Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion analyzes our financial condition and results of operations and should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q (our "Form 10-Q"). This discussion contains forward-looking statements that involve risks and uncertainties. See "Forward-Looking Statements." When reviewing the discussion below, you should keep in mind the substantial risks and uncertainties that characterize our business. Known material factors that could affect our financial performance and actual results, and could cause actual results to differ materially from those expressed or implied in any forward-looking statements included in this discussion or otherwise made by our management, are described in Item 2 of Part I of this Form 10-Q, and in Item 1A, "Risk Factors" of Part I of our Annual Report on Form 10-K for the year ended December 31, 2024 (our "Form 10-K"). Factors that could cause or contribute to such difference are not limited to those identified in "Risk Factors." When used in the following discussion, "Senior" patients and populations mean individuals who are aged 65 and older, "Specialty" patients and populations mean individuals who have unique, specialized and most often chronic/life-long health conditions and needs, and "Behavioral" patients and populations mean individuals with intellectual and developmental disabilities including mental illness.

Overview

We are a leading home and community-based healthcare services platform, focused on delivering complementary pharmacy and provider services to complex patients. We have a differentiated approach to care delivery, with an integrated and scaled model that addresses critical services that the highest-need and highest-cost patients require. With a focus on Senior and Specialty patients, which includes Behavioral populations, our platform provides pharmacy and provider services (both clinical and supportive care in nature) in lower-cost home and community settings largely to Medicare, Medicaid, and commercially-insured populations. We are an essential part of our nation's health delivery network as a front-line provider of high-quality and cost-effective care to a large and growing number of people, who increasingly require a combination of specialized solutions to enable holistic health care management. Our presence spans all 50 states, we serve over 460,000 patients daily through our approximately 10,500 clinical providers and pharmacists, and our services make a profound impact in the lives and communities of the people we serve.

On January 17, 2025, the Company entered into a purchase agreement with National Mentor Holding, Inc. to divest our community living services, home and community based waiver programs, and intermediate care facilities (the "Community Living business"), for $835 million, subject to typical adjustments for working capital and other customary items. We expect the divestiture to close in the first fiscal quarter of 2026, subject to customary closing conditions. This transaction provides for continuity of important intellectual and developmental disability services while BrightSpring focuses on a concentrated group of customers, patients and stakeholders in the future. We believe the Company's streamlined service offerings will result in increased strategic focus, operational efficiencies, a refined payer mix, and greater clinical integration and business synergy across the Provider Services segment. The divestiture will also augment our expected Revenue and Adjusted EBITDA growth rates and maximize exposure to target growth markets that require BrightSpring's needed and valuable solutions, such as home health, rehab, primary care, and hospice.

The Company has determined the divestiture of the Community Living business represents a strategic shift that will have a major effect on its business and therefore met the criteria for classification as discontinued operations in the first fiscal quarter of 2025. As a result, in accordance with ASC 205-20, the financial results of the Community Living business, which were previously reported as part of our Provider Services segment, have been classified as discontinued operations in the unaudited condensed consolidated statements of operations, and the Community Living business's assets and liabilities have been classified as held for sale for all periods presented. Unless otherwise noted, amounts and disclosures throughout this Management's Discussion and Analysis relate to our continuing operations. Refer to "PART I - Item 1. Note 2" of our Form 10-K for additional information regarding discontinued operations.

For additional overview of our business, see "PART I - Item 1. Business" of our Form 10-K.

Financial Performance Highlights: Third Quarter of 2025 Compared to Third Quarter of 2024

(1)Reconciliation of GAAP to non-GAAP results is provided below under the section entitled "Non-GAAP Financial Measures."

Financial Performance Highlights: Third Quarter of 2025 Compared to Third Quarter of 2024 (continued)

(1)Reconciliation of GAAP to non-GAAP results is provided below under the section entitled "Non-GAAP Financial Measures."

Recent Developments

As previously disclosed, on October 22, 2025, KKR Stockholder and certain management selling stockholders completed a registered secondary public offering of 15,000,000 shares of the Company's common stock (the "October 2025 Offering"). The Company did not sell any shares of common stock that were offered in the October 2025 Offering. Also, the Company did not receive any proceeds from the October 2025 Offering, other than proceeds received in connection with the cash exercise of stock options by the management selling stockholders in connection with the October 2025 Offering.

In connection with the October 2025 Offering, the Company concurrently purchased from the underwriter, out of the aggregate of 15,000,000 shares of common stock that were the subject of the October 2025 Offering, 1,500,000 shares of common stock at a price of $29.00 per share, for a total purchase price of $43.5 million. The purchase price reflected a discount to the closing market price on the date of purchase. The repurchase was reviewed and approved by the audit committee of our Board of Directors.

Our Service Offerings

We are one of the largest independent providers of home and community-based health services in the United States, delivering both pharmacy and provider services. We believe our high-quality and complementary health services offerings address significant and important patient and stakeholder needs. We enhance patient outcomes through the delivery and coordination of high-quality services that high-need, high-cost patients require. Our services are principally delivered in patient-preferred and lower-cost settings and often over longer periods of time, given the chronic nature of the patient conditions that we address. We believe our breadth of service capabilities and proven outcomes position us as a provider of choice for patients, families, referral sources, customers, and payors. We deliver services through two reportable segments: Pharmacy Solutions and Provider Services. For additional details regarding our diversified service offerings within each reportable segment see "PART I - Item 1. Business" of our Form 10-K.

The following table summarizes the revenues generated by each of our reportable segments:

Payor Mix

We are characterized by payor diversification across our platform. Our payors are principally federal, state, and local governmental agencies, commercial insurance, private, and other payors. Additionally, our Medicaid payors can be further broken down across each individual state with our top 10 Medicaid states representing 7% of total Company revenue for the three and nine months ended September 30, 2025 and 2024.

We provide our services across all 50 states, Puerto Rico and Canada, with our top 10 states of operations comprising 53% of total Company revenues for the three and nine months ended September 30, 2025, compared to 52% for the three and nine months ended September 30, 2024. The federal, state, and local programs under which we operate are subject to legislative and budgetary changes that can influence reimbursement rates.

The following tables summarize the percentage of revenue generated by each payor type for each of our service offerings and reportable segments:

See Note 3 of the unaudited condensed consolidated financial statements and related notes in this Form 10-Q for more information regarding revenue by payor type for each reportable segment for the three and nine months ended September 30, 2025 and 2024.

Trends and Other Factors Affecting Business

Continued Growth of our Pharmacy Solutions Patient Populations

We focus on providing health-dependent medications in a timely and well-supported manner to our patients receiving pharmacy solutions in their home and community-based settings. Our pharmacy services are primarily delivered directly to patients in their place of residence, home, or stay, and sometimes in a clinic setting. According to industry reports, pharmacy solutions delivered to and tailored for the home environment, such as home infusion services, oncology services, and daily medication management services in the home, will continue to grow faster than the overall and general pharmacy market. We have continued to expand our pharmacy

capabilities to serve this need. Overall, our pharmacy has grown patient census by approximately 2%, in the third fiscal quarter of 2025 compared to the third fiscal quarter of 2024. We are a leading independent pharmacy provider in our respective pharmacy patient markets, and we expect to continue to increase our share, including home infusion patients, specialty oncology patients, behavioral patients, in-home Seniors, and hospice patients.

Continued Growth of our Provider Services Patient Populations

We focus on delivering high-touch and coordinated services to medically complex Senior and Specialty patients in the home and community-based settings where they live. As the baby boomer population ages, Seniors, who comprise a significant majority of our patients, will represent a higher percentage of the overall population. Given the proven value proposition of home-based health services, we believe patients will increasingly seek treatment and referral sources and payors will increasingly support treatment in homes more often than in higher cost, less convenient, higher acuity institutional settings.

The vast majority of patients we serve in our provider businesses are served in the home, and we have purposefully continued to expand our service offering and footprint to serve patients in this lower cost setting. Since 2019, we built upon supportive care services to patients, as we have meaningfully expanded our footprint of highly clinical and expert services to home health, rehabilitation, and hospice patients to address a large national healthcare need and more completely and better serve Senior and Specialty patients in the home as evidenced by continued census growth within the Provider Services segment. Our complementary services that address the multiple needs of these patient populations will increasingly provide integrated care opportunities to provide more complete and better coordinated services to patients across health settings and stages.

Stable Reimbursement Environment Across our Portfolio of Businesses

Our revenue is dependent upon our contracts and relationships with payors for our "must-serve" patient populations. We partner with a large and diverse set of payor groups nationally and in each of our markets, to form provider networks and to lower the overall cost of care. We structure our payor contracts to help both providers and payors achieve their objectives in a mutually aligned manner. Maintaining, supporting, and both deepening and increasing the number of these contracts and relationships, particularly as we continue to grow market share and enter new markets, is important for our long-term success.

We have observed relatively stable reimbursement rates from government and commercial payors in our pharmacy and provider services over a number of years, particularly for services provided to high-need, medically complex populations. Due to the medical necessity of our services, which are lower cost than healthcare services provided in other settings and reduce ER, hospital and institutional facility utilization, we have a history of reimbursement stability.

Culture of Quality and Compliance and Consistent Operations Execution

Quality and compliance are central to our strategies and mission. We have demonstrated leading and excellent service and customer/patient/family satisfaction scores across the organization, as referenced in prior filings such as our Form 10-K. In addition to quality and compliance resources and programs in field operations, we invest in people, training, auditing, signature programs, accreditations, advocacy, and technologies to support quality, compliance, and safety as part of our "Quality First" framework. We have demonstrated consistently high and often leading marks for service levels, satisfaction scores, and quality metrics in our industries.

Operational excellence is also an ongoing focus at the Company, including how we collect and share key metrics, hold operational reviews, audit, conduct training, deploy expert support resources, execute on corrective and preventative actions, and implement continuous improvement initiatives across the organization. We have continued to make investments in automation, data, and technology systems to support enhanced workflows, further scale, and future growth across service lines.

Ability to Build De Novo Locations

We have a proven ability to augment growth of existing operations by expanding our presence and opening new locations - in both of our reportable segments, Pharmacy Solutions and Provider Services - across geographies with consistent ramp-up in performance after site opening. We believe our platform can continue to build further scale nationally, adding density to additional and targeted key markets as a lever to facilitate maximum pharmacy and provider services overlap, integrated and value-based care, and growth. The Company's geographic and operations scale, and platform of complementary segments and service lines, provides us with access to more de novo opportunities to consider and prioritize.

We typically identify and open new locations within proximity of an existing location as we leverage existing market knowledge and presence to expand in target markets, regions, and states. Our internal support resources in real estate, purchasing, IT, credentialing, payor contracting, HR, and sales and marketing, along with our Project Management Office, help to support and manage de novo locations from start to opening. We expect to continue to selectively and strategically expand our footprint within the United States and extend our service offerings to our patients and for customers, referral sources, and payors. We believe de novo investments facilitate more integrated care capability and are a meaningful organic growth driver for the Company.

Ability to Facilitate Integrated Care

Our operating model consists of complementary pharmacy and provider services that high-need Senior and Specialty populations require, and it is designed to increasingly coordinate, manage, and serve patients across our various needs and settings over time, leading to improved patient, family, physician, and referral source satisfaction, improved payor experiences, and better outcomes. Our performance and potential to drive increased service volume for increased patient and health outcomes impact is driven partly by our appeal with our patients, families, customers, referral sources, and payors to provide multiple integrated care services - either in the same setting at the same time or across settings and stages of health - within our collection of pharmacy solutions and provider services and differentiated overall capabilities.

We provide multiple pharmacy and provider services to approximately 8,000 patients today, and we believe that there are substantially more opportunities to deliver more integrated care, given the hundreds of thousands of patients we serve and a similar number of patients discharging from customers annually. Value-add, beneficial, and multiple integrated care opportunities exist for our customer base and all Senior and Specialty patient populations not only across pharmacy and provider services, but also within each segment. Within pharmacy services, CCRx is aimed at providing medication risk and therapy management continuously and longitudinally post discharge from hospitals and skilled nursing customers. Within provider services, patients often transition from home health to hospice services and can receive therapy and supportive care services concurrent with each other and with home health and hospice.

Aligning to Value-Based Care Reimbursement Models with Innovative Solutions

The scale and depth of our complimentary platform of diverse yet related customer and patient services - that complex patients require - positions us at the forefront with governmental and commercial payors who are increasingly seeking ways to expand value-based reimbursement models. Our high-quality services that are delivered in home and community-based and patient and family-preferred settings at lower comparable costs are well-positioned for the long-term, and we continue to add wraparound care management capabilities and offerings to our core services. In addition to our large Medicare and Medicaid beneficiary populations, we have a large number of non-governmental payor contracts across the organization today, which both diversifies our payor mix, and provides for additional value-based opportunities and partnerships. The Company's focused build out of its (i) Home-Based Primary Care, transitional care programs, and in-home medication therapy management, and (ii) Clinical (Nursing) Hub, are key enablers to coordinate base pharmacy and provider services and drive improved quality and lower costs for value-based care constructs. In addition to numerous payor contracts that feature reimbursement incentives, in the past year the Company has entered into several accountable care organization ("ACO") arrangements to participate in shared savings from its attributed primary care patients and other ACO partnerships and contract as a preferred provider.

Factors Affecting Results of Operations and Comparability

Legal Costs and Settlements Accrual

In November 2023, the Company agreed to settle the Silver matter without admitting liability, as discussed under Part I, Item 3. "Legal Proceedings" in our Annual Report on Form 10-K for the year ended December 31, 2024. On May 29, 2024, the parties entered into a final settlement agreement, which was approved by both the United States Department of Justice and the District Court. The total financial impact of the settlement was $120.0 million; all of which has been paid as of April 2025. We paid $110.0 million of the settlement in 2024, and the remainder in April 2025. The District Court entered an order dismissing the Silver action in its entirety, with prejudice, on July 3, 2024. See Note 13 "Commitments and Contingencies" within the unaudited condensed consolidated financial statements and related notes, included elsewhere in this Form 10-Q.

Discontinued Operations

On January 17, 2025, the Company entered into a definitive agreement to sell its Community Living business to National Mentor Holdings, Inc. (the "Purchaser"), for $835.0 million in cash upon closing, subject to certain post-closing adjustments. We entered into the transaction in order to streamline our service offerings and further focus on the senior and specialty populations. The transaction is currently expected to close in the first fiscal quarter of 2026, subject to receipt of customary regulatory approvals and satisfaction of other closing conditions.

The Company has determined the divestiture of the Community Living business represents a strategic shift that will have a major effect on its business and has concluded the criteria for classification as discontinued operations were met during the first fiscal quarter of 2025. Accordingly, the Community Living business is reported as discontinued operations in accordance with Accounting Standards Codification ("ASC") 205-20, Discontinued Operations. The related assets and liabilities of the Community Living business are classified as assets and liabilities held for sale in the accompanying unaudited condensed consolidated balance sheet as of September 30, 2025, and the results of operations from the Community Living business are classified as discontinued operations in the unaudited condensed consolidated statements of operations. Applicable amounts in prior years have been recast to conform to this

discontinued operations presentation. The Community Living business was historically presented as a part of the Provider Services reportable segment.

See Note 2 "Discontinued Operations" within the unaudited condensed consolidated financial statements and related notes, included elsewhere in this Form 10-Q.

Components of Results of Operations

Revenues. The Company recognizes the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. For transactions involving the transfer of goods, revenues are primarily recognized when the customer obtains control of the products sold, which is generally upon shipment or delivery, depending on the delivery terms specified in the sales agreement. For transactions exclusively involving provision of services, revenues are recognized over time based on an appropriate measure of progress.

Cost of Goods and Cost of Services. We classify expenses directly related to providing goods and services, including depreciation and amortization, as cost of goods and cost of services. Direct costs and expenses principally include cost of drugs, net of rebates, salaries and benefits for direct care and service professionals, contracted labor costs, insurance costs, transportation costs for clients requiring services, certain client expenses such as food, supplies and medicine, residential occupancy expenses, which primarily comprise rent and utilities, and other miscellaneous direct goods or service-related expenses.

Selling, General, and Administrative Expenses. Selling, general, and administrative expenses consist of expenses incurred in support of our operations and administrative functions and include labor costs, such as salaries, bonuses, commissions, benefits, and travel-related expenses, distribution expenses, facilities rental costs, third-party revenue cycle management costs, and corporate support costs including finance, information technology, legal costs and settlements, human resources, procurement, and other administrative costs.

Loss on Extinguishment of Debt. Loss on extinguishment of debt reflects the write-off of unamortized debt issuance costs upon the early repayment of our Second Lien Facility in 2024.

Interest Expense, net. Interest expense, net includes the debt service costs associated with our various debt instruments, including our First Lien Facilities, and the amortization of related deferred financing fees, which are amortized over the term of the respective credit agreement. Interest expense, net also includes the portion of the gain or loss on our interest rate swap agreements that is reclassified into earnings.

Income Tax Expense (Benefit). Our provision for income taxes is based on permanent book/tax differences and statutory tax rates in the various jurisdictions in which we operate. Significant estimates and judgments are required in determining the provision for income taxes.

Results of Operations

Consolidated Results of Operations

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

The following table sets forth, for the periods indicated, our consolidated results of operations.

* n.m.: not meaningful

(1) Reconciliation of GAAP to non-GAAP results is provided below under the section entitled "Non-GAAP Financial Measures."

The following discussion of our results of operations should be read in conjunction with the foregoing table summarizing our consolidated results of operations.

Revenues

Revenues were $3,334.1 million for the three months ended September 30, 2025, as compared with $2,601.2 million for the three months ended September 30, 2024, an increase of $732.9 million or 28.2%. The increase resulted from growth in our Pharmacy Solutions and Provider Services segments. See additional discussion in "-Segment Results of Operations" below.

Cost of Goods

Cost of goods was $2,721.3 million for the three months ended September 30, 2025, as compared with $2,077.1 million for the three months ended September 30, 2024, an increase of $644.2 million or 31.0%. The increase resulted from an increase in Pharmacy Solutions cost of goods. See additional discussion in "-Segment Results of Operations" below.

Cost of Services

Cost of services was $220.8 million for the three months ended September 30, 2025, as compared with $201.0 million for the three months ended September 30, 2024, an increase of $19.8 million or 9.8%. The increase resulted from an increase in Provider Services cost of services. See additional discussion in "-Segment Results of Operations" below.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were $304.2 million for the three months ended September 30, 2025, as compared with $294.0 million for the three months ended September 30, 2024, an increase of $10.2 million or 3.5%. The increase primarily resulted from the following segment activity and factors:

Interest Expense, net

Interest expense, net was $38.2 million for the three months ended September 30, 2025, as compared with $46.6 million for the three months ended September 30, 2024, a decrease of $8.4 million or 18.0%. The decrease primarily resulted from a decrease in both the variable-rate and applicable margin for the three months ended September 30, 2025 as compared to the prior period, offset by a $5.2 million decrease in interest income received related to cash flow hedges of interest rate risk.

Income Tax Expense

Income tax expense was $12.1 million for the three months ended September 30, 2025, as compared with $8.2 million for the three months ended September 30, 2024, an increase in the expense of $4.0 million. The increase in the income tax expense is primarily driven by the increase in pre-tax book income for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024, and an increase in the effective tax rate for the three months ended September 30, 2025 of 24.4% compared to (46.6)% for the three months ended September 30, 2024. The increase in the effective tax rate is primarily as a result of the cumulative impact of the year-to-date estimated tax rate on 2024 pre-tax book losses as well as the 2023 return-to-provision adjustment.

Net Income (Loss)

Net income was $37.5 million for the three months ended September 30, 2025, as compared with a net loss of $25.7 million for the three months ended September 30, 2024, an increase of $63.2 million. The increase in net income is primarily attributable to the increase in gross profit and the aforementioned decrease in interest expense, net, offset by an increase in selling, general, and administrative expenses and income tax expense.

Adjusted EBITDA(1)

Adjusted EBITDA was $160.4 million for the three months ended September 30, 2025, as compared with $116.9 million for the three months ended September 30, 2024, an increase of $43.5 million or 37.2%. The increase primarily resulted from the following segment activity and factors:

(1)Reconciliation of GAAP to non-GAAP results is provided below under the section entitled "Non-GAAP Financial Measures."

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

The following table sets forth, for the periods indicated, our consolidated results of operations.

* n.m.: not meaningful

(1) Reconciliation of GAAP to non-GAAP results is provided below under the section entitled "Non-GAAP Financial Measures."

The following discussion of our results of operations should be read in conjunction with the foregoing table summarizing our consolidated results of operations.

Revenues

Revenues were $9,359.9 million for the nine months ended September 30, 2025, as compared with $7,325.2 million for the nine months ended September 30, 2024, an increase of $2,034.7 million or 27.8%. The increase resulted from growth in our Pharmacy Solutions and Provider Services segments. See additional discussion in "-Segment Results of Operations" below.

Cost of Goods

Cost of goods was $7,605.9 million for the nine months ended September 30, 2025, as compared with $5,816.0 million for the nine months ended September 30, 2024, an increase of $1,790.0 million or 30.8%. The increase resulted from an increase in Pharmacy Solutions cost of goods. See additional discussion in "-Segment Results of Operations" below.

Cost of Services

Cost of services was $648.8 million for the nine months ended September 30, 2025, as compared with $581.5 million for the nine months ended September 30, 2024, an increase of $67.3 million or 11.6%. The increase resulted from an increase in Provider Services cost of services. See additional discussion in "-Segment Results of Operations" below.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were $918.1 million for the nine months ended September 30, 2025, as compared with $875.3 million for the nine months ended September 30, 2024, an increase of $42.7 million or 4.9%. The increase primarily resulted from the following segment activity and factors:

Loss on Extinguishment of Debt

During the nine months ended September 30, 2024, we used proceeds from the IPO Offerings to repay the Second Lien on January 30, 2024 and as a result incurred a loss on extinguishment of debt of $12.7 million related to the write-off of unamortized debt issuance costs. There was no loss on extinguishment of debt recognized for the nine months ended September 30, 2025.

Interest Expense, net

Interest expense, net was $118.8 million for the nine months ended September 30, 2025, as compared with $144.4 million for the nine months ended September 30, 2024, a decrease of $25.6 million or 17.7%. The decrease primarily resulted from a decrease in both the variable-rate and applicable margin for the nine months ended September 30, 2025 as compared to the prior periods and lower outstanding term debt as compared to the prior period, offset by a $15.5 million decrease in interest income received related to cash flow hedges of interest rate risk.

Income Tax Expense (Benefit)

Income tax expense was $13.1 million for the nine months ended September 30, 2025, as compared with an income tax benefit of $31.5 million for the nine months ended September 30, 2024, an increase in the income tax expense of $44.6 million. The increase in the income tax expense is primarily driven by the increase in pre-tax book income for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, and a decrease in the effective tax rate for the nine months ended September 30, 2025 of 19.2% compared to 30.1% for the nine months ended September 30, 2024. The decrease in the effective tax rate is primarily as a result of $4.7 million in tax benefits resulting from the recognition of excess tax benefits from stock-based compensation partially offset by limitations on the deductibility of certain executive compensation as a percentage of estimated pre-tax book income for the nine months ended September 30, 2025. In addition, the discrete tax benefit related to the Silver matter increased the effective tax rate on pre-tax book loss for the nine months ended September 30, 2024.

Net Income (Loss)

Net income was $55.2 million for the nine months ended September 30, 2025, as compared with a net loss of $73.2 million for the nine months ended September 30, 2024, an increase of $128.5 million. The increase in net income is primarily attributable to the increase in gross profit and the aforementioned decrease in interest expense, net, and loss on extinguishment of debt, partially offset by an increase in selling, general, and administrative expenses and income tax expense (benefit).

Adjusted EBITDA(1)

Adjusted EBITDA was $434.0 million for the nine months ended September 30, 2025, as compared with $329.8 million for the nine months ended September 30, 2024, an increase of $104.2 million or 31.6%. The increase primarily resulted from the following segment activity and factors:

(1)Reconciliation of GAAP to non-GAAP results is provided below under the section entitled "Non-GAAP Financial Measures."

Segment Results of Operations

Pharmacy Solutions Segment

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

The following table sets forth, for the periods indicated, our segment results of operations for Pharmacy Solutions.

The following discussion of our Pharmacy Solutions segment results of operations should be read in conjunction with the foregoing table summarizing our segment results of operations.

Revenues

Revenues were $2,967.0 million for the three months ended September 30, 2025, as compared with $2,265.7 million for the three months ended September 30, 2024, an increase of $701.3 million or 31.0%. The increase primarily resulted from volume growth in prescriptions dispensed within Infusion and Specialty Pharmacy partially offset by a decline in prescriptions dispensed within Home and Community Pharmacy. Revenues attributable to Infusion and Specialty Pharmacy were $2,377.0 million for the three months ended September 30, 2025, as compared with $1,678.1 million for the three months ended September 30, 2024, an increase of $698.9 million or 41.6% attributable to an increase in prescriptions dispensed on certain specialty branded drugs. Revenues attributable to Home and Community Pharmacy were $590.0 million for the three months ended September 30, 2025, as compared with $587.6 million for the three months ended September 30, 2024, an increase of $2.4 million or 0.4% attributable to mix changes in prescriptions dispensed.

The increase in revenue per prescription dispensed is due to mix changes year-over-year and a greater relative increase in volume growth in certain specialty brand drugs, which carry a higher revenue per prescription dispensed.

Cost of Goods

Cost of goods was $2,721.3 million for the three months ended September 30, 2025, as compared with $2,077.1 million for the three months ended September 30, 2024, an increase of $644.2 million or 31.0%. The increase primarily resulted from the aforementioned revenue growth in the period as well as an increase in cost per prescription dispensed as a result of mix shift.

Gross profit was $245.7 million for the three months ended September 30, 2025, as compared with $188.6 million for the three months ended September 30, 2024, an increase of $57.1 million or 30.3%. The increase primarily resulted from the aforementioned revenue growth in the period, primarily the result of outsized volume growth as well as mix in certain specialty branded drugs, which have lower margins.

Gross profit margin for the three months ended September 30, 2025 and September 30, 2024 remained consistent at 8.3%.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were $131.1 million for the three months ended September 30, 2025, as compared with $117.3 million for the three months ended September 30, 2024, an increase of $13.8 million or 11.7%. The increase primarily resulted from the aforementioned revenue growth in the period with selling, general, and administrative expenses growing less than revenue due to demonstrating economies of scale.

Segment EBITDA

Segment EBITDA was $141.0 million for the three months ended September 30, 2025, as compared with $99.2 million for the three months ended September 30, 2024, an increase of $41.8 million or 42.2%. The increase primarily resulted from the aforementioned revenue and gross profit growth in the period. See Note 15 "Segment Information" to our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q for further discussion.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

The following table sets forth, for the periods indicated, our segment results of operations for Pharmacy Solutions.

The following discussion of our Pharmacy Solutions segment results of operations should be read in conjunction with the foregoing table summarizing our segment results of operations.

Revenues

Revenues were $8,289.2 million for the nine months ended September 30, 2025, as compared with $6,357.2 million for the nine months ended September 30, 2024, an increase of $1,932.0 million or 30.4%. The increase primarily resulted from volume growth in prescriptions dispensed across and within the Pharmacy Solutions segment. Revenues attributable to Infusion and Specialty Pharmacy were $6,531.9 million for the nine months ended September 30, 2025, as compared with $4,729.8 million for the nine months ended September 30, 2024, an increase of $1,802.1 million or 38.1% attributable to an increase in prescriptions dispensed on certain specialty branded drugs. Revenues attributable to Home and Community Pharmacy were $1,757.3 million for the nine months ended September 30, 2025, as compared with $1,627.4 million for the nine months ended September 30, 2024, an increase of $129.9 million or 8.0% attributable to volume growth.

The increase in revenue per prescription dispensed is due to mix changes year-over-year and a greater relative increase in volume growth in certain specialty brand drugs, which carry a higher revenue per prescription dispensed.

Cost of Goods

Cost of goods was $7,605.9 million for the nine months ended September 30, 2025, as compared with $5,816.0 million for the nine months ended September 30, 2024, an increase of $1,790.0 million or 30.8%. The increase primarily resulted from the aforementioned revenue growth in the period as well as an increase in cost per prescription dispensed as a result of mix shift.

Gross profit was $683.3 million for the nine months ended September 30, 2025, as compared with $541.2 million for the nine months ended September 30, 2024, an increase of $142.1 million or 26.2%. The increase primarily resulted from the aforementioned revenue growth in the period, primarily the result of outsized volume growth as well as mix in certain specialty branded drugs, which have lower margins.

Gross profit margin for the nine months ended September 30, 2025 was 8.2% compared to 8.5% for the nine months ended September 30, 2024. The decrease in gross profit margin is due to mix shift in the Pharmacy Solutions segment with greater relative volume growth in Infusion and Specialty Pharmacy, along with product-level mix shifts, rate changes, and an increase in the fulfillment cost per script in Home and Community Pharmacy.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were $382.9 million for the nine months ended September 30, 2025, as compared with $341.8 million for the nine months ended September 30, 2024, an increase of $41.1 million or 12.0%. The increase primarily resulted from the aforementioned revenue growth in the period with selling, general, and administrative expenses growing less than the volume growth rate and demonstrating economies of scale.

Segment EBITDA

Segment EBITDA was $381.4 million for the nine months ended September 30, 2025, as compared with $281.8 million for the nine months ended September 30, 2024, an increase of $99.6 million or 35.3%. The increase primarily resulted from the aforementioned revenue and gross profit growth in the period. See Note 15 "Segment Information" to our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q for further discussion.

Provider Services Segment

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

The following discussion of our Provider Services segment results of operations should be read in conjunction with the foregoing table summarizing our segment results of operations.

Revenues

Revenues were $367.1 million for the three months ended September 30, 2025, as compared with $335.5 million for the three months ended September 30, 2024, an increase of $31.6 million or 9.4%. The increase primarily resulted from volume growth as well as rate increases received during the period. Revenues attributable to Home Health Care were $188.3 million for the three months ended September 30, 2025, as compared with $168.2 million for the three months ended September 30, 2024, an increase of $20.1 million or 12.0%. Revenues attributable to Rehab Care were $76.4 million for the three months ended September 30, 2025, as compared with $70.2 million for the three months ended September 30, 2024, an increase of $6.2 million or 8.8%. Revenues attributable to Personal Care were $102.4 million for the three months ended September 30, 2025, as compared with $97.1 million for the three months ended September 30, 2024, an increase of $5.3 million or 5.5%.

Cost of Services

Cost of services was $220.8 million for the three months ended September 30, 2025, as compared with $201.0 million for the three months ended September 30, 2024, an increase of $19.8 million or 9.8%. The increase primarily resulted from the aforementioned revenue growth.

Gross profit was $146.4 million for the three months ended September 30, 2025, as compared with $134.5 million for the three months ended September 30, 2024, an increase of $11.8 million or 8.8%. The increase primarily resulted from the aforementioned revenue growth and costs of services improvements in the period.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were $93.0 million for the three months ended September 30, 2025, as compared with $88.5 million for the three months ended September 30, 2024, an increase of $4.5 million or 5.1%. The increase primarily resulted from the aforementioned revenue growth in the period with selling, general, and administrative expenses growing less than the volume growth rate and demonstrating economies of scale.

Segment EBITDA

Segment EBITDA was $60.7 million for the three months ended September 30, 2025, as compared with $52.3 million for the three months ended September 30, 2024, an increase of $8.4 million or 16.0%. The increase primarily resulted from the aforementioned revenue growth. See Note 15 "Segment Information" to our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q for further discussion.

Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024

The following table sets forth, for the years indicated, our segment results of operations for Provider Services.

The following discussion of our Provider Services segment results of operations should be read in conjunction with the foregoing table summarizing our segment results of operations.

Revenues

Revenues were $1,070.7 million for the nine months ended September 30, 2025, as compared with $968.0 million for the nine months ended September 30, 2024, an increase of $102.7 million or 10.6%. The increase primarily resulted from volume growth as well as rate increases received during the period. Revenues attributable to Home Health Care were $551.2 million for the nine months ended September 30, 2025, as compared with $473.3 million for the nine months ended September 30, 2024, an increase of $77.9 million or 16.5%. Revenues attributable to Rehab Care were $219.5 million for the nine months ended September 30, 2025, as compared with $206.9 million for the nine months ended September 30, 2024, an increase of $12.6 million or 6.1%. Revenues attributable to Personal Care were $300.0 million for the nine months ended September 30, 2025, as compared with $287.8 million for the nine months ended September 30, 2024, an increase of $12.2 million or 4.2%.

Cost of Services

Cost of services was $648.8 million for the nine months ended September 30, 2025, as compared with $581.5 million for the nine months ended September 30, 2024, an increase of $67.3 million or 11.6%. The increase primarily resulted from the aforementioned revenue growth.

Gross profit was $421.9 million for the nine months ended September 30, 2025, as compared with $386.5 million for the nine months ended September 30, 2024, an increase of $35.4 million or 9.2%. The increase primarily resulted from the aforementioned revenue growth and costs of services improvements in the period.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were $275.0 million for the nine months ended September 30, 2025, as compared with $254.8 million for the nine months ended September 30, 2024, an increase of $20.2 million or 7.9%. The increase primarily resulted from the aforementioned revenue growth in the period with selling, general, and administrative expenses growing less than the volume growth rate and demonstrating economies of scale.

Segment EBITDA

Segment EBITDA was $168.2 million for the nine months ended September 30, 2025, as compared with $149.7 million for the nine months ended September 30, 2024, an increase of $18.5 million or 12.4%. The increase primarily resulted from the aforementioned revenue growth. See Note 15 "Segment Information" to our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q for further discussion.

Non-GAAP Financial Measures

In addition to our results of operations prepared in accordance with U.S. GAAP, which we have discussed above, we also evaluate our financial performance using EBITDA, Adjusted EBITDA, and Adjusted EPS. These non-GAAP financial measures are not intended to replace financial performance measures determined in accordance with U.S. GAAP, such as net income (loss) and diluted EPS. Rather, we present EBITDA, Adjusted EBITDA, and Adjusted EPS as supplemental measures of our performance.

EBITDA, Adjusted EBITDA, and Adjusted EPS

The following are key financial metrics and, when used in conjunction with U.S. GAAP measures, we believe they provide useful information for evaluating our core business performance, enable comparison of financial results across periods, and allow for greater transparency with respect to key metrics used by management for financial and operational decision-making. We define EBITDA as net income (loss) before income tax expense (benefit), interest expense, net, and depreciation and amortization. Adjusted EBITDA and Adjusted EPS exclude certain other items that are either non-recurring, infrequent, non-cash, unusual, or items deemed by management to not be indicative of the performance of our core operations, including non-cash, share-based compensation; acquisition, integration, and transaction-related costs; restructuring and divestiture-related and other costs; legal costs associated with certain historical matters for PharMerica and settlement costs; significant projects; and management fees. In determining which adjustments are made to arrive at Adjusted EBITDA and Adjusted EPS, management considers both (1) certain non-recurring, infrequent, non-cash, or unusual items, which can vary significantly from year to year, as well as (2) certain other items that may be recurring, frequent, or settled in cash but which management does not believe are indicative of our core operating performance. The financial measure calculated under U.S. GAAP which is most directly comparable to Adjusted EBITDA is net income (loss). The financial measure calculated under U.S. GAAP which is most directly comparable to Adjusted EPS is diluted EPS.

We have historically incurred substantial acquisition, integration, and transaction-related costs. The underlying acquisition activities take place over a defined timeframe, have distinct project timelines, and are incremental to activities and costs that arise in the ordinary course of our business. Therefore, we have excluded these costs from our Adjusted EBITDA and Adjusted EPS because it provides management a normalized view of our core, ongoing operations after integrating our acquired companies.

The legal costs and settlements adjustment represents defense costs associated with certain PharMerica litigation matters, all of which have been finalized as of September 30, 2025, that commenced prior to KKR Stockholder's and Walgreen Stockholder's acquisition of PharMerica in December 2017, as well as settlement costs associated with these historical PharMerica cases including the Silver matter, which settled in November 2023. We have excluded defense costs associated with these PharMerica litigation matters from our Adjusted EBITDA and Adjusted EPS due to the magnitude of these cases and the costs attributable to them, the timing of the commencement of the cases and the fact that no similar cases have been brought against the Company since the acquisition of PharMerica, and the fact that these cases are unlike our routine legal and regulatory proceedings that we see in the normal course of business. Further, we have excluded settlement costs associated with the Silver matter from our Adjusted EBITDA and Adjusted EPS due to the magnitude of the case and the costs attributable to it, as well as the fact that the Silver matter is unlike our routine legal and regulatory proceedings that we see in the normal course of business.

The significant projects adjustment represents costs associated with certain transformational projects, which are not considered to be a part of our normal and recurring business operations and are not expected to recur in our future business plans. Moreover, the costs associated with significant projects, which are incurred on an infrequent and limited basis, are not reflective of our operating performance. Due to the aforementioned reasons, we have excluded the costs related to significant projects from our Adjusted EBITDA and Adjusted EPS, as such adjustment provides a more meaningful understanding to investors and others of our ongoing results.

The management fees adjustment represents fees paid historically under the Monitoring Agreement related to either (i) activities that are expected to be performed by our existing personnel upon the termination of the Monitoring Agreement, and thus not expected

to result in incremental costs subsequent to the IPO Offerings, or (ii) acquisitions, divestitures, and external financing activities, which costs would otherwise be excluded from our Adjusted EBITDA and Adjusted EPS. Therefore, we have excluded management fees from our Adjusted EBITDA and Adjusted EPS, as such fees are no longer applicable and representative of our ordinary operating performance as a result of the completion of the IPO Offerings.

EBITDA, Adjusted EBITDA, and Adjusted EPS are not measures of financial performance under U.S. GAAP and should be considered in addition to, and not as a substitute for, net income (loss), diluted EPS or other financial measures calculated in accordance with U.S. GAAP. Our method of determining non-GAAP financial measures may differ from other companies' financial measures and therefore may not be comparable to methods used by other companies.

Given our determination of adjustments in arriving at our computations of EBITDA, Adjusted EBITDA and Adjusted EPS, these non-GAAP measures have limitations as analytical tools and should not be considered in isolation or as substitutes or alternatives to net income or loss, operating income or loss, earnings or loss per diluted share, cash flows from operating activities, total indebtedness, or any other financial measures calculated in accordance with U.S. GAAP.

The following table reconciles net income (loss) to EBITDA and Adjusted EBITDA:

The following table reconciles diluted EPS to Adjusted EPS:

Liquidity and Capital Resources

Our principal sources of cash have historically been from operating activities. Our principal source of liquidity in excess of cash from operating activities has historically been from proceeds from our debt facilities and issuances of common stock. Our principal uses of cash and liquidity have historically been for acquisitions, debt service requirements, and financing of working capital. We believe that our operating cash flows, available cash on hand, and availability under our Revolving Credit Facility and the LC Facility will be sufficient to meet our cash requirements for the next twelve months and beyond. Our cash flows are primarily provided by the continuing operations of the Company. Cash provided by operating activities of the discontinued operations is expected to be offset at the closing of the transaction through proceeds from the sale, which may be utilized for the paydown of debt. Our future capital requirements will depend on many factors that are difficult to predict, including the size, timing, and structure of any future acquisitions, future capital investments, and future results of operations. We cannot assure you that cash provided by operating activities or cash and cash equivalents will be sufficient to meet our future needs. If we are unable to generate sufficient cash flows from operations in the future, we may have to obtain additional financing. If we obtain additional capital by issuing equity, the interests of our existing stockholders will be diluted. If we incur additional indebtedness, that indebtedness may contain significant financial and other covenants that may significantly restrict our operations. We cannot assure you that we could obtain refinancing or additional financing on favorable terms or at all.

We evaluate our liquidity based upon the availability we have under our First Lien Facilities in addition to the net cash provided by (used in) operating, investing, and financing activities. Specifically, we review the activity under the Revolving Credit Facility and the LC Facility and consider period end balances outstanding under the Revolving Credit Facility and the LC Facility. Based upon the outstanding borrowings and letters of credit under the Revolving Credit Facility and the LC Facility, we calculate the availability for incremental borrowings under the Revolving Credit Facility and the LC Facility. Such amount, in addition to cash on our balance sheet, is what we consider to be our "Total Liquidity."

The following table provides a calculation of our Total Liquidity:

Cash Flow Activity

The activity discussed in this section relates to our consolidated company results and includes the impacts of discontinued operations.

Nine Months Ended September 30, 2025 and 2024

The following table sets forth a summary of our cash flows provided by (used in) operating, investing, and financing activities for the periods presented:

Operating Activities

Net cash provided by operating activities was $258.6 million for the nine months ended September 30, 2025 compared to net cash used in operating activities of $66.8 million for the nine months ended September 30, 2024. The change was primarily due to the following:

Investing Activities

Net cash used in investing activities decreased by $53.3 million, from $124.5 million in the nine months ended September 30, 2024 to $71.2 million in the nine months ended September 30, 2025. The decrease was primarily due to a $51.4 million decrease in cash paid for acquisitions in 2025 compared to 2024.

Financing Activities

Net cash used in financing activities was $107.4 million for the nine months ended September 30, 2025, primarily attributable to repayments on our long-term debt of $37.9 million, net repayments on our Revolving Credit Facility of $63.3 million, and payment of finance lease obligations of $10.1 million, offset by other financing activities.

Net cash provided by financing activities was $214.2 million for the nine months ended September 30, 2024, primarily attributable to net proceeds received from the IPO Offerings of $1,045.5 million, offset by extinguishment of and net repayments on our long-term debt of $818.6 million, net borrowings on our Revolving Credit Facility of $46.4 million, payment of debt issuance costs of $43.2 million, and other financing activities.

Debt

We typically incur debt to finance mergers and acquisitions, and we borrow under our Revolving Credit Facility for working capital purposes, as well as to finance acquisitions, as needed. Below is a summary of our long-term indebtedness as of September 30, 2025 and December 31, 2024.

We were in compliance with all applicable financial covenants as of September 30, 2025 and December 31, 2024.

First Lien Credit Agreement

On March 5, 2019, the Company entered into the First Lien Credit Agreement, among Phoenix Intermediate Holdings Inc., as Holdings, Phoenix Guarantor Inc., as the Borrower, the several lenders from time to time parties thereto and Morgan Stanley Senior Funding, Inc., as the Administrative Agent and Collateral Agent (the "First Lien Credit Agreement"). The First Lien Credit Agreement originally consisted of a principal amount of $1,650.0 million. In 2019, an additional delayed draw of $150.0 million was made on the First Lien Credit Agreement ("Tranche B-1"). The First Lien Credit Agreement was further amended in 2020 ("Tranche B-2") and 2021 ("Tranche B-3") to establish additional borrowings of $550.0 million and $675.0 million, respectively, resulting in a total gross borrowings of $3,025.0 million.

On June 30, 2023, the Company amended the terms of the First Lien Credit Agreement to reflect a change in reference rate to the Secured Overnight Financing Rate ("SOFR").

On February 21, 2024, we used a portion of the net proceeds received from the IPO Offerings to repay $343.3 million of the borrowings under the First Lien, and established Tranche B-4 to refinance the remaining $2,566.0 million of borrowings under the First Lien Credit Agreement at a rate equal to SOFR plus 3.25%. Tranche B-4 has a maturity date of February 21, 2031. On December 11, 2024 we amended the First Lien to refinance Tranche B-4 by establishing Tranche B-5 in an aggregate principal amount of $2,553.2 million at a rate equal to SOFR plus 2.50% or ABR plus 1.50% with a maturity date of February 21, 2031.

For additional information about our First Lien Credit Agreement, see Note 6 of the unaudited condensed consolidated financial statements and related notes in this Quarterly Report on Form 10-Q.

The First Lien Credit Agreement described above contain customary negative covenants, including, but not limited to, restrictions on the Company and its restricted subsidiaries' ability to merge and consolidate with other companies, incur indebtedness, grant liens or security interests on assets, make acquisitions, loans, advances, or investments, pay dividends, sell or otherwise transfer assets, prepay or modify terms of certain junior indebtedness, enter into transactions with affiliates, or change their lines of business or fiscal year. In addition, under the Revolving Credit Facility, the Company will not permit the consolidated first lien secured debt to consolidated EBITDA (as defined in the First Lien Credit Agreement) ratio to be greater than 6.90 to 1.00, which shall be tested as of the end of the most recent quarter at any time when the aggregate revolving credit loans exceed 35% of the total revolving credit commitments.

Revolving Credit Facility

The total borrowing capacity under the Revolving Credit Facility included in the First Lien Credit Agreement (the "Revolver") was $475.0 million as of September 30, 2025 and December 31, 2024. As of September 30, 2025, the Company had $475.0 million of borrowing capacity available under the Revolver as there were no borrowings under the Revolver or letters of credit outstanding. As of December 31, 2024, the Company had $63.3 million of borrowings outstanding under the Revolver and no letters of credit, reducing the available borrowing capacity to $411.7 million.

The First Lien Credit Agreement, as amended on September 17, 2024, provides for an additional $65.0 million of letter of credit commitments, or the LC Facility, which are not subject to the LC Sublimit. As of September 30, 2025, there were $62.8 million of letters of credit outstanding under the LC Facility, resulting in an available borrowing capacity of $2.2 million. As of December 31, 2024, there were $61.8 million of letters of credit outstanding under the LC Facility, resulting in an available borrowing capacity of $3.2 million.

For additional information about our Revolving Credit Facility and LC Facility, see Note 6 of the unaudited condensed consolidated financial statements and related notes in this Quarterly Report on Form 10-Q.

Second Lien Credit Agreement

On March 5, 2019, the Company entered into a $450.0 million Second Lien Facility. Borrowings under the Second Lien Facility were subordinated to the First Lien Credit Agreement. On January 30, 2024, we used a portion of the net proceeds received from the IPO Offerings to repay all outstanding borrowings under the Second Lien Facility. No further obligation exists related to the Second Lien Facility. This transaction was accounted for as a debt extinguishment and the Company incurred a loss on extinguishment of debt of $12.7 million related to the write-off of unamortized debt issuance costs.

Interest Rate Swap Agreements

To manage fluctuations in cash flows resulting from changes in the variable interest rates, the Company entered into pay-fixed interest rate swap agreements. For the nine months ended September 30, 2025 and the year ended December 31, 2024, interest expense, net includes interest income received related to cash flow hedges of interest rate risk of $13.4 million and $35.3 million, respectively. Refer to Note 6 within our unaudited condensed consolidated financial statements and related notes in this Quarterly Report on Form 10-Q for further discussion.

Tangible Equity Units

Concurrently with the IPO, we issued 8,000,000 TEUs, which have a stated amount of $50.00 per unit. Each TEU is comprised of a prepaid stock purchase contract ("Purchase Contract") and a senior amortizing note ("Amortizing Note") due February 1, 2027, each issued by the Company. The Company will pay equal quarterly cash installments of $0.8438 per Amortizing Note on February 1, May 1, August 1 and November 1, commencing on May 1, 2024, except for the May 1, 2024 installment payment, which was $0.8531 per Amortizing Note, with a final installment payment date of February 1, 2027. In the aggregate, the annual quarterly cash installments will be equivalent of 6.75% per year. Each installment payment constitutes a payment of interest and a partial repayment of principal. Each TEU may be separated by a holder into its constituent Purchase Contract and Amortizing Note. Refer to Note 7 within our unaudited condensed consolidated financial statements and related notes in this Quarterly Report on Form 10-Q for further discussion.

The table below summarizes the total outstanding debt of the Company: