Financial Analysis

Contingencies The Company is routinely subjected to legal and regulatory proceedings in the normal course of business. These matters can include, without limitation: periodic compliance and other reviews and investigations by various federal and state regulatory agencies with respect to requirements applicable to the Company's business, including, without limitation, those related to payment of claims, compliance with the CMS Medicare and Marketplace regulations, including risk adjustment, prior authorizations and broker compensation, compliance with the False Claims Act, the calculation of minimum MLR and rebates related thereto, submissions to state agencies related to payments or state false claims acts, pre-authorization penalties, timely review of grievances and appeals, timely and accurate payment of claims, provider directory accuracy, network adequacy, cybersecurity issues, including those related to the Company's or the Company's third-party vendors' information systems, and the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and other federal and state fraud, waste and abuse laws; litigation arising out of general business activities, such as tax matters, disputes related to healthcare benefits coverage or reimbursement, putative securities class actions, and medical malpractice, privacy, real estate, intellectual property, vendor disputes and employment-related claims; and disputes regarding reinsurance arrangements, claims arising out of the ac …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Retirement Plan Centene has a defined contribution plan which covers substantially all team members who are at least 21 years of age. Under the plan, eligible team members may contribute a percentage of their base salary, subject to certain limitations. Centene may elect to match a portion of the employee's contribution. Company expense related to matching contributions to the plan was $138 million, $136 million and $131 million during the years ended December 31, 2025, 2024 and 2023, respectively.

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Debt Debt consists of the following ($ in millions): December 31, 2025 December 31, 2024 $2,500 million 4.25% Senior Notes, due December 15, 2027 $ 2,211 $ 2,398 $2,300 million 2.45% Senior Notes, due July 15, 2028 2,302 2,302 $3,500 million 4.625% Senior Notes, due December 15, 2029 3,277 3,277 $2,000 million 3.375% Senior Notes, due February 15, 2030 2,000 2,000 $2,200 million 3.00% Senior Notes, due October 15, 2030 2,200 2,200 $2,200 million 2.50% Senior Notes, due March 1, 2031 2,200 2,200 $1,300 million 2.625% Senior Notes, due August 1, 2031 1,300 1,300 Total senior notes 15,490 15,677 Term Loan Facility 2,000 2,006 Revolving Credit Agreement 950 Debt issuance costs (89) (100) Total debt 17,401 18,533 Less: current portion (50) (110) Long-term debt $ 17,351 $ 18,423 Senior Notes During 2025, the Company repurchased $189 million of its par value Senior Notes due 2027 through the Company's senior note debt repurchase program. The Company recognized a $1 million gain on the repurchase of the notes, including the write-off of unamortized debt discount and issuance costs. In January 2026, the Company repurchased an additional $29 million of its par value Senior Notes due 2027 through the debt repurchase program. The indentures governing the senior notes listed in the table above contain restrictive covenants of Centene Corporation. At December 31, 2025, the Company was in compliance with all covenants. Revolving Credit Facility and Term Loan Credit Facility On March 5, 2025 …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Stock Incentive Plans The Company's stock incentive plans allow for the granting of restricted stock or restricted stock unit awards and options to purchase common stock. Both incentive stock options and nonqualified stock options can be awarded under the plans. However, an immaterial amount of options were granted, exercised or outstanding in 2025. The plans have 12 million shares available for future awards. Compensation expense for stock options and restricted stock unit awards is recognized on a straight-line basis over the vesting period, generally three to five years for stock options and one to three years for restricted stock or restricted stock unit awards. Vesting is accelerated by one year for individuals who qualify under the Company's retirement eligible provisions. Certain restricted stock unit awards contain performance-based or market-based provisions as well as service-based provisions. The fair value of restricted stock and restricted stock units with only service-based or performance-based provisions is determined using the previous day's market close price at the time of grant. The fair value of restricted stock units with market-based provisions is determined using a Monte Carlo simulation model. The fair value of stock options is determined based on the Black-Scholes option-pricing model. Forfeitures for all stock awards are recognized as they occur. The total compensation cost that has been charged against income for the stock incentive plans was $204 m …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

Fair Value Measurements Assets and liabilities recorded at fair value in the Consolidated Balance Sheets are categorized based upon observable or unobservable inputs used to estimate fair value. Level inputs are as follows: Level Input: Input Definition: Level I Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management's best estimate of what market participants would use in pricing the asset or liability at the measurement date. The following table summarizes fair value measurements by level at December 31, 2025, for assets and liabilities measured at fair value on a recurring basis ($ in millions): Level I Level II Level III Total Assets Cash and cash equivalents $ 17,888 $ $ $ 17,888 Investments: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 55 $ $ $ 55 Corporate securities 10,652 10,652 Municipal securities 2,906 2,906 Short-term time deposits 205 205 Asset-backed securities 1,666 1,666 Residential mortgage-backed securities 1,714 1,714 Commercial mortgage-backed securities 1,136 1,136 Equity securities 1 1 Total investments $ 55 $ 18,280 $ $ 18,335 Restricted deposits: Cash and cash equivalents $ 69 $ $ $ 69 U.S. Treasury securities and obligations of …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Goodwill and Intangible Assets The passage of the OBBBA in July 2025 had various implications for the Company, including potential membership impacts to the Company's Medicaid reporting unit as well as the non-renewal of Marketplace Enhanced APTCs. As a result of these market conditions along with the decline in the Company's stock price, the Company performed a quantitative impairment analysis during the third quarter of 2025 to determine whether goodwill, intangibles or other assets were impaired. The goodwill impairment analysis utilized a weighted discounted cash flow model and guideline public company market approach to measure the fair value of the Company's reporting units. As a result of the analysis, the Company recorded a $6,723 million impairment to goodwill. The following table summarizes the changes in goodwill by operating segment ($ in millions): Medicaid Medicare Commercial Other Consolidated Total Balance, December 31, 2023 $ 10,198 $ 1,592 $ 5,424 $ 344 $ 17,558 Current year activity Balance, December 31, 2024 $ 10,198 $ 1,592 $ 5,424 $ 344 $ 17,558 Impairments (6,186) (212) (325) (6,723) Balance, December 31, 2025 $ 4,012 $ 1,592 $ 5,212 $ 19 $ 10,835 Intangible assets at December 31, consist of the following ($ in millions): Weighted Average Useful Life in Years 2025 2024 2025 2024 Purchased contract rights and customer relationships $ 7,737 $ 7,845 13.5 13.5 Trade names 913 943 15.5 15.6 Provider contracts 492 612 13.8 14.0 Developed technologies 227 298 …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

Income Taxes The consolidated income tax expense consists of the following ($ in millions): Year Ended December 31, 2025 2024 2023 Income (loss) from continuing operations before income tax expense (benefit) U.S. Federal $ (6,727) $ 3,529 $ 3,686 Foreign (1) (1) 728 (88) Total $ (6,728) $ 4,257 $ 3,598 Income tax expense (benefit) from continuing operations Current tax expense (benefit) Federal $ 77 $ 798 $ 833 State and local (69) 142 132 Foreign 1 Total current tax expense $ 8 $ 940 $ 966 Deferred tax expense (benefit) Federal $ (29) $ 8 $ (71) State and local (30) 7 33 Foreign 8 (29) Total deferred tax expense (benefit) $ (59) $ 23 $ (67) Total income tax expense (benefit) Federal $ 48 $ 806 $ 762 State and local (99) 149 165 Foreign 8 (28) Total income tax expense (benefit) $ (51) $ 963 $ 899 (1) Foreign income from continuing operations includes the Company's Cayman Islands reinsurance entity. The Company has elected for its Cayman Islands entity to be taxed as a U.S. corporation and pays U.S. tax at the 21% tax rate. The U.S. tax resulting from this entity is included in Federal income tax expense. This entity ceased operations in 2025. The reconciliation of the tax provision at the U.S. federal statutory rate to income tax expense (benefit) is as follows ($ in millions): Year Ended December 31, 2025 2024 2023 Total % Total % Total % Earnings (loss) from continuing operations, before income tax expense $ (6,728) $ 4,257 $ 3,598 Tax provision at the U.S. federal statutor …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Leases The Company records right-of-use (ROU) assets and lease liabilities for non-cancelable operating leases primarily for real estate and equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Expense related to leases is recorded on a straight-line basis over the lease term, including rent holidays. The Company recognized operating lease expense of $99 million and $108 million during the years ended December 31, 2025 and 2024, respectively. The Company considers the existence of options to extend or terminate leases in its analysis of the lease term for the purposes of measuring its ROU assets and lease liabilities. The renewal options are not included in the measurement of the ROU assets and lease liabilities unless the Company is reasonably certain to exercise the optional renewal periods. The following table sets forth the ROU assets and lease liabilities ($ in millions): December 31, 2025 December 31, 2024 Assets ROU assets (recorded within other long-term assets) $ 317 $ 359 Liabilities Short-term (recorded within accounts payable and accrued expenses) $ 146 $ 158 Long-term (recorded within other long-term liabilities) 615 738 Total lease liabilities $ 761 $ 896 Cash paid for amounts included in the measurement of lease liabilities, recorded as operating cash flows in the Consolidated Statements of Cash Flows, was $195 million and $227 million during the years ended December 31, 2025 and 2024, respectively. New operating le …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Recent Accounting Guidance Not Yet Adopted In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03 Income Statement Reporting Comprehensive Income: Disaggregation of Income Statement Expenses which expands disclosures about specific expense categories presented on the face of the Statement of Operations. The new standard is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The Company is currently evaluating the effect of the new disclosure requirements. In September 2025, the FASB issued ASU 2025-06 Intangibles Goodwill and Other Internal-Use Software. The standard update modernizes and clarifies the threshold for when an entity is required to start capitalizing software costs by removing stage-based and linear capitalization rules and is based on when (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The new standard is effective for fiscal years and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this standard update. In December 2025, the FASB issued ASU 2025-11 Interim Reporting Narrow-Scope Improvements which clarifies interim disclosure requirements and the applicability of Topic 270. The objective of the standard …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Segment Information The Company operates in four segments: (1) a Medicaid segment, (2) a Medicare segment, (3) a Commercial segment and (4) an Other segment. The Medicaid, Medicare and Commercial segments primarily represent the government-sponsored or subsidized programs under which the Company offers managed healthcare services. The Other segment includes the Company's pharmacy operations, vision and dental services, clinical healthcare, behavioral health, and centralized services, among others. The Company signed a definitive agreement to divest the remaining Magellan Health businesses in December 2025. Factors used in determining the reportable business segments include the nature of operating activities, the existence of separate senior management teams and the type of information presented to the Company's chief operating decision-maker (CODM) to evaluate all results of operations. The Company's CODM is its Chief Executive Officer. The Company's CODM focuses primarily on each segment's ability to generate sufficient revenues and manage expenses associated with health benefits and cost of services (including estimated costs incurred). As such, the CODM measures operating performance at the segment level based on gross margin, including evaluation of budget to actual variances, to determine the allocation of financial and capital resources for each segment. The Company does not report total assets by segment since this is not a metric used by the Company's CODM to allocat …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements include the accounts of Centene Corporation and all majority owned subsidiaries and subsidiaries over which the Company exercises the power and control to direct activities significantly impacting financial performance. All material intercompany balances and transactions have been eliminated. Certain 2023 and 2024 amounts in the consolidated financial statements and notes to the consolidated financial statements have been reclassified to conform to the 2025 presentation. These reclassifications have no effect on net earnings or stockholders' equity as previously reported. During the fourth quarter of 2025, the Company signed a definitive agreement to sell Magellan Health, which was accounted for as held for sale as of December 31, 2025. During 2024, the Company completed the divestitures of Circle Health Group (Circle Health) and Collaborative Health Systems (CHS). See Note 3. Acquisitions and Divestitures for further details. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Future events …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Stockholders' Equity The Company's Board of Directors has authorized a stock repurchase program of the Company's common stock from time to time on the open market or through privately negotiated transactions. The Company is authorized to repurchase up to $10,000 million, inclusive of past authorizations. As of December 31, 2025, the Company had a remaining amount of $1,830 million available under the Company's stock repurchase program. No duration has been placed on the repurchase program. The Company reserves the right to discontinue the repurchase program at any time. Share repurchases in 2025, 2024 and 2023 were primarily funded through divestiture proceeds and free cash flow generated from operations. The following represents the Company's share repurchase activity ($ in millions, shares in thousands): Year Ended December 31, 2025 2024 2023 Shares Cost Shares Cost Shares Cost Share buybacks 6,713 $ 400 41,987 $ 2,999 22,886 $ 1,577 Income tax withholding 846 48 1,494 114 828 56 Total share repurchases (1) 7,559 $ 448 43,481 $ 3,113 23,714 $ 1,633 (1) Excludes year-to-date share repurchase excise tax of approximately $3 million, $28 million and $10 million accrued as of December 31, 2025, 2024 and 2023 respectively. Prior to the adoption of the 2025 Stock Incentive Plan in May 2025, shares repurchased for income tax withholding were shares withheld in connection with employee stock plans to meet applicable tax withholding requirements. These shares were typically included …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

Subsequent Events CMS Part D risk-sharing receivables The Company has receivables due from CMS for Part D risk-sharing programs attributable to the 2025 plan year that are expected to be paid by CMS within a year after the plan year closes. As of December 31, 2025, the stand-alone Part D risk-sharing programs receivable balance for the 2025 plan year was $3,992 million. On February 13, 2026, the Company entered into a master receivable purchase agreement (the February 2026 Receivable Purchase Agreement). The February 2026 Receivable Purchase Agreement allows the Company to from time to time offer up to the full amount of its 2025 plan year stand-alone Part D risk-sharing programs receivable to the purchaser, which the purchaser may elect to purchase. The purchase price for each purchased receivable portion equals the net estimated invoice amount of such portion minus the discount, which is determined by reference to Secured Overnight Financing Rate (SOFR) plus a spread. The Company will account for the transfer of all or any portion of this receivable as a sale of accounts receivable. The difference between the balance of the receivable (or portion thereof) sold and cash proceeds received will be recorded as a loss on sale of receivables and included in selling, general and administrative expenses in the Consolidated Statements of Operations. The Company will act as a servicer for the transferred receivable. As of the date of this report, no receivable (or any portions thereo …

SubsequentEventsTextBlock · excerpt; the full note is in the filing

Contingencies The Company is routinely subjected to legal and regulatory proceedings in the normal course of business. These matters can include, without limitation: periodic compliance and other reviews and investigations by various federal and state regulatory agencies with respect to requirements applicable to the Company's business, including, without limitation, those related to payment of claims, compliance with the CMS Medicare and Marketplace regulations, including risk adjustment, prior authorizations and broker compensation, compliance with the False Claims Act, the calculation of minimum MLR and rebates related thereto, submissions to state agencies related to payments or state false claims acts, pre-authorization penalties, timely review of grievances and appeals, timely and accurate payment of claims, provider directory accuracy, network adequacy, cybersecurity issues, including those related to the Company's or the Company's third-party vendors' information systems, and the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and other federal and state fraud, waste and abuse laws; litigation arising out of general business activities, such as tax matters, disputes related to healthcare benefits coverage or reimbursement, putative securities class actions, and medical malpractice, privacy, real estate, intellectual property, vendor disputes and employment-related claims; and disputes regarding reinsurance arrangements, claims arising out of the ac …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Debt Debt consists of the following ($ in millions): June 30, 2026 December 31, 2025 $2,500 million 4.25% Senior Notes due December 15, 2027 $ 1,067 $ 2,211 $2,300 million 2.45% Senior Notes due July 15, 2028 2,160 2,302 $3,500 million 4.625% Senior Notes due December 15, 2029 3,277 3,277 $2,000 million 3.375% Senior Notes due February 15, 2030 2,000 2,000 $2,200 million 3.00% Senior Notes due October 15, 2030 2,200 2,200 $2,200 million 2.50% Senior Notes due March 1, 2031 2,200 2,200 $1,300 million 2.625% Senior Notes due August 1, 2031 1,300 1,300 Total senior notes 14,204 15,490 Term Loan Facility 1,975 2,000 Debt issuance costs (74) (89) Total debt 16,105 17,401 Less: current portion (75) (50) Long-term debt $ 16,030 $ 17,351 Senior Notes Senior Notes due December 15, 2027 During the three and six months ended June 30, 2026, the Company repurchased $118 million and $1,147 million, respectively, of its par value Senior Notes due 2027 through the Company's senior note debt repurchase program. During the six months ended June 30, 2026, the Company recognized a $5 million pre-tax loss on the repurchase of the notes, including the impact of unamortized debt discount and issuance costs. Senior Notes due July 15, 2028 During the three months ended June 30, 2026, the Company repurchased $142 million of its par value Senior Notes due 2028 for $135 million through the Company's senior note debt repurchase program. The Company recognized a $6 million pre-tax gain on the repurchase o …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

Fair Value Measurements Assets and liabilities recorded at fair value in the Consolidated Balance Sheets are categorized based upon observable or unobservable inputs used to estimate fair value. Level inputs are as follows: Level Input: Input Definition: Level I Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management's best estimate of what market participants would use in pricing the asset or liability at the measurement date. The following table summarizes fair value measurements by level at June 30, 2026, for assets and liabilities measured at fair value on a recurring basis ($ in millions): Level I Level II Level III Total Assets Cash and cash equivalents $ 24,151 $ $ $ 24,151 Investments: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 63 $ $ $ 63 Corporate securities 10,788 10,788 Municipal securities 2,749 2,749 Short-term time deposits 195 195 Asset-backed securities 1,523 1,523 Residential mortgage-backed securities 1,693 1,693 Commercial mortgage-backed securities 1,082 1,082 Equity securities 1 1 Total investments $ 63 $ 18,031 $ $ 18,094 Restricted deposits: Cash and cash equivalents $ 103 $ $ $ 103 U.S. Treasury securities and obligations of U …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Recent Accounting Guidance Not Yet Adopted In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03 Income Statement Reporting Comprehensive Income: Disaggregation of Income Statement Expenses which expands disclosures about specific expense categories presented on the face of the Statement of Operations. The standard update is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The Company is currently evaluating the effect of the new disclosure requirements. In September 2025, the FASB issued ASU 2025-06 Intangibles Goodwill and Other Internal-Use Software. The standard update modernizes and clarifies the threshold for when an entity is required to start capitalizing software costs by removing stage-based and linear capitalization rules and is based on when (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The standard update is effective for fiscal years and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this standard update. In December 2025, the FASB issued ASU 2025-11 Interim Reporting Narrow-Scope Improvements which clarifies interim disclosure requirements and the applicability of Topic 270. The objective of the sta …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Enterprise Optimization During the three and six months ended June 30, 2026, the Company incurred $47 million and $61 million, respectively, of third-party vendor costs and severance costs due to enterprise optimization initiatives and contract exits, which are included in selling, general and administrative expenses in the Consolidated Statements of Operations. On July 27, 2026, the Company committed to accept employees' offers to participate in a voluntary separation program, which qualifies as a plan of termination. During the remainder of 2026, the Company estimates it will record severance costs of approximately $315 million to $365 million primarily in connection with the program

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Segment Information The Company operates in four segments: (1) a Medicaid segment, (2) a Medicare segment, (3) a Commercial segment and (4) an Other segment. The Medicaid, Medicare and Commercial segments primarily represent the government-sponsored or subsidized programs under which the Company offers managed healthcare services. The Other segment includes the Company's pharmacy operations, vision and dental services, clinical healthcare, behavioral health, and corporate management company, among others. Factors used in determining the reportable business segments include the nature of operating activities, the existence of separate senior management teams and the type of information presented to the Company's chief operating decision-maker (CODM) to evaluate all results of operations. The Company's CODM is its Chief Executive Officer. The Company's CODM focuses primarily on each segment's ability to generate sufficient revenues and manage expenses associated with health benefits and cost of services (including estimated costs incurred). As such, the CODM measures operating performance at the segment level based on gross margin, including evaluation of budget to actual variances, to determine the allocation of financial and capital resources for each segment. The Company does not report total assets by segment since this is not a metric used by the Company's CODM to allocate resources or evaluate segment performance. Segment information for the three months ended June 30, 20 …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing