Centene (CNC) investor relations material

Executive summary

• Q2 2026 adjusted diluted EPS was $2.51, exceeding expectations and reflecting strong profitability improvements year-over-year, with GAAP diluted EPS at $2.19.

• Total revenues for Q2 2026 reached $53.6 billion, up 10% year-over-year, driven by premium tax revenue, PDP growth, and rate increases in Marketplace and Medicaid.

• Managed care membership declined 8% year-over-year to 25.9 million, primarily due to Medicaid redeterminations and regulatory changes.

• Margin restoration, operational transformation, and ongoing investments in AI, data, and organizational optimization remain key priorities.

• Cash flow from operations for Q2 2026 was $3.6 billion, primarily from net earnings and payment timing.

Financial highlights

• Premium and service revenues increased 4% year-over-year to $44.4 billion in Q2 2026.

• Health benefits ratio (HBR) improved to 89.6% from 93.0% in Q2 2025, reflecting improved pricing and risk transfer.

• Adjusted SG&A expense ratio improved to 6.9% from 7.1% year-over-year.

• Net earnings attributable to shareholders were $1.1 billion for Q2 2026, up from a loss of $253 million in Q2 2025.

• Operating income rose to $1.2 billion from a loss of $458 million year-over-year.

Outlook and guidance

• 2026 adjusted diluted EPS guidance raised to greater than $4.80, and GAAP diluted EPS guidance raised to greater than $3.11.

• Total revenues guidance for 2026 increased to $193.5–$197.5 billion; premium and service revenues guidance raised to $173.0–$177.0 billion.

• Marketplace pre-tax margin guidance raised to 4.5%-5% for 2026; PDP pre-tax margin expected to be greater than 3%.

• Medicaid HBR forecast remains at 93.5% for the full year, with membership expected to decline 8%-9% from 12/31/2025.

• Projected severance costs of $315–$365 million in 2026 related to enterprise optimization initiatives.