CoreCivic ((CXW)) has held its Q3 earnings call. Read on for the main highlights of the call.
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CoreCivic’s recent earnings call showcased a blend of optimism and hurdles. The company celebrated substantial contract awards and revenue growth, particularly from ICE, alongside a vigorous share repurchase strategy. Despite these positives, the company faces legal and start-up challenges impacting facility activations and a downward revision in financial guidance. Overall, the sentiment leans slightly positive, with long-term growth prospects overshadowing immediate obstacles.
New Contract Awards and Revenue Growth
CoreCivic announced significant new contract awards for four facilities, expected to generate approximately $320 million in annual revenue once stabilized occupancy is achieved. The company projects a total annual run rate revenue of $2.5 billion, with an increase in EBITDA by $100 million to over $450 million by the first half of 2026.
ICE Detention Population Increase
ICE detention populations reached historical highs of around 60,000 by the end of September 2025. CoreCivic’s facilities saw an increase of 3,700 ICE detainees, bringing the total to nearly 14,000, marking a 37% rise since the end of 2024.
Share Repurchase Program
CoreCivic has repurchased 5.9 million shares of common stock in the first nine months of 2025, costing $121 million. The company plans to continue this aggressive buyback strategy, potentially more than doubling the amount repurchased in previous quarters.
Strong State Partner Engagement
Revenue from state partners rose by 3.6% compared to the prior year quarter, fueled by new contracts with the State of Montana and increased populations in Georgia.
Lawsuit Delaying Facility Activation
A lawsuit filed by the City of Leavenworth has delayed the intake process at CoreCivic’s Midwest Regional Reception Center, impacting the timeline for reaching stabilized occupancy.
Reduction in Financial Guidance
The updated 2025 financial guidance reflects a reduction in expected adjusted EBITDA due to start-up activities at new facilities. The revised guidance is lower than previous estimates, with an expected decrease in EBITDA by $10 million to $11 million.
Operating Losses Due to Start-Up Activities
CoreCivic reported operating losses of $3.4 million at three facilities during the third quarter, attributed to start-up related activities.
Forward-Looking Guidance
CoreCivic’s updated financial guidance for 2025 highlights substantial growth from 2024, with an expected run rate revenue of around $2.5 billion and an increase in annual run rate EBITDA by $100 million to over $450 million. The company anticipates impacts on fourth-quarter financials due to start-up activities and plans to accelerate its share repurchase program, with $198 million authorized under the current program.
In conclusion, CoreCivic’s earnings call revealed a cautiously optimistic outlook. While the company faces immediate challenges, particularly legal and start-up issues, its strategic initiatives in contract awards and share repurchases position it for potential long-term growth. Investors may find reassurance in the company’s proactive approach to navigating these complexities.