Dive Brief:
- The Mayo Clinic ended 2025 with income over 13% higher than the year before, as the nonprofit health system was buoyed by increased volumes and demand for healthcare services, according to earnings documents released this week.
- The Rochester, Minnesota-based nonprofit health system said increases in its outpatient, hospital and surgical volumes accounted for the rise in revenue compared to the year prior.
- Still, as revenues rose, so too did expenses. Mayo’s increase in volumes drove supply and services expenses up, contributing to an over 8% year-over-year increase in operating costs, according to the health system.
Dive Insight:
Mayo has consistently posted earnings results that have climbed higher each year as the health system rebounds from pandemic-era staffing shortages.
Like other major hospital operators, Mayo was hampered by contract labor expenses and workforce shortages that constrained its ability to take on more capacity in the aftermath of the coronavirus pandemic, when mass attrition plagued the healthcare industry. In 2022, Mayo’s posted income that was cut in half from the prior year as the health system grappled with labor challenges.
Since then, the health system’s income has steadily improved its finances as it worked to improve hiring and retention. The nonprofit invested in professional development opportunities, well-being services and increased salaries. As a result, it was able to attract staff to accommodate higher volumes — Mayo’s admissions last year were almost 15% higher compared to 2023.
In 2025, Mayo posted income of $1.5 billion, a 13% increase from the year prior. The nonprofit attributed its growth to strong volumes including an almost 7% growth in admissions.
However, expenses rose as volumes have increased.
Expenses totaled $20 billion in 2025, close to outpacing its growth in operating revenue. Salaries and benefits made up the majority of its costs, rising to $11.2 billion. Mayo said its admissions growth contributed to an increase in expenses.
The nonprofit gave an update on its multi-year, multibillion-dollar initiative titled “Bold. Forward. Unbound.” that prioritizes physical and digital investments across the health system, including integrating artificial intelligence.
The initiative compromised significant spending of Mayo’s $1.4 billion capital expenditures last year, including for projects to expand and modernize bed towers in Mankato, Minnesota, and La Crosse, Wisconsin, and other investments.
