Centene (NYSE: CNC) swings to Q2 profit and boosts 2026 guidance
Rhea-AI Filing Summary
Centene Corporation reported strong second-quarter 2026 results, with total revenues of $53,579 million and premium and service revenues of $44,375 million, up 4% from a year earlier. GAAP diluted EPS was $2.19 and adjusted diluted EPS was $2.51, versus diluted losses in the prior-year quarter.
The consolidated health benefits ratio improved to 89.6% from 93.0%, while the SG&A expense ratio edged down to 7.0% and adjusted SG&A to 6.9%. Commercial HBR was 79.2%, Medicare 89.5% and Medicaid 93.9%. Cash flow provided by operations was $3,590 million, and cash, investments and restricted deposits totaled $44,846 million against $16.1 billion of debt, resulting in a debt-to-capitalization ratio of 41.6%.
For 2026, Centene raised total revenue guidance by $6.0 billion to $193.5–$197.5 billion and premium and service revenues to $173.0–$177.0 billion, and updated EPS floors to GAAP diluted EPS greater than $3.11 and adjusted diluted EPS greater than $4.80. The company also announced director Kenneth Burdick’s retirement and appointed Paul Diaz to the Board.
Positive
- Q2 2026 returned to strong profitability with GAAP net earnings of $1,091 million versus a $253 million loss in Q2 2025, supported by higher revenues, an improved consolidated HBR of 89.6% and lower SG&A and adjusted SG&A ratios.
- 2026 guidance was raised materially, with total revenues increased by $6.0 billion to $193.5–$197.5 billion and an adjusted diluted EPS floor lifted to greater than $4.80, alongside robust Q2 operating cash flow of $3,590 million and a reduced debt-to-capitalization ratio of 41.6%.
Negative
- Total at-risk membership declined to 25,885,400 at June 30, 2026 from 28,004,900 a year earlier, including Marketplace membership falling to 3,494,700 from 5,862,800 and total Medicaid membership decreasing to 12,110,700 from 12,819,700.
Filing Explained
As of June 30, only $715 million was available for general corporate use despite $44.8 billion in cash, investments and restricted deposits.
A Form 8-K reports specified material events; this filing records Centene’s second-quarter results and a completed board transition effective
Paul Diaz’s term runs through the 2027 annual meeting, and he joined the Audit Committee and Quality and Compliance Committee after Kenneth Burdick’s resignation.
The filing states that Burdick’s resignation was not due to a dispute with Centene or its board, and reports no arrangements, family relationships, or related-party transactions involving Diaz.
At
The results and board-change releases are furnished rather than filed, and the 8-K says they are not incorporated by reference unless a filing specifically refers to them.
8-K Event Classification
4 items: 2.02, 5.02, 7.01, 9.01
4 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers
Governance
Key personnel changes including departures, elections, or appointments of directors and executive officers.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 total revenues: $53,579 million
Q2 2026 GAAP diluted EPS: $2.19
Q2 2026 adjusted diluted EPS: $2.51
+5 more
8 metrics
Q2 2026 total revenues
$53,579 million
Total revenues for the three months ended June 30, 2026
Q2 2026 GAAP diluted EPS
$2.19
GAAP diluted earnings per share for the second quarter of 2026
Q2 2026 adjusted diluted EPS
$2.51
Adjusted diluted earnings per share for the second quarter of 2026
Q2 2026 health benefits ratio
89.6 %
Consolidated HBR in the three months ended June 30, 2026
Q2 2026 cash flow from operations
$3,590 million
Total cash flow provided by operations in the second quarter of 2026
Cash, investments and restricted deposits
$44,846 million
Balance at June 30, 2026 across regulated and unregulated entities
Total debt after note repurchases
$16.1 billion
Total debt at June 30, 2026 after repurchasing $260 million of senior notes
Total at-risk membership
25,885,400
Members at June 30, 2026 versus 28,004,900 at June 30, 2025
Key Terms
Health benefits ratio (HBR), premium deficiency reserve (PDR), enterprise optimization, State-directed Payments, +1 more
5 terms
Health benefits ratio (HBR) financial
"Health benefits ratio (HBR) of 89.6% for the second quarter of 2026 represents a decrease"
enterprise optimization financial
"enterprise optimization costs of $37 million, severance costs due to enterprise optimization"
State-directed Payments financial
"State-directed Payments: Payments directed by a state that have minimal risk but are administered"
Pass-through Payments financial
"Pass-through Payments: Non-risk supplemental payments from a state that the Company is required"
Pass-through payments are cash a company collects or handles on behalf of someone else and then forwards unchanged to that other party, like a shop collecting a utility bill for a tenant and paying the utility company. They matter to investors because these amounts are not the company’s earnings—treating them as revenue can overstate performance—so understanding them helps separate true profit from temporary cash flows and assess balance-sheet risk.
Earnings Snapshot
Total revenues: $53,579 million · Guidance included
Three months ended June 30, 2026
Total revenues
$53,579 million
up from $48,742 million in Q2 2025
Premium and service revenues
$44,375 million
increased 4% from $42,467 million in Q2 2025
GAAP diluted EPS
$2.19
improved from $(0.51) in Q2 2025
Adjusted diluted EPS
$2.51
improved from $(0.16) in Q2 2025
Health benefits ratio
89.6 %
decreased from 93.0% in Q2 2025
Cash flow from operations
$3,590 million
Q2 2026 operating cash flow; six-month total $7,956 million
Guidance
For full-year 2026, Centene guides GAAP diluted EPS to greater than $3.11 and adjusted diluted EPS to greater than $4.80. Total revenues are projected between $193.5 billion and $197.5 billion, with premium and service revenues between $173.0 billion and $177.0 billion, an HBR of 90.5%–91.3%, SG&A expense ratio of 7.2%–7.8%, adjusted SG&A ratio of 6.9%–7.5%, and an effective tax rate of 26.5%–27.5%.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What were Centene (CNC)'s key financial results for Q2 2026?
Centene reported total revenues of $53,579 million and premium and service revenues of $44,375 million in Q2 2026. GAAP diluted EPS was $2.19 and adjusted diluted EPS was $2.51, with a consolidated health benefits ratio of 89.6% and SG&A expense ratio of 7.0%.
How did Centene (CNC) update its 2026 guidance in this filing?
Centene raised total revenues guidance by $6.0 billion to $193.5–$197.5 billion and increased premium and service revenues guidance to $173.0–$177.0 billion. It also set a GAAP diluted EPS floor above $3.11 and an adjusted diluted EPS floor above $4.80 for 2026.
How did Centene (CNC)'s membership change year over year in Q2 2026?
Total at-risk membership was 25,885,400 at June 30, 2026, down from 28,004,900 a year earlier. Marketplace membership declined to 3,494,700 from 5,862,800, while total Medicaid membership fell to 12,110,700 from 12,819,700 over the same period.
What is Centene (CNC)'s balance sheet and leverage position as of June 30, 2026?
At June 30, 2026 Centene held $44,846 million in cash, investments and restricted deposits and total debt of about $16.1 billion. Medical claims liabilities were $20,262 million, and the company reported a debt-to-capitalization ratio of 41.6%.
What board of directors changes did Centene (CNC) announce on July 28, 2026?
Centene announced that Kenneth A. Burdick retired from its Board of Directors effective July 28, 2026. The company simultaneously appointed Paul J. Diaz to the Board, with service on the Audit Committee and the Quality and Compliance Committee.
How strong was Centene (CNC)'s cash flow from operations in early 2026?
For Q2 2026, Centene generated $3,590 million in cash flow provided by operations. For the six months ended June 30, 2026, net cash provided by operating activities totaled $7,956 million, reflecting contributions from net earnings and working capital movements.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 28, 2026
(Exact Name of Registrant as Specified in Charter)
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
| (Address of Principal Executive Offices) | (Zip Code) | |||||||||||||
Registrant’s telephone number, including area code: (314 ) 725-4477
(Former Name or Former Address, if Changed Since Last Report): N/A
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
(a) On July 28, 2026, we issued a press release announcing our financial results for the second quarter ended June 30, 2026. The full text of the press release is included as Exhibit 99.1 to this report. The information contained in the website cited in the press release is not a part of this report.
ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS
(a) On July 23, 2026, Director Kenneth Burdick notified Centene Corporation (the Company) of his resignation from the Board of Directors (the Board), including from his service on the Quality and Compliance Committee, effective July 28, 2026. His resignation was not the result of any dispute or disagreement with the Company or the Company's Board on any matter relating to the operations, policies or practices of the Company.
(d) Effective July 28, 2026, the Board elected Paul Diaz to the Board to fill the vacancy created by Mr. Burdick's resignation, with a term expiring at the Company's 2027 annual meeting of stockholders. He was appointed to serve as a member of the Audit Committee and the Quality and Compliance Committee.
Mr. Diaz has served as a Managing Partner at Cressey & Company, a private equity firm focusing on healthcare, since May 2025. Prior to that, he served as Director, President and CEO of Myriad Genetics, Inc., a publicly-traded genetic testing and precision medicine company from August 2020 to April 2025. Prior to that, he was a partner with Cressey from 2016 to 2020. Prior to that, he served with Kindred Healthcare, a Fortune 500 Company and one of the largest providers of healthcare services in the United States, from 2002 to 2018. He was the President and CEO of Kindred Healthcare from 2004 to 2015 and a director from 2004 to 2018.
Mr. Diaz will participate in the Company's standard non-employee director compensation program as described in the Company's proxy statement filed with the SEC on March 27, 2026.
There are no arrangements or understandings pursuant to which Mr. Diaz has been elected as a director of the Company. There are no family relationships between Mr. Diaz and any director or executive officer of the Company. There are no related party transactions in respect of the Company of the kind described in Item 404(a) of Regulation S-K in which Mr. Diaz was a participant.
ITEM 7.01 REGULATION FD DISCLOSURE
A copy of the press release announcing the events described in Item 5.02 above is attached hereto as Exhibit 99.2 and incorporated herein by reference.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits
EXHIBIT INDEX
| Exhibit Number | Description | |||||||
| 99.1* | Press release of Centene Corporation issued July 28, 2026 as to financial results for the second quarter ended June 30, 2026 | |||||||
| 99.2* | Press release dated July 28, 2026 | |||||||
| 104 | Cover page information from Centene Corporation’s Current Report on Form 8-K filed on July 28, 2026 formatted in Inline Extensible Business Reporting Language (iXBRL). | |||||||
| * | The information contained in Exhibits 99.1 and 99.2 attached hereto shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. | |||||||
The information contained in Item 2.02, Item 7.01, Exhibit 99.1 and Exhibit 99.2 attached hereto shall be deemed to be "furnished" and not "filed" for purpose of Section 18 of the Securities Exchange Act of 1934 and shall not otherwise be subject to the liabilities of that section. Nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such filing.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CENTENE CORPORATION | ||||||||||||||
| Date: | July 28, 2026 | By: | /s/ ANDREW L. ASHER | |||||||||||
| Andrew L. Asher Executive Vice President & Chief Financial Officer | ||||||||||||||
Exhibit 99.1
N E W S R E L E A S E
| Contact: | Investor Relations Inquiries | Media Inquiries | ||||||
| Jennifer Gilligan | Sara Garland | |||||||
| Senior Vice President, Finance & Investor Relations | Chief Communications Officer | |||||||
| (212) 549-1306 | (314) 445-0790 | |||||||
FOR IMMEDIATE RELEASE
CENTENE CORPORATION REPORTS SECOND QUARTER 2026 RESULTS
-- Second Quarter GAAP Diluted Earnings Per Share of $2.19; Adjusted Diluted Earnings Per Share of $2.51 --
-- Increases 2026 GAAP Diluted EPS Guidance: Greater than $3.11 & Adjusted Diluted EPS Greater than $4.80 --
•Commercial HBR of 79.2%, demonstrating significant year-over-year improvement in profitability.
•Medicare segment HBR of 89.5%, including fundamental outperformance in both Medicare Advantage and PDP.
•Medicaid HBR of 93.9%, in-line with expectations and reflecting continued execution in management of medical cost trend.
•Guidance increase resulting from underlying strength of the business, including approximately $0.50 of non-recurring items in Medicare and Commercial segments.
ST. LOUIS, July 28, 2026 -- Centene Corporation (NYSE: CNC) (the Company) announced today its financial results for the second quarter ended June 30, 2026. In summary, the 2026 second quarter results were as follows:
| Total revenues (in millions) | $ | 53,579 | |||||||||
| Premium and service revenues (in millions) | $ | 44,375 | |||||||||
| Health benefits ratio | 89.6 | % | |||||||||
| SG&A expense ratio | 7.0 | % | |||||||||
Adjusted SG&A expense ratio (1) | 6.9 | % | |||||||||
| GAAP diluted earnings per share | $ | 2.19 | |||||||||
Adjusted diluted earnings per share (1) | $ | 2.51 | |||||||||
| Total cash flow provided by operations (in millions) | $ | 3,590 | |||||||||
(1) | Represents a non-GAAP financial measure. A full reconciliation of the adjusted diluted earnings per share (EPS) and adjusted selling, general and administrative (SG&A) expenses is shown in the Non-GAAP Financial Presentation section of this release. | ||||||||||
"Our second quarter results and improved full-year outlook represent meaningful milestones on our path to restoring profitability and increasing shareholder value," said Chief Executive Officer of Centene, Sarah M. London. "We are excited by the positive momentum we have built and remain focused on our goal of delivering industry-leading health outcomes with an industry-leading cost structure."
1
Membership
The following table sets forth membership by line of business:
| June 30, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
Traditional Medicaid (1) | 10,745,800 | 11,227,400 | ||||||||||||
High Acuity Medicaid (2) | 1,364,900 | 1,592,300 | ||||||||||||
| Total Medicaid | 12,110,700 | 12,819,700 | ||||||||||||
| Marketplace | 3,494,700 | 5,862,800 | ||||||||||||
Individual and Commercial Group (3) | 497,000 | 449,700 | ||||||||||||
| Total Commercial | 3,991,700 | 6,312,500 | ||||||||||||
Medicare (4) | 980,000 | 1,026,900 | ||||||||||||
Medicare Prescription Drug Plan (PDP) | 8,803,000 | 7,845,800 | ||||||||||||
| Total at-risk membership | 25,885,400 | 28,004,900 | ||||||||||||
(1) | Membership includes Temporary Assistance for Needy Families (TANF), Medicaid Expansion, Children's Health Insurance Program (CHIP), Foster Care, and Behavioral Health. | |||||||||||||
(2) | Membership includes Aged, Blind, or Disabled (ABD), Intellectual and Developmental Disabilities (IDD), Long-Term Services and Supports (LTSS), and Medicare-Medicaid Plans (MMP) Duals. The Company operated MMPs through December 31, 2025. In 2026 these members are included in Medicare as a result of the Centers for Medicare and Medicaid Services (CMS) transition to Dual Eligible Special Needs Plans (D-SNP) based integration. | |||||||||||||
(3) | Membership includes Commercial Group, Individual Coverage Health Reimbursement Arrangement (ICHRA) and Other Off-Exchange Individual. | |||||||||||||
(4) | Membership includes Medicare Advantage, Medicare Supplement, and Applicable Integrated Plans (AIPs) as a result of the CMS transition to D-SNP based integration in 2026. | |||||||||||||
Premium and Service Revenues
The following table sets forth supplemental revenue information ($ in millions):
| Three Months Ended June 30, | ||||||||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||||||||
| Medicaid | $ | 22,766 | $ | 21,723 | 5 | % | ||||||||||||||
| Commercial | 9,356 | 10,070 | (7) | % | ||||||||||||||||
Medicare (1) | 11,057 | 9,450 | 17 | % | ||||||||||||||||
| Other | 1,196 | 1,224 | (2) | % | ||||||||||||||||
| Total premium and service revenues | $ | 44,375 | $ | 42,467 | 4 | % | ||||||||||||||
(1) | Medicare includes Medicare Advantage, Medicare PDP and Medicare Supplement. | |||||||||||||||||||
Statement of Operations: Three Months Ended June 30, 2026
•For the second quarter of 2026, premium and service revenues increased 4% to $44.4 billion from $42.5 billion in the comparable period of 2025. The increase was primarily driven by premium yield and membership growth in the PDP business, rate increases in Marketplace and in the Medicaid business to address medical trend, Marketplace risk adjustment revenue transfer for the 2025 and 2026 benefit years, and state directed payments. The increases were partially offset by lower Marketplace and Medicaid membership.
•Health benefits ratio (HBR) of 89.6% for the second quarter of 2026 represents a decrease from 93.0% in the comparable period in 2025. The consolidated HBR benefited from a lower Marketplace HBR resulting from improved pricing and risk transfer reflecting the acuity of the Marketplace membership. The HBR also decreased due to rate and revenue increases and continued tangible progress in managing medical costs in the Medicaid business. The HBR benefited by the favorable resolution of programmatic elements for the 2025 benefit year in Medicare and was also driven by an increase to the premium deficiency reserve (PDR) in 2025 versus no PDR in 2026 for our Medicare Advantage business as a result of our progression towards profitability.
2
•The SG&A expense ratio was 7.0% for the second quarter of 2026, compared to 7.1% in the second quarter of 2025. The adjusted SG&A expense ratio was 6.9% for the second quarter of 2026, compared to 7.1% in the second quarter of 2025. The decreases were primarily driven by strong cost management, leveraging of expenses over higher revenues and reduced Marketplace membership, which operates at a meaningfully higher SG&A expense ratio, as well as overall discipline in Marketplace SG&A. The decreases were also driven by growth in the PDP business, which operates at a meaningfully lower SG&A expense ratio as compared to the overall company.
•The effective tax rate was 26.9% for the second quarter of 2026. For the second quarter of 2026, our effective tax rate on adjusted earnings was 26.5%.
•GAAP diluted EPS of $2.19 for the second quarter of 2026.
•Adjusted diluted EPS of $2.51 for the second quarter of 2026.
•Cash flow provided by operations for the second quarter of 2026 was $3.6 billion, primarily driven by net earnings and the timing of pass through, premium and other payments, partially offset by net improvement in 2025 risk adjustment transfer position.
Balance Sheet
At June 30, 2026, the Company had cash, investments and restricted deposits of $44.8 billion and maintained $715 million of cash available for general corporate use. Medical claims liabilities totaled $20.3 billion. The Company's days in claims payable (DCP) was 47 days, a decrease of one day as compared to the first quarter of 2026 driven by timing of state directed payments.
During the second quarter of 2026, the Company repurchased $260 million of the Company's par value senior notes due 2027 and 2028. Following the senior note repurchase, total debt was $16.1 billion, which included no borrowings on the $4.0 billion Revolving Credit Facility at quarter end.
Outlook
Please refer to the Forward-Looking Statements, which should be reviewed in conjunction with the Company's 2026 outlook.
The Company is increasing total revenues guidance range by $6.0 billion to a range of $193.5 billion to $197.5 billion driven by premium tax revenue, Marketplace, and Medicaid. The Company is increasing premium and service revenues guidance range by $2.0 billion to a range of $173.0 billion to $177.0 billion driven by Marketplace and Medicaid. The Company is also increasing its investment and other income expectation by $50 million to $1.50 billion.
The Company is updating its 2026 GAAP diluted EPS guidance floor to greater than $3.11 and its 2026 adjusted diluted EPS guidance floor to greater than $4.80.
3
The Company's annual guidance for 2026 is as follows and will be discussed further on our conference call:
Full Year 2026 | ||||||||||||||||||||
| GAAP diluted EPS | > $3.11 | |||||||||||||||||||
Adjusted diluted EPS (1) | > $4.80 | |||||||||||||||||||
(1) | A full reconciliation of adjusted diluted EPS is shown in the Non-GAAP Financial Presentation section of this release. | |||||||||||||||||||
Full Year 2026 | ||||||||||||||||||||
| Low | High | |||||||||||||||||||
| Total revenues (in billions) | $ | 193.5 | $ | 197.5 | ||||||||||||||||
| Premium and service revenues (in billions) | $ | 173.0 | $ | 177.0 | ||||||||||||||||
| HBR | 90.5 | % | 91.3 | % | ||||||||||||||||
| SG&A expense ratio | 7.2 | % | 7.8 | % | ||||||||||||||||
Adjusted SG&A expense ratio (2) | 6.9 | % | 7.5 | % | ||||||||||||||||
| Effective tax rate | 26.5 | % | 27.5 | % | ||||||||||||||||
Adjusted effective tax rate (3) | 25.5 | % | 26.5 | % | ||||||||||||||||
| Diluted shares outstanding (in millions) | 497.0 | 500.0 | ||||||||||||||||||
(2) | Adjusted SG&A expense ratio excludes severance costs due to enterprise optimization and contract exits of approximately $355 million to $405 million, enterprise optimization third-party vendor costs of approximately $85 million to $115 million and acquisition and divestiture related expenses of approximately $750 thousand. | |||||||||||||||||||
(3) | Adjusted effective tax rate excludes income tax effects of adjustments of approximately $268 million to $272 million. | |||||||||||||||||||
Conference Call
As previously announced, the Company will host a conference call Tuesday, July 28, 2026, at 8:30 a.m. ET to review the financial results for the second quarter ended June 30, 2026.
Investors and other interested parties are invited to listen to the conference call by dialing 1-877-883-0383 (toll free) in the U.S. and Canada; +1-412-902-6506 (toll) from abroad, including the following Elite Entry Number: 4306002 to expedite caller registration; or via a live, audio webcast on the Company's website at www.centene.com, under the Investors section.
A webcast replay will be available for on-demand listening shortly following the completion of the call for the next 12 months or until 11:59 p.m. ET on Tuesday, July 27, 2027, at the aforementioned URL. In addition, a digital audio playback will be available until 9 a.m. ET on Tuesday, August 4, 2026, by dialing 1-855-669-9658 (toll free) in North America, or +1-412-317-0088 (toll) from abroad, and entering access code 6500508.
Non-GAAP Financial Presentation
The Company is providing certain non-GAAP financial measures in this release as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company's operations and measure the Company's performance more consistently across periods. The Company uses the presented non-GAAP financial measures internally in evaluating the Company's performance and for planning purposes, by allowing management to focus on period-to-period changes in the Company's core business operations, and in determining employee incentive compensation. Therefore, the Company believes that this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The Company strongly encourages investors to review its consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP financial measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.
Specifically, the Company believes the presentation of non-GAAP financial measures that excludes amortization of acquired intangible assets, acquisition and divestiture related expenses, as well as other items, allows investors to develop a more meaningful understanding of the Company's core performance over time.
4
The tables below provide reconciliations of non-GAAP items ($ in millions, except per share data):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| GAAP net earnings (loss) attributable to Centene | $ | 1,091 | $ | (253) | $ | 2,632 | $ | 1,058 | |||||||||||||||
| Amortization of acquired intangible assets | 161 | 173 | 327 | 346 | |||||||||||||||||||
| Acquisition and divestiture related expenses | — | 1 | — | 1 | |||||||||||||||||||
Other adjustments (1) | 46 | 58 | 53 | 61 | |||||||||||||||||||
Income tax effects of adjustments (2) | (50) | (58) | (92) | (100) | |||||||||||||||||||
| Adjusted net earnings (loss) | $ | 1,248 | $ | (79) | $ | 2,920 | $ | 1,366 | |||||||||||||||
(1) Other adjustments include the following pre-tax items:
2026:
(a) for the three months ended June 30, 2026: enterprise optimization costs of $37 million, severance costs due to enterprise optimization and contract exits of $15 million, and net gain on debt extinguishment of $6 million;
(b) for the six months ended June 30, 2026: enterprise optimization costs of $50 million, severance costs due to enterprise optimization and contract exits of $18 million, gain on sale of a provider network in the Other segment of $10 million, net gain on real estate transactions of $4 million, and net gain on debt extinguishment of $1 million.
2025:
(a) for the three months ended June 30, 2025: intangible asset impairment related to the wind-down of certain contracts in the Other segment of $55 million and a reduction to the previously reported gain on real estate transactions of $3 million;
(b) for the six months ended June 30, 2025: intangible asset impairment related to the wind-down of certain contracts in the Other segment of $55 million, a reduction to the previously reported gain on the sale of Magellan Rx of $10 million, and a net gain on real estate transactions of $4 million.
(2) The income tax effects of adjustments are based on the effective income tax rates applicable to each adjustment.
| Three Months Ended June 30, | Six Months Ended June 30, | Annual Guidance December 31, 2026 | |||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||
| GAAP diluted earnings (loss) per share attributable to Centene | $ | 2.19 | $ | (0.51) | $ | 5.30 | $ | 2.13 | greater than $3.11 | ||||||||||||||||||||
| Amortization of acquired intangible assets | 0.32 | 0.35 | 0.66 | 0.70 | ~$1.30 | ||||||||||||||||||||||||
Other adjustments (3) | 0.09 | 0.12 | 0.11 | 0.12 | ~$0.93 | ||||||||||||||||||||||||
Income tax effects of adjustments (4) | (0.09) | (0.12) | (0.19) | (0.20) | ~$(0.54) | ||||||||||||||||||||||||
| Adjusted diluted earnings (loss) per share | $ | 2.51 | $ | (0.16) | $ | 5.88 | $ | 2.75 | greater than $4.80 | ||||||||||||||||||||
(3) Other adjustments include the following pre-tax items:
2026:
(a) for the three months ended June 30, 2026: enterprise optimization costs of $0.07 per share ($0.06 after-tax), severance costs due to enterprise optimization and contract exits of $0.03 per share ($0.02 after-tax), and net gain on debt extinguishment of $0.01 per share ($0.01 after-tax);
(b) for the six months ended June 30, 2026: enterprise optimization costs of $0.10 per share ($0.08 after-tax), severance costs due to enterprise optimization and contract exits of $0.04 per share ($0.03 after-tax); gain on sale of a provider network in the Other segment of $0.02 per share ($0.02 after-tax), and net gain on real estate transactions of $0.01 per share ($0.01 after-tax);
5
(c) for the year ended December 31, 2026, an estimated: $0.76 per share ($0.58 after-tax) of severance costs, $0.20 per share ($0.15 after-tax) of enterprise optimization costs, $0.02 per share ($0.02 after-tax) gain on sale of a provider network in the Other segment, and a $0.01 per share ($0.01 after-tax) net gain on real estate transactions.
2025:
(a) for the three months ended June 30, 2025: intangible asset impairment related to the wind-down of certain contracts in the Other segment of $0.11 per share ($0.08 after-tax), and a reduction to the previously reported gain on real estate transactions of $0.01 per share ($0.01 after-tax);
(b) for the six months ended June 30, 2025: intangible asset impairment related to the wind-down of certain contracts in the Other segment of $0.11 per share ($0.08 after-tax), a reduction to the previously reported gain on the sale of Magellan Rx of $0.02 per share ($0.02 after-tax), and a net gain on real estate transactions of $0.01 per share ($0.01 after-tax).
(4) The income tax effects of adjustments are based on the effective income tax rates applicable to each adjustment.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| GAAP selling, general and administrative expenses | $ | 3,103 | $ | 3,036 | $ | 6,500 | $ | 6,389 | |||||||||||||||
| Less: | |||||||||||||||||||||||
| Acquisition and divestiture related expenses | — | 1 | — | 1 | |||||||||||||||||||
| Severance | 15 | — | 18 | — | |||||||||||||||||||
| Enterprise optimization costs | 37 | — | 50 | — | |||||||||||||||||||
| Adjusted selling, general and administrative expenses | $ | 3,051 | $ | 3,035 | $ | 6,432 | $ | 6,388 | |||||||||||||||
To provide clarity on the way management defines certain key metrics and ratios, the Company is providing a description of how the metric or ratio is calculated as follows:
•Health Benefits Ratio (HBR) (GAAP) = Medical costs divided by premium revenues.
•SG&A Expense Ratio (GAAP) = Selling, general and administrative expenses divided by premium and service revenues.
•Adjusted SG&A Expense Ratio (non-GAAP) = Adjusted selling, general and administrative expenses divided by premium and service revenues.
•Adjusted Effective Tax Rate (non-GAAP) = GAAP income tax expense (benefit) excluding the income tax effects of adjustments to net earnings divided by adjusted earnings (loss) before income tax expense.
•Adjusted Net Earnings (non-GAAP) = Net earnings less amortization of acquired intangible assets, less acquisition and divestiture related expenses, as well as adjustments for other items, net of the income tax effect of the adjustments.
•Adjusted Diluted EPS (non-GAAP) = Adjusted net earnings divided by weighted average common shares outstanding on a fully diluted basis.
•Debt to Capitalization Ratio (GAAP) = Total debt, divided by total debt plus total stockholder's equity.
•Average Medical Claims Expense (GAAP) = Medical costs for the period divided by number of days in such period. Average medical claims expense is most often calculated for the quarterly reporting period.
•Days in Claims Payable (GAAP) = Medical claims liabilities divided by average medical claims expense. Days in claims payable is most often calculated for the quarterly reporting period.
6
In addition, the following terms are defined as follows:
•State-directed Payments: Payments directed by a state that have minimal risk but are administered as a premium adjustment. These payments are recorded as premium revenue and medical costs at close to a 100% HBR. In many instances, the Company has little visibility to the timing of these payments until they are paid by a state.
•Pass-through Payments: Non-risk supplemental payments from a state that the Company is required to pass through to designated contracted providers. These payments are recorded as premium tax revenue and premium tax expense.
About Centene Corporation
Centene Corporation, a Fortune 500 company, is a leading healthcare enterprise that is committed to helping people live healthier lives. The Company takes a local approach with local teams to provide fully integrated, high-quality, and cost-effective services to government-sponsored and commercial healthcare programs, focusing on under-insured individuals. Centene offers affordable and high-quality products to more than 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace.
Centene uses its investor relations website to publish important information about the Company, including information that may be deemed material to investors. Financial and other information about Centene is routinely posted and is accessible on Centene's investor relations website, https://investors.centene.com.
Forward-Looking Statements
All statements, other than statements of current or historical fact, contained in this press release are forward-looking statements. Without limiting the foregoing, forward-looking statements often use words such as "believe," "anticipate," "plan," "expect," "estimate," "predict," "intend," "seek," "target," "goal," "potential," "may," "will," "would," "could," "should," "can," "continue," and other similar words or expressions (and the negative thereof). Our 2026 full year guidance, including our estimated severance costs in connection with the voluntary separation program, is a forward-looking statement. Centene Corporation and its subsidiaries (Centene, the Company, our or we) intends such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for purposes of complying with these safe-harbor provisions. In particular, these statements include, without limitation, statements about our expected future operating or financial performance, changes in laws and regulations, market opportunity, expectations concerning pricing actions, competition, expected contract start dates and terms, expected activities in connection with completed and future acquisitions and dispositions, our investments, and the adequacy of our available cash resources. These forward-looking statements reflect our current views with respect to future events and are based on numerous assumptions and assessments made by us in light of our experience and perception of historical trends, current conditions, business strategies, operating environments, future developments, and other factors we believe appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties and are subject to change because they relate to events and depend on circumstances that will occur in the future, including economic, regulatory, competitive, and other factors that may cause our or our industry's actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and assumptions. All forward-looking statements included in this press release are based on information available to us on the date hereof. Except as may be otherwise required by law, we undertake no obligation to update or revise the forward-looking statements included in this press release, whether as a result of new information, future events, or otherwise, after the date hereof. You should not place undue reliance on any forward-looking statements, as actual results may differ materially from projections, estimates, or other forward-looking statements due to a variety of important factors, variables, and events including, but not limited to: our ability to design and price products that are competitive and/or actuarially sound; our ability to accurately predict and effectively manage health benefits and other operating expenses and reserves, including fluctuations in medical costs; rate cuts, insufficient rate changes or other payment reductions or delays by government payors affecting our government businesses; the effect of social, economic, and political conditions, geopolitical events and state and federal policies, including the amount and terms of state and federal funding for government-sponsored healthcare programs, including as a result of changes in U.S. presidential administrations or Congress; changes in federal or state laws or regulations, including changes with respect to income tax reform or government healthcare programs as well as changes with respect to the Patient Protection and Affordable Care Act and the Health Care and Education Affordability Reconciliation Act (collectively referred to as the ACA) and any regulations enacted thereunder, including the timing and terms of renewal or modification of the Enhanced Advance Premium Tax Credits (eAPTCs) or program integrity initiatives that could have the
7
effect of reducing membership or profitability of our products; unanticipated increased healthcare costs, including due to changes in consumer and provider behaviors, inflation and tariffs; our ability to successfully execute on our enterprise optimization initiatives, including any separation programs; our ability to maintain or achieve improvement in the Centers for Medicare and Medicaid Services (CMS) Star ratings and maintain or achieve improvement in other quality scores in each case that could impact revenue and future growth; competition, including for providers, broker distribution networks, contract reprocurements and organic growth; our ability to adequately anticipate demand and timely provide for operational resources to maintain service level requirements in compliance with the terms of our contracts and state and federal regulations; our ability to comply with the terms of our contracts and state and federal regulations and our ability to effectively oversee our third-party vendors to comply with the terms of their contracts with us and state and federal regulations; our ability to manage our information systems effectively; disruption, unexpected costs, or similar risks from business transactions, including acquisitions, divestitures, and changes in our relationships with third-party vendors; impairments to real estate, investments, goodwill and intangible assets; changes in senior management, loss of one or more key personnel or an inability to attract, hire, integrate and retain skilled personnel; membership and revenue declines or unexpected trends; changes in healthcare practices, new technologies, and advances in medicine; our ability to effectively and ethically use artificial intelligence and machine learning in compliance with applicable laws; changes in macroeconomic conditions, including inflation, interest rates and volatility in the financial markets; negative public perception of the Company and the managed care industry; uncertainty concerning government shutdowns, debt ceilings or funding; tax matters; disasters, climate-related incidents, acts of war or aggression or major epidemics; changes in expected contract start dates and terms; changes in provider, broker, vendor, state, federal and other contracts and delays in the timing of regulatory approval of contracts, including due to protests and our ability to timely comply with any such changes to our contractual requirements or manage any unexpected delays in regulatory approval of contracts; the expiration, suspension, or termination of our contracts with federal or state governments (including, but not limited to, Medicaid, Medicare or other customers); the difficulty of predicting the timing or outcome of legal or regulatory audits, investigations, proceedings or matters including, but not limited to, our ability to resolve claims and/or allegations on acceptable terms, or at all, or whether additional claims, reviews or investigations will be brought; challenges to our contract awards; cyber-attacks or other data security incidents or our failure to comply with applicable privacy, data or security laws and regulations; the exertion of management's time and our resources, and other expenses incurred and business changes required in connection with complying with the terms of our contracts and the undertakings in connection with any regulatory, governmental, or third-party consents or approvals for acquisitions or dispositions; any changes in expected closing dates, estimated purchase price, or accretion for acquisitions or dispositions; losses in our investment portfolio; restrictions and limitations in connection with our indebtedness; a downgrade of our corporate family rating, issuer rating or credit rating of our indebtedness; the availability of debt and equity financing on terms that are favorable to us and risks and uncertainties discussed in the reports that Centene has filed with the Securities and Exchange Commission (SEC). This list of important factors is not intended to be exhaustive. We discuss certain of these matters more fully, as well as certain other factors that may affect our business operations, financial condition, and results of operations, in our filings with the SEC, including our annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. Due to these important factors and risks, we cannot give assurances with respect to our future performance, including without limitation our ability to maintain adequate premium levels or our ability to control our future medical and selling, general and administrative (SG&A) costs.
8
CENTENE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In millions, except shares in thousands and per share data in dollars)
| June 30, 2026 | December 31, 2025 | ||||||||||
| (Unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 24,151 | $ | 17,888 | |||||||
| Premium and trade receivables | 18,076 | 18,105 | |||||||||
| Short-term investments | 2,906 | 2,432 | |||||||||
| Other current assets | 1,552 | 1,945 | |||||||||
| Total current assets | 46,685 | 40,370 | |||||||||
| Long-term investments | 16,302 | 17,035 | |||||||||
| Restricted deposits | 1,487 | 1,412 | |||||||||
| Property, software and equipment, net | 2,130 | 2,037 | |||||||||
| Goodwill | 10,835 | 10,835 | |||||||||
| Intangible assets, net | 4,203 | 4,530 | |||||||||
| Other long-term assets | 1,370 | 528 | |||||||||
| Total assets | $ | 83,012 | $ | 76,747 | |||||||
| LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND STOCKHOLDERS' EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Medical claims liability | $ | 20,262 | $ | 20,544 | |||||||
| Accounts payable and accrued expenses | 17,965 | 13,796 | |||||||||
| Return of premium payable | 1,751 | 1,592 | |||||||||
| Unearned revenue | 706 | 736 | |||||||||
| Current portion of long-term debt | 75 | 50 | |||||||||
| Total current liabilities | 40,759 | 36,718 | |||||||||
| Long-term debt | 16,030 | 17,351 | |||||||||
| Deferred tax liability | 756 | 833 | |||||||||
| Other long-term liabilities | 2,810 | 1,789 | |||||||||
| Total liabilities | 60,355 | 56,691 | |||||||||
| Commitments and contingencies | |||||||||||
| Redeemable noncontrolling interests | 23 | 23 | |||||||||
| Stockholders' equity: | |||||||||||
Preferred stock, $0.001 par value; authorized 10,000 shares; no shares issued or outstanding at June 30, 2026 and December 31, 2025 | — | — | |||||||||
Common stock, $0.001 par value; authorized 800,000 shares; 625,693 issued and 493,987 outstanding at June 30, 2026, and 623,463 issued and 491,757 outstanding at December 31, 2025 | 1 | 1 | |||||||||
| Additional paid-in capital | 20,890 | 20,777 | |||||||||
| Accumulated other comprehensive (loss) | (194) | (58) | |||||||||
| Retained earnings | 11,306 | 8,674 | |||||||||
Treasury stock, at cost (131,706 and 131,706 shares, respectively) | (9,441) | (9,441) | |||||||||
| Total Centene stockholders' equity | 22,562 | 19,953 | |||||||||
| Nonredeemable noncontrolling interest | 72 | 80 | |||||||||
| Total stockholders' equity | 22,634 | 20,033 | |||||||||
| Total liabilities, redeemable noncontrolling interests and stockholders' equity | $ | 83,012 | $ | 76,747 | |||||||
9
CENTENE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except shares in thousands and per share data in dollars)
(Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Premium | $ | 43,582 | $ | 41,740 | $ | 87,469 | $ | 83,452 | |||||||||||||||
| Service | 793 | 727 | 1,561 | 1,504 | |||||||||||||||||||
| Premium and service revenues | 44,375 | 42,467 | 89,030 | 84,956 | |||||||||||||||||||
| Premium tax | 9,204 | 6,275 | 14,493 | 10,406 | |||||||||||||||||||
| Total revenues | 53,579 | 48,742 | 103,523 | 95,362 | |||||||||||||||||||
| Expenses: | |||||||||||||||||||||||
| Medical costs | 39,029 | 38,808 | 77,332 | 75,311 | |||||||||||||||||||
| Cost of services | 729 | 641 | 1,431 | 1,339 | |||||||||||||||||||
| Selling, general and administrative expenses | 3,103 | 3,036 | 6,500 | 6,389 | |||||||||||||||||||
| Depreciation expense | 139 | 141 | 273 | 283 | |||||||||||||||||||
| Amortization of acquired intangible assets | 161 | 173 | 327 | 346 | |||||||||||||||||||
| Premium tax expense | 9,220 | 6,346 | 14,601 | 10,563 | |||||||||||||||||||
| Impairment | — | 55 | — | 55 | |||||||||||||||||||
| Total operating expenses | 52,381 | 49,200 | 100,464 | 94,286 | |||||||||||||||||||
| Earnings (loss) from operations | 1,198 | (458) | 3,059 | 1,076 | |||||||||||||||||||
| Other income (expense): | |||||||||||||||||||||||
| Investment and other income | 435 | 371 | 842 | 753 | |||||||||||||||||||
| Gain on debt extinguishment | 6 | — | 1 | — | |||||||||||||||||||
| Interest expense | (153) | (170) | (317) | (340) | |||||||||||||||||||
| Earnings (loss) before income tax | 1,486 | (257) | 3,585 | 1,489 | |||||||||||||||||||
| Income tax expense | 399 | 2 | 959 | 434 | |||||||||||||||||||
| Net earnings (loss) | 1,087 | (259) | 2,626 | 1,055 | |||||||||||||||||||
| Loss attributable to noncontrolling interests | 4 | 6 | 6 | 3 | |||||||||||||||||||
| Net earnings (loss) attributable to Centene Corporation | $ | 1,091 | $ | (253) | $ | 2,632 | $ | 1,058 | |||||||||||||||
| Net earnings (loss) per common share attributable to Centene Corporation: | |||||||||||||||||||||||
| Basic earnings (loss) per common share | $ | 2.21 | $ | (0.51) | $ | 5.34 | $ | 2.14 | |||||||||||||||
| Diluted earnings (loss) per common share | $ | 2.19 | $ | (0.51) | $ | 5.30 | $ | 2.13 | |||||||||||||||
| Weighted average number of common shares outstanding: | |||||||||||||||||||||||
| Basic | 493,819 | 493,548 | 492,949 | 494,896 | |||||||||||||||||||
| Diluted | 497,637 | 493,548 | 496,605 | 496,328 | |||||||||||||||||||
10
CENTENE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions, unaudited)
| Six Months Ended June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net earnings | $ | 2,626 | $ | 1,055 | |||||||
| Adjustments to reconcile net earnings to net cash provided by operating activities | |||||||||||
| Depreciation and amortization | 600 | 629 | |||||||||
| Stock compensation expense | 126 | 94 | |||||||||
| Impairment | — | 55 | |||||||||
| (Gain) loss on debt extinguishment | (1) | — | |||||||||
| Deferred income taxes | (34) | (116) | |||||||||
| Loss on divestitures | — | 10 | |||||||||
| Changes in assets and liabilities | |||||||||||
| Premium and trade receivables | (6) | (1,801) | |||||||||
| Other assets | (488) | (543) | |||||||||
| Medical claims liabilities | (268) | 1,809 | |||||||||
| Unearned revenue | (30) | 21 | |||||||||
| Accounts payable and accrued expenses | 4,249 | 209 | |||||||||
| Other long-term liabilities | 1,162 | 1,857 | |||||||||
| Other operating activities, net | 20 | 16 | |||||||||
| Net cash provided by operating activities | 7,956 | 3,295 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (374) | (343) | |||||||||
| Purchases of investments | (2,328) | (3,593) | |||||||||
| Sales and maturities of investments | 2,438 | 2,508 | |||||||||
| Net cash (used in) investing activities | (264) | (1,428) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Proceeds from long-term debt | — | 750 | |||||||||
| Payments and repurchases of long-term debt | (1,304) | (1,707) | |||||||||
| Common stock repurchases | (33) | (473) | |||||||||
| Proceeds from common stock issuances | 18 | 18 | |||||||||
| Other financing activities, net | (3) | (12) | |||||||||
| Net cash (used in) financing activities | (1,322) | (1,424) | |||||||||
| Net increase in cash, cash equivalents and restricted cash and cash equivalents | 6,370 | 443 | |||||||||
| Cash and cash equivalents reclassified (to) held for sale | (73) | — | |||||||||
Cash, cash equivalents and restricted cash and cash equivalents, beginning of period | 17,957 | 14,156 | |||||||||
Cash, cash equivalents and restricted cash and cash equivalents, end of period | $ | 24,254 | $ | 14,599 | |||||||
| Supplemental disclosures of cash flow information: | |||||||||||
| Interest paid | $ | 302 | $ | 320 | |||||||
| Income tax net payments (refunds) | $ | (225) | $ | 504 | |||||||
| The following table provides a reconciliation of cash, cash equivalents and restricted cash and cash equivalents reported within the Consolidated Balance Sheets to the totals above: | |||||||||||
| June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Cash and cash equivalents | $ | 24,151 | $ | 14,513 | |||||||
| Restricted cash and cash equivalents, included in restricted deposits | 103 | 86 | |||||||||
| Total cash, cash equivalents and restricted cash and cash equivalents | $ | 24,254 | $ | 14,599 | |||||||
11
CENTENE CORPORATION
SUPPLEMENTAL FINANCIAL DATA
| Q2 | Q1 | Q4 | Q3 | Q2 | ||||||||||||||||||||||||||||
| 2026 | 2026 | 2025 | 2025 | 2025 | ||||||||||||||||||||||||||||
| MEMBERSHIP | ||||||||||||||||||||||||||||||||
Traditional Medicaid (1) | 10,745,800 | 10,923,100 | 10,932,600 | 11,115,400 | 11,227,400 | |||||||||||||||||||||||||||
High Acuity Medicaid (2) | 1,364,900 | 1,503,800 | 1,585,800 | 1,591,000 | 1,592,300 | |||||||||||||||||||||||||||
| Total Medicaid | 12,110,700 | 12,426,900 | 12,518,400 | 12,706,400 | 12,819,700 | |||||||||||||||||||||||||||
| Marketplace | 3,494,700 | 3,582,200 | 5,541,400 | 5,828,100 | 5,862,800 | |||||||||||||||||||||||||||
Individual and Commercial Group (3) | 497,000 | 481,000 | 452,500 | 447,900 | 449,700 | |||||||||||||||||||||||||||
| Total Commercial | 3,991,700 | 4,063,200 | 5,993,900 | 6,276,000 | 6,312,500 | |||||||||||||||||||||||||||
Medicare (4) | 980,000 | 1,002,200 | 1,002,600 | 1,013,200 | 1,026,900 | |||||||||||||||||||||||||||
| Medicare PDP | 8,803,000 | 8,780,600 | 8,118,600 | 7,972,500 | 7,845,800 | |||||||||||||||||||||||||||
| Total at-risk membership | 25,885,400 | 26,272,900 | 27,633,500 | 27,968,100 | 28,004,900 | |||||||||||||||||||||||||||
(1) | Membership includes TANF, Medicaid Expansion, CHIP, Foster Care and Behavioral Health. | |||||||||||||||||||||||||||||||
(2) | Membership includes ABD, IDD, LTSS and MMPs. The Company operated MMPs through December 31, 2025. In 2026 these members are included in Medicare as a result of the CMS transition to D-SNP based integration. | |||||||||||||||||||||||||||||||
(3) | Membership includes Commercial Group, ICHRA and Other Off-Exchange Individual. | |||||||||||||||||||||||||||||||
(4) | Membership includes Medicare Advantage, Medicare Supplement and AIPs as a result of the CMS transition to D-SNP based integration in 2026. | |||||||||||||||||||||||||||||||
| NUMBER OF EMPLOYEES | 59,800 | 61,000 | 61,100 | 60,900 | 60,300 | |||||||||||||||||||||||||||
DAYS IN CLAIMS PAYABLE | 47 | 48 | 46 | 48 | 47 | |||||||||||||||||||||||||||
| CASH, INVESTMENTS AND RESTRICTED DEPOSITS (in millions) | ||||||||||||||||||||||||||||||||
| Regulated | $ | 43,015 | $ | 40,239 | $ | 37,289 | $ | 37,574 | $ | 36,403 | ||||||||||||||||||||||
| Unregulated | 1,831 | 1,533 | 1,478 | 1,259 | 1,086 | |||||||||||||||||||||||||||
| Total | $ | 44,846 | $ | 41,772 | $ | 38,767 | $ | 38,833 | $ | 37,489 | ||||||||||||||||||||||
| DEBT TO CAPITALIZATION | 41.6 | % | 43.2 | % | 46.5 | % | 45.5 | % | 39.0 | % | ||||||||||||||||||||||
| OPERATING RATIOS | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| HBR | 89.6 | % | 93.0 | % | 88.4 | % | 90.2 | % | |||||||||||||||
| SG&A expense ratio | 7.0 | % | 7.1 | % | 7.3 | % | 7.5 | % | |||||||||||||||
| Adjusted SG&A expense ratio | 6.9 | % | 7.1 | % | 7.2 | % | 7.5 | % | |||||||||||||||
| HBR BY PRODUCT | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| Medicaid | 93.9 | % | 94.9 | % | 93.5 | % | 94.2 | % | ||||||||||||||||||
| Commercial | 79.2 | % | 90.6 | % | 77.2 | % | 82.8 | % | ||||||||||||||||||
Medicare (5) | 89.5 | % | 90.9 | % | 87.3 | % | 88.6 | % | ||||||||||||||||||
(5) | Medicare includes Medicare Advantage, Medicare PDP and Medicare Supplement. | |||||||||||||||||||||||||
12
MEDICAL CLAIMS LIABILITY
The changes in medical claims liability are summarized as follows (in millions):
Balance, June 30, 2025 | $ | 20,117 | ||||||
| Less: Reinsurance recoverables | 60 | |||||||
Balance, June 30, 2025, net | 20,057 | |||||||
| Incurred related to: | ||||||||
| Current period | 161,849 | |||||||
| Prior periods | (1,737) | |||||||
| Total incurred | 160,112 | |||||||
| Paid related to: | ||||||||
| Current period | 142,602 | |||||||
| Prior periods | 16,854 | |||||||
| Total paid | 159,456 | |||||||
| Plus: Premium deficiency reserve | (389) | |||||||
| Plus: Divestitures | (109) | |||||||
Balance, June 30, 2026, net | 20,215 | |||||||
| Plus: Reinsurance recoverables | 47 | |||||||
Balance, June 30, 2026 | $ | 20,262 | ||||||
Centene's claims reserving process utilizes a consistent actuarial methodology to estimate Centene's ultimate liability. Any reduction in the "Incurred related to: Prior periods" amount may be offset as Centene actuarially determines the "Incurred related to: Current period." Additionally, approximately $22 million was recorded as a reduction to premium revenues resulting from development within "Incurred related to: Prior periods" due to minimum HBR and other return of premium programs.
The amount of the "Incurred related to: Prior periods" above represents favorable development and includes the effects of reserving under moderately adverse conditions, new markets where we use a conservative approach in setting reserves during the initial periods of operations, receipts from other third-party payors related to coordination of benefits and lower medical utilization and cost trends for dates of service June 30, 2025, and prior.
13
Exhibit 99.2
N E W S R E L E A S E
| Contact: | Investor Relations Inquiries | Media Inquiries | ||||||
| Jennifer Gilligan | Isabella Wiltse | |||||||
| Senior Vice President, Finance & Investor Relations | Vice President, Media & Public Relations | |||||||
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FOR IMMEDIATE RELEASE
CENTENE ANNOUNCES BOARD OF DIRECTORS CHANGES
ST. LOUIS, July 28, 2026 -- Centene Corporation (NYSE: CNC) today announced that Kenneth A. Burdick has retired from the Company's Board of Directors, effective July 28, 2026, and that Paul J. Diaz has been appointed to the Board, effective July 28, 2026.
Mr. Burdick joined Centene's Board of Directors in January 2022 and has provided valuable insight and guidance leveraging his decades-long leadership in healthcare. Prior to joining the Board, he served as Executive Vice President of Products and Markets at Centene and before that was the Chief Executive Officer of WellCare Health Plans.
Mr. Diaz is a Managing Partner at Cressey & Company, a private investment firm focused on investing and cultivating high-quality healthcare firms. He previously served as President and Chief Executive Officer of Myriad Genetics, Inc., a leading genetic testing and precision medicine company. Before that, he served as President and Chief Executive Officer of Kindred Healthcare, a Fortune 500 healthcare services company. Mr. Diaz also brings extensive public company board experience, having served on the boards of several healthcare organizations, including DaVita and PharMerica.
"After careful consideration, I have decided the time is right to step down from the Centene Board to focus on personal priorities and other opportunities," said Mr. Burdick. "It has been a privilege to serve Centene and support its mission of transforming the health of the communities it serves, one person at a time. I have great confidence in the Company's leadership, strategy and future, and I leave knowing it is well positioned for its next chapter of growth and impact."
"Ken has been a valued member of our Board. His deep industry expertise, strategic perspective, and commitment to improving healthcare have made a meaningful impact on Centene. On behalf of the Board, we thank him for his service and wish him all the best in retirement," said Frederick H. Eppinger, Chair of Centene's Board of Directors. "We are also pleased to welcome Paul Diaz to the Board. His extensive healthcare leadership experience, public company governance expertise and record of guiding organizations through growth and transformation will bring valuable perspective as Centene continues to advance its strategy and serve its members."
"I am honored to join Centene's Board of Directors and support a company with such a strong mission and commitment to improving the health of the communities it serves," said Mr. Diaz. "I look forward to drawing on my experience across the healthcare industry to help advance innovation, strengthen access to high-quality care and support Centene's continued impact for its members and stakeholders."
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About Centene Corporation
Centene Corporation, a Fortune 500 company, is a leading healthcare enterprise that is committed to helping people live healthier lives. The Company takes a local approach with local teams to provide fully integrated, high-quality, and cost-effective services to government-sponsored and commercial healthcare programs, focusing on under-insured individuals. Centene offers affordable and high-quality products to more than 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace.
Centene uses its investor relations website to publish important information about the Company, including information that may be deemed material to investors. Financial and other information about Centene is routinely posted and is accessible on Centene's investor relations website, https://investors.centene.com.
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