| Revenue Recognition |
NOTE 9. Deferred Revenue The following table summarizes the Company’s deferred revenue (in thousands): | | | | | | | | | | | | | | | | June 30, | | December 31, | | | 2026 | | 2025 | Non-refundable entrance fees | | $ | 695,511 | | $ | 669,528 | Other deferred revenue | | | 3,734 | | | 3,479 | Deferred revenue | | $ | 699,245 | | $ | 673,007 |
The opening and closing balances of non-refundable entrance fees were as follows (in thousands): | | | | | | | | Closing balance - December 31, 2024 | | $ | 615,723 | Additions(1) | | | 152,717 | Amortization(2) | | | (98,912) | Closing balance - December 31, 2025 | | $ | 669,528 | Additions(1) | | | 75,631 | Acquisitions | | | 5,362 | Amortization(2) | | | (55,010) | Closing balance - June 30, 2026 | | $ | 695,511 |
| (1) | During the three months June 30, 2026, the Company collected non-refundable entrance fees of $41 million. During the three and six months ended June 30, 2025, the Company collected non- refundable entrance fees of $43 million and $71 million, respectively. |
| (2) | Amortization of non-refundable entrance fees is included within resident fees and services on the Combined and Consolidated Statements of Operations. During the three months ended June 30, 2026, the Company recognized amortization of $28 million. During the three and six months ended June 30, 2025, the Company recognized amortization of $24 million and $48 million, respectively. |
As of each of June 30, 2026 and December 31, 2025, the weighted average remaining length of stay based on the unamortized non-refundable entrance fee balance of the Company’s in-place residents was 8 years. Entrance Fee Receivables For certain residents that qualify, the Company may offer to provide a deferral of the upfront cash entrance fee requirements so that they are able to move into a community while still continuing the process of selling their previous home. These entrance fee receivables are due upon sale of the resident’s previous home. The following table summarizes the Company’s entrance fee receivables, which are recognized in other assets on the Combined and Consolidated Balance Sheets (in thousands): | | | | | | | | Closing balance - December 31, 2024 | | $ | 61,273 | Current year deferrals provided | | | 99,960 | Receipts applied to entrance fee commitments | | | (87,857) | Closing balance - December 31, 2025 | | $ | 73,376 | Current year deferrals provided | | | 53,160 | Receipts applied to entrance fee commitments | | | (55,273) | Closing balance - June 30, 2026 | | $ | 71,263 |
NOTE 15. Revenue Recognition Disaggregation of Resident Fees and Services Revenue The following table disaggregates the Company’s resident fees and services according to whether such revenue relates to amortization of non-refundable entrance fees, room and rents, or ancillary and other services (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, | | | | 2026 | | 2025 | | | | Amount | | Percent of Total | | Amount | | Percent of Total | | Room and rents | | $ | 169,156 | | 78 | % | $ | 111,737 | | 75 | % | Non-refundable entrance fee amortization | | | 27,808 | | 13 | % | | 23,652 | | 16 | % | Ancillary and other services | | | 19,492 | | 9 | % | | 13,466 | | 9 | % | Resident fees and services | | $ | 216,456 | | 100 | % | $ | 148,855 | | 100 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | Six Months Ended June 30, | | | | 2026 | | 2025 | | | | Amount | | Percent of Total | | Amount | | Percent of Total | | Room and rents | | $ | 333,523 | | 80 | % | $ | 232,147 | | 78 | % | Non-refundable entrance fee amortization | | | 55,010 | | 13 | % | | 47,658 | | 16 | % | Ancillary and other services | | | 28,268 | | 7 | % | | 17,977 | | 6 | % | Resident fees and services | | $ | 416,801 | | 100 | % | $ | 297,782 | | 100 | % |
Room and rents and non-refundable entrance fee amortization are recognized over time, or approximately one month and expected stay of the resident, respectively. Ancillary and other services are recognized at a point in time, as services are delivered. Accounts Receivable, net The opening and closing balances of accounts receivable, net were as follows (in thousands): | | | | | | | | Closing balance - December 31, 2025 | | $ | 19,431 | Closing balance - June 30, 2026 | | | 24,076 | Change | | $ | 4,645 |
The following is a summary of the Company’s adjustments to allowances for credit losses (in thousands): | | | | | | | | Opening balance - December 31, 2024 | | $ | 2,243 | Additional allowance | | | 2,269 | Write-offs, recoveries, and other adjustments | | | (2,494) | Closing balance - December 31, 2025 | | $ | 2,018 | | | | | Opening balance - December 31, 2025 | | $ | 2,018 | Additional allowance | | | 2,219 | Write-offs, recoveries, and other adjustments | | | (714) | Closing balance - June 30, 2026 | | $ | 3,523 |
|
NOTE 12. Revenue Recognition Disaggregation of Resident Fees and Services Revenue The following tables disaggregate the Company’s resident fees and services according to whether such revenue relates to amortization of non-refundable entrance fees, room and board, or ancillary and other services (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | | 2025 | | 2024 | | | | | | | Percent of | | | | | Percent of | | | | Amount | | Total | | Amount | | Total | | Room and board | | $ | 488,366 | | 80.8 | % | $ | 463,938 | | 81.6 | % | Non-refundable entrance fee amortization | | | 98,912 | | 16.4 | % | | 88,995 | | 15.7 | % | Ancillary and other services | | | 16,711 | | 2.8 | % | | 15,542 | | 2.7 | % | Total resident fees and services | | $ | 603,989 | | 100.0 | % | $ | 568,475 | | 100.0 | % |
Room and board and non-refundable entrance fee amortization are recognized over time, or approximately one month and expected stay of the resident, respectively. Ancillary and other services are recognized at a point in time, as services are delivered. Accounts Receivable, net The opening and closing balances of accounts receivable, net were as follows (in thousands): | | | | | | | | Opening balance – December 31, 2023 | | $ | 19,970 | Closing balance – December 31, 2024 | | | 19,697 | Change | | $ | (273) | Opening balance – December 31, 2024 | | $ | 19,697 | Closing balance – December 31, 2025 | | | 19,431 | Change | | $ | (266) |
The following is a summary of the Company’s adjustments to allowances for credit losses (in thousands): | | | | | | | | Opening balance – December 31, 2023 | | $ | 2,282 | Additional allowance | | | 2,494 | Write-offs, recoveries, and other adjustments | | | (2,533) | Closing balance – December 31, 2024 | | $ | 2,243 | Opening balance – December 31, 2024 | | $ | 2,243 | Additional allowance | | | 2,269 | Write-offs, recoveries, and other adjustments | | | (2,494) | Closing balance – December 31, 2025 | | $ | 2,018 |
|