Core Viewpoint - Clover Health positions itself as a leader in AI-enabled healthcare transformation, emphasizing the use of its proprietary AI platform, Clover Assistant, to enhance care delivery, particularly for seniors in underserved communities [1][2][6]. Group 1: AI and Healthcare Transformation - Clover Assistant is deployed across multiple states, serving thousands of healthcare providers and demonstrating measurable improvements in patient outcomes while reducing healthcare costs [2]. - The AI platform enables earlier disease detection, with data showing that diabetes can be diagnosed up to 3 years earlier and chronic kidney disease over 1.5 years earlier, leading to better health outcomes [7][22]. - AI is presented as a tool to enhance, not replace, the role of physicians, with the potential to improve care for all patients [4][14]. Group 2: Economic Impact and Cost Savings - AI-enabled care for congestive heart failure patients has resulted in 18% fewer hospitalizations and 25% fewer readmissions, while COPD patients experience 15% fewer hospitalizations and 18% lower 30-day readmissions [7][28]. - The Medical Cost Ratio for returning members whose doctors use Clover Assistant is over ten percent better than those who do not, allowing Clover to offer lower out-of-pocket costs for members [28]. Group 3: Empowering Providers - Clover Assistant acts as a central hub for a patient's care team, providing tailored views of patient data in specific clinical language, which helps combat physician burnout by automating tedious tasks [7][28]. - The platform is designed to integrate seamlessly into existing workflows, allowing practices to adopt it quickly with minimal training [13][19]. Group 4: Commitment to Responsible AI Use - The company advocates for the responsible use of AI, emphasizing that it should empower healthcare providers and improve patient care without denying or minimizing care [6][28]. - Clover Health calls for standardizing data interoperability to ensure AI can access comprehensive patient histories, which is essential for effective care delivery [29].

Core Viewpoint - Clover Health Investments, Corp. (CLOV) has experienced a significant decline of 25.5% over the past four weeks, but the formation of a hammer chart pattern suggests a potential trend reversal as buying interest may be emerging to counteract selling pressure [1][2]. Technical Analysis - The hammer chart pattern indicates a possible bottoming out, with reduced selling pressure and a potential shift in control from bears to bulls [2][5]. - A hammer pattern forms when there is a small candle body with a long lower wick, typically occurring during a downtrend, signaling that the stock may have found support [4][5]. - The effectiveness of the hammer pattern is enhanced when used alongside other bullish indicators, as its strength is influenced by its placement on the chart [6]. Fundamental Analysis - There has been a positive trend in earnings estimate revisions for CLOV, which is a bullish indicator suggesting potential price appreciation [7]. - The consensus EPS estimate for the current year has increased by 6.3% over the last 30 days, indicating strong agreement among analysts regarding the company's improved earnings potential [8]. - CLOV holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which typically outperform the market [9][10].

Summary of Clover Health Investments (CLOV) FY Conference - August 12, 2025 Company Overview - Clover Health is a tech-enabled insurance company focused on Medicare Advantage, experiencing growth despite industry challenges [3][6] - The company aims to deliver excellent clinical outcomes while providing broad access to healthcare for its members [3][6] Key Industry Insights - The Medicare Advantage market is substantial, valued at approximately $500 billion annually, with around 35 million enrollees in the U.S. [6] - Clover Health's unique approach includes a high percentage of members (97%) enrolled in PPO plans, allowing for wider access [7] Financial Performance - Membership is projected to grow by 32% in 2025, with revenue growth expected at 37% [7] - The company has maintained adjusted EBITDA profitability year-over-year, with flat profitability compared to the first half of the previous year [7][19] - Positive cash flow from operating activities was reported at approximately $84 million in 2024 [18] Technology and Clinical Outcomes - Clover Assistant, powered by machine learning and AI, enables physicians to diagnose and treat diseases earlier, leading to better health outcomes and lower total care costs [6][10] - Physicians using Clover Assistant can identify and treat chronic diseases significantly earlier, with diabetes treatment starting on average 36 months earlier [12] - The company boasts a high HEDIS score of 4.94 out of 5, indicating strong clinical quality [14] Business Model Differentiation - Clover Health's model emphasizes a clinical approach at the point of care, contrasting with traditional players that focus on back-office operations [15][16] - The company does not engage in traditional risk delegation, which is common among competitors [16] Growth Strategy - Clover Health is focused on expanding its presence in core markets: New Jersey, Georgia, South Carolina, and Texas, where it holds a 12% market share in New Jersey [20][21] - The company is also exploring opportunities to offer its technology to third-party providers and payers, enhancing its revenue model [22] Future Outlook - Membership and revenue growth are expected to accelerate, with a potential increase in profitability for 2026 [23] - The transition from a three-and-a-half-star to a four-star payment year is anticipated to add around 5% in premium fees [41] - The company is preparing for the upcoming Annual Enrollment Period (AEP) with a strategy focused on precise growth [33] Additional Considerations - Clover Health is investing in R&D and quality improvements while managing costs through efficiency programs [19] - The company is addressing higher utilization trends in Part D and expects a 40% increase in direct subsidies from CMS next year [28] This summary encapsulates the key points discussed during the conference, highlighting Clover Health's unique position in the Medicare Advantage market, its technological advancements, and its growth strategies moving forward.

Financial Performance & Growth - Clover Health anticipates insurance revenue of $1.8 billion to $1.875 billion for full year 2025[50] - The company projects Adjusted EBITDA between $50 million and $70 million for full year 2025[9, 50] - Clover Health expects a 32% year-over-year increase in Medicare Advantage (MA) membership in 2025[9, 44] - Clover Health's Insurance Benefits Expense Ratio (BER) for the first half of 2025 was 87.3%[24] Clover Assistant & Clinical Outcomes - Clover Assistant (CA) is associated with earlier diagnosis of Chronic Kidney Disease (CKD) by approximately 18 months on average[18] - Clover Assistant is associated with 15% lower all-cause hospitalizations and 18% lower 30-day readmissions for members with Chronic Obstructive Pulmonary Disease (COPD)[18, 20] - Clover Health achieved a 4.94 out of 5 Stars on HEDIS measures for Star Rating year 2025, the top-performing score on core HEDIS measures for Medicare Advantage plans with over 2,000 members nationwide[18] Strategic Initiatives - Clover Health is focused on a ~$500 billion market with over 35 million seniors enrolled in Medicare Advantage[8] - Clover Health's Counterpart Health subsidiary aims to expand the company's care model to more plans and providers[8] - Approximately 97% of Clover Health's membership is enrolled in PPO plans[8, 49]

Last week, Clover Health Investments, Corp. (NASDAQ: CLOV ) reported its Q2 earnings, showing continued exponential growth in members and revenues. However, the stock dropped as much as 30% since then due to industry-wide heightened medical costs as a result of the implementation of a Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed abo ...

[Filing Information](index=1&type=section&id=Filing%20Information) This section provides details on the Form 10-Q filing, including registrant status and outstanding shares [Form 10-Q Details](index=1&type=section&id=Form%2010-Q%20Details) Details of the Form 10-Q filing, including registrant status and outstanding Class A and B Common Stock - The company is an **accelerated filer**[3](index=3&type=chunk)[4](index=4&type=chunk) Outstanding Shares as of August 1, 2025 | Class of Stock | Shares Outstanding | | :--------------- | :----------------- | | Class A Common Stock | 420,139,394 | | Class B Common Stock | 92,373,157 | [Cautionary Note Regarding Forward-Looking Statements](index=3&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section outlines the inherent risks and uncertainties associated with forward-looking statements in the report [Forward-Looking Statements and Risks](index=3&type=section&id=Forward-Looking%20Statements%20and%20Risks) Forward-looking statements are subject to risks concerning financial performance, business strategy, regulatory changes, and market conditions - Forward-looking statements are subject to risks including those related to **financial performance**, **business strategy**, **regulatory environment**, and **market conditions**[11](index=11&type=chunk)[13](index=13&type=chunk) - Risks include expectations regarding results of operations, financial condition, and cash flows - Ability to maintain and increase adoption and use of Clover Assistant, including expansion for external payors and providers - Impact of current, pending, or future legislation, regulations, or policies on revenue, profit margins, and cash flows - Ability to maintain or improve Star Ratings and financial performance - General economic conditions, persistent high inflation, and fluctuating interest rates [Additional Information and Disclosure Channels](index=4&type=section&id=Additional%20Information%20and%20Disclosure%20Channels) This section details where additional company information and SEC filings can be accessed, including digital channels [Company Website and Social Media](index=4&type=section&id=Company%20Website%20and%20Social%20Media) Company information and SEC filings are available on its website and investor relations page, with social media also used for disclosures - Company filings are available free of charge on its website **www.cloverhealth.com** and the SEC website[16](index=16&type=chunk) - Material information is routinely announced via SEC filings, press releases, public conference calls, presentations, webcasts, and the **investor relations page (investors.cloverhealth.com)**[17](index=17&type=chunk) - Social media channels (**@CloverHealth, CloverHealth on X**, and LinkedIn accounts of CEO/CFO) are also used for disclosing company information[17](index=17&type=chunk) [PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the unaudited condensed consolidated financial statements and management's discussion and analysis [Item 1. Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Unaudited condensed consolidated financial statements, including Balance Sheets, Statements of Operations, Equity, and Cash Flows, with explanatory notes [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position, detailing assets, liabilities, and stockholders' equity at specific dates Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | **Assets** | | | | Cash and cash equivalents | $188,648 | $194,543 | | Total current assets | $362,939 | $343,124 | | Total assets | $574,987 | $580,742 | | **Liabilities** | | | | Unpaid claims | $139,660 | $156,396 | | Total current liabilities | $201,948 | $213,516 | | Total liabilities | $230,808 | $239,599 | | **Stockholders' Equity** | | | | Total stockholders' equity | $344,179 | $341,143 | | Total liabilities and stockholders' equity | $574,987 | $580,742 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) This section outlines the company's financial performance, including revenues, expenses, and net income or loss over specific periods Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands, except per share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Premiums earned, net | $469,826 | $349,900 | $926,732 | $691,622 | | Other income | $7,794 | $6,360 | $13,219 | $11,560 | | Total revenues | $477,620 | $356,260 | $939,951 | $703,182 | | Net medical claims incurred | $377,992 | $248,347 | $731,434 | $513,509 | | Total operating expenses | $488,179 | $349,073 | $951,784 | $718,698 | | Net (loss) income from continuing operations | $(10,578) | $7,170 | $(11,852) | $(16,000) | | Net (loss) income | $(10,578) | $7,408 | $(11,852) | $(11,762) | | Basic (loss) earnings per share (continuing operations) | $(0.02) | $0.01 | $(0.02) | $(0.03) | | Diluted (loss) earnings per share (continuing operations) | $(0.02) | $0.01 | $(0.02) | $(0.03) | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity) This section details the changes in stockholders' equity, reflecting impacts from net loss, stock-based compensation, and repurchases Changes in Stockholders' Equity (in thousands) | Metric | Balance, Dec 31, 2024 | Stock-based compensation | Repurchases of common stock | Net loss | Balance, June 30, 2025 | | :----------------------------------- | :-------------------- | :----------------------- | :-------------------------- | :------- | :--------------------- | | Total stockholders' equity | $341,143 | $52,632 | $(18,298) | $(11,852) | $344,179 | - Total stockholders' equity increased from **$341,143 thousand** at December 31, 2024, to **$344,179 thousand** at June 30, 2025, primarily due to **stock-based compensation** and unrealized gains on investments, partially offset by net loss and common stock repurchases[25](index=25&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes cash inflows and outflows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | $(10,885) | $70,692 | | Net cash provided by investing activities | $44,496 | $14,139 | | Net cash used in financing activities | $(39,506) | $(6,554) | | Net (decrease) increase in cash and cash equivalents | $(5,895) | $78,277 | | Cash and cash equivalents, end of period | $188,648 | $254,771 | - Net cash used in operating activities from continuing operations was **$(10.9) million** for the six months ended June 30, 2025, a significant decrease from **$79.7 million** provided in the prior year, primarily due to a net loss and changes in operating assets and liabilities[27](index=27&type=chunk)[147](index=147&type=chunk)[148](index=148&type=chunk) - Net cash provided by investing activities increased to **$44.5 million** in 2025 from **$14.1 million** in 2024, driven by higher proceeds from sales and maturities of investment securities[27](index=27&type=chunk)[149](index=149&type=chunk)[150](index=150&type=chunk) - Net cash used in financing activities increased to **$(39.5) million** in 2025 from **$(6.6) million** in 2024, mainly due to cash paid for shares withheld related to stock-based compensation and common stock repurchases[27](index=27&type=chunk)[151](index=151&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the condensed consolidated financial statements [Note 1. Organization and Operations](index=10&type=section&id=Note%201.%20Organization%20and%20Operations) Clover Health leverages its Clover Assistant platform to improve care and launched Counterpart Health for external MA payors - Clover Health's core strategy is to use its **Clover Assistant technology** to help seniors receive better care at lower costs by empowering physicians to identify and manage chronic diseases early[29](index=29&type=chunk)[31](index=31&type=chunk) - In 2024, the company launched **Counterpart Health, Inc.**, a Software-as-a-Service (SaaS) and Tech Enabled Services Solution, to offer its AI-powered care management platform to external Medicare Advantage payors and providers, aiming for new growth and high-margin business opportunities[32](index=32&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=10&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the company's key accounting policies, estimates, and the evaluation of recent accounting pronouncements - The Company operates as one reportable segment, **'Insurance'**, providing PPO and HMO plans to Medicare Advantage members[40](index=40&type=chunk) - Significant estimates are made for **incurred but not reported claims**, which are subject to variability from economic conditions, healthcare policy changes, and medical technology advancements[36](index=36&type=chunk) - The Company is evaluating the impact of new accounting pronouncements **ASU 2023-09 (Income Taxes)** and **ASU 2024-03 (Expense Disaggregation Disclosures)** on future financial statements[45](index=45&type=chunk)[46](index=46&type=chunk) [Note 3. Investment Securities](index=12&type=section&id=Note%203.%20Investment%20Securities) Details on the company's investment portfolio, including fair value, net investment income, and credit quality of securities Investment Securities Fair Value (in thousands) | Category | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Total held-to-maturity and available-for-sale investment securities | $200,462 | $242,644 | Net Investment Income (in thousands) | Period | 2025 | 2024 | | :----------------------------------- | :----- | :----- | | Three Months Ended June 30, | $4,682 | $5,734 | | Six Months Ended June 30, | $9,290 | $10,201 | - All investment securities were **investment grade (BBB or higher)** at June 30, 2025, with unrealized losses primarily due to changes in interest rates[50](index=50&type=chunk) [Note 4. Fair Value Measurements](index=14&type=section&id=Note%204.%20Fair%20Value%20Measurements) Fair value measurements of financial instruments, primarily Level 2 debt securities and Level 3 private warrants receivable Total Assets at Fair Value (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Total assets at fair value | $190,990 | $229,480 | | Warrants receivable (Level 3) | $745 | $764 | - Private warrants receivable, classified as **Level 3**, decreased slightly due to unrealized losses of less than **$0.1 million** for the six months ended June 30, 2025[53](index=53&type=chunk)[54](index=54&type=chunk) [Note 5. Healthcare Receivables](index=15&type=section&id=Note%205.%20Healthcare%20Receivables) Overview of healthcare receivables, including pharmaceutical rebates and Medicare Part D settlements, showing a decrease from prior period Healthcare Receivables (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Healthcare receivables | $46,893 | $51,539 | [Note 6. Related Party Transactions](index=15&type=section&id=Note%206.%20Related%20Party%20Transactions) Details on related party transactions, including expenses with CarePoint Health, Credo Health, and Thyme Care Related Party Expenses (in thousands) | Related Party | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | | CarePoint Health | $4,400 | $2,800 | | Credo Health Solutions, Inc. | $300 | $400 | | Thyme Care, Inc. | $4,200 | $2,300 | - **CarePoint Health** is no longer considered a related party as of May 22, 2025, following its emergence from Chapter 11 bankruptcy[57](index=57&type=chunk) [Note 7. Unpaid Claims](index=16&type=section&id=Note%207.%20Unpaid%20Claims) Analysis of unpaid claims liability, including favorable development and faster processing of current year medical claims Unpaid Claims Activity (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Gross and net balance, beginning of period | $156,396 | $137,100 | | Total incurred | $715,819 | $503,606 | | Total paid | $732,555 | $440,156 | | Gross and net balance, end of period | $139,660 | $200,550 | - Favorable development of **$2.8 million** recognized for prior years' claims in H1 2025, compared to **$28.0 million** in H1 2024[62](index=62&type=chunk) - Current year medical claims paid as a percentage of current year Net medical claims incurred increased to **81.7%** in H1 2025 (from **67.6%** in H1 2024), indicating faster claims processing[62](index=62&type=chunk) [Note 8. Variable Interest Entity and Equity Method of Accounting](index=17&type=section&id=Note%208.%20Variable%20Interest%20Entity%20and%20Equity%20Method%20of%20Accounting) Details on the company's equity method investment in Character Biosciences, Inc., with no shared loss recognized - Clover Health's ownership in **Character Biosciences, Inc.** decreased to approximately **9.1%** by June 30, 2025[63](index=63&type=chunk) - No shared loss was recognized for the three and six months ended June 30, 2025, as the investment carrying amount was reduced to zero by cumulative shared losses as of **March 31, 2024**[65](index=65&type=chunk) [Note 9. Employee Benefit Plans](index=17&type=section&id=Note%209.%20Employee%20Benefit%20Plans) Overview of employee benefit plans, including 401(k) and equity incentive plans, and stock-based compensation expense Stock-based Compensation Expense (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Stock options | $116 | $530 | $294 | $1,148 | | RSUs | $23,069 | $20,400 | $46,093 | $41,317 | | PRSUs | $2,904 | $6,944 | $5,987 | $14,157 | | ESPP | $106 | $26 | $258 | $76 | | Total compensation cost | $26,195 | $27,900 | $52,632 | $56,698 | - Unrecognized stock-based compensation expense totaled approximately **$363.0 million** at June 30, 2025[73](index=73&type=chunk) - The **2020 Plan** includes an evergreen provision for increasing shares available for issuance, with a reduction in the percentage for fiscal years beginning with 2025[69](index=69&type=chunk) [Note 10. Income Taxes](index=21&type=section&id=Note%2010.%20Income%20Taxes) Discussion of the company's 0.0% effective tax rate due to net operating losses and valuation allowance, and OBBBA evaluation - The effective tax rate was **0.0%** for both the three and six months ended June 30, 2025 and 2024, due to net operating losses and a full valuation allowance[83](index=83&type=chunk) - The company is currently evaluating the financial impact of the **One Big Beautiful Bill Act (OBBBA)** on its US federal corporate income tax system[84](index=84&type=chunk) [Note 11. Net (Loss) Income per Share](index=22&type=section&id=Note%2011.%20Net%20(Loss)%20Income%20per%20Share) Analysis of net loss per share, with potentially dilutive securities excluded due to anti-dilutive effects during loss periods Net (Loss) Income per Share (Continuing Operations) | Metric | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :----------------------------------- | :------------------------------- | :----------------------------- | | Basic (loss) earnings per share | $(0.02) | $(0.02) | | Diluted (loss) earnings per share | $(0.02) | $(0.02) | Potentially Dilutive Shares Excluded (in thousands) | Type of Shares | June 30, 2025 (3 months) | June 30, 2025 (6 months) | | :----------------------------------- | :----------------------- | :----------------------- | | Options to purchase common stock | 23,993,192 | 23,993,192 | | RSUs | 41,224,131 | 41,224,131 | | PRSUs | 28,799,293 | 28,799,293 | | Total potentially dilutive shares excluded | 94,016,616 | 94,016,616 | - Potentially dilutive securities were excluded from diluted EPS calculations for periods with net losses because their inclusion would be **anti-dilutive**[85](index=85&type=chunk) [Note 12. Commitments and Contingencies](index=23&type=section&id=Note%2012.%20Commitments%20and%20Contingencies) Overview of legal proceedings, including the conclusion of an SEC investigation and settlements of class action and derivative lawsuits - The **SEC investigation**, initiated in February 2021, concluded on **September 26, 2024**, with the Staff not recommending an enforcement action against the company[88](index=88&type=chunk) - A securities class action was settled for **$22 million**, with **$19.5 million** funded by insurance proceeds[89](index=89&type=chunk) - Shareholder derivative actions were settled, resulting in **corporate governance enhancements** and a **$2.5 million** payment for plaintiffs' counsel fees, with no monetary payment from the company[90](index=90&type=chunk) [Note 13. Operating Segments](index=24&type=section&id=Note%2013.%20Operating%20Segments) The company operates solely through its Insurance segment, reporting net losses for the three and six months ended June 30, 2025 - The company operates solely through its **Insurance segment**, offering PPO and HMO Medicare Advantage plans[91](index=91&type=chunk) Insurance Segment Net (Loss) Income (in thousands) | Period | 2025 | 2024 | | :----------------------------------- | :---------- | :---------- | | Three Months Ended June 30, | $(32,388) | $2,355 | | Six Months Ended June 30, | $(51,771) | $(24,226) | [Note 14. Dividend Restrictions](index=24&type=section&id=Note%2014.%20Dividend%20Restrictions) State regulations restrict dividend payments from regulated insurance subsidiaries to the parent company, with no dividends paid to date - Regulated insurance subsidiaries are subject to **state regulations** limiting dividend payments to the parent company[93](index=93&type=chunk) - No dividends were authorized or paid by the regulated insurance subsidiaries as of **June 30, 2025**[93](index=93&type=chunk) [Note 15. Restructuring costs](index=25&type=section&id=Note%2015.%20Restructuring%20costs) Business transformation initiatives concluded by December 31, 2024, resulting in no restructuring costs for the current periods - Business transformation initiatives, including a **workforce reduction** and **platform migration**, were concluded by **December 31, 2024**[94](index=94&type=chunk) Restructuring Costs (in thousands) | Period | 2025 | 2024 | | :----------------------------------- | :--- | :--- | | Three Months Ended June 30, | $0 | $473 | | Six Months Ended June 30, | $0 | $826 | [Note 16. Discontinued Operations](index=25&type=section&id=Note%2016.%20Discontinued%20Operations) Clover Health exited the ACO REACH Program, resulting in no net income from discontinued operations for current periods - Clover Health exited the **ACO REACH Program**, effective for the 2024 performance year, with remaining activities related to the December 2024 settlement for prior performance years[95](index=95&type=chunk) Net Income from Discontinued Operations (in thousands) | Period | 2025 | 2024 | | :----------------------------------- | :--- | :--- | | Three Months Ended June 30, | $0 | $238 | | Six Months Ended June 30, | $0 | $4,238 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion and analysis of financial condition, results of operations, liquidity, and capital resources, including key performance measures [Overview](index=26&type=section&id=Overview) Clover Health's strategy focuses on empowering physicians with Clover Assistant to improve care and lower costs for Medicare Advantage members - Clover Health's vision is to empower physicians with **Clover Assistant technology** to identify, manage, and treat chronic diseases earlier, thereby improving care and lowering costs for Medicare beneficiaries[97](index=97&type=chunk) - As of June 30, 2025, the company operated MA plans in **five states** and **200 counties**, serving **106,323 members**[98](index=98&type=chunk) [Key Performance Measures](index=26&type=section&id=Key%20Performance%20Measures) Key performance measures for the Insurance segment include membership, premiums earned, medical claim expenses, and various ratios - The company's key performance measures include **Insurance members at period end**, **Premiums earned (gross and net)**, **Insurance medical claim expense incurred (gross and net)**, **Benefits expense ratio (gross and net)**, **Adjusted SG&A**, **Adjusted EBITDA**, and **Adjusted Net income from continuing operations**[103](index=103&type=chunk) Key Financial Measures (in thousands, except PMPM) | Metric | June 30, 2025 | June 30, 2024 | | :----------------------------------- | :-------------- | :-------------- | | Insurance members at period end () | 106,323 | 80,261 | | Premiums earned, net | $469,826 | $349,900 | | Insurance net medical claims incurred | $394,212 | $249,406 | | Benefits expense ratio, net | 88.4% | 76.1% | - **Member growth and retention** are key to driving total revenues, expanding brand awareness, deepening market penetration, and generating data for Clover Assistant to improve care and decrease medical claim expenses[104](index=104&type=chunk) [Non-GAAP Financial Measures](index=28&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP financial measures like Adjusted SG&A and Adjusted EBITDA are used to assess core operating performance by excluding non-cash and non-recurring items - **Insurance BER (Benefits expense ratio):** Calculated as total Insurance net medical expenses incurred and quality improvements divided by net premiums earned. It provides a comprehensive view of costs related to maintaining and improving care quality[114](index=114&type=chunk) - **Adjusted SG&A:** Total SG&A less stock-based compensation and non-recurring legal expenses/settlements, offering insight into core operating expenses and operational leverage[117](index=117&type=chunk) - **Adjusted EBITDA:** Net (loss) income from continuing operations before depreciation, loss on investment, interest expense, change in fair value of warrants, stock-based compensation, premium deficiency reserve benefit, restructuring costs, impairment, and non-recurring legal expenses/settlements. Used to evaluate operating performance and trends[119](index=119&type=chunk) - **Adjusted Net income from continuing operations:** Net (loss) income from continuing operations before stock-based compensation, premium deficiency reserve benefit, restructuring costs, non-recurring legal expenses/settlements, and impairment. Helps assess financial performance by excluding certain non-cash and non-recurring items[121](index=121&type=chunk) Non-GAAP Financial Measures (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Benefits expense ratio, net | 88.4% | 76.1% | 87.3% | 79.6% | | Adjusted SG&A | $82,493 | $71,704 | $165,600 | $146,644 | | Adjusted EBITDA | $17,135 | $36,209 | $42,917 | $43,029 | | Adjusted Net income from continuing operations | $16,722 | $35,862 | $42,038 | $41,897 | [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Analysis of revenue growth, medical claims, and operating expenses, resulting in a net loss from continuing operations for the current periods [Comparison of the Three Months Ended June 30, 2025 and 2024](index=31&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030%2C%202025%20and%202024) Total revenues increased by 34.1% to $477.6 million, driven by member growth, but net medical claims incurred surged by 52.2%, leading to a net loss Three Months Ended June 30, 2025 vs. 2024 (in thousands) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Premiums earned, net | $469,826 | $349,900 | $119,926 | 34.3% | | Total revenues | $477,620 | $356,260 | $121,360 | 34.1% | | Net medical claims incurred | $377,992 | $248,347 | $129,645 | 52.2% | | Salaries and benefits | $61,309 | $55,499 | $5,810 | 10.5% | | General and administrative expenses | $48,484 | $44,424 | $4,060 | 9.1% | | Net (loss) income from continuing operations | $(10,578) | $7,170 | $(17,748) | * | | Net (loss) income | $(10,578) | $7,408 | $(17,986) | * | - Premiums earned, net increased by **34%** primarily due to approximately **32% growth in average members**[125](index=125&type=chunk) - Net medical claims incurred increased by **52%** due to member growth and increased Part D cost sharing from the Inflation Reduction Act, as well as less favorable prior period developments compared to the current year[127](index=127&type=chunk) [Comparison of the Six Months Ended June 30, 2025 and 2024](index=32&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Total revenues increased by 33.7% to $939.9 million, driven by member growth, with net medical claims incurred up 42.4%, resulting in a net loss Six Months Ended June 30, 2025 vs. 2024 (in thousands) | Metric | 2025 | 2024 | Change ($) | Change (%) | | :----------------------------------- | :----- | :----- | :--------- | :--------- | | Premiums earned, net | $926,732 | $691,622 | $235,110 | 34.0% | | Total revenues | $939,951 | $703,182 | $236,769 | 33.7% | | Net medical claims incurred | $731,434 | $513,509 | $217,925 | 42.4% | | Salaries and benefits | $120,331 | $114,722 | $5,609 | 4.9% | | General and administrative expenses | $99,159 | $88,993 | $10,166 | 11.4% | | Net loss from continuing operations | $(11,852) | $(16,000) | $4,148 | (25.9%) | | Net loss | $(11,852) | $(11,762) | $(90) | 0.8% | - Premiums earned, net increased by **34%** primarily due to approximately **30% growth in average members**[132](index=132&type=chunk) - Net medical claims incurred increased by **42%** due to member growth and increased Part D cost sharing from the Inflation Reduction Act, as well as less favorable prior period developments compared to the current year[134](index=134&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity, comprising cash, cash equivalents, and investments, decreased to $389.3 million, but is expected to meet future requirements Cash, Cash Equivalents, and Investments (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :---------------- | | Total cash, cash equivalents, and investments | $389,300 | $437,600 | | Unregulated Entities (Parent & Unregulated Subs) | $145,900 | $151,500 | | Regulated Entities (Regulated Subs) | $243,400 | $286,100 | Cash Flows from Continuing Operations (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :----------------------------- | :----------------------------- | | Net cash (used in) provided by operating activities | $(10,885) | $79,697 | | Net cash provided by investing activities | $44,496 | $14,139 | | Net cash used in financing activities | $(39,506) | $(6,554) | - The company expects current cash, investments, and projected cash flows to be sufficient for operating and regulatory requirements for the **next 12 months**[138](index=138&type=chunk) [Contractual Obligations and Commitments](index=35&type=section&id=Contractual%20Obligations%20and%20Commitments) Material cash requirements include $2.8 million in operating lease obligations, expected to be met by current resources and projected cash flows - Material cash requirements from known contractual obligations at June 30, 2025, include **$2.8 million** in operating lease obligations[154](index=154&type=chunk) - The company does not have any **off-balance sheet arrangements** that are reasonably likely to have a material effect on its financial condition or results of operations[156](index=156&type=chunk) [Indemnification Agreements](index=35&type=section&id=Indemnification%20Agreements) The company routinely enters into indemnification agreements with various parties to protect them from third-party claims - The company enters into **indemnification agreements** with various parties in the ordinary course of business, agreeing to defend and indemnify them from third-party claims related to the company's obligations[155](index=155&type=chunk) [Critical Accounting Policies and Estimates](index=35&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) No significant changes occurred in critical accounting policies and estimates during the three months ended June 30, 2025 - No significant changes in **critical accounting policies and estimates** occurred during the three months ended June 30, 2025[157](index=157&type=chunk) [Recently Issued and Adopted Accounting Pronouncements](index=35&type=section&id=Recently%20Issued%20and%20Adopted%20Accounting%20Pronouncements) Information on recently issued and adopted accounting pronouncements is detailed in Note 2, 'Summary of Significant Accounting Policies' - Details on recently issued and adopted accounting pronouncements are provided in **Note 2, 'Summary of Significant Accounting Policies'**[158](index=158&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk from fixed-maturity investments, managed by investing in high-quality, diversified securities - The primary market risk is **interest rate risk** from fixed-maturity investments, mainly U.S. government debt securities[159](index=159&type=chunk)[161](index=161&type=chunk) - **Credit risk** is managed by investing in high-quality, diversified securities; all fixed-maturity securities were **investment grade (BBB or higher)** at June 30, 2025[160](index=160&type=chunk)[161](index=161&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes in internal control over financial reporting - **Disclosure controls and procedures** were evaluated and deemed effective as of June 30, 2025[162](index=162&type=chunk) - No material changes in **internal control over financial reporting** occurred during the most recent fiscal quarter[164](index=164&type=chunk) [PART II. OTHER INFORMATION](index=37&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part covers other information including legal proceedings, risk factors, equity sales, defaults, and exhibits [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings and investigations, with further details referenced in Note 12 - The company is subject to various **legal proceedings and investigations** incidental to its highly regulated business[167](index=167&type=chunk) - Further details on legal proceedings are incorporated by reference from **Note 12 (Commitments and Contingencies)**[168](index=168&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from the 2024 Form 10-K, but the company remains exposed to various business and financial risks - No material changes to **risk factors** from the 2024 Form 10-K, except as updated in subsequent filings[169](index=169&type=chunk) - The company is exposed to a variety of risks that could adversely affect its **financial results and condition**, and the market price of its Class A common stock[169](index=169&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report during the period - No **unregistered sales of equity securities** or use of proceeds to report[170](index=170&type=chunk) [Item 3. Defaults Upon Senior Securities](index=37&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report during the period - No **defaults upon senior securities** to report[170](index=170&type=chunk) [Item 4. Mine Safety Disclosures](index=37&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine Safety Disclosures are not applicable to the company's operations - **Mine Safety Disclosures** are not applicable to the company[171](index=171&type=chunk) [Item 5. Other Information](index=37&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted or terminated **Rule 10b5-1** or **non-Rule 10b5-1 trading arrangements** during the three months ended June 30, 2025[172](index=172&type=chunk) [Item 6. Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including officer certifications and Inline XBRL documents - The exhibits include **certifications from the Principal Executive Officer and Principal Financial Officer**, as well as Inline XBRL documents[173](index=173&type=chunk) [Signatures](index=39&type=section&id=Signatures) This section contains the official signatures of the company's Chief Executive Officer and Chief Financial Officer [Signatures](index=39&type=section&id=Signatures) The report is officially signed by the Chief Executive Officer and Chief Financial Officer on August 8, 2025 - The report is signed by **Andrew Toy, Chief Executive Officer**, and **Peter Kuipers, Chief Financial Officer**, on **August 8, 2025**[179](index=179&type=chunk)

During Q2 2025, GAAP revenue rose 34.0% from the prior year, GAAP revenue outpaced consensus estimates. The company credited this result mainly to a surge in Medicare Advantage membership, which finished at 106,323 as of June 30, 2025.—up 32% year-over-year from last year's 80,261. Insurance revenue closely matched total revenue, a sign that core health plan operations drove most of the top-line improvement. Clover Health Investments (CLOV -1.04%), a technology-focused Medicare Advantage insurer, reported i ...

Clover Health Investments, Corp. (CLOV) came out with quarterly earnings of $0.03 per share, in line with the Zacks Consensus Estimate . This compares to earnings of $0.01 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this company would post a loss of $0.07 per share when it actually produced earnings of $0.05, delivering a surprise of +171.43%.Over the last four quarters, the company has surpassed consensus EPS estimates three times.Clover Hea ...

Financial Data and Key Metrics Changes - The company reported a 32% year-over-year growth in Medicare Advantage membership, reaching over 106,000 members [20] - Insurance revenue increased by 34% to $470 million in Q2 2025, with year-to-date revenue at $927 million [20] - Adjusted EBITDA for Q2 2025 was $70 million, maintaining year-to-date adjusted EBITDA at $43 million [24] - GAAP net loss improved by $4 million year-to-date to $12 million [19][24] - The insurance benefit expense ratio (BER) was reported at 88.4%, up from 76.1% in 2024 [24] Business Line Data and Key Metrics Changes - The Medicare Advantage segment continues to show robust growth, with a focus on leveraging technology to enhance care management [5][8] - The company is experiencing elevated utilization levels in supplemental benefits and Part D, which are being monitored closely [21][22] Market Data and Key Metrics Changes - The company is insulated from broader industry pressures affecting Medicaid and ACA markets due to its focus on Medicare Advantage [10] - The Part D direct subsidy rate for 2026 is significantly higher than for 2025, indicating potential cost pressures that may alleviate in 2026 [12] Company Strategy and Development Direction - The company aims to achieve profitability, return to growth while sustaining profitability, and leverage its differentiated model for accelerated growth [6] - The focus remains on expanding the reach of Clover Assistant and enhancing member retention in existing markets [14] - The company is strategically positioned for a four-star payment year in 2026, which is expected to provide financial tailwinds [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the upcoming membership growth season, potentially stronger than the current year [7] - The company is closely monitoring the impacts of the Part D IRA changes and anticipates variability in performance modeling [11] - Management believes that the technology-centric care delivery model will differentiate the company amidst industry pressures [12][13] Other Important Information - The company has maintained a strong cash position with $389 million in cash and investments as of Q2 2025 [26] - Days in claims payable decreased to 32 days, indicating normalization of claims inventory [25] Q&A Session Summary Question: How much conservatism is embedded in the raised guidance on the BER? - The increase in the BER guidance is primarily related to Part D and supplemental benefits, with initiatives in place to monitor these trends going forward [36][37] Question: When did the pressures start emerging, and how much was captured in the bids for next year? - The pressures, especially on Part D, have been tracked throughout the year, with adjustments made in pricing for bids [38][39] Question: What are the drivers for improvements in adjusted SG&A? - Improvements are mainly due to cost efficiencies and renegotiations with partners, reflecting the company's strong growth [41][42] Question: What response has been received from the COPD white paper? - The company plans to continue producing similar papers to highlight the benefits of using Clover Assistant in managing care [43][44] Question: Is the elevated cost trend localized or broad-based? - The elevated cost trends are not specific to new or returning members and are being monitored across the board [48][50] Question: How is the competitive landscape changing for the upcoming AEP? - Competitors are pulling back in certain areas, particularly within PPO networks, which may benefit the company due to its strong positioning [51][52]

Second Quarter 2025 Earnings Conference Call August 5, 2025 LGTMs: Date: Andrew T. (Input) Verbal LGTM 8/1 Peter K. LGTM 8/1 af Legal (Karen / Peter R.) LGTM 8/4 Accounting (#s confirm) LGTM (7/31 - Joe) Disclaimer This presentation and the accompanying oral presentation include forward-looking statements, including, without limitation, statements regarding future events and Clover Health Investments, Corp.'s ("Clover Health," "we," "our," or "us") expectations regarding Adjusted EBITDA, Adjusted Net income ...