Mayo Clinic’s $1.3B operating profit sets new yearly record

Mayo Clinic set a record for operating profit last year as the Rochester-based health system continued seeing growth in patient visits for outpatient and hospital care.

In 2022, Mayo was like many health systems in struggling to find enough workers to fully staff its operations. Those problems dissipated significantly in 2023 and the clinic made even more progress last year, Chief Financial Officer Dennis Dahlen said in an interview.

On Wednesday, the not-for-profit health system reported financial results that include double-digit growth since 2022 in patient visits to outpatient care centers and Mayo hospitals.

“We’re more often than not fully open for business, and that wasn’t the case, certainly, in 2022,” Dahlen said. “It was mostly the case in 2023, but more reliably so in 2024.”

In 2024, Mayo saw $1.29 billion in operating income, an increase of 19% compared with the previous year. Revenue grew more than 10% to about $18.8 billion in that time.

The financial performance is helping fund Mayo’s ongoing campus expansion in Rochester, Dahlen said, as well as plans announced this week for a nearly $1.9 billion project in Arizona.

The expansion in Phoenix will increase clinical space by nearly 60%, Mayo says, including 11 new operating rooms and 48 additional hospital beds.

Mayo Clinic is Minnesota’s largest employer, with about 57,000 workers in the state. Add in operations in Arizona, Florida, Iowa and Wisconsin, and the clinic’s overall headcount was about 83,000 people at the end of last year.

Salary and benefit expense last year grew by about 8% to nearly $10.5 billion.

“Our staff are our greatest strength, and we invested significantly in them in 2024,” Christina Zorn, the clinic’s chief administrative officer, said in a statement.

While operating income in 2024 set a record in terms of revenue in excess of expenses, the margin — meaning operating income as a percentage of Mayo’s revenue — was higher during some years before the COVID-19 pandemic, Dahlen said.

“Mayo is growing, so we’re approaching $20 billion in top line [revenue],” he said. “It’s natural that the dollars will be growing in terms of income, as well.”

Operating income at Mayo Clinic includes some money from investments and philanthropy. This makes the clinic’s results somewhat difficult to compare with most hospitals, which tend to exclude investment gains from operating results.

Not all investment and philanthropic gains at Mayo, however, are included in operating income; after factoring all sources of income, the clinic in 2024 saw its net assets grow by $2.9 billion.

As a nonprofit foundation, Mayo Clinic reinvests its profits in operations, Dahlen said, since there aren’t shareholders to receive distributions.

Other performance details for 2024 released Wednesday include: