) Information for our Hospital Operations and other segment is presented on a same-hospital basis, which includes the results of our same 68 hospitals operated throughout the six months ended June 30, 2018 and 2017 and associated outpatient facilities, but excludes the results of hospitals Tenet divested since January 1, 2017.

(2) Less implicit price concessions and provision for doubtful accounts.

* This change is the difference between the 2018 and 2017 amounts shown.

TENET HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in millions except per share amounts)		Three Months Ended								Six Months Ended
		3/31/2018				6/30/2018				6/30/2018
Net operating revenues		$	4,699			$	4,506			$	9,205
Equity in earnings of unconsolidated affiliates			25				39				64
Operating expenses:
Salaries, wages and benefits			2,227				2,135				4,362
Supplies			774				748				1,522
Other operating expenses, net			1,060				1,027				2,087
Electronic health record incentives			(1	)			—				(1	)
Depreciation and amortization			204				194				398
Impairment and restructuring charges, and acquisition-related costs			47				30				77
Litigation and investigation costs			6				13				19
Net gains on sales, consolidation and deconsolidation of facilities			(110	)			(8	)			(118	)
Operating income			517				406				923
Interest expense			(255	)			(254	)			(509	)
Other non-operating expense, net			(1	)			(1	)			(2	)
Loss from early extinguishment of debt			(1	)			(1	)			(2	)
Income from continuing operations, before income taxes			260				150				410
Income tax expense			(70	)			(44	)			(114	)
Income from continuing operations, before discontinued operations			190				106				296
Discontinued operations:
Income from operations			1				2				3
Income tax benefit (expense)			—				—				—
Income from discontinued operations			1				2				3
Net income			191				108				299
Less: Net income available to noncontrolling interests			92				82				174
Net income available to Tenet Healthcare Corporation common shareholders		$	99			$	26			$	125
Amounts available to Tenet Healthcare Corporation common shareholders
Income from continuing operations, net of tax		$	98			$	24			$	122
Income from discontinued operations, net of tax			1				2				3
Net income available to Tenet Healthcare Corporation common shareholders		$	99			$	26			$	125
Earnings per share available to Tenet Healthcare Corporation common shareholders:
Basic
Continuing operations		$	0.97			$	0.23			$	1.20
Discontinued operations			0.01				0.02				0.03
		$	0.98			$	0.25			$	1.23
Diluted
Continuing operations		$	0.95			$	0.23				1.18
Discontinued operations			0.01				0.02			$	0.03
		$	0.96			$	0.25			$	1.21
Weighted average shares and dilutive securities outstanding (in thousands):
Basic			101,392				102,147				101,770
Diluted			102,656				104,177				103,416

TENET HEALTHCARE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in millions except per share amounts)		Three Months Ended																Year Ended
		3/31/2017				6/30/2017				9/30/2017				12/31/2017				12/31/2017
Net operating revenues:
Net operating revenues before provision for doubtful accounts		$	5,196			$	5,173			$	4,941			$	5,303			$	20,613
Less: Provision for doubtful accounts			383				371				355				325				1,434
Net operating revenues			4,813				4,802				4,586				4,978				19,179
Equity in earnings of unconsolidated affiliates			29				28				38				49				144
Operating expenses:
Salaries, wages and benefits			2,380				2,346				2,264				2,284				9,274
Supplies			765				780				740				800				3,085
Other operating expenses, net			1,187				1,159				1,120				1,104				4,570
Electronic health record incentives			(1	)			(6	)			(1	)			(1	)			(9	)
Depreciation and amortization			221				222				219				208				870
Impairment and restructuring charges, and acquisition-related costs			33				41				329				138				541
Litigation and investigation costs			5				1				6				11				23
Net gains on sales, consolidation and deconsolidation of facilities			(15	)			(23	)			(104	)			(2	)			(144	)
Operating income			267				310				51				485				1,113
Interest expense			(258	)			(260	)			(257	)			(253	)			(1,028	)
Other non-operating expense, net			(5	)			(5	)			(4	)			(8	)			(22	)
Loss from early extinguishment of debt			—				(26	)			(138	)			—				(164	)
Income (loss) from continuing operations, before income taxes			4				19				(348	)			224				(101	)
Income tax benefit (expense)			33				12				60				(324	)			(219	)
Income (loss) from continuing operations, before discontinued operations			37				31				(288	)			(100	)			(320	)
Discontinued operations:
Income (loss) from operations			(2	)			2				(1	)			1				—
Income tax benefit (expense)			1				(1	)			—				—				—
Income (loss) from discontinued operations			(1	)			1				(1	)			1				—
Net income (loss)			36				32				(289	)			(99	)			(320	)
Less: Net income available to noncontrolling interests			89				87				78				130				384
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	(53	)		$	(55	)		$	(367	)		$	(229	)		$	(704	)
Amounts available (attributable) to Tenet Healthcare Corporation common shareholders
Loss from continuing operations, net of tax		$	(52	)		$	(56	)		$	(366	)		$	(230	)		$	(704	)
Income (loss) from discontinued operations, net of tax			(1	)			1				(1	)			1				—
Net loss attributable to Tenet Healthcare Corporation common shareholders		$	(53	)		$	(55	)		$	(367	)		$	(229	)		$	(704	)
Earnings available (loss attributable) per share to Tenet Healthcare Corporation common shareholders:
Basic
Continuing operations		$	(0.52	)		$	(0.56	)		$	(3.63	)		$	(2.28	)		$	(7.00	)
Discontinued operations			(0.01	)			0.01				(0.01	)			0.01				—
		$	(0.53	)		$	(0.55	)		$	(3.64	)		$	(2.27	)		$	(7.00	)
Diluted
Continuing operations		$	(0.52	)		$	(0.56	)		$	(3.63	)		$	(2.28	)		$	(7.00	)
Discontinued operations			(0.01	)			0.01				(0.01	)			0.01				—
		$	(0.53	)		$	(0.55	)		$	(3.64	)		$	(2.27	)		$	(7.00	)
Weighted average shares and dilutive securities outstanding (in thousands):
Basic			100,000				100,612				100,812				100,945				100,592
Diluted			100,000				100,612				100,812				100,945				100,592

TENET HEALTHCARE CORPORATION SELECTED STATISTICS – CONTINUING TOTAL HOSPITALS(1) (Unaudited)
(Dollars in millions except per adjusted patient day and per adjusted patient admission amounts)
		Three Months Ended								Six Months Ended
		3/31/2018				6/30/2018				06/30/2018
Admissions, Patient Days and Surgeries
Number of hospitals (at end of period)			69				68				68
Total admissions			182,306				168,453				350,759
Adjusted patient admissions			320,868				306,063				626,931
Paying admissions (excludes charity and uninsured)			172,490				158,216				330,706
Charity and uninsured admissions			9,816				10,237				20,053
Admissions through emergency department			125,076				115,036				240,112
Paying admissions as a percentage of total admissions			94.6	%			93.9	%			94.3	%
Charity and uninsured admissions as a percentage of total admissions			5.4	%			6.1	%			5.7	%
Emergency department admissions as a percentage of total admissions			68.6	%			68.3	%			68.5	%
Surgeries — inpatient			47,223				46,274				93,497
Surgeries — outpatient			63,008				63,805				126,813
Total surgeries			110,231				110,079				220,310
Patient days — total			858,648				766,519				1,625,167
Adjusted patient days			1,486,139				1,373,480				2,859,619
Average length of stay (days)			4.71				4.55				4.63
Licensed beds (at end of period)			18,457				18,314				18,314
Average licensed beds			18,685				18,362				18,523
Utilization of licensed beds			51.1	%			45.9	%			48.5	%
Outpatient Visits
Total visits			1,842,539				1,749,847				3,592,386
Paying visits (excludes charity and uninsured)			1,725,976				1,633,372				3,359,348
Charity and uninsured visits			116,563				116,475				233,038
Emergency department visits			697,001				643,036				1,340,037
Paying visits as a percentage of total visits			93.7	%			93.3	%			93.5	%
Charity and uninsured visits as a percentage of total visits			6.3	%			6.7	%			6.5	%
Total emergency department admissions and visits			822,077				758,072				1,580,149
Revenues
Net patient revenues(3)		$	3,643			$	3,443			$	7,086
Revenues on a Per Adjusted Patient Admission and Per Adjusted Patient Day
Net patient revenue(3) per adjusted patient admission		$	11,354			$	11,249			$	11,303
Net patient revenue(3) per adjusted patient day		$	2,451			$	2,507			$	2,478
Total selected operating expenses (salaries, wages and benefits, supplies and other operating expenses) per adjusted patient admission(2)		$	10,561			$	10,619			$	10,590
Net Patient Revenues (3) from:
Medicare			21.5	%			20.4	%			20.9	%
Medicaid			8.8	%			9.1	%			9.0	%
Managed care			65.0	%			66.0	%			65.5	%
Self-pay			1.0	%			0.2	%			0.6	%
Indemnity and other			3.7	%			4.3	%			4.0	%

(1) Represents the consolidated results of Tenet’s acute care hospitals and related outpatient facilities included in the Hospital Operations and other segment.

(2) Excludes operating expenses from Tenet's health plans.

(3) Less implicit price concessions and provision for doubtful accounts.

TENET HEALTHCARE CORPORATION SELECTED STATISTICS – CONTINUING TOTAL HOSPITALS(1) (Unaudited)
(Dollars in millions except per adjusted patient day and per adjusted patient admission amounts)
		Three Months Ended																Year Ended
		3/31/2017				6/30/2017				9/30/2017				12/31/2017				12/31/2017
Admissions, Patient Days and Surgeries
Number of hospitals (at end of period)			76				76				73				72				72
Total admissions			196,907				190,394				185,389				186,185				758,875
Adjusted patient admissions			347,150				342,439				332,035				332,642				1,354,266
Paying admissions (excludes charity and uninsured)			186,648				179,889				174,803				176,158				717,498
Charity and uninsured admissions			10,259				10,505				10,586				10,027				41,377
Admissions through emergency department			126,473				121,807				120,493				123,887				492,660
Paying admissions as a percentage of total admissions			94.8	%			94.5	%			94.3	%			94.6	%			94.5	%
Charity and uninsured admissions as a percentage of total admissions			5.2	%			5.5	%			5.7	%			5.4	%			5.5	%
Emergency department admissions as a percentage of total admissions			64.2	%			64.0	%			65.0	%			66.5	%			64.9	%
Surgeries — inpatient			51,800				52,083				50,939				50,292				205,114
Surgeries — outpatient			69,604				71,366				67,321				68,604				276,895
Total surgeries			121,404				123,449				118,260				118,896				482,009
Patient days — total			923,339				874,930				853,059				857,728				3,509,056
Adjusted patient days			1,603,698				1,552,302				1,502,831				1,505,130				6,163,961
Average length of stay (days)			4.69				4.60				4.60				4.61				4.62
Licensed beds (at end of period)			20,439				20,435				19,433				19,141				19,141
Average licensed beds			20,440				20,435				19,783				19,320				19,995
Utilization of licensed beds			50.2	%			47.0	%			46.9	%			48.3	%			48.1	%
Outpatient Visits
Total visits			2,039,942				1,981,848				1,867,471				1,901,864				7,791,125
Paying visits (excludes charity and uninsured)			1,908,212				1,849,697				1,741,815				1,777,790				7,277,514
Charity and uninsured visits			131,730				132,151				125,656				124,074				513,611
Emergency department visits			733,051				724,785				685,096				711,268				2,854,200
Paying visits as a percentage of total visits			93.5	%			93.3	%			93.3	%			93.5	%			93.4	%
Charity and uninsured visits as a percentage of total visits			6.5	%			6.7	%			6.7	%			6.5	%			6.6	%
Total emergency department admissions and visits			859,524				846,592				805,589				835,155				3,346,860
Revenues
Net patient revenues(3)		$	3,728			$	3,719			$	3,522			$	3,860			$	14,829
Revenues on a Per Adjusted Patient Admission and Per Adjusted Patient Day
Net patient revenue(3) per adjusted patient admission		$	10,739			$	10,860			$	10,607			$	11,604			$	10,950
Net patient revenue(3) per adjusted patient day		$	2,325			$	2,396			$	2,344			$	2,565			$	2,406
Total selected operating expenses (salaries, wages and benefits, supplies and other operating expenses) per adjusted patient admission(2)		$	10,288			$	10,394			$	10,367			$	10,492			$	10,384
Net Patient Revenues (3) from:
Medicare			23.1	%			22.0	%			22.0	%			20.4	%			21.9	%
Medicaid			7.4	%			7.5	%			7.1	%			12.9	%			8.8	%
Managed care			65.2	%			65.9	%			66.1	%			61.5	%			64.6	%
Self-pay			0.3	%			0.5	%			0.3	%			1.3	%			0.6	%
Indemnity and other			4.0	%			4.1	%			4.5	%			3.9	%			4.1	%

(1) Represents the consolidated results of Tenet’s acute care hospitals and related outpatient facilities included in the Hospital Operations and other segment.

(2) Excludes operating expenses from Tenet's health plans.

(3) Less implicit price concessions and provision for doubtful accounts.

TENET HEALTHCARE CORPORATION SELECTED STATISTICS – CONTINUING SAME HOSPITALS(1) (Unaudited)
(Dollars in millions except per adjusted patient day and per adjusted patient admission amounts)
		Three Months Ended								Six Months Ended
		3/31/2018				6/30/2018				6/30/2018
Admissions, Patient Days and Surgeries
Number of hospitals (at end of period)			68				68				68
Total admissions			178,189				168,135				346,324
Adjusted patient admissions			312,297				305,541				617,838
Paying admissions (excludes charity and uninsured)			168,554				157,904				326,458
Charity and uninsured admissions			9,635				10,231				19,866
Admissions through emergency department			122,922				114,945				237,867
Paying admissions as a percentage of total admissions			94.6	%			93.9	%			94.3	%
Charity and uninsured admissions as a percentage of total admissions			5.4	%			6.1	%			5.7	%
Emergency department admissions as a percentage of total admissions			69.0	%			68.4	%			68.7	%
Surgeries — inpatient			45,940				46,057				91,997
Surgeries — outpatient			61,049				63,615				124,664
Total surgeries			106,989				109,672				216,661
Patient days — total			840,786				765,659				1,606,445
Adjusted patient days			1,448,356				1,372,048				2,820,404
Average length of stay (days)			4.72				4.55				4.64
Licensed beds (at end of period)			17,946				17,946				17,946
Average licensed beds			17,946				17,946				17,946
Utilization of licensed beds			52.1	%			46.9	%			49.5	%
Outpatient Visits
Total visits			1,793,901				1,748,312				3,542,213
Paying visits (excludes charity and uninsured)			1,680,249				1,631,963				3,312,212
Charity and uninsured visits			113,652				116,349				230,001
Emergency department visits			682,603				642,623				1,325,226
Paying visits as a percentage of total visits			93.7	%			93.3	%			93.5	%
Charity and uninsured visits as a percentage of total visits			6.3	%			6.7	%			6.5	%
Total emergency department admissions and visits			805,525				757,568				1,563,093
Revenues
Net patient revenues(2)		$	3,570			$	3,432			$	7,002
Revenues on a Per Adjusted Patient Admission and Per Adjusted Patient Day
Net patient revenue(2) per adjusted patient admission		$	11,431			$	11,233			$	11,333
Net patient revenue(2) per adjusted patient day		$	2,465			$	2,501			$	2,483
Net Patient Revenues (2) from:
Medicare			21.3	%			20.4	%			20.8	%
Medicaid			8.8	%			9.1	%			9.0	%
Managed care			64.9	%			66.1	%			65.5	%
Self-pay			1.3	%			0.1	%			0.7	%
Indemnity and other			3.7	%			4.3	%			4.0	%

(1) Information for our Hospital Operations and other segment is presented on a same-hospital basis, which includes the results of our same 68 hospitals operated throughout the six months ended June 30, 2018 and 2017 and associated outpatient facilities, but excludes the results of hospitals Tenet divested since January 1, 2017.

(2) Less implicit price concessions and provision for doubtful accounts.

TENET HEALTHCARE CORPORATION SELECTED STATISTICS – CONTINUING SAME HOSPITALS(1) (Unaudited)
(Dollars in millions except per adjusted patient day and per adjusted patient admission amounts)
		Three Months Ended																Year Ended
		3/31/2017				6/30/2017				9/30/2017				12/31/2017				12/31/2017
Admissions, Patient Days and Surgeries
Number of hospitals (at end of period)			68				68				68				68				68
Total admissions			177,624				172,048				171,766				175,152				696,590
Adjusted patient admissions			310,137				306,278				305,300				310,485				1,232,200
Paying admissions (excludes charity and uninsured)			168,523				162,630				161,743				165,400				658,296
Charity and uninsured admissions			9,101				9,418				10,023				9,752				38,294
Admissions through emergency department			114,767				110,486				112,210				116,901				454,364
Paying admissions as a percentage of total admissions			94.9	%			94.5	%			94.2	%			94.4	%			94.5	%
Charity and uninsured admissions as a percentage of total admissions			5.1	%			5.5	%			5.8	%			5.6	%			5.5	%
Emergency department admissions as a percentage of total admissions			64.6	%			64.2	%			65.3	%			66.7	%			65.2	%
Surgeries — inpatient			46,900				47,288				47,315				47,350				188,853
Surgeries — outpatient			62,112				63,642				61,562				63,410				250,726
Total surgeries			109,012				110,930				108,877				110,760				439,579
Patient days — total			833,761				792,160				789,040				805,567				3,220,528
Adjusted patient days			1,433,858				1,390,154				1,379,096				1,402,038				5,605,146
Average length of stay (days)			4.69				4.60				4.59				4.60				4.62
Licensed beds (at end of period)			17,964				17,980				18,006				17,946				17,946
Average licensed beds			17,964				17,980				18,007				17,970				17,980
Utilization of licensed beds			51.6	%			48.4	%			47.6	%			48.7	%			49.1	%
Outpatient Visits
Total visits			1,810,801				1,766,625				1,715,650				1,771,336				7,064,412
Paying visits (excludes charity and uninsured)			1,698,917				1,652,532				1,600,195				1,653,581				6,605,225
Charity and uninsured visits			111,884				114,093				115,455				117,755				459,187
Emergency department visits			650,777				645,803				627,415				659,617				2,583,612
Paying visits as a percentage of total visits			93.8	%			93.5	%			93.3	%			93.4	%			93.5	%
Charity and uninsured visits as a percentage of total visits			6.2	%			6.5	%			6.7	%			6.6	%			6.5	%
Total emergency department admissions and visits			765,544				756,289				739,625				776,518				3,037,976
Revenues
Net patient revenues(2)		$	3,343			$	3,325			$	3,237			$	3,609			$	13,514
Revenues on a Per Adjusted Patient Admission and Per Adjusted Patient Day
Net patient revenue(2) per adjusted patient admission		$	10,780			$	10,856			$	10,603			$	11,624			$	10,967
Net patient revenue(2) per adjusted patient day		$	2,331			$	2,392			$	2,347			$	2,574			$	2,411
Net Patient Revenues (2) from:
Medicare			23.5	%			22.3	%			21.9	%			20.3	%			21.9	%
Medicaid			7.0	%			7.1	%			6.8	%			13.2	%			8.7	%
Managed care			65.0	%			65.8	%			66.1	%			61.0	%			64.4	%
Self-pay			0.3	%			0.6	%			0.3	%			1.5	%			0.7	%
Indemnity and other			4.2	%			4.2	%			4.9	%			4.0	%			4.3	%

(1) Information for our Hospital Operations and other segment is presented on a same-hospital basis, which includes the results of our same 68 hospitals operated throughout the six months ended June 30, 2018 and 2017 and associated outpatient facilities, but excludes the results of hospitals Tenet divested since January 1, 2017.

(2) Less implicit price concessions and provision for doubtful accounts.

TENET HEALTHCARE CORPORATION SEGMENT REPORTING (Unaudited)
(Dollars in millions)										June 30,				December 31,
										2018				2017
Assets
Hospital Operations and other										$	15,396			$	16,466
Ambulatory Care											5,865				5,822
Conifer											1,082				1,097
Total										$	22,343			$	23,385
		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2018				2017				2018				2017
Capital expenditures:
Hospital Operations and other		$	108			$	136			$	228			$	319
Ambulatory Care			13				10				28				21
Conifer			4				4				12				8
Total		$	125			$	150			$	268			$	348
Net operating revenues:
Hospital Operations and other total prior to inter-segment eliminations(1)		$	3,733			$	4,085			$	7,680			$	8,200
Ambulatory Care			531				472				1,029				927
Conifer
Tenet			144				155				294				314
Other customers			242				245				496				488
Total Conifer revenues			386				400				790				802
Inter-segment eliminations			(144	)			(155	)			(294	)			(314	)
Total		$	4,506			$	4,802			$	9,205			$	9,615
Equity in earnings of unconsolidated affiliates:
Hospital Operations and other		$	6			$	(2	)		$	4			$	—
Ambulatory Care			33				30				60				57
Total		$	39			$	28			$	64			$	57
Adjusted EBITDA:
Hospital Operations and other(2)		$	345			$	346			$	747			$	655
Ambulatory Care			198				164				363				317
Conifer			91				60				189				125
Total		$	634			$	570			$	1,299			$	1,097
Depreciation and amortization:
Hospital Operations and other		$	164			$	188			$	339			$	375
Ambulatory Care			17				22				34				44
Conifer			13				12				25				24
Total		$	194			$	222			$	398			$	443

(1) Hospital Operations and other revenues includes health plan revenues of less than $1 million and $6 million for the three and six months ended June 30, 2018, respectively and $25 million and $90 million for the three and six months ended June 30, 2017, respectively.

(2) Hospital Operations and other Adjusted EBITDA excludes health plan EBITDA of $1 million and less than $1 million for the three and six months ended June 30, 2018, respectively, and $(19) million and $(35) million for the three and six months ended June 30, 2017, respectively.

TENET HEALTHCARE CORPORATION STATEMENT OF OPERATIONS – AMBULATORY CARE SEGMENT (Unaudited)
(Dollars in millions)		Three Months Ended June 30,
		2018								2017
		Ambulatory Care as Reported Under GAAP				Unconsolidated Affiliates				Ambulatory Care as Reported Under GAAP				Unconsolidated Affiliates
Net operating revenues:
Net operating revenues before provision for doubtful accounts										$	483			$	499
Less: Provision for doubtful accounts											(11	)			(10	)
Net operating revenues (1)		$	531			$	547				472				489
Equity in earnings of unconsolidated affiliates (2)			33				—				30				—
Operating expenses:
Salaries, wages and benefits			165				134				153				116
Supplies			106				144				96				129
Other operating expenses, net			95				114				89				100
Depreciation and amortization			17				17				22				16
Impairment and restructuring charges, and acquisition-related costs			6				—				3				1
Net gains on sales, consolidation and deconsolidation of facilities			—				—				—				—
Operating income			175				138				139				127
Interest expense			(37	)			(5	)			(39	)			(5	)
Other			1				1				2				—
Net income from continuing operations, before income taxes			139				134				102				122
Income tax expense			(18	)			(2	)			(20	)			(2	)
Net income			121			$	132				82			$	120
Less: Net income available to noncontrolling interests			75								67
Net income available to Tenet Healthcare Corporation common shareholders		$	46							$	15
Equity in earnings of unconsolidated affiliates						$	33							$	30

(1) On a same-facility system-wide basis, net revenue in Tenet’s Ambulatory Care segment increased 6.9% during the three months ended June 30, 2018, with cases increasing 4.3% and revenue per case increasing 2.4%.

(2) At June 30, 2018, 110 of the 342 facilities in the Company’s Ambulatory segment were not consolidated based on the nature of the segment’s joint venture relationships with physicians and prominent healthcare systems. Although revenues of the segment’s unconsolidated facilities are not recorded as revenues by the Company, equity in earnings of unconsolidated affiliates is nonetheless a significant portion of the Company’s overall earnings. To help analyze results of operations, management also uses system-wide operating measures such as system-wide revenue growth, which includes revenues of both consolidated and unconsolidated facilities. We control our remaining 232 facilities and account for these investments as consolidated subsidiaries.

TENET HEALTHCARE CORPORATION STATEMENT OF OPERATIONS – AMBULATORY CARE SEGMENT (Unaudited)
(Dollars in millions)		Six Months Ended June 30,
		2018								2017
		Ambulatory Care as Reported Under GAAP				Unconsolidated Affiliates				Ambulatory Care as Reported Under GAAP				Unconsolidated Affiliates
Net operating revenues:
Net operating revenues before provision for doubtful accounts										$	945			$	974
Less: Provision for doubtful accounts											(18	)			(20	)
Net operating revenues (1)		$	1,029			$	1,040				927				954
Equity in earnings of unconsolidated affiliates (2)			60				—				57				—
Operating expenses:
Salaries, wages and benefits			327				254				303				230
Supplies			212				274				190				250
Other operating expenses, net			187				219				174				197
Depreciation and amortization			34				33				44				32
Impairment and restructuring charges, and acquisition-related costs			7				—				8				1
Net gains on sales, consolidation and deconsolidation of facilities			(1	)			—				(7	)			—
Operating income			323				260				272				244
Interest expense			(73	)			(10	)			(74	)			(11	)
Other			3				1				3				—
Net income from continuing operations, before income taxes			253				251				201				233
Income tax expense			(33	)			(4	)			(38	)			(4	)
Net income			220			$	247				163			$	229
Less: Net income available to noncontrolling interests			139				—				133
Net income available to Tenet Healthcare Corporation common shareholders		$	81				—			$	30
Equity in earnings of unconsolidated affiliates						$	60							$	57

(1) On a same-facility system-wide basis, net revenue in Tenet’s Ambulatory Care segment increased 4.8% during the six months ended June 30, 2018, with cases increasing 3.8% and revenue per case increasing 1.0%.

(2) At June 30, 2018, 110 of the 342 facilities in the Company’s Ambulatory segment were not consolidated based on the nature of the segment’s joint venture relationships with physicians and prominent healthcare systems. Although revenues of the segment’s unconsolidated facilities are not recorded as revenues by the Company, equity in earnings of unconsolidated affiliates is nonetheless a significant portion of the Company’s overall earnings. To help analyze results of operations, management also uses system-wide operating measures such as system-wide revenue growth, which includes revenues of both consolidated and unconsolidated facilities. We control our remaining 232 facilities and account for these investments as consolidated subsidiaries.

Non-GAAP Financial Measures

Adjusted EBITDA, a non-GAAP measure, is defined by the Company as net income available (loss attributable) to Tenet Healthcare Corporation common shareholders before (1) the cumulative effect of changes in accounting principle, (2) net loss attributable (income available) to noncontrolling interests, (3) income (loss) from discontinued operations, (4) income tax benefit (expense), (5) gain (loss) from early extinguishment of debt, (6) other non-operating income (expense), net, (7) interest expense, (8) litigation and investigation (costs) benefit, net of insurance recoveries, (9) net gains (losses) on sales, consolidation and deconsolidation of facilities, (10) impairment and restructuring charges and acquisition-related costs, (11) depreciation and amortization and (12) income (loss) from divested operations and closed businesses (i.e., the Company’s health plan businesses). Litigation and investigation costs do not include ordinary course of business malpractice and other litigation and related expense.

Adjusted net income available (loss attributable) from continuing operations to Tenet Healthcare Corporation common shareholders, a non-GAAP measure, is defined by the Company as net income available (loss attributable) to Tenet Healthcare Corporation common shareholders before (1) net income (loss) from discontinued operations, (2) impairment and restructuring charges, and acquisition-related costs, (3) litigation and investigation costs, (4) net gains (losses) on sales, consolidation and deconsolidation of facilities, (5) gain (loss) from early extinguishment of debt, (6) income (loss) from divested operations and closed businesses, and (7) the associated impact of these items on taxes and noncontrolling interests. Adjusted diluted earnings (loss) per share from continuing operations, a non-GAAP term, is defined by the Company as Adjusted net income available (loss attributable) from continuing operations to Tenet Healthcare Corporation common shareholders divided by the weighted average primary or diluted shares outstanding in the reporting period.

Free Cash Flow, a non-GAAP measure, is defined by the Company as (1) net cash provided by (used in) operating activities, less (2) purchases of property and equipment from continuing operations.

Adjusted Free Cash Flow, a non-GAAP measure, is defined by the Company as (1) Adjusted net cash provided by (used in) operating activities from continuing operations, less (2) purchases of property and equipment from continuing operations. Adjusted net cash provided by (used in) operating activities, a non-GAAP measure, is defined by the Company as cash provided by (used in) operating activities prior to (1) payments for restructuring charges, acquisition-related costs and litigation costs and settlements, and (2) net cash provided by (used in) operating activities from discontinued operations.

The Company believes the foregoing non-GAAP measures are useful to investors and analysts because they present additional information on the Company’s financial performance. Investors, analysts, Company management and the Company’s Board of Directors utilize these non-GAAP measures, in addition to GAAP measures, to track the Company’s financial and operating performance and compare the Company’s performance to its peer companies, which utilize similar non-GAAP measures in their presentations. The Human Resources Committee of the Company’s Board of Directors also uses certain of these measures to evaluate management’s performance for the purpose of determining incentive compensation. Additional information regarding the purpose and utility of specific non-GAAP measures used in this release is set forth below.

The Company believes that Adjusted EBITDA is a useful measure, in part, because certain investors and analysts use both historical and projected Adjusted EBITDA, in addition to other GAAP and non-GAAP measures, as factors in determining the estimated fair value of shares of the Company’s common stock. Company management also regularly reviews the Adjusted EBITDA performance for each operating segment. The Company does not use Adjusted EBITDA to measure liquidity, but instead to measure operating performance.

We use, and we believe investors and analysts use, Free Cash Flow and Adjusted Free Cash Flow as supplemental measures to analyze cash flows generated from our operations because we believe it is useful to investors in evaluating our ability to fund distributions paid to noncontrolling interests, acquisitions, purchasing equity interests in joint ventures or repaying debt.

These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Because these measures exclude many items that are included in our financial statements, they do not provide a complete measure of our operating performance. For example, the Company’s definitions of Free Cash Flow and Adjusted Free Cash Flow do not include other important uses of cash including (1) cash used to purchase businesses or joint venture interests, or (2) any items that are classified as Cash Flows From Financing Activities on the Company’s Consolidated Statement of Cash Flows, including items such as (i) cash used to repay borrowings, (ii) distributions paid to noncontrolling interests, or (iii) payments under the Put/Call Agreement for USPI redeemable noncontrolling interest, which are recorded on the Statement of Cash Flows as the purchase of noncontrolling interest. Accordingly, investors are encouraged to use GAAP measures when evaluating the Company’s financial performance.

A reconciliation of net income available (loss attributable) to Tenet Healthcare Corporation common shareholders, the most comparable GAAP measure, to Adjusted EBITDA is set forth in Table #1 below for each quarter in 2017 and 2018. A reconciliation of net income available (loss attributable) to Tenet Healthcare Corporation common shareholders, the most comparable GAAP measure, to Adjusted net income available (loss attributable) from continuing operations to Tenet Healthcare Corporation common shareholders is set forth in Table #2 below for each quarter in 2017 and 2018. A reconciliation of net cash provided by operating activities, the most comparable GAAP measure, to Free Cash Flow and Adjusted Free Cash Flow is set forth in Table #3 below for each quarter in 2017 and 2018.

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #1 – Reconciliation of Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Adjusted EBITDA for 2018 (Unaudited)
(Dollars in millions)		2018
		1st Qtr				2nd Qtr				YTD
Net income available to Tenet Healthcare Corporation common shareholders		$	99			$	26			$	125
Less: Net income available to noncontrolling interests			(92	)			(82	)			(174	)
Income from discontinued operations, net of tax			1				2				3
Income from continuing operations			190				106				296
Income tax expense			(70	)			(44	)			(114	)
Loss from early extinguishment of debt			(1	)			(1	)			(2	)
Other non-operating expense, net			(1	)			(1	)			(2	)
Interest expense			(255	)			(254	)			(509	)
Operating income			517				406				923
Litigation and investigation costs			(6	)			(13	)			(19	)
Net gains on sales, consolidation and deconsolidation of facilities			110				8				118
Impairment and restructuring charges, and acquisition-related costs			(47	)			(30	)			(77	)
Depreciation and amortization			(204	)			(194	)			(398	)
Gain (loss) from divested and closed businesses			(1	)			1				—
Adjusted EBITDA		$	665			$	634			$	1,299
Net operating revenues		$	4,699			$	4,506			$	9,205
Less: Net operating revenues from health plans			6				—				6
Adjusted net operating revenues		$	4,693			$	4,506			$	9,199
Net income available to Tenet Healthcare Corporation common shareholders as a % of net operating revenues			2.1	%			0.6	%			1.4	%
Adjusted EBITDA as a % of adjusted net operating revenues (Adjusted EBITDA margin)			14.2	%			14.1	%			14.1	%

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #1 – Reconciliation of Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Adjusted EBITDA for 2017 (Unaudited)
(Dollars in millions)		2017
		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				Total
Net loss attributable to Tenet Healthcare Corporation common shareholders		$	(53	)		$	(55	)		$	(367	)		$	(229	)		$	(704	)
Less: Net income available to noncontrolling interests			(89	)			(87	)			(78	)			(130	)			(384	)
Income (loss) from discontinued operations, net of tax			(1	)			1				(1	)			1				—
Income (loss) from continuing operations			37				31				(288	)			(100	)			(320	)
Income tax benefit (expense)			33				12				60				(324	)			(219	)
Loss from early extinguishment of debt			—				(26	)			(138	)			—				(164	)
Other non-operating expense, net			(5	)			(5	)			(4	)			(8	)			(22	)
Interest expense			(258	)			(260	)			(257	)			(253	)			(1,028	)
Operating income			267				310				51				485				1,113
Litigation and investigation costs			(5	)			(1	)			(6	)			(11	)			(23	)
Net gains on sales, consolidation and deconsolidation of facilities			15				23				104				2				144
Impairment and restructuring charges, and acquisition-related costs			(33	)			(41	)			(329	)			(138	)			(541	)
Depreciation and amortization			(221	)			(222	)			(219	)			(208	)			(870	)
Loss from divested and closed businesses			(16	)			(19	)			(6	)			—				(41	)
Adjusted EBITDA		$	527			$	570			$	507			$	840			$	2,444
Net operating revenues		$	4,813			$	4,802			$	4,586			$	4,978			$	19,179
Less: Net operating revenues from health plans			65				25				10				10				110
Adjusted net operating revenues		$	4,748			$	4,777			$	4,576			$	4,968			$	19,069
Net loss attributable to Tenet Healthcare Corporation common shareholders as a % of net operating revenues			(1.1	)%			(1.1	)%			(8.0	)%			(4.6	)%			(3.7	)%
Adjusted EBITDA as a % of adjusted net operating revenues (Adjusted EBITDA margin)			11.1	%			11.9	%			11.1	%			16.9	%			12.8	%

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #2 – Reconciliation of Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Adjusted Net Income Available from Continuing Operations to Common Shareholders for 2018 (Unaudited)
(Dollars in millions except per share amounts)		2018
		1st Qtr				2nd Qtr				YTD
Net income available to Tenet Healthcare Corporation common shareholders		$	99			$	26			$	125
Net income from discontinued operations			1			$	2				3
Net income from continuing operations			98				24				122
Less: Impairment and restructuring charges, and acquisition-related costs			(47	)			(30	)			(77	)
Litigation and investigation costs			(6	)			(13	)			(19	)
Net gains on sales, consolidation and deconsolidation of facilities			110				8				118
Loss from early extinguishment of debt			(1	)			(1	)			(2	)
Income (loss) from divested and closed businesses			(1	)			1				—
Tax impact of above items			(16	)			8				(8	)
Adjusted net income available from continuing operations to common shareholders		$	59			$	51			$	110
Diluted earnings per share from continuing operations		$	0.95			$	0.23			$	1.18
Less: Impairment and restructuring charges, and acquisition-related costs			(0.46	)			(0.29	)			(0.75	)
Litigation and investigation costs			(0.06	)			(0.12	)			(0.18	)
Net gains on sales, consolidation and deconsolidation of facilities			1.08				0.07				1.15
Loss from early extinguishment of debt			(0.01	)			(0.01	)			(0.02	)
Loss from divested and closed businesses			(0.01	)			0.01				—
Tax impact of above items			(0.16	)			0.08				(0.08	)
Adjusted diluted earnings per share from continuing operations		$	0.57			$	0.49			$	1.06
Weighted average basic shares outstanding (in thousands)			101,392				102,147				101,770
Weighted average dilutive shares outstanding (in thousands)			102,656				104,177				103,416

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #2 – Reconciliation of Net Loss Attributable to Tenet Healthcare Corporation Common Shareholders to Adjusted Net Income Available (Loss Attributable) from Continuing Operations to Common Shareholders for 2017 (Unaudited)
(Dollars in millions except per share amounts)		2017
		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				Total
Net loss attributable to Tenet Healthcare Corporation common shareholders		$	(53	)		$	(55	)		$	(367	)		$	(229	)		$	(704	)
Net income (loss) from discontinued operations			(1	)		$	1				(1	)			1				—
Net loss from continuing operations			(52	)			(56	)			(366	)			(230	)			(704	)
Less: Impairment and restructuring charges, and acquisition-related costs			(33	)			(41	)			(329	)			(138	)			(541	)
Litigation and investigation costs			(5	)			(1	)			(6	)			(11	)			(23	)
Net gains on sales, consolidation and deconsolidation of facilities			15				23				104				2				144
Loss from early extinguishment of debt			—				(26	)			(138	)			—				(164	)
Loss from divested and closed businesses			(16	)			(19	)			(6	)			—				(41	)
Tax impact of above items			14				25				26				49				114
Tax reform adjustment			—				—				—				(252	)			(252	)
Noncontrolling interests impact of above items			—				—				—				(23	)			(23	)
Adjusted net income available (loss attributable) from continuing operations to common shareholders		$	(27	)		$	(17	)		$	(17	)		$	143			$	82
Diluted loss per share from continuing operation		$	(0.52	)		$	(0.56	)		$	(3.63	)		$	(2.28	)		$	(7.00	)
Less: Impairment and restructuring charges, and acquisition-related costs			(0.33	)			(0.41	)			(3.26	)			(1.35	)			(5.34	)
Litigation and investigation costs			(0.05	)			(0.01	)			(0.06	)			(0.11	)			(0.23	)
Net gains on sales, consolidation and deconsolidation of facilities			0.15				0.23				1.03				0.02				1.42
Loss from early extinguishment of debt			—				(0.26	)			(1.37	)			—				(1.62	)
Loss from divested and closed businesses			(0.16	)			(0.19	)			(0.06	)			—				(0.40	)
Tax impact of above items			0.14				0.25				0.26				0.48				1.12
Tax reform adjustment			—				—				—				(2.47	)			(2.49	)
Noncontrolling interests impact of above items			—				—				—				(0.23	)			(0.23	)
Adjusted diluted earnings (loss) per share from continuing operations		$	(0.27	)		$	(0.17	)		$	(0.17	)		$	1.40			$	0.81
Weighted average basic shares outstanding (in thousands)			100,000				100,612				100,812				100,945				100,592
Weighted average dilutive shares outstanding (in thousands)			100,848				101,294				101,523				101,853				101,380

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #3 – Reconciliations of Net Cash Provided By Operating Activities to Free Cash Flow and Adjusted Free Cash Flow from Continuing Operations (Unaudited)
(Dollars in millions)		2018
		1st Qtr				2nd Qtr				YTD
Net cash provided by operating activities		$	113			$	348			$	461
Purchases of property and equipment			(143	)			(125	)			(268	)
Free cash flow		$	(30	)		$	223			$	193
Net cash provided by (used in) investing activities		$	373			$	(148	)		$	225
Net cash used in financing activities		$	(123	)		$	(771	)		$	(894	)
Net cash provided by operating activities		$	113			$	348			$	461
Less: Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements			(33	)			(30	)			(63	)
Net cash provided by (used in) operating activities from discontinued operations			(1	)			(2	)			(3	)
Adjusted net cash provided by operating activities from continuing operations			147				380				527
Purchases of property and equipment			(143	)			(125	)			(268	)
Adjusted free cash flow – continuing operations		$	4			$	255			$	259

(Dollars in millions)		2017
		1st Qtr				2nd Qtr				3rd Qtr				4th Qtr				Total
Net cash provided by operating activities		$	186			$	215			$	308			$	491			$	1,200
Purchases of property and equipment			(198	)			(150	)			(144	)			(215	)			(707	)
Free cash flow		$	(12	)		$	65			$	164			$	276			$	493
Net cash provided by (used in) investing activities		$	(189	)		$	(119	)		$	535			$	(206	)		$	21
Net cash used in financing activities		$	(141	)		$	(193	)		$	(889	)		$	(103	)		$	(1,326	)
Net cash provided by operating activities		$	186			$	215			$	308			$	491			$	1,200
Less: Payments for restructuring charges, acquisition-related costs, and litigation costs and settlements			(24	)			(38	)			(26	)			(37	)			(125	)
Net cash provided by (used in) operating activities from discontinued operations			2				(4	)			(1	)			(2	)			(5	)
Adjusted net cash provided by operating activities from continuing operations			208				257				335				530				1,330
Purchases of property and equipment			(198	)			(150	)			(144	)			(215	)			(707	)
Adjusted free cash flow – continuing operations		$	10			$	107			$	191			$	315			$	623

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #4 – Reconciliation of Outlook Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Outlook Adjusted EBITDA (Unaudited)
(Dollars in millions)		Q3 2018								2018
		Low				High				Low				High
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	(15	)		$	5			$	110			$	186
Less: Net income available to noncontrolling interests			(90	)			(100	)			(390	)			(410	)
Net loss from discontinued operations, net of tax			(5	)			—				(5	)			—
Income tax expense			(30	)			(35	)			(196	)			(215	)
Interest expense			(245	)			(255	)			(1,010	)			(1,020	)
Loss from early extinguishment of debt(1)			—				—				(2	)			(2	)
Other non-operating expense, net			—				(5	)			(5	)			(10	)
Net gains on sales, consolidation and deconsolidation of facilities(1)			—				—				118				118
Impairment and restructuring charges, acquisition-related costs, and litigation costs and settlements(2)			(25	)			(15	)			(150	)			(100	)
Depreciation and amortization			(195	)			(205	)			(790	)			(810	)
Loss from divested and closed businesses			—				(5	)			(10	)			(15	)
Adjusted EBITDA		$	575			$	625			$	2,550			$	2,650
Income (loss) from continuing operations		$	(10	)		$	5			$	115			$	186
Net operating revenues		$	4,300			$	4,500			$	17,900			$	18,300
Income (loss) from continuing operations as a % of operating revenues			(0.2	)%			0.1	%			0.6	%			1.0	%
Adjusted EBITDA as a % of net operating revenues (Adjusted EBITDA margin)			13.4	%			13.9	%			14.2	%			14.5	%

(1)The Company does not generally forecast losses from the early extinguishment of debt or net gains (losses) on sales, consolidation and deconsolidation of facilities because the Company does not believe that it can forecast these items with sufficient accuracy since some of these items are indeterminable at the time the Company provides its financial Outlook. The figures shown represent the Company's actual year-to-date results for these items.

(2) The Company has provided an estimate of restructuring charges and related payments that it anticipates in 2018. The figures shown represent the Company's estimate for restructuring charges plus the actual year-to-date results for impairment charges, acquisition-related costs, and litigation costs and settlements. The Company does not generally forecast impairment charges, acquisition-related costs, litigation costs and settlements because the Company does not believe that it can forecast these items with sufficient accuracy since some of these items are indeterminable at the time the Company provides its financial Outlook.

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #5 – Reconciliation of Outlook Net Income Available (Loss Attributable) to Tenet Healthcare Corporation Common Shareholders to Outlook Adjusted Net Income Available from Continuing Operations to Common Shareholders (Unaudited)
(Dollars in millions except per share amounts)		Q3 2018								2018
		Low				High				Low				High
Net income available (loss attributable) to Tenet Healthcare Corporation common shareholders		$	(15	)		$	5			$	110			$	186
Net loss from discontinued operations, net of tax			(5	)		$	—				(5	)			—
Net income (loss) from continuing operations			(10	)			5				115				186
Less: Impairment and restructuring charges, acquisition-related costs, and litigation costs and settlements			(25	)			(15	)			(150	)			(100	)
Net gains on sales, consolidation and deconsolidation of facilities			—				—				118				118
Loss from early extinguishment of debt			—				—				(2	)			(2	)
Loss from divested and closed businesses			—				(5	)			(10	)			(15	)
Tax impact of above items			5				—				(1	)			(10	)
Adjusted net income available from continuing operations to common shareholders		$	10			$	25			$	160			$	195
Diluted earnings (loss) per share from continuing operations		$	(0.10	)		$	0.05			$	1.11			$	1.79
Less: Impairment and restructuring charges, acquisition-related costs, and litigation costs and settlements			(0.25	)			(0.14	)			(1.44	)			(0.96	)
Net gains on sales, consolidation and deconsolidation of facilities			—				—				1.13				1.13
Loss from early extinguishment of debt			—				—				(0.02	)			(0.02	)
Loss from divested and closed businesses			—				(0.05	)			(0.09	)			(0.14	)
Tax impact of above items			0.05				—				(0.01	)			(0.10	)
Adjusted diluted earnings per share from continuing operations		$	0.10			$	0.24			$	1.54			$	1.88
Weighted average basic shares outstanding (in thousands)			102,000				102,000				102,000				102,000
Weighted average dilutive shares outstanding (in thousands)			104,000				104,000				104,000				104,000

TENET HEALTHCARE CORPORATION Additional Supplemental Non-GAAP disclosures Table #6 – Reconciliation of Outlook Net Cash Provided by Operating Activities to Outlook Adjusted Free Cash Flow from Continuing Operations
(Dollars in millions)		2018
		Low				High
Net cash provided by operating activities		$	1,220			$	1,525
Less: Payments for restructuring charges, acquisition-related costs and litigation costs and settlements(1)			(125	)			(75	)
Net cash used in operating activities from discontinued operations			(5	)			—
Adjusted net cash provided by operating activities – continuing operations			1,350				1,600
Purchases of property and equipment – continuing operations			(625	)			(675	)
Adjusted free cash flow – continuing operations (2)		$	725			$	925

(1)The Company has provided an estimate of payments that it anticipates in 2018 related to restructuring charges. The Company does not generally forecast payments related to acquisition-related costs and litigation costs and settlements because the Company does not believe that it can forecast these items with sufficient accuracy since some of these items may be indeterminable at the time the Company provides its financial Outlook.

(2) The Company's definition of Adjusted Free Cash Flow does not include other important uses of cash including (1) cash used to purchase businesses or joint venture interests, or (2) any items that are classified as Cash Flows From Financing Activities on the Company's Consolidated Statement of Cash Flows, including items such as (i) cash used to repay borrowings, (ii) distributions paid to noncontrolling interests, or (iii) payments under the Put/Call Agreement for USPI redeemable noncontrolling interests, which are recorded on the Statement of Cash Flows as the purchase of noncontrolling interests.