A U.S. outpatient diagnostic imaging company, RadNet operates roughly four hundred multi-modality centers across nine states, where patients get MRIs, CT scans, PET scans, and mammograms. Founded in 1981 by six Los Angeles doctors (including current CEO Howard Berger), it began by billing for radiology groups before opening its first imaging center across from Cedars-Sinai. Its name blends "radiology" and "network," and its DeepHealth arm builds AI tools for reading scans, born from a 2020 acquisition of a Cambridge mammography-AI startup.
RadNet Q2 revenue rose 25% to $622.7M, but Digital Health losses widened to $11.5M as AI integration costs grew.
growth accelerated to 25%, the fastest quarterly pace in the company's reported history. Q2 revenue reached $622.7 million, driven by an 11.1% increase in Imaging Center and a 56.5% increase in Digital Health revenue, while rose 27.8% to $39.5 million and came in at $0.10. The core imaging business is expanding, but the AI 's losses continue to widen and the company now carries $1.3 billion in with its interest rate hedge expired.
Key takeaways
Digital Health rose 56.5% to $32.4 million, driven by a 135.9% increase in Clinical AI revenue, while the 's net loss widened to $11.5 million from $4.9 million a year earlier as the company integrates Gleamer, iCAD, See-Mode, and CIMAR.
Imaging Center rose 11.1% in Q2, driven by higher procedure volumes, reimbursement, and a continued mix shift toward advanced modalities such as PET/CT.
Imaging Center operating expenses rose 21.9%, led by a 34.4% increase in professional reading fees and a 41.7% increase in medical supplies, reflecting the advanced-imaging mix shift and higher isotope tracer costs.
Section summaries
Management's Discussion and Analysis
Q2 FY2026 revenue rose 25% to $622.7M, driven by imaging volume growth and Digital Health expansion, while net loss widened.
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Total service rose 25.0% to $622.7M in Q2 2026 and 23.6% to $1,198.4M for H1 2026, with Imaging Center same-center revenue up 11.1% in Q2 on higher procedure volumes, reimbursement, and advanced-imaging mix.
rose 27.8% to $39.5 million, and the widened 0.1 points to 6.3%, as growth of 25.0% outpaced the increase in operating expenses.
rose 20.9% to $1.30 billion, after the company added a $250 million incremental term loan during the quarter, while cash and equivalents stood at $726.3 million.
rose to $99.7 million from $81.2 million a year earlier, with Imaging Center contributing $97.2 million and Digital Health contributing $2.5 million.
What changed
The Digital Health 's quarterly loss widened to $11.5 million from $7.1 million in Q2 2025 and $17.7 million in Q1 2026, as the company continues to absorb the costs of integrating the Gleamer, iCAD, See-Mode, and CIMAR acquisitions.
The $400 million that locked SOFR at 1.98% expired in October 2025, and the company has not replaced it; a hypothetical 1% rise in SOFR would now increase annual by $12.1 million on the Barclays Term Loan, up from $9.6 million disclosed in Q1 2026.
Medical supplies costs rose 41.7% in Q2 2026, accelerating from the 17.6% increase in Q2 2025 and the 45.3% increase in Q1 2026, as isotope tracer inflation for prostate and Alzheimer's PET/CT studies persists.
Cash and equivalents fell to $726.3 million from $767.2 million at year-end 2025, after $434.5 million in investing cash outflows during H1 2026, primarily for the Gleamer acquisition and imaging facility purchases.
growth accelerated to 25.0% in Q2 2026 from 8.4% in Q2 2025 and 22.1% in Q1 2026, the fastest quarterly growth rate in the company's reported history.
What to watch
Whether the Digital Health 's $11.5 million quarterly net loss narrows in Q3 2026 as the Gleamer, iCAD, See-Mode, and CIMAR integrations progress, or whether AI investment costs continue to outpace the 56.5% growth.
Whether the 41.7% increase in medical supplies costs — driven by isotope tracer inflation for prostate and Alzheimer's PET/CT studies — persists into Q3 2026 or begins to moderate.
Whether the company enters a new interest rate hedge to replace the expired $400 million swap, given that a 1% SOFR increase would now add $12.1 million in annual on the Barclays Term Loan.
How the $726.3 million cash balance is deployed against the $1.30 billion debt load, and whether the pace of acquisitions and AI investment draws the balance low enough to require additional financing.
Digital Health grew 56.5% to $32.4M in Q2 2026, driven by a 135.9% increase in Clinical AI revenue and a 17.3% increase in Enterprise Informatics revenue, with rising to $105.5M from $53.5M.
Imaging Center operating expenses rose 21.9% in Q2 2026, led by a 34.4% increase in professional reading fees and a 41.7% increase in medical supplies, reflecting advanced-imaging mix shift toward PET/CT and higher isotope tracer costs.
Digital Health net loss widened to $11.5M in Q2 2026 from $4.9M a year earlier, and the company expects continued near-term losses as it integrates Gleamer, iCAD, See-Mode, and CIMAR.
rose $11.2M to $173.1M in H1 2026, while investing cash use increased $280.3M to $434.5M, mainly for the Gleamer acquisition and imaging facilities; financing provided $222.7M, including a $250M incremental term loan.
rose to $99.7M in Q2 2026 from $81.2M in Q2 2025, with Imaging Center Adjusted EBITDA of $97.2M and Digital Health Adjusted EBITDA of $2.5M.
Quantitative and Qualitative Disclosures About Market Risk
Company faces foreign-exchange and floating-rate debt risk, with no FX hedges and swaps that expired in October 2025.
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Foreign exchange exposure arises from Pound Sterling, Euro, Canadian Dollar, Hungarian Forint, and Indian Rupee revenues and expenses tied to UK radiology services, Netherlands AI operations, and R&D centers in Canada, Hungary, and India.
The company holds no foreign currency exchange contracts to mitigate currency risk.
A hypothetical 1% decline in the U.S. dollar against those currencies would increase annual operating expenses by about $0.7 million.
The 2019 Swaps, which locked one-month Term at 1.98% on $400 million notional, expired in October 2025, leaving floating-rate debt exposure unhedged.
At June 30, 2026, a hypothetical 1% increase in would raise annual by $12.1 million on the $1,205.6 million Barclays Term Loan and by about $1.2 million on the $118.1 million Truist .
Effective plus applicable margin was 5.66% on the Barclays Term Loan and 5.33% on the Truist at June 30, 2026.
From time to time we are engaged in legal proceedings that arise in the ordinary course of our business. We do not believe that the outcome of any of our current legal proceedings will have a material adverse impact on our business, financial condition and results of operations.
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From time to time we are engaged in legal proceedings that arise in the ordinary course of our business. We do not believe that the outcome of any of our current legal proceedings will have a material adverse impact on our business, financial condition and results of operations.
For information about the risks and uncertainties related to our business, please see the risk factors described in our Annual Report. The risks described in our Annual Report are not the only risks facing our Company. Additional risks and uncertainties not currently known to us…
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For information about the risks and uncertainties related to our business, please see the risk factors described in our Annual Report. The risks described in our Annual Report are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.