CoreCivic (NYSE:CXW) executives said the company is working toward “stabilized occupancy” across several recently reactivated or newly awarded facilities by mid-2026, as demand from federal partners—particularly U.S. Immigration and Customs Enforcement (ICE)—continued to climb during the fourth quarter of 2025.
On the company’s fourth-quarter earnings call, President and CEO Patrick Swindle said three of four previously idle facilities tied to awards announced in the second half of 2025 are taking in additional populations. The fourth, the Midwest Regional Reception Center, remains delayed as CoreCivic awaits the outcome of a special use permit application filed in December 2025. Swindle said discussions with the city have been “productive,” but management excluded Midwest Regional from 2026 guidance due to uncertainty around intake timing.
Activation ramp and demand backdrop
Management expects those facilities to reach stabilized occupancy during the first half of 2026. Swindle said that once stabilized occupancy is achieved (excluding Midwest Regional), CoreCivic expects an annual revenue run rate of approximately $2.5 billion and an annual EBITDA run rate of about $450 million—nearly $100 million higher year over year.
Executives pointed to historically high ICE detention levels early in January 2026 of around 69,900 individuals nationwide, up almost 10,000 from the end of the third quarter. Swindle said ICE has been CoreCivic’s largest customer for more than a decade and noted that ICE populations in CoreCivic’s care grew by 5,903 individuals from the end of 2024 through the end of 2025 to just over 16,000, which he characterized as a 58% increase.
By contrast, Swindle said U.S. Marshals Service populations have declined, with CoreCivic’s average daily Marshals population down 1,235 individuals from the fourth quarter of 2024. He attributed the decline to fewer apprehensions at the southern border and added that where facilities are shared between ICE and the Marshals Service, capacity has shifted toward ICE because of higher demand.
Looking ahead, Swindle said that even after the current activations, CoreCivic still owns five idle corrections and detention facilities totaling about 7,000 beds. Including surge capacity and partial capacity at currently operating facilities, he said the company has told ICE it could provide nearly 13,000 additional beds.
Fourth-quarter results driven by ICE growth
Swindle said federal partners comprised 57% of CoreCivic’s total revenue in the fourth quarter, with revenue from federal partners rising 49% from the year-ago period. He said ICE revenue increased to $124.4 million, up 103.4%, while revenue from the U.S. Marshals Service declined by $11.3 million year over year.
Revenue from state partners increased 5% year over year, with management citing additional revenue from Montana tied to two contracts signed since the second quarter of 2024 and population increases in Georgia and Colorado.
Total occupancy for the company’s Safety and Community segments was 78.1% in the quarter, up 2.6 percentage points from the prior-year period. Average daily population across all managed facilities was 56,380 individuals in the fourth quarter of 2025, compared with 50,202 in the year-ago quarter. Swindle said growth reflected higher demand, new contracting activity, and the July 1, 2025 acquisition of the Farmville Detention Center.
Profitability, startup losses, and margin commentary
CFO David Garfinkle reported fourth-quarter 2025 GAAP EPS of $0.26 and funds from operations (FFO) per share of $0.51. Special items included a $1.5 million net loss on the sale of assets and $0.7 million of M&A charges in G&A expense. Excluding special items, Adjusted EPS was $0.27, up from $0.16 a year earlier, and Normalized FFO per share was $0.52, compared with $0.39 in the prior-year quarter. Adjusted EBITDA was $92.5 million, up from $74.2 million a year ago.
Garfinkle said results reflected the full activation of the 2,400-bed Dilley Immigration Processing Facility, which was completed in the third quarter of 2025 after being idle following a prior funding termination in 2024. He also said the quarter included startup activity at California City and Diamondback—both idle at the start of 2025—which together produced facility net operating losses of $3.6 million in the quarter. Management expects California City and Diamondback to reach stabilized occupancy in the first and second quarters of 2026, respectively, and Garfinkle said both are projected to reach profitability in the first quarter of 2026 as intake continues.
Operating margin in the Safety and Community facilities combined was 22.2% in the fourth quarter, down from 23.6% a year earlier. Excluding the four facilities in various stages of activation, Garfinkle said operating margin was 24.1%. In response to an analyst question, management said it expects margin improvement as activated facilities reach stabilized occupancy.
Capital structure, buybacks, and 2026 guidance
Garfinkle said CoreCivic amended its bank credit facility on Dec. 1 to expand revolver capacity and increase its accordion feature, bringing total commitments under the bank credit facility to $700 million. As of Dec. 31, CoreCivic had $97.9 million of cash and $311.4 million of borrowing capacity on the revolver, for total liquidity of $409.3 million.
CoreCivic repurchased 5.3 million shares in the fourth quarter for $97.3 million, bringing 2025 repurchases to 11.2 million shares for $218.4 million. Garfinkle said the year’s repurchases represented 10.2% of shares outstanding at the beginning of the year and reduced shares outstanding to 100 million as of Dec. 31, 2025. The board increased total repurchase authorization in the fourth quarter, leaving $300.5 million available at year-end. Net leverage was 2.8x net debt to adjusted EBITDA on a trailing 12-month basis.
For 2026, CoreCivic guided for diluted EPS of $1.49 to $1.59, FFO per share of $2.54 to $2.64, and EBITDA of $437 million to $445 million. Garfinkle reiterated that guidance excludes new contract awards not previously announced and does not include Midwest Regional due to ongoing delays tied to the special use permit dispute and related litigation, though management said a favorable outcome would provide upside.
Additional 2026 outlook items discussed on the call included:
- Maintenance capital expenditures of $60 million to $70 million and $15 million for other capital expenditures
- $35 million to $40 million of capital expenditures tied to facility activations and readiness, including about $23.5 million carried over from the 2025 forecast
- Adjusted funds from operations (AFFO) of $245 million to $259.3 million, which management described as a proxy for cash available for allocation decisions
- An expected effective tax rate of 25% to 30% and 2026 G&A expense forecast of $160 million to $165 million
Management also described first-quarter seasonality, noting Q1 is typically weaker than Q4 due to fewer days, higher utilities, and a concentration of unemployment taxes, which Garfinkle said collectively reduces earnings by about $0.04 per share from Q4 to Q1. He added that in Q1 2026 those headwinds are expected to be offset by net operating income contributions as California City and Diamondback move toward profitability.
Throughout the call, Swindle and Garfinkle emphasized continued use of share repurchases, citing what they view as a valuation discount versus historical trading multiples. Swindle said the company plans to prioritize cash flow and buybacks while maintaining flexibility for other growth opportunities, and Garfinkle said the company expects to continue repurchasing shares “subject to any legal limitations.”
About CoreCivic (NYSE:CXW)
CoreCivic, Inc (NYSE: CXW) is a real estate investment trust specializing in the ownership, management and operation of private correctional and detention facilities in the United States. The company enters into contracts with federal, state and local government agencies to house inmates and detainees in facilities that it owns or operates on a concession basis. In addition to traditional prison operations, CoreCivic provides specialized services such as community-based reentry programs, electronic monitoring and rehabilitation initiatives aimed at reducing recidivism.
CoreCivic’s portfolio encompasses a mix of adult correctional facilities, immigration detention centers, residential reentry centers and other community-based programs.
