-- Third Quarter GAAP Diluted Loss Per Share of $(0.14); Adjusted Diluted Earnings Per Share of $0.58 --

-- Increases 2026 GAAP Diluted EPS Guidance: Greater than $3.46 & Adjusted Diluted EPS Greater than $5.20 --

- Increases 2026 full year adjusted diluted EPS guidance by $0.40.

- Consolidated HBR of 92.7% in the third quarter, better than expectations, driven by the Medicare segment, with Medicaid and Marketplace on track.

- Full year 2026 HBR mid-point expectation improved by 15 basis points to 90.75%.

- Debt reduced by $1.1 billion since June 30, 2026, including full redemption of 2027 Senior Notes in October.

ST. LOUIS, Oct. 27, 2026 /PRNewswire/ -- Centene Corporation (NYSE: CNC) (the Company) announced today its financial results for the third quarter ended September 30, 2026. In summary, the 2026 third quarter results were as follows:

"Solid underlying fundamentals within our core businesses have powered a faster recovery to our earnings trajectory than previously anticipated," said Chief Executive Officer of Centene, Sarah M. London. "We are pleased with the progress our teams have made in delivering increased margin to power our mission of transforming the health of the communities we serve, one person at a time. We remain focused on a strong finish to 2026 and building on this progress in 2027."

Membership

The following table sets forth membership by line of business:

Premium and Service Revenues

The following table sets forth supplemental revenue information ($ in millions):

Statement of Operations: Three Months Ended September 30, 2026

- For the third quarter of 2026, premium and service revenues increased 0.5% to $45.1 billion from $44.9 billion in the comparable period of 2025. The increase was primarily driven by premium yield and membership growth in the PDP business, rate increases in Marketplace and in the Medicaid business to address medical trend, Marketplace risk adjustment revenue transfer for the 2026 benefit year, and state directed payments. The increases were partially offset by lower Marketplace and Medicaid membership.

- Health benefits ratio (HBR) of 92.7% for the third quarter of 2026, unchanged from 92.7% in the comparable period in 2025. The consolidated HBR benefited from a lower Marketplace HBR resulting from improved pricing and risk transfer reflecting the acuity of the Marketplace membership as well as strong fundamental performance in both the Medicare Advantage and PDP businesses. The HBR in 2025 was positively impacted by a decrease to the premium deficiency reserve versus no premium deficiency reserve in 2026 for our Medicare Advantage business as a result of our progression towards profitability.

- The SG&A expense ratio was 7.2% for the third quarter of 2026, compared to 7.0% in the third quarter of 2025. The adjusted SG&A expense ratio was 6.5% for the third quarter of 2026, compared to 7.0% in the third quarter of 2025. The increase in the SG&A expense ratio was primarily driven by enterprise optimization severance and vendor costs. The decrease in the adjusted SG&A expense ratio was driven by strong cost management, leveraging of expenses over higher revenues and reduced Marketplace membership, which operates at a meaningfully higher SG&A expense ratio. The decrease was also driven by growth in the PDP business, which operates at a meaningfully lower SG&A expense ratio as compared to the overall company.

- The effective tax rate was 46.7% for the third quarter of 2026, compared to 0.6% in the third quarter of 2025. For the third quarter of 2026, our effective tax rate on adjusted earnings was 14.5%, compared to 2.5% in the third quarter of 2025. The GAAP and adjusted effective tax rates for 2026 reflect a decrease to the estimated annual effective tax rate applied to year-to-date operating results. The GAAP and adjusted effective tax rates for 2025 reflect the impact of estimating interim period taxes on the year-to-date tax method. The effective tax rate for 2025 also reflects the non-deductible nature of the goodwill impairment.

- GAAP diluted loss per share of $(0.14) for the third quarter of 2026.

- Adjusted diluted earnings per share (EPS) of $0.58 for the third quarter of 2026.

- Cash flow used in operations for the third quarter of 2026 was $3.7 billion, primarily driven by the timing of pass through, premium and other payments, as expected.

Balance Sheet

At September 30, 2026, the Company had cash, investments and restricted deposits of $39.9 billion and maintained $175 million of cash available for general corporate use. Medical claims liabilities totaled $21.5 billion. The Company's days in claims payable (DCP) was 48 days, an increase of one day as compared to the second quarter of 2026.

During the third quarter of 2026, the Company repurchased $558 million of the Company's par value senior notes due 2027 and 2028. Following the senior note repurchase, total debt was $15.5 billion, which included no borrowings on the $4.0 billion Revolving Credit Facility at quarter end. In October 2026, the debt repurchase program was increased by $2.0 billion and subsequently the Company repurchased the remaining $569 million of its par value Senior Notes due 2027. With the increase and subsequent repurchase, there was $1.9 billion available under the senior note debt repurchase program as of October 27, 2026.

Outlook

Please refer to the Forward-Looking Statements, which should be reviewed in conjunction with the Company's 2026 outlook.

The Company is updating its 2026 GAAP diluted EPS guidance floor to greater than $3.46 and its 2026 adjusted diluted EPS guidance floor to greater than $5.20. Additionally, the Company is decreasing its HBR guidance range to 90.4% to 91.1% and its interest expense guidance range to $600 million to $620 million.

The Company's annual guidance for 2026 is as follows and will be discussed further on our conference call:

Conference Call

As previously announced, the Company will host a conference call Tuesday, October 27, 2026, at 8:30 a.m. ET to review the financial results for the third quarter ended September 30, 2026.

Investors and other interested parties are invited to listen to the conference call by dialing 1-877-883-0383 (toll free) in the U.S. and Canada; +1-412-902-6506 (toll) from abroad, including the following Elite Entry Number: 1565730 to expedite caller registration; or via a live, audio webcast on the Company's website at www.centene.com, under the Investors section.

A webcast replay will be available for on-demand listening shortly following the completion of the call for the next 12 months or until 11:59 p.m. ET on Tuesday, October 26, 2027, at the aforementioned URL. In addition, a digital audio playback will be available until 9 a.m. ET on Tuesday, November 3, 2026, by dialing 1-855-669-9658 (toll free) in North America, or +1-412-317-0088 (toll) from abroad, and entering access code 581422.

Non-GAAP Financial Presentation

The Company is providing certain non-GAAP financial measures in this release as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company's operations and measure the Company's performance more consistently across periods. The Company uses the presented non-GAAP financial measures internally in evaluating the Company's performance and for planning purposes, by allowing management to focus on period-to-period changes in the Company's core business operations, and in determining employee incentive compensation. Therefore, the Company believes that this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The Company strongly encourages investors to review its consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP financial measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

Specifically, the Company believes the presentation of non-GAAP financial measures that excludes amortization of acquired intangible assets, acquisition and divestiture related expenses, as well as other items, allows investors to develop a more meaningful understanding of the Company's core performance over time.

The tables below provide reconciliations of non-GAAP items ($ in millions, except per share data):

To provide clarity on the way management defines certain key metrics and ratios, the Company is providing a description of how the metric or ratio is calculated as follows:

- Health Benefits Ratio (HBR) (GAAP) = Medical costs divided by premium revenues.

- SG&A Expense Ratio (GAAP) = Selling, general and administrative expenses divided by premium and service revenues.

- Adjusted SG&A Expense Ratio (non-GAAP) = Adjusted selling, general and administrative expenses divided by premium and service revenues.

- Adjusted Effective Tax Rate (non-GAAP) = GAAP income tax expense (benefit) excluding the income tax effects of adjustments to net earnings divided by adjusted earnings (loss) before income tax expense.

- Adjusted Net Earnings (non-GAAP) = Net earnings less amortization of acquired intangible assets, less acquisition and divestiture related expenses, as well as adjustments for other items, net of the income tax effect of the adjustments.

- Adjusted Diluted EPS (non-GAAP) = Adjusted net earnings divided by weighted average common shares outstanding on a fully diluted basis.

- Debt to Capitalization Ratio (GAAP) = Total debt, divided by total debt plus total stockholder's equity.

- Average Medical Claims Expense (GAAP) = Medical costs for the period divided by number of days in such period.