Diversified Healthcare Trust Q4 2025 Earnings Call Summary - Moby Strategic Transformation and Operational Recovery Completed a comprehensive wind-down of AlerisLife, transitioning 116 senior housing communities to seven regionally focused operators to leverage local expertise. Achieved 31.3% consolidated NOI growth in 2025, driven by a 230 basis point expansion in SHOP margins and a 5.8% increase in average monthly rates. Executed $1.4 billion in capital markets activity, reducing leverage by over ...

DHC said SHOP results were driven by improving occupancy, pricing, and margins. Same-property SHOP occupancy increased 90 basis points year-over-year to 82.4%, while the average monthly rate increased 5.8%. Same-property SHOP NOI margins improved by 230 basis points year-over-year, with management pointing to revenue growth as a key factor.Medical office and life science NOI of $108.1 million, slightly above the midpoint of guidanceManagement said full-year consolidated NOI grew 31.3% in 2025, supported by ...

Financial Data and Key Metrics Changes - In 2025, the company achieved full year consolidated NOI growth of 31.3% and reduced leverage by over three turns, with no debt maturities until 2028 [6][7] - For Q4, total revenue was $379.6 million, adjusted EBITDAre was $72.4 million, and normalized FFO was $21.8 million or $0.09 per share [9] - Full year adjusted EBITDAre was $284 million, at the high end of guidance [22] Business Line Data and Key Metrics Changes - SHOP NOI for the full year was $139.3 million, driven by same-property occupancy increasing 90 basis points year-over-year to 82.4% and an average monthly rate increase of 5.8% [9][10] - Medical office and life science portfolio saw same-property Cash Basis NOI increase by 3.8% year-over-year, with margins improving 100 basis points to 59.6% [12] - The company completed approximately 81,000 sq ft of leasing in the medical office and life science portfolio at weighted average rents 7.9% above prior rents [12] Market Data and Key Metrics Changes - The company noted robust demand for SHOP communities, supported by a growing 80-plus population and muted new supply expected for several years [15] - The leasing pipeline in the medical office and life science segment remains active, totaling 1 million sq ft with average lease terms of 6.9 years and GAAP rent spreads averaging more than 10% [12] Company Strategy and Development Direction - The company is focused on unlocking value through operational improvements and has identified approximately 15 locations for potential reopening of closed wings, which could add around 500 units to the portfolio [28] - Future capital expenditures are expected to decrease significantly, with guidance for 2026 set at $100 million-$115 million, reflecting a disciplined approach to capital spending [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the 2026 outlook, citing strong improvements in the SHOP segment and reduced debt as key drivers of free cash flow growth [22][23] - The company anticipates continued increases in revenue and occupancy, leading to strong NOI and margin growth in 2026 [18] Other Important Information - The company completed the sale of 37 non-core properties for approximately $250 million in Q4, contributing to a total of 69 properties sold for approximately $605 million in 2025 [13][14] - The company has a well-laddered debt maturity schedule with no maturities until 2028, allowing for a focus on operations [21] Q&A Session Summary Question: What is the go-forward strategy and opportunities for reopening wings? - The main strategy is to grow performance through operations, with potential to add close to 500 units through identified wings at a cost of $125-$175 per unit [27][28] Question: Will external investments focus on renovations or acquisitions? - The focus is on renovations due to better risk-adjusted returns, but acquisitions are not ruled out for the future [29][30] Question: What drove the Q4 margin improvement? - The improvement was a combination of reduced transition noise and core operational gains [31] Question: What are the trends for January and February? - January showed promising results in line with expectations, with rent escalators in the range of 4%-6% [33][34] Question: How should NOI growth be viewed over the coming quarters? - NOI growth is expected to be back half of the year weighted due to occupancy growth and sales season [39] Question: What are the prospects for renewing leases in the medical office and life science segment? - There are promising outlooks for re-leasing, particularly for a building in Fremont, California [46] Question: What implications does the momentum have on dividends? - There are no immediate priorities on addressing the dividend, with a focus on operations and growth in NOI [52][53]

Financial Data and Key Metrics Changes - In 2025, the company achieved consolidated NOI growth of 31.3% and reduced leverage by over three turns, with no debt maturities until 2028 [6][12] - Total revenue for the fourth quarter was $379.6 million, with Adjusted EBITDAre of $72.4 million and Normalized FFO of $21.8 million or $0.09 per share [8][22] - Full year Adjusted EBITDAre was $284 million, at the high end of guidance [22] Business Line Data and Key Metrics Changes - The SHOP NOI for the full year was $139.3 million, driven by a same-property occupancy increase of 90 basis points year-over-year to 82.4% and an average monthly rate increase of 5.8% [8][16] - Medical office and life science NOI was $108.1 million, just above the midpoint of guidance, while triple net lease senior living community and wellness center NOI was $31.1 million, exceeding guidance [22] Market Data and Key Metrics Changes - Consolidated occupancy in the medical office and life science portfolio increased by 460 basis points sequentially to 91.2% [11] - Same-property Cash Basis NOI increased 3.8% year-over-year, with margins improving 100 basis points to 59.6% [11] Company Strategy and Development Direction - The company aims to continue unlocking value through operational improvements and has identified approximately 15 locations for potential reopening of wings, which could add around 500 units to the portfolio [27] - Future dispositions will be opportunistic, focusing on reducing leverage or redeploying into accretive initiatives [14][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the 2026 outlook, supported by a robust demand for SHOP communities and a favorable industry outlook [10][14] - The company anticipates strong improvements in SHOP segment performance and reduced debt, driving free cash flow growth [22] Other Important Information - The company completed the wind down of AlerisLife, transitioning 116 communities to seven operators and completed renovations at over 30 communities [5][6] - The company expects recurring capital expenditures for 2026 to range from $100 million to $115 million, representing an over 18% decrease compared to 2025 [18] Q&A Session Summary Question: What is the go-forward strategy and opportunities for reopening wings? - The main strategy focuses on growing performance through operations, with potential for 500 units from reopening wings at identified locations [26][27] Question: Will external investments focus on renovations or acquisitions? - Renovations are prioritized for better risk-adjusted returns, but acquisitions are not ruled out for the future [28][29] Question: What drove the fourth quarter margin improvement? - The improvement was due to a combination of reduced transition disruptions and core operational gains [30] Question: What are the trends for January and February? - January showed promising results in line with expectations, with rent escalators around 4%-6% [32][33] Question: How does the company view NOI growth for the coming quarters? - NOI growth is expected to be back half of the year weighted due to ongoing transitions [38] Question: What are the prospects for renewing leases in the medical office and life science segment? - There are promising outlooks for re-leasing, particularly in the Fremont building, which is in a strong R&D market [44] Question: What implications does the momentum have on dividends? - The board will consider dividends, but there are no immediate priorities for addressing them [52]

Financial Data and Key Metrics Changes - In 2025, the company achieved consolidated NOI growth of 31.3% and reduced leverage by over three turns, with no debt maturities until 2028 [6][12] - For Q4 2025, total revenue was $379.6 million, Adjusted EBITDAre was $72.4 million, and Normalized FFO was $21.8 million or $0.09 per share [7][20] - Full year Adjusted EBITDAre was $284 million, at the high end of guidance [20] Business Line Data and Key Metrics Changes - SHOP NOI for Q4 improved 27.6% year-over-year to $38.3 million, with full year SHOP NOI at $139.3 million, towards the high end of guidance [6][7] - Medical office and life science NOI was $108.1 million, just above the midpoint of guidance [21] - Same-property Cash Basis NOI increased 15.4% year-over-year to $70.4 million in Q4 [15] Market Data and Key Metrics Changes - Same-property occupancy for SHOP increased 90 basis points year-over-year to 82.4%, with average monthly rates up 5.8% [7][15] - Consolidated occupancy in the medical office and life science portfolio increased 460 basis points sequentially to 91.2% [11] Company Strategy and Development Direction - The company aims to unlock value through operational performance and is focused on executing property-specific business plans [9][26] - There is a healthy pipeline of ROI projects expected to add approximately 500 SHOP units, with an unlevered mid-teens ROI [10][27] - Future dispositions will be opportunistic, with proceeds used to reduce leverage or redeploy into accretive initiatives [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2026 outlook due to robust demand for SHOP communities and a favorable industry outlook [10][14] - The company anticipates continued increases in revenue and occupancy, leading to strong NOI and margin growth in 2026 [15][20] Other Important Information - The company completed the wind down of AlerisLife, transitioning 116 communities to seven operators [5] - G&A expenses for Q4 included a $5.7 million business management incentive fee, driven by a total shareholder return of nearly 113% in 2025 [16] Q&A Session Summary Question: What is the go-forward strategy and opportunities for reopening wings at existing communities? - The main strategy is to grow performance through operations, with potential to add close to 500 units through identified wings at a cost of $125-$175 per unit [26][27] Question: Will external investments focus on renovations or acquisitions? - Renovations are expected to provide better risk-adjusted returns, but acquisitions are not the current focus [28][29] Question: What drove the Q4 margin improvement? - The improvement was a combination of reduced transition noise and core operational gains [30][31] Question: What are the trends for January and February? - January showed promising results in line with expectations, with rent escalators around 4%-6% [33][34] Question: How should NOI growth be expected over the coming quarters? - NOI growth is expected to be back half of the year weighted due to occupancy growth and rate increases [38][40] Question: What are the prospects for renewing or releasing medical office and life science assets? - There are promising prospects for re-leasing, particularly for a building in Fremont, California [44] Question: What implications does the momentum have on the dividend? - The board will consider the dividend, but there are no immediate priorities for addressing it [51]

Financial Results and Supplemental Information FOURTH QUARTER 2025 February 23, 2026 Diversified Healthcare Trust Announces Fourth Quarter 2025 Financial Results "DHC finished an active 2025 on a strong note and is carrying significant positive momentum into 2026. Fourth quarter and full year results came in at the high end of our expectations, with fourth quarter same property SHOP NOI improving 27.6% over last year to $38.3 million, and full year SHOP NOI improving 31.3% to $139.3 million. Same property S ...

Investor Presentation February 2026 1 1 Overture at Plano 500 Coit Road Plano, TX Warning Concerning Forward Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws that are subject to risks and uncertainties. These statements may include words such as "believe", "expect", "anticipate", "intend", "plan", "estimate", "will", "may" and negatives or derivatives of these or similar expressions. ...

Core Insights - Diversified Healthcare (DHC) reported quarterly funds from operations (FFO) of $0.09 per share, missing the Zacks Consensus Estimate of $0.12 per share, but showing an improvement from $0.02 per share a year ago [1] - The company experienced an FFO surprise of -25.00% for the quarter, and has only surpassed consensus FFO estimates once in the last four quarters [2] - Revenues for the quarter were $379.57 million, which was 4.53% below the Zacks Consensus Estimate, and slightly down from $379.62 million year-over-year [3] Financial Performance - The FFO for the last quarter was $0.09 per share, compared to an expected $0.12 per share, indicating a significant miss [1] - The company’s revenues of $379.57 million fell short of expectations, marking a slight decline from the previous year's revenues [3] - Over the last four quarters, the company has exceeded revenue estimates twice, indicating some variability in performance [3] Market Position and Outlook - Diversified Healthcare shares have increased by approximately 28.7% since the beginning of the year, outperforming the S&P 500, which gained only 0.9% [4] - The future performance of the stock will largely depend on management's commentary during the earnings call and the outlook for FFO [4][5] - The current consensus FFO estimate for the upcoming quarter is $0.14, with projected revenues of $395.44 million, and for the current fiscal year, the estimate is $0.57 on $1.61 billion in revenues [8] Industry Context - The REIT and Equity Trust - Other industry, to which Diversified Healthcare belongs, is currently ranked in the bottom 35% of over 250 Zacks industries, which may impact stock performance [9] - Empirical research indicates a strong correlation between stock movements and estimate revisions, suggesting that investors should monitor these trends closely [6][7]

Regulatory Compliance - Medicare reimbursement for skilled nursing services is subject to fixed payments under the Medicare prospective payment systems, with annual adjustments made by CMS [69]. - Medicaid reimbursement rates for assisted living and memory care communities are based on fixed payment systems, which are adjusted annually for inflation but may not reflect actual cost increases [70]. - The enactment of Public Law No. 119-21 on July 4, 2025, included significant funding cuts and policy changes to Medicaid, potentially adversely affecting tenants' ability to pay rent and the profitability of managed senior living communities [70]. - Increased federal and state enforcement efforts targeting healthcare fraud and abuse have led to higher civil monetary penalties and criminal sanctions for noncompliance, impacting operational costs [72]. - The federal Health Insurance Portability and Accountability Act (HIPAA) and related laws impose strict compliance requirements regarding the privacy and security of individually identifiable information, with significant penalties for violations [75]. - Recent legislative developments, such as the California Consumer Privacy Act and similar laws in other states, may increase compliance costs and potential liabilities related to consumer health data [76]. - Government authorities are conducting more inspections and audits of healthcare facilities, which could lead to sanctions affecting tenants' ability to pay rent and the profitability of managed communities [64]. - Changes in the regulatory framework, including potential federal minimum staffing rules for skilled nursing facilities, could materially impact the ability of tenants to operate effectively [62]. - Compliance with federal, state, and local laws is crucial for the operation of senior living communities, and non-compliance could adversely affect profitability and tenant rent payments [77]. Financial Performance - For the year ended December 31, 2025, the majority of net operating income (NOI) from senior living communities was generated from properties relying on private resources, with a small portion from Medicare and Medicaid programs [68]. - Healthcare providers face increasing scrutiny and cost control pressures under Medicare and Medicaid, which may impact their ability to cover rising costs, including rent [79]. - The company competes with other REITs and financial institutions for tenants and investments, influenced by factors such as location, rents, and reputation [82]. Environmental Initiatives - As of December 31, 2025, 18 properties received LEED® designations, representing 10.5% of the Medical Office and Life Science Portfolio [91]. - 24 properties achieved ENERGY STAR certification, covering 3.6 million square feet, which is 12.5% of eligible properties [92]. - The company has generated $4.5 million in cumulative savings through real-time energy monitoring across 14 properties [90]. - Environmental regulations may impose additional costs, but the company does not expect these to materially impact operations as they are typically passed on to tenants [98]. Corporate Governance - The Board of Trustees consists of 43% women and approximately 29% members of marginalized minorities, reflecting a commitment to diversity and inclusion [101]. - The company has a governance hotline accessible on its website for shareholders to report concerns about accounting or auditing matters [103]. - The company provides free access to its Annual Reports, Quarterly Reports, and Current Reports through the "Investors" section of its website [103]. - The company has a policy for handling concerns or complaints about accounting and internal controls, which is accessible on its website [103]. REIT Compliance and Taxation - The company has elected to be taxed as a REIT under Sections 856 through 860 of the IRC since its 1999 taxable year, and it believes it will continue to qualify as a REIT [112]. - The company is generally not subject to federal income tax on net income distributed as dividends to shareholders, provided it meets certain qualification tests [113]. - If the company fails to qualify for taxation as a REIT, it could face significant tax liabilities, reducing cash available for distribution to shareholders [116]. - The company must distribute at least 85% of its REIT ordinary income and 95% of its REIT capital gain net income to avoid a 4% nondeductible excise tax on excess distributions [117]. - The company may be subject to federal tax on undistributed "real estate investment trust taxable income" if it retains earnings [117]. - The company has restrictions in place to ensure that no more than 20% of its total asset value is comprised of investments in TRSs [129]. - The company must ensure that at least 95% of its gross income for each taxable year consists of qualifying income under the 75% gross income test [134]. - The company believes that all or substantially all of its rents and related service charges have qualified as "rents from real property" for purposes of Section 856 of the IRC [137]. - The company aims to satisfy the 75% and 95% gross income tests on a continuing basis beginning with its first taxable year as a REIT [145]. - The company must satisfy the asset tests at the close of each calendar quarter of each taxable year as a REIT [147]. Debt and Financing - The company has a floating rate mortgage loan of $140,000 with an annual interest rate of 6.19%, resulting in an annual interest expense of $8,786, maturing in March 2028 [467]. - The company has purchased an interest rate cap with a SOFR strike rate of 4.50% to hedge against risks related to changes in SOFR [468]. - As of December 31, 2025, the company has no amounts outstanding under its revolving credit facility, which allows for flexible repayments without penalties [469]. - The company’s fixed rate debt totals $2,303,503, with the highest annual interest expense from senior secured notes at $27,188, maturing in October 2030 [473]. - A one percentage point increase in interest rates would raise the annual floating rate interest expense to $9,936, impacting earnings per share by $(0.04) [471]. - The company’s debt agreements allow for early repayments, which may help mitigate refinancing risks at maturity [478]. - Changes in market interest rates affect the fair value of fixed rate debt, with increases decreasing fair value and vice versa [477]. - The company’s floating rate mortgage loan is vulnerable to changes in U.S. dollar short-term interest rates, specifically SOFR [468]. - The company expects no significant changes in its exposure to interest rate fluctuations in the near future [466]. Shareholder Distributions and Tax Implications - The company expects to make distributions to shareholders, which may include cash and property distributions [175]. - Distributions not designated as capital gain dividends will generally be treated as ordinary income dividends to the extent of available earnings and profits [178]. - Noncorporate U.S. shareholders may face a maximum federal income tax rate of 15% for long-term capital gains and most corporate dividends, increasing to 20% for those exceeding income thresholds [177]. - The company may elect to retain and pay taxes on some or all of its net capital gains, affecting shareholders' tax treatment [181]. - Tax-exempt shareholders receiving distributions should not have such amounts treated as UBTI if certain conditions are met [190]. - Non-U.S. shareholders are expected to receive distributions without being subject to higher federal tax rates if the shares are listed on a U.S. national securities exchange [192]. - Non-U.S. shareholders will generally face a 30% withholding tax on distributions not designated as capital gain dividends, unless a lower treaty rate applies [193]. - Distributions to non-U.S. shareholders attributable to the sale of U.S. real property interests will not be subject to withholding if the shares are listed on a U.S. national securities exchange [194]. - Tax treaties may reduce withholding obligations, but rates below 30% may not apply to ordinary income dividends from a REIT [196]. - If shares are not listed on a U.S. national securities exchange, non-U.S. shareholders may be taxed up to 21% on distributions attributable to capital gain dividends [197]. - Non-U.S. shareholders may seek refunds from the IRS for excess withholding on distributions exceeding their allocable share of earnings and profits [196]. - The company expects its shares will not be classified as U.S. real property interests, thus non-U.S. shareholders' gains on sales will generally not be subject to U.S. federal income taxation [199]. - The company believes it qualifies as a "domestically controlled" REIT, with less than 50% of shares held by non-U.S. shareholders over the past five years [200]. - Non-U.S. financial institutions must comply with diligence and reporting requirements to avoid a 30% U.S. withholding tax on applicable payments [207]. - Distributions to non-U.S. shareholders will be reported to both the shareholders and the IRS, regardless of withholding status [206]. Investment and Acquisition Strategies - The integration and consolidation of healthcare delivery are leading to heightened antitrust scrutiny, which could affect competition and the ability to enter transactions involving property sales or acquisitions [80]. - The company has engaged in transactions to acquire C corporations, which may affect its REIT qualification tests and distribution requirements [170]. - The company has invested in real estate through subsidiaries that are expected to qualify as REITs, which are crucial for maintaining compliance with asset tests [127]. - The company has protective TRS elections in place to mitigate risks associated with subsidiary REITs failing to qualify, although effectiveness cannot be guaranteed [128]. - The company may utilize its TRSs in transactions to avoid recognizing dealer gains subject to the 100% penalty tax [142].

Financial Results and Supplemental Information FOURTH QUARTER 2025 February 23, 2026 Exhibit 99.2 Table of Contents | FINANCIAL RESULTS | Diversified Healthcare Trust Announces Fourth Quarter 2025 Financial Results . | | | --- | --- | --- | | | Fourth Quarter 2025 Highlights | | | | Full Year 2026 Guidance .. | | | FINANCIALS | Key Financial Data | | | | Condensed Consolidated Balance Sheets | | | | Condensed Consolidated Statements of Income (Loss) | | | DEBT AND LEVERAGE | Debt Summary . | | | | Debt Matu ...