Core Insights - Alignment Healthcare reported quarterly earnings of $0.07 per share, exceeding the Zacks Consensus Estimate of a loss of $0.07 per share, and showing improvement from a loss of $0.13 per share a year ago, resulting in an earnings surprise of +200.00% [1] - The company achieved revenues of $1.02 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 5.75%, and compared to revenues of $681.29 million in the same quarter last year [2] Financial Performance - Over the last four quarters, Alignment Healthcare has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2] - The current consensus EPS estimate for the upcoming quarter is -$0.08 on revenues of $953.68 million, and for the current fiscal year, it is -$0.33 on revenues of $3.8 billion [7] Market Position - Alignment Healthcare shares have increased approximately 4.7% since the beginning of the year, while the S&P 500 has gained 8.3% [3] - The Zacks Industry Rank indicates that the Medical Services sector is currently in the top 37% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] Future Outlook - The sustainability of the stock's price movement will depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The estimate revisions trend for Alignment Healthcare was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6]

Financial Data and Key Metrics Changes - Health plan membership reached 223,700 members, representing a growth of approximately 28% year over year [5][17] - Total revenue for the second quarter was $1,000,000,000, increasing approximately 49% year over year [5][17] - Adjusted gross profit was $135,000,000, which is a 76% increase year over year, resulting in a consolidated Medical Benefit Ratio (MBR) of 86.7%, an improvement of 200 basis points [6][18] - Adjusted EBITDA for the quarter was $46,000,000, with an adjusted EBITDA margin of 4.5%, reflecting a margin expansion of 360 basis points year over year [6][21] Business Line Data and Key Metrics Changes - The company reported strong execution in provider engagement and clinical initiatives, leading to inpatient admissions per 1,000 in the low 140s [9][18] - The adjusted SG&A ratio improved to 8.8%, a decline of 160 basis points year over year [6][20] Market Data and Key Metrics Changes - The company is experiencing rapid membership growth that is seven times higher than the industry average, indicating strong market positioning [8] - The introduction of the V28 risk model changes has led to large incumbent Managed Care Organizations (MCOs) losing market share for the first time since 2014, while the company has maintained high star ratings [12] Company Strategy and Development Direction - The company is focused on deepening provider relationships and enhancing clinical management capabilities to improve chronic condition management and care coordination [10][11] - The strategic framework emphasizes excellent customer experience, exceptional clinical outcomes, and affordable products, positioning the company as a leader in Medicare Advantage [11] - Investments are being made in administrative automation and care navigation to support long-term growth objectives [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving at least 20% growth in 2026, with substantial capacity to expand into new counties and states [12][13] - The company is well-positioned to navigate the final phase of V28 risk model changes and achieve growth and profitability objectives [15] - Management highlighted the importance of quality care and the potential for positive public perception changes regarding Medicare Advantage [51] Other Important Information - The company ended the second quarter with $504,000,000 in cash, cash equivalents, and investments [21] - The guidance for the third quarter includes health plan membership between 225,227 members and revenue in the range of $970,000,000 to $985,000,000 [22] Q&A Session Summary Question: Can you provide details on your provider relationships and how they differ from prior relationships? - Management noted that improved visibility and control through collaborative efforts with IPAs and medical groups have led to better outcomes and member satisfaction [30][33] Question: What is the outlook for SG&A and its durability as the company scales? - Management emphasized the competitive advantage of a unified data architecture, which allows for lower SG&A ratios and improved operational efficiency [38][41] Question: Can you elaborate on the $14,000,000 final sweep benefit and its implications for future earnings? - Management clarified that the final sweep is a normal part of business and should not significantly impact future earnings forecasts [46][48] Question: How is the company addressing public advocacy and perception in the healthcare insurance sector? - Management highlighted their efforts to advocate for choice and quality care for seniors, noting positive reception in Washington [51][52] Question: What is the company's approach to predictive analytics and managing chronic populations? - Management indicated a focus on personalized care and evolving machine learning algorithms to enhance care management [54][55]

Financial Data and Key Metrics Changes - Health plan membership reached 223,700 members, representing a growth of approximately 28% year over year [4][15] - Total revenue for the second quarter was $1,000,000,000, increasing approximately 49% year over year [4][15] - Adjusted gross profit was $135,000,000, a 76% increase year over year, resulting in a consolidated Medical Benefit Ratio (MBR) of 86.7%, an improvement of 200 basis points [5][16] - Adjusted EBITDA was $46,000,000, surpassing guidance and producing an adjusted EBITDA margin of 4.5%, with a margin expansion of 360 basis points year over year [5][19] Business Line Data and Key Metrics Changes - The company demonstrated strong execution in provider engagement and clinical initiatives, leading to inpatient admissions per 1,000 in the low 140s [6][16] - The adjusted SG&A ratio improved to 8.8%, a decline of 160 basis points year over year, indicating effective cost management [5][18] Market Data and Key Metrics Changes - The company is positioned to capture additional market share, with current membership representing only 5% of the total Medicare Advantage enrollees in served counties [12] - The introduction of the V28 risk model changes has led to a shift in market dynamics, with large incumbent Managed Care Organizations (MCOs) losing share for the first time since 2014 [11] Company Strategy and Development Direction - The company is focused on deepening provider relationships and enhancing care management capabilities, aiming to improve chronic condition management and increase adoption of AIVA technology [9][10] - Investments are being made in administrative automation and care navigation to support long-term growth objectives [12][13] - The company aims to establish itself as a preferred Medicare Advantage platform, leveraging high star ratings and exceptional member satisfaction [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving at least 20% growth in 2026, supported by strong fundamentals and market expansion opportunities [11][12] - The company is optimistic about its ability to navigate the evolving Medicare landscape and maintain high-quality care standards [10][11] Other Important Information - The company expects to be free cash flow positive in 2025, marking a significant milestone in its organizational maturity [25] - The Arizona HMO contract was revised from 3.5 to 4 stars for payment year 2026, reflecting the company's commitment to quality [13] Q&A Session Summary Question: Can you provide details on your provider relationships and how they differ from prior relationships? - Management highlighted improved visibility and control through collaboration with IPAs and medical groups, resulting in better outcomes and member satisfaction [28][30] Question: What is the outlook for SG&A as you continue to scale? - Management indicated that a unified data architecture allows for lower SG&A ratios, with potential for further reductions as operational efficiencies improve [36][38] Question: How does the final risk adjustment sweep benefit impact your earnings? - The $14,000,000 benefit was attributed to the 2024 final sweep and is considered a normal part of the business, not expected to significantly impact future earnings [44][46] Question: What is the company's stance on public advocacy in the healthcare sector? - Management emphasized the importance of advocating for senior care choices and differentiating the company from incumbents in the Medicare Advantage space [50][52] Question: How is the company leveraging predictive analytics in care management? - Management is focused on evolving machine learning algorithms to enhance personalized care and improve risk management [54][56]

PART I. Financial Information [Item 1. Financial Statements (Unaudited)](index=7&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)%3A) Unaudited financial statements for Q2 2025 show significant revenue growth, a shift from net loss to net income, and improved cash flow from operations [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to **$1.0 billion**, driven by higher cash and accounts receivable, while liabilities grew due to increased medical expenses payable Condensed Consolidated Balance Sheet Highlights | Account | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $470,266 | $432,859 | | Accounts receivable, net | $282,931 | $153,904 | | Total current assets | $880,122 | $661,638 | | Total assets | $1,000,150 | $782,063 | | **Liabilities & Equity** | | | | Medical expenses payable | $455,154 | $289,788 | | Total current liabilities | $529,527 | $351,845 | | Long-term debt, net | $322,295 | $321,428 | | Total liabilities | $859,183 | $681,108 | | Total stockholders' equity | $140,967 | $100,955 | [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 total revenues increased **49.0%** to **$1.02 billion**, leading to a significant turnaround from an operating loss to a net income of **$15.7 million** Q2 and Six-Month Performance Summary | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | % Change | Six Months 2025 (in thousands) | Six Months 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total revenues | $1,015,288 | $681,286 | 49.0% | $1,942,220 | $1,309,887 | 48.3% | | Medical expenses | $881,740 | $605,312 | 45.7% | $1,702,640 | $1,178,530 | 44.5% | | Income (loss) from operations | $22,748 | $(18,382) | 223.7% | $17,355 | $(59,488) | 129.2% | | Net income (loss) attributable to Co. | $15,667 | $(24,010) | 165.2% | $6,553 | $(70,531) | 109.3% | | Diluted EPS | $0.07 | $(0.13) | 153.8% | $0.03 | $(0.37) | 108.1% | [Condensed Consolidated Statements of Stockholders' Equity](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Total stockholders' equity increased to **$141.0 million** by June 30, 2025, driven by net income and equity-based compensation, a significant improvement from the prior year - Total stockholders' equity increased by **$40.0 million** in the first six months of 2025, from **$100.96 million** to **$140.97 million**[24](index=24&type=chunk) - Key drivers for the equity increase in the first half of 2025 were net income of **$6.3 million** and equity-based compensation of **$32.7 million**[24](index=24&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities significantly increased to **$45.7 million** for the six months ended June 30, 2025, driven by improved net income, while investing and financing cash flows shifted Six-Month Cash Flow Summary | Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $45,746 | $17,291 | | Net cash (used in) provided by investing activities | $(10,126) | $69,671 | | Net cash provided by financing activities | $1,797 | $49,153 | | **Net increase in cash** | **$37,417** | **$136,115** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=15&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, revenue composition, a significant increase in medical expenses payable, debt refinancing, and a contingent liability from a new CMS RADV audit - The company operates as a single reportable segment focused on providing healthcare services to seniors, primarily through Medicare Advantage Plans in California, North Carolina, Nevada, Arizona, and Texas[29](index=29&type=chunk)[33](index=33&type=chunk) - In November 2024, the company issued **$330 million** of **4.25% Convertible Senior Notes** due 2029 and used the proceeds to repay its existing Oxford term loans[95](index=95&type=chunk)[98](index=98&type=chunk) - Medical expenses payable increased to **$455.2 million** at June 30, 2025, from **$289.8 million** at year-end 2024, with favorable prior year development of **$12.5 million** recognized in the first six months of 2025[90](index=90&type=chunk)[91](index=91&type=chunk) - On June 25, 2025, the company was notified of a Medicare Advantage contract-specific risk adjustment data validation (RADV) audit for payment year 2019, with no reasonable estimate of potential retrospective adjustment currently available[130](index=130&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong H1 2025 performance to **27.8%** membership growth, leading to **$1.94 billion** in revenue, profitability, improved Adjusted EBITDA, and a stronger Medical Benefits Ratio [Overview](index=33&type=section&id=Overview) Alignment Healthcare is a consumer-centric platform improving senior healthcare through Medicare Advantage plans, serving **223,700** members across 45 markets in 5 states as of June 30, 2025 - The company's business model is a "virtuous cycle" that uses savings from managed healthcare expenditures to reinvest in richer benefits, which drives membership growth[137](index=137&type=chunk) - Health Plan Membership grew to **223,700** as of June 30, 2025, operating in 45 markets across California, North Carolina, Nevada, Arizona, and Texas[136](index=136&type=chunk)[138](index=138&type=chunk) [Executive Summary](index=36&type=section&id=Executive%20Summary) The company's Q2 2025 performance showed substantial year-over-year improvement, with **27.8%** membership growth, **49.0%** revenue increase, a shift to **$15.7 million** net income, and a **660.9%** surge in Adjusted EBITDA Key Financial and Operational Metrics | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | % Change | Six Months 2025 (in thousands) | Six Months 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Health plan membership | 223,700 | 175,100 | 27.8% | 223,700 | 175,100 | 27.8% | | Medical benefits ratio | 86.7% | 88.7% | (2.0)% | 87.5% | 89.8% | (2.3)% | | Revenues | $1,015,288 | $681,286 | 49.0% | $1,942,220 | $1,309,887 | 48.3% | | Net income (loss) | $15,653 | $(24,003) | 165.2% | $6,299 | $(70,578) | 108.9% | | Adjusted EBITDA | $45,913 | $6,034 | 660.9% | $66,091 | $(5,946) | 1,211.5% | [Results of Operations](index=39&type=section&id=Results%20of%20Operations) H1 2025 total revenues increased **48.3%** to **$1.94 billion**, driven by membership growth and higher per-member rates, leading to a shift from operating loss to **$17.4 million** operating income - Earned premium revenues for H1 2025 increased by **$628.6 million** (**48.5%**) YoY, driven by a **27.8%** increase in membership and higher CMS benchmark and Part D revenue rates[165](index=165&type=chunk)[166](index=166&type=chunk) - Medical expenses for H1 2025 increased by **$524.1 million** (**44.5%**) YoY, a slower pace than revenue growth, attributed to a more favorable mix of returning members and despite unit cost increases[168](index=168&type=chunk) - SG&A expenses for H1 2025 increased by **$29.3 million** (**16.4%**) YoY, but decreased as a percentage of revenue from **14%** to **11%** due to economies of scale from membership growth[169](index=169&type=chunk) - Interest expense for H1 2025 decreased by **$3.2 million** (**28.8%**) YoY, due to refinancing debt at a lower fixed rate of **4.25%** with new convertible notes, despite a higher principal balance[172](index=172&type=chunk) [Liquidity and Capital Resources](index=43&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$503.8 million** in cash and investments as of June 30, 2025, having refinanced debt with **$330 million** in convertible senior notes - As of June 30, 2025, the company had **$503.8 million** in cash, cash equivalents, and short-term investments[175](index=175&type=chunk) - In November 2024, the company completed the sale of **$330.0 million** of its **4.25% Convertible Senior Notes** due 2029, using proceeds to repay its **$215.0 million** Oxford term loan[184](index=184&type=chunk)[187](index=187&type=chunk) - Net cash from operating activities increased to **$45.7 million** in H1 2025 from **$17.3 million** in H1 2024, primarily due to higher net income[191](index=191&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rates and inflation, with interest rate risk mitigated by fixed-rate debt and short-term investments - The company's **$330.0 million** in Convertible Senior Notes have a fixed annual interest rate of **4.25%**, mitigating exposure to interest rate changes on its debt[205](index=205&type=chunk) - Management believes inflation has not had a material effect on operating results thus far, though it remains a potential future risk[206](index=206&type=chunk) [Controls and Procedures](index=47&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the reporting period, June 30, 2025[207](index=207&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter ended June 30, 2025[208](index=208&type=chunk) PART II. Other Information [Legal Proceedings](index=48&type=section&id=Item%201.%20Legal%20Proceedings) The company faces various legal proceedings, including a new CMS RADV audit with an unestimable liability, and tentative settlements for class action and stockholder lawsuits - The company was notified of a Medicare Advantage contract-specific risk adjustment data validation (RADV) audit for payment year 2019, the outcome of which is currently uncertain[130](index=130&type=chunk) - A tentative settlement of **$913 thousand** was reached in the Dabney v. Alignment Healthcare USA, LLC class action lawsuit[126](index=126&type=chunk) [Risk Factors](index=48&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024, were reported - No material changes to risk factors were reported for the quarter[211](index=211&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=48&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities occurred during the quarter, and there was no material change in the use of **$361.6 million** net proceeds from the March 2021 IPO - The company generated net proceeds of approximately **$361.6 million** from its IPO in March 2021[213](index=213&type=chunk) - There has been no material change in the planned use of IPO proceeds[214](index=214&type=chunk) [Other Information](index=48&type=section&id=Item%205.%20Other%20Information) Dawn Maroney, President, adopted a Rule 10b5-1 trading plan on May 22, 2025, for the potential sale of up to **410,000** securities from August 2025 to June 2026 - Dawn Maroney, President, adopted a Rule 10b5-1 trading plan on May 22, 2025, for the potential sale of up to **410,000** securities[219](index=219&type=chunk)[220](index=220&type=chunk) [Exhibits](index=49&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files

[Executive Summary & Business Overview](index=1&type=section&id=Executive%20Summary%20%26%20Business%20Overview) This section provides an overview of Alignment Healthcare's strong Q2 2025 financial performance, future outlook, and CEO's strategic vision for high-quality senior care [Company Introduction & CEO Statement](index=1&type=section&id=1.1%20Company%20Introduction%20%26%20CEO%20Statement) Alignment Healthcare reported strong second-quarter 2025 results, with CEO John Kao emphasizing that their model successfully combines financial performance with high-quality, affordable senior care through clinical excellence and member experience - CEO John Kao highlights that Q2 performance demonstrates strong financial results and high-quality care are achievable with their model, emphasizing clinical excellence, affordability, and member experience by prioritizing seniors and real-time health visibility[3](index=3&type=chunk) [Second Quarter 2025 Financial Highlights](index=1&type=section&id=1.2%20Second%20Quarter%202025%20Financial%20Highlights) Alignment Healthcare exceeded its second-quarter guidance across all key metrics, reporting significant year-over-year growth in membership and total revenue, alongside positive adjusted gross profit, income from operations, adjusted EBITDA, and net income Q2 2025 Key Financial Highlights | Metric | Q2 2025 Value | YoY Change | | :----------------------- | :-------------- | :--------- | | Health Plan Membership (members) | 223,700 | +27.8% | | Total Revenue ($ millions) | 1,015.3 | +49.0% | | Adjusted Gross Profit ($ millions) | 135.2 | N/A | | Income from Operations ($ millions) | 22.7 | N/A | | Medical Benefits Ratio (%) | 86.7 | N/A | | Adjusted EBITDA ($ millions) | 45.9 | N/A | | Net Income ($ millions) | 15.7 | N/A | - Alignment Healthcare surpassed the high-end of its Q2 guidance for **membership**, **revenue**, **adjusted gross profit**, and **adjusted EBITDA**[7](index=7&type=chunk) [Outlook for Third Quarter and Fiscal Year 2025](index=1&type=section&id=1.3%20Outlook%20for%20Third%20Quarter%20and%20Fiscal%20Year%202025) The company has raised its full-year outlook for 2025 across all key metrics, including health plan membership, revenue, adjusted gross profit, and adjusted EBITDA, reflecting strong anticipated performance Q3 and FY 2025 Outlook | Metric | Q3 2025 (Low) | Q3 2025 (High) | FY 2025 (Low) | FY 2025 (High) | | :----------------- | :-------------- | :--------------- | :-------------- | :--------------- | | Health Plan Membership | 225,000 | 227,000 | 229,000 | 234,000 | | Revenue ($ Millions) | $970 | $985 | $3,885 | $3,910 | | Adjusted Gross Profit ($ Millions) | $106 | $114 | $452 | $469 | | Adjusted EBITDA ($ Millions) | $5 | $13 | $69 | $83 | - The company has raised its full-year outlook across **membership**, **revenue**, **adjusted gross profit**, and **adjusted EBITDA**[7](index=7&type=chunk) [Condensed Consolidated Financial Statements](index=3&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Alignment Healthcare's balance sheets, statements of operations, and cash flows, detailing the company's financial position and performance for Q2 and the first half of 2025 [Condensed Consolidated Balance Sheets](index=3&type=section&id=2.1%20Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Alignment Healthcare reported a significant increase in total assets, liabilities, and stockholders' equity compared to December 31, 2024, driven by growth in cash, accounts receivable, and medical expenses payable Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------------------- | :-------------- | :---------------- | :----- | | Total Assets | $1,000,150 | $782,063 | +27.9% | | Total Liabilities | $859,183 | $681,108 | +26.1% | | Total Stockholders' Equity | $140,967 | $100,955 | +39.6% | | Cash and cash equivalents | $470,266 | $432,859 | +8.6% | | Medical expenses payable | $455,154 | $289,788 | +57.1% | [Condensed Consolidated Statements of Operations](index=4&type=section&id=2.2%20Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2025 and the six months ended June 30, 2025, Alignment Healthcare demonstrated a strong turnaround, moving from net losses in the prior year to positive income from operations and net income, with substantial revenue growth Condensed Consolidated Statements of Operations Highlights (in thousands) | Income Statement Item (in thousands) | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :--------------------------------- | :-------- | :-------- | :-------- | :-------- | | Total Revenues | $1,015,288 | $681,286 | $1,942,220 | $1,309,887 | | Medical Expenses | $881,740 | $605,312 | $1,702,640 | $1,178,530 | | Income (loss) from operations | $22,748 | $(18,382) | $17,355 | $(59,488) | | Net income (loss) | $15,653 | $(24,003) | $6,299 | $(70,578) | | Diluted EPS | $0.07 | $(0.13) | $0.03 | $(0.37) | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=2.3%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, operating activities generated significantly more cash compared to the prior year, while investing activities shifted to a net cash outflow, and financing activities saw a decrease in cash provided Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Item (in thousands) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------ | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $45,746 | $17,291 | | Net cash (used in) provided by investing activities | $(10,126) | $69,671 | | Net cash provided by financing activities | $1,797 | $49,153 | | Net increase in cash | $37,417 | $136,115 | | Cash, cash equivalents and restricted cash at end of period | $472,359 | $341,069 | [Non-GAAP Financial Information](index=2&type=section&id=Non-GAAP%20Financial%20Information) This section provides reconciliations and definitions for key non-GAAP financial measures, including Adjusted Gross Profit and Adjusted EBITDA, used to assess operational performance [Non-GAAP Reconciliations](index=2&type=section&id=3.1%20Non-GAAP%20Reconciliations) The report provides detailed reconciliations for Adjusted Gross Profit and Adjusted EBITDA, bridging these non-GAAP measures from their most directly comparable GAAP figures, Income (loss) from operations and Net income (loss), respectively Adjusted Gross Profit and Adjusted EBITDA Reconciliations (in thousands) **Adjusted Gross Profit Reconciliation (in thousands):** | Item | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :------------------------------------ | :-------- | :-------- | :-------- | :-------- | | Income (loss) from operations | $22,748 | $(18,382) | $17,355 | $(59,488) | | Add back: | | | | | | Equity-based compensation (medical expenses) | 1,594 | 762 | 2,746 | 1,895 | | Depreciation (medical expenses) | 33 | 46 | 66 | 98 | | Restructuring costs (medical expenses) | — | 21 | — | 796 | | Depreciation and amortization | 7,003 | 6,493 | 14,597 | 12,470 | | Selling, general, and administrative expenses | 103,797 | 87,863 | 207,628 | 178,375 | | **Adjusted gross profit** | **$135,175** | **$76,803** | **$242,392** | **$134,146** | **Adjusted EBITDA Reconciliation (in thousands):** | Item | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :------------------------------------ | :-------- | :-------- | :-------- | :-------- | | Net income (loss) | $15,653 | $(24,003) | $6,299 | $(70,578) | | Less: Net income (loss) attributable to noncontrolling interest | (14) | 7 | (254) | (47) | | Adjustments: | | | | | | Interest expense | 3,950 | 5,691 | 7,900 | 11,118 | | Depreciation and amortization | 7,036 | 6,539 | 14,663 | 12,568 | | Income taxes | 3,224 | 22 | 3,245 | 22 | | Equity-based compensation | 15,553 | 16,784 | 32,740 | 37,638 | | Acquisition expenses | — | 12 | — | 12 | | Litigation costs | 555 | 401 | 1,062 | 721 | | Loss on ROU assets | — | — | — | 143 | | Gain on sale of property and equipment | (72) | — | (72) | — | | Restructuring costs | — | 595 | — | 2,363 | | **Adjusted EBITDA** | **$45,913** | **$6,034** | **$66,091** | **$(5,946)** | [Non-GAAP Financial Measures Definitions](index=6&type=section&id=3.2%20Non-GAAP%20Financial%20Measures%20Definitions) Alignment Healthcare defines and utilizes Adjusted EBITDA, Medical Benefits Ratio (MBR), and Adjusted Gross Profit as non-GAAP measures to provide a more comprehensive understanding of its operational performance and to aid in internal comparisons and future planning - **Adjusted EBITDA:** Defined as net income (loss) before interest expense, income taxes, depreciation and amortization expense, certain litigation costs, gains or losses on ROU assets, gains or losses on sale of property and equipment, restructuring costs, and equity-based compensation expense - **Medical Benefits Ratio (MBR):** Calculated by dividing total medical expenses (excluding depreciation, equity-based compensation, and clinical restructuring costs) by total revenues - **Adjusted Gross Profit:** Defined as income (loss) from operations before depreciation and amortization, clinical equity-based compensation expense, clinical restructuring costs, and selling, general, and administrative expenses - These non-GAAP measures are used to supplement GAAP results, provide a more complete understanding of operations, and aid management in evaluating financial results and future planning[23](index=23&type=chunk)[24](index=24&type=chunk)[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) [Corporate Information & Disclosures](index=2&type=section&id=Corporate%20Information%20%26%20Disclosures) This section includes details for the Q2 earnings conference call, an overview of Alignment Health's mission, forward-looking statements, and investor/media contact information [Conference Call Details](index=2&type=section&id=4.1%20Conference%20Call%20Details) Alignment Healthcare hosted a conference call on July 30, 2025, to discuss its Q2 results and future outlook, with a live webcast and an on-demand replay available online - **Date & Time:** July 30, 2025, at 5 p.m. EDT - **Live Webcast:** Available at https://ir.alignmenthealth.com/ and https://edge.media-server.com/mmc/p/45vdkr4b - **Replay:** An on-demand webcast replay will be available for approximately 12 months[10](index=10&type=chunk) [About Alignment Health](index=2&type=section&id=4.2%20About%20Alignment%20Health) Alignment Health, a consumer brand of Alignment Healthcare, is dedicated to empowering seniors through high-quality, low-cost Medicare Advantage care, leveraging a customized care model, 24/7 concierge team, and AVA technology, while expanding its national presence - **Mission:** To empower seniors to age well and live vibrant lives by providing high-quality, low-cost Medicare Advantage care - **Care Model:** Delivers coordinated care through a customized model, a 24/7 concierge care team, and proprietary AVA technology - **Core Values:** Emphasizes leading with a serving heart and prioritizing seniors - **Operations:** Based in California, partnering with local providers, and expanding its national footprint[11](index=11&type=chunk)[12](index=12&type=chunk) [Forward-Looking Statements](index=3&type=section&id=4.3%20Forward-Looking%20Statements) This section serves as a cautionary disclosure regarding forward-looking statements, highlighting inherent risks and uncertainties that could cause actual results to differ materially from projections, and clarifies that the company has no obligation to update this information unless legally required - This release contains forward-looking statements concerning future growth and financial outlook for Q3 and FY 2025 - **Key Risks:** Include attracting new members, governmental approvals, maintaining high Star Quality Ratings, provider relationships, risks as a government contractor (e.g., MA funding), regulatory changes, indebtedness, market conditions, litigation, security incidents, and personnel shortages - **Disclaimer:** Actual results may vary materially, and the company undertakes no duty to update this information unless legally required[13](index=13&type=chunk) [Investor & Media Contacts](index=7&type=section&id=4.4%20Investor%20%26%20Media%20Contacts) Contact information is provided for investor relations and media inquiries - **Investor Contact:** Harrison Zhuo (hzhuo@ahcusa.com) - **Media Contact:** Priya Shah of mPR, Inc. (alignment@mpublicrelations.com)[29](index=29&type=chunk)

Core Viewpoint - Alignment Healthcare's second quarter performance demonstrates that strong financial results and high-quality care can coexist with the right model, emphasizing a senior-first approach in Medicare Advantage [2][7]. Financial Highlights - Total revenue for Q2 2025 reached $1,015.3 million, reflecting a 49.0% increase year-over-year [7][8]. - Health plan membership grew to approximately 223,700, marking a 27.8% increase compared to the previous year [7][8]. - Adjusted gross profit was reported at $135.2 million, with an adjusted EBITDA of $45.9 million [8][10]. - The medical benefits ratio based on adjusted gross profit was 86.7% [8]. Outlook - The company raised its full-year outlook for health plan membership, revenue, adjusted gross profit, and adjusted EBITDA, indicating positive growth expectations [7][8]. Operational Performance - Income from operations for Q2 2025 was $22.7 million, a significant improvement from a loss of $18.4 million in Q2 2024 [9][18]. - Net income for the quarter was $15.7 million, compared to a net loss of $24.0 million in the same period last year [9][18]. Balance Sheet - As of June 30, 2025, total assets amounted to $1,000.2 million, with total liabilities at $859.2 million [17]. - Cash and cash equivalents increased to $470.3 million from $432.9 million year-over-year [17][19]. Cash Flow - Net cash provided by operating activities for the six months ended June 30, 2025, was $45.7 million, compared to $17.3 million in the prior year [19][20].

Core Insights - The article introduces Afflare Investments as a new contributing analyst for Seeking Alpha, emphasizing the opportunity for individuals to share investment ideas and gain exposure [1] - The focus of the contributing analyst is on global macro asset allocation and SMid individual stock opportunities, particularly those with high growth potential [2] Group 1 - Afflare Investments aims to enhance investment thesis verification through detailed writing and critical thinking [2] - The approach includes validating management's growth claims against financial results and analyzing the broader economic and industry context [2] Group 2 - The article highlights the importance of independent analysis and personal investment strategies without external compensation or influence [3] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not represent the platform as a whole [4]

Core Insights - Alignment Healthcare, Inc. released its 2024 Impact Report, highlighting its commitment to providing high-quality, personalized care for seniors while positively impacting members, providers, employees, and communities [1][4] Access to Care - The company served 11,500 members through its Care Anywhere program in 2024, marking a 35% increase from 8,500 members in 2023 [5] - There was a 95% year-over-year increase in ACCESS On-Demand Concierge Card transactions, reaching 3.1 million in 2024, with eligible members using the debit card growing from 97,000 in 2023 to 151,000 in 2024 [5] - Caregiver benefit access expanded by almost 86%, with eligible members rising from 63,000 in 2023 to 117,000 in 2024 [5] Health Outcomes - The hospitalization rate reached a record low of 149 per 1,000 members in 2024, down nearly 4.5% from 156 in 2023 [5] - Skilled nursing facility admissions were reported to be 47% fewer compared to the 2019 Medicare fee-for-service benchmark, an increase from a 45% reduction in 2023 [5] Innovative Care Delivery - Enhanced care delivery through the integration of new capabilities in AVA®, including streamlined health risk assessments and virtual care coordination enhancements [5] - Administrative wait time per member was reduced by 45 minutes through AVA's provider integration [5] Member Satisfaction - The percentage of members enrolled in 4-star or higher-rated plans increased from 90% in 2023 to 100% in 2024 [5] - The overall Net Promoter Score (NPS) was 61, significantly higher than the industry average of 40, with the Care Anywhere program earning an NPS of 78 [5] - The company maintained an average Google review rating of 4.9 out of 5 across more than 10,000 reviews [5] Employee Commitment - The company prioritized employee well-being, achieving an 89% participation rate in the annual employee engagement survey and a 77% engagement index [5] Environmental Responsibility - Greenhouse gas emissions were reduced by 36% compared to 2023, equivalent to the annual energy use of 43.5 average U.S. homes or charging 26 million smartphones [5]

Core Insights - IHS Markit is a global leader in critical information, analytics, and solutions for major industries and markets that drive economies worldwide [1] - The company serves over 50,000 key business and government customers, including 80% of the Fortune Global 500 and leading financial institutions [1] - IHS Markit is headquartered in London and is committed to sustainable, profitable growth [1] Company Overview - IHS Markit provides next-generation information, analytics, and solutions aimed at improving operational efficiency for its customers in business, finance, and government [1] - The company focuses on delivering deep insights that enable well-informed and confident decision-making [1]

Group 1 - Alignment Healthcare, Inc. will release its second quarter 2025 financial results on July 30, after market close [1] - A conference call to review the financial results will be held at 5 p.m. EDT on the same day [1] - A live audio webcast of the conference call will be available online, with a replay accessible for approximately 12 months [2] Group 2 - Alignment Health focuses on empowering seniors to age well and live vibrant lives through high-quality, low-cost care [3] - The company partners with trusted local providers to deliver coordinated care, utilizing a customized care model and a 24/7 concierge care team [3] - Alignment Health is based in California and is committed to its core values of serving seniors first as it expands its national footprint [3]