Segment Reporting

9 Months Ended

Sep. 30, 2025

Our operating segments are based on our internal reporting structure and property type and are aligned with how our Chief Operating Decision Maker, or the CODM, reviews the operating results to allocate resources and assess segment performance. The CODM is our President and Chief Executive Officer. Our two reportable segments are SHOP and Medical Office and Life Science Portfolio. Our SHOP segment consists of managed senior living communities that provide short term and long term residential living and, in some instances, care and other services for residents where we pay fees to managers to operate the communities on our behalf. Our Medical Office and Life Science Portfolio segment primarily consists of medical office properties leased to medical providers and other medical related businesses, as well as life science properties primarily leased to biotech laboratories and other similar tenants.

The significant expense categories and amounts presented below align with the segment-level information that is regularly provided to our CODM. The CODM reviews operating and financial results, including net income (loss) and its components, to assess performance, allocate resources and guide strategic decisions. For further information regarding the accounting policies of our reportable segments, see Note 2 to our consolidated financial statements included in Part IV, Item 15 of our Annual Report. The tables below present information about our segments.


	For the Three Months Ended September 30, 2025
	SHOP		Medical Office and Life Science Portfolio		Total
Revenues:
Rental income	$	—	$	48,201	$	48,201
Residents fees and services	333,390		—		333,390
Total segment revenues	333,390		48,201		381,591

Reconciliation of revenue:
Other revenue (1)					7,115
Total revenues					388,706

Less:
Senior living labor and benefits	172,422		—		172,422
Dietary	21,362		—		21,362
Utilities	19,839		3,990		23,829
Real estate taxes	10,944		5,723		16,667
Insurance	9,385		739		10,124
Other operating expenses (2)	69,818		11,074		80,892
Interest expense	6,943		2,290		9,233
Depreciation and amortization	47,113		15,840		62,953
Other segment items (3)	36,130		55,538		91,668
Segment loss	(60,566)		(46,993)		(107,559)

Reconciliation of segment loss:
Other income (1)					4,653
General and administrative					(12,789)
Acquisition and certain other transaction related costs					(1,158)
Gain on sale of properties					1,554
Interest income and other expenses					(774)
Interest expense					(39,653)
Loss on modification or early extinguishment of debt					(11,191)
Income tax expense					(337)
Equity in net earnings of an investee					3,214
Net loss					$	(164,040)

(1)Revenue and net income from our triple net leased wellness centers and senior living communities that are leased to third party operators, which we do not consider to be sufficiently material to constitute a separate reportable segment.

(2)Other operating expenses for each reportable segment include expenses such as management fees, repairs and maintenance, cleaning and other costs incurred in connection with the operation of our properties.

(3)Other segment items for each reportable segment include impairment of assets, gain (loss) on sale of properties, gain (loss) on modification or early extinguishment of debt, equity in net earnings (losses) of investees, interest income and other expenses and gain on insurance recoveries, as applicable.


	For the Nine Months Ended September 30, 2025
	SHOP		Medical Office and Life Science Portfolio		Total
Revenues:
Rental income	$	—	$	146,020	$	146,020
Residents fees and services	989,241		—		989,241
Total segment revenues	989,241		146,020		1,135,261

Reconciliation of revenue:
Other revenue (1)					23,021
Total revenues					1,158,282

Less:
Senior living labor and benefits	500,086		—		500,086
Dietary	62,893		—		62,893
Utilities	56,777		10,380		67,157
Real estate taxes	34,988		17,529		52,517
Insurance	27,717		1,962		29,679
Other operating expenses (2)	203,717		36,131		239,848
Interest expense	11,870		6,814		18,684
Depreciation and amortization	143,474		49,336		192,810
Other segment items (3)	49,787		94,881		144,668
Segment loss	(102,068)		(71,013)		(173,081)

Reconciliation of segment loss:
Other income (1)					15,803
General and administrative					(32,966)
Acquisition and certain other transaction related costs					(1,257)
Gain on sale of properties					99,114
Interest income and other expenses					4,307
Interest expense					(138,959)
Loss on modification or early extinguishment of debt					(40,388)
Income tax expense					(1,229)
Equity in net earnings of an investee					3,991
Net loss					$	(264,665)


	For the Three Months Ended September 30, 2024
	SHOP		Medical Office and Life Science Portfolio		Total
Revenues:
Rental income	$	—	$	52,901	$	52,901
Residents fees and services	312,005		—		312,005
Total segment revenues	312,005		52,901		364,906

Reconciliation of revenue:
Other revenue (1)					8,734
Total revenues					373,640

Less:
Senior living labor and benefits	157,756		—		157,756
Dietary	21,786		—		21,786
Utilities	18,917		4,240		23,157
Real estate taxes	8,851		6,767		15,618
Insurance	10,899		1,040		11,939
Other operating expenses (2)	66,363		13,027		79,390
Interest expense	54		2,319		2,373
Depreciation and amortization	47,343		18,773		66,116
Other segment items (3)	—		21,213		21,213
Segment loss	(19,964)		(14,478)		(34,442)

Reconciliation of segment loss:
Other income (1)					5,840
General and administrative					(13,933)
Acquisition and certain other transaction related costs					(331)
Interest income and other expenses					2,575
Interest expense					(57,070)

Income tax expense					(148)
Equity in net earnings (losses) of an investee					(1,180)
Net loss					$	(98,689)


	For the Nine Months Ended September 30, 2024
	SHOP		Medical Office and Life Science Portfolio		Total
Revenues:
Rental income	$	—	$	161,605	$	161,605
Residents fees and services	928,653		—		928,653
Total segment revenues	928,653		161,605		1,090,258

Reconciliation of revenue:
Other revenue (1)					25,550
Total revenues					1,115,808

Less:
Senior living labor and benefits	470,363		—		470,363
Dietary	63,282		—		63,282
Utilities	53,726		10,639		64,365
Real estate taxes	31,983		21,006		52,989
Insurance	33,446		2,820		36,266
Other operating expenses (2)	194,726		38,788		233,514
Interest expense	183		3,435		3,618
Depreciation and amortization	141,176		58,488		199,664
Other segment items (3)	—		78,867		78,867
Segment loss	(60,232)		(52,438)		(112,670)

Reconciliation of segment loss:
Other income (1)					17,178
General and administrative					(27,763)
Acquisition and certain other transaction related costs					(2,243)
Interest income and other expenses					7,215
Interest expense					(172,103)
Loss on modification or early extinguishment of debt					(209)
Income tax expense					(505)
Equity in net earnings of an investee					8,291
Net loss					$	(282,809)


	As of September 30, 2025		As of December 31, 2024
Assets (1)
SHOP	$	2,954,224	$	3,084,101
Medical Office and Life Science Portfolio	1,340,558		1,688,034
All Other	389,192		364,870
Total assets	$	4,683,974	$	5,137,005

(1)See Note 3 for further information regarding additions to long-lived assets.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

DIVERSIFIED HEALTHCARE TRUST 10-Q