What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-08-04 compared with 2022-05-06 · 207 added, 159 removed, 450 unchanged (45% of the section changed)

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Investment Assets

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide information to assist you in better understanding and evaluating our financial condition as of March 31, 2022, compared with December 31, 2021 and our results of operations for the three months ended March 31, 2022, compared with the same period last year and is intended to help you understand the ongoing trends in our business.

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide information to assist you in better understanding and evaluating our financial condition as of June 30, 2022, compared with December 31, 2021 and our results of operations for the three and six months ended June 30, 2022, compared with the same periods last year and is intended to help you understand the ongoing trends in our business.

We encourage you to read this MD&A in conjunction with our Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2021 ("2021 Form 10-K").

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We exclude these items from this measure because management believes they are not indicative of past or future underlying performance of the business.

Adjusted revenues is not determined in accordance with GAAP and should not be viewed as a

substitute for the most directly comparable GAAP measure, total revenues.

Adjusted revenues is not determined in accordance with GAAP and should not be viewed as a substitute for the most directly comparable GAAP measure, total revenues.

See the below Financial Highlights section for a reconciliation of consolidated adjusted revenues to total revenues.

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our ability to adapt to changes in an evolving and rapidly changing industry;

the scale, scope and duration of the COVID-19 pandemic and its potential impact on our business, operating results, cash flows or financial condition;

our ability to compete effectively, differentiate our products and services from those of our competitors and maintain or increase market share;

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political, legal, operational, regulatory, economic and other risks that could affect our multinational operations;

the scale, scope and duration of the COVID-19 pandemic and its potential impact on our business, operating results, cash flows or financial condition;

risks related to strategic transactions and realization of the expected benefits of such transactions, including with respect to the sale of our international life, accident and supplemental benefits businesses, as well as integration or separation difficulties or underperformance relative to expectations;

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potential failure of our prevention, detection and control systems;

unfavorable economic and market conditions, stock market or interest rate declines and risks related to a downgrade in financial strength ratings of our insurance subsidiaries;

unfavorable economic and market conditions, including the risk of a recession or other economic downturn and resulting impact on employment metrics, stock market or interest rate declines and risks related to a downgrade in financial strength ratings of our insurance subsidiaries;

the impact of our significant indebtedness and the potential for further indebtedness in the future;

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See Note 1 to the Consolidated Financial Statements for a description of our segments.

Summarized below are certain key measures of our performance by segment for the three months ended March 31, 2022 and 2021:

The commentary provided below describes our results for the three and six months ended June 30, 2022 compared with the same periods in 2021.

Unless specified otherwise, commentary applies to both the three and six month periods.

Summarized below are certain key measures of our performance by segment for the three and six months ended June 30, 2022 and 2021:

Financial highlights by segment

Three Months Ended March 31,

(Dollars in millions, except per share amounts) 2022 2021 % Change

Three Months Ended June 30, Six Months Ended June 30,

(Dollars in millions, except per share amounts) 2022 2021 % Change 2022 2021 % Change

Adjusted revenues by segment

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Net realized investment gains (losses) (1)

(422) (13) N/M

(46) 83 N/M (468) 70 N/M

Amortization of acquired intangible assets (501) (503) — (959) (998) 4

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Three Months Ended

(Dollars in millions) 2022 2021 % Change

June 30, Six Months Ended

(Dollars in millions) 2022 2021 % Change 2022 2021 % Change

Pharmacy revenues $ 31,972 $ 30,047 6 % $ 62,669 $ 58,072 8 %

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Interest expense and other (301) (298) (1) (600) (612) 2

Debt extinguishment costs — (131) N/M

Net realized investment gains (losses) (319) 1 N/M

Debt extinguishment costs — (10) N/M — (141) N/M

Net realized investment gains (losses) (95) 59 N/M (414) 60 N/M

Income before income taxes 1,985 1,898 5 3,534 3,411 4

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Shareholders' net income $ 1,559 $ 1,467 6 % $ 2,742 $ 2,628 4 %

Consolidated effective tax rate 22.7 % 22.6 % 10 bps

Consolidated effective tax rate 20.8 % 22.2 % (140) bps 21.6 % 22.4 % (80) bps

Medical customers (in thousands) 17,806 16,921 5 %

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Three Months Ended

March 31, Three Months Ended

June 30, Six Months Ended

June 30, Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021 2022 2021 2022 2021

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Integration and transaction-related costs 26 14 63 36 0.08 0.04 0.20 0.10

Charge for organizational efficiency plan 17 — 17 — 0.05 — 0.05 —

Charges (benefits) associated with litigation matters (20) — (20) (21) (0.06) — (0.06) (0.06)

Debt extinguishment costs — 9 — 110 — 0.03 — 0.32

(Benefits) charges associated with litigation matters — (21) — (0.06)

Total special items 23 23 60 125 0.07 0.07 0.19 0.36

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Recent Events

Cigna's commitment to the health, well-being and peace of mind of our employees and the people we serve remains our focus as the pandemic environment evolves.

We continue to leverage our resources, expertise, data and actionable intelligence to assist customers, clients and care providers throughout this time.

The situation surrounding COVID-19 remains fluid with continued uncertainty and a wide range of potential outcomes.

We continue to actively manage our response and assess impacts to our financial position and operating results, as well as mitigate adverse developments in our business.

For further information regarding the potential impact of COVID-19 on the Company, see "Risk Factors" contained in Part I, Item 1A of our 2021 Form 10-K.

The United States economy continues to be impacted by rising inflation.

While we have not experienced material impacts from inflation on our results of operations or cash flows for the three months ended March 31, 2022, we continue to monitor our operations for any inflationary impacts.

For further information regarding risks we encounter in our business due to economic conditions including inflationary pressures, please see "Risk Factors" contained in Part I, Item 1A of our 2021 Form 10-K.

We have not experienced material impacts from inflation on our results of operations or cash flows for the three and six months ended June 30, 2022.

We continue to monitor our operations, including vendor costs, health care provider costs and drug pricing for any inflationary impacts, and believe we are prepared to respond to inflationary pressures.

For further information regarding risks we encounter in our business due to economic conditions including inflationary pressures, see "Risk Factors" contained in Part I, Item 1A of our 2021 Form 10-K.

Russian Invasion of Ukraine

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We have not experienced significant impacts to date on our investment portfolio, financial position, or results of operations.

For a more complete discussion of the risks we encounter in our business, please see "Risk Factors" contained in Part I, Item 1A of our 2021 Form 10-K.

Three Months Ended March 31, 2022 versus Three Months Ended March 31, 2021

The commentary presented below, and in the segment discussions that follow, compare results for the three months ended March 31, 2022 with results for the three months ended March 31, 2021.

Shareholders' net income increased slightly, reflecting strong growth in adjusted income from operations (as discussed below) and the absence in 2022 of debt extinguishment costs incurred in the first quarter of 2021.

These favorable effects were largely offset by higher realized investment losses primarily due to mark-to-market adjustments on equity securities during the first quarter of 2022.

Adjusted income from operations increased, primarily due to improved results in Cigna Healthcare, primarily reflecting higher specialty contributions, and in Evernorth, primarily reflecting continued contract affordability improvements and business growth.

Medical customers grew, reflecting a higher customer base in our Middle Market, Select and International Health market segments.

For a more complete discussion of the risks we encounter in our business, see "Risk Factors" contained in Part I, Item 1A of our 2021 Form 10-K.

Cigna's commitment to the health, well-being and peace of mind of our employees and the people we serve remains our focus as the pandemic environment evolves.

We continue to leverage our resources, expertise, data and actionable intelligence to assist customers, clients and care providers throughout this time.

The situation surrounding COVID-19 remains fluid with continued uncertainty and a wide range of potential outcomes.

We continue to actively manage our response and assess impacts to our financial position and operating results, as well as mitigate adverse developments in our business.

For further information regarding the potential impact of COVID-19 on the Company, see "Risk Factors" contained in Part I, Item 1A of our 2021 Form 10-K.

Three and Six Months Ended June 30, 2022 versus Three and Six Months Ended June 30, 2021

The commentary presented below, and in the segment discussions that follow, compare results for the three and six months ended June 30, 2022 with results for the three and six months ended June 30, 2021.

Shareholders' net income increased, reflecting strong growth in adjusted income from operations (as discussed below) and, for the six month period, the absence in 2022 of debt extinguishment costs incurred in 2021.

These favorable effects were partially offset by higher realized investment losses primarily due to unfavorable mark-to-market adjustments on investments in 2022.

Adjusted income from operations increased, primarily due to improved results in Cigna Healthcare, primarily reflecting lower medical care ratios and increased specialty contributions, and in Evernorth, primarily reflecting continued contract affordability improvements and business growth.

Medical customers increased, reflecting growth in our Middle Market, Select and International Health market segments.

See "Cigna Healthcare segment" section of this MD&A for discussion of an update to the definitions of U.S.

Commercial's market segments.

Pharmacy revenues increased, reflecting higher specialty claims volume due in part to Evernorth's collaboration with Prime Therapeutics, as well as increased prices, primarily due to inflation on branded drugs.

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See "Cigna Healthcare segment" section of this MD&A for further discussion.

Fees and other revenues increased, primarily reflecting customer growth from our formulary rebate administrative services.

Fees and other revenues increased, primarily reflecting customer growth from our Pharmacy Rebate Program services.

See "Evernorth segment" section of this MD&A for further discussion.

Net investment income increased due to strong returns on our partnership investments.

Net investment income increased primarily due to strong returns on our partnership investments.

See the "Investment Assets" section of this MD&A for further discussion.

Pharmacy and other service costs increased, reflecting higher specialty claims volume due in part to Evernorth's collaboration with Prime Therapeutics, as well as increased prices, primarily due to inflation on branded drugs.

Medical costs and other benefit expenses increased, resulting from higher medical cost trend, partially offset by the disposition of the Medicaid business.

Selling, general and administrative expenses were largely flat.

Interest expense and other decreased primarily due to lower average interest rates.

Debt extinguishment costs were lower as no debt was retired early in the first quarter of 2022.

Realized investment results were lower, primarily due to mark-to-market adjustments on equity securities during the first quarter of 2022.

Medical costs and other benefit expenses decreased for the three and six months ended June 30, 2022, reflecting reduced customers in our U.S.

Government business, primarily resulting from the disposition of the Medicaid business.

Decreases also reflect lower direct COVID-19 costs and are partially offset by medical cost trend.

See "Cigna Healthcare segment" section of this MD&A for further discussion.

Selling, general and administrative expenses increased for the three months ended June 30, 2022, compared with the same period last year, primarily due to the absence of favorable litigation developments recorded in the second quarter of 2021 and, to a lesser extent, an increase in expenses associated with business growth.

For the six months ended June 30, 2022, the increase was primarily driven by expenses associated with business growth.

Interest expense and other was essentially flat.

Debt extinguishment costs declined as no debt was retired early in the first six months of 2022.

Realized investment results were lower, primarily due to unfavorable mark-to-market adjustments on investments in 2022.

See Note 11 to the Consolidated Financial Statements for further discussion.

The effective tax rate increased slightly primarily attributable to an increase in state and foreign income taxes, partially offset by the favorable impact of the remeasurement of deferred income taxes.

The effective tax rate decreased, driven by favorable results relative to our foreign operations and for the six months ended June 30, 2022 the favorable impact of the remeasurement of deferred taxes, partially offset by the absence of the favorable impact of non-recurring items recorded in 2021.

Kaiser Permanente

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As discussed in Note 15 to the Consolidated Financial Statements, during the fourth quarter of 2021, the Company approved a strategic plan to drive operational efficiencies.

We believe this plan, coupled with the previously announced divestiture of the international life, accident and supplemental health benefits businesses (described below), will further leverage the Company's ongoing growth to drive operational efficiency through enhancements to organizational structure and increased use of automation and shared services.

In connection with these plans, Cigna has updated its reporting segments to align with the new business reporting structure and recognized a charge in the fourth quarter of 2021 in the amount of $168 million, pre-tax ($119 million, after-tax).

We expect to realize annualized after-tax savings of approximately $180 million.

A substantial portion of the savings is expected to be realized in 2022.

Although a substantial portion of the actions associated with these strategic steps have been reflected in the charge recognized in the fourth quarter of 2021, additional amounts are expected to be recorded in the second quarter of 2022 as we finalize our plans following the completion of the divestiture.

We believe this plan, coupled with the divestiture of the international life, accident and supplemental health benefits businesses (described below), will further leverage the Company's ongoing growth to drive operational efficiency through enhancements to organizational structure and increased use of automation and shared services.

In connection with these plans, Cigna updated its reporting segments to align with the new business reporting structure and recognized a charge in the fourth quarter of 2021 in the amount of $168 million, pre-tax ($119 million, after-tax).

As previously anticipated, during the second quarter of 2022, the Company updated its strategic plan, primarily for severance costs, and recognized a charge in the amount of $22 million, pre-tax ($17 million, after-tax).

As a result of our Organizational Efficiency Plan, we expect to realize annualized after-tax savings of $184 million.

A substantial amount of the savings is expected to be realized in 2022.

See Note 15 to the Consolidated Financial Statements for further information regarding our organizational efficiency charge.

Agreement to Sell International Life, Accident and Supplemental Benefits Businesses

We entered into a definitive agreement in October 2021 to sell our life, accident and supplemental benefits businesses in several countries to Chubb INA Holdings, Inc.

As of March 31, 2022, we now expect to sell our life, accident and supplemental benefits businesses in six countries (Hong Kong, Indonesia, New Zealand, South Korea, Taiwan and Thailand) to Chubb for $5.72 billion in cash (the "Chubb Transaction");

we no longer expect to sell our interest in a joint venture in Turkey as part of the Chubb Transaction.

Sale of International Life, Accident and Supplemental Benefits Businesses in Six Countries

On July 1, 2022, we completed the sale of our life, accident and supplemental benefits businesses in six countries (Hong Kong, Indonesia, New Zealand, South Korea, Taiwan and Thailand) to Chubb INA Holdings, Inc.

("Chubb") for approximately $5.4 billion in cash (the "Chubb Transaction");

as previously agreed, we excluded our interest in a joint venture in Türkiye from the Chubb Transaction.

We aggregated and classified the assets and liabilities of these businesses as held for sale in our Consolidated Balance

Sheets as of June 30, 2022 and December 31, 2021.

See Note 5 to the Consolidated Financial Statements for further information on the classification of these businesses as held for sale.

Subject to applicable regulatory approvals and customary closing conditions, we expect to complete the sale of these businesses in the second quarter of 2022.

The "Liquidity and Capital Resources" section of this MD&A provides a discussion of the expected impact of this transaction to liquidity.

The "Liquidity and Capital Resources" section of this MD&A provides further information on the impact of this transaction to liquidity.

See "Other Operations" section of this MD&A for further information on the results of these businesses.

Purchase of MDLIVE

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Most of the Evernorth segment operations are not subject to regulatory restrictions regarding dividends and therefore provide significant financial flexibility to Cigna.

Cash flows for the three months ended March 31 were as follows:

Three Months Ended March 31,

Cash flows for the six months ended June 30 were as follows:

Six Months Ended June 30,

(In millions) 2022 2021

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Financing activities $ (3,087) $ (4,113)

The following discussion explains variances in the various categories of cash flows for the three months ended March 31, 2022 compared with the same period in 2021.

The following discussion explains variances in the various categories of cash flows for the six months ended June 30, 2022 compared with the same period in 2021.

Operating activities

Cash flows from operating activities consist principally of cash receipts and disbursements for pharmacy revenues and costs, premiums, fees, investment income, taxes, benefit costs and other expenses.

Cash provided by operating activities increased, driven primarily by the receipt of the delayed 2021 CMS Part D settlement and the timing of accrued liability payments, partially offset by timing of pharmacy and other service costs payable.

As a result of the receipt of the delayed 2021 CMS Part D settlement, lower income tax payments and timing of payments in accounts payable and accrued liabilities in 2022 compared to 2021, cash provided by operating activities increased.

Investing and Financing activities

Cash used in investing activities decreased due to lower net purchases of investments.

Cash used in financing activities decreased primarily due to lower stock repurchases and lower debt repayments.

The Company acquired MDLIVE and had higher net purchases of investments in 2021.

These activities resulted in lower cash used in investing activities in 2022.

The Company repurchased less stock and repaid less debt, which resulted in a reduction in cash used in financing activities in 2022.

Capital Resources

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Dividends from U.S.

regulated subsidiaries were $475 million for the three months ended March 31, 2022 and $625 million for the three months ended March 31, 2021.

regulated subsidiaries were $1.0 billion for the six months ended June 30, 2022 and $1.3 billion for the six months ended June 30, 2021.

Non-regulated subsidiaries also generate significant cash flow from operating activities, which is typically available immediately to the parent company for general corporate purposes.

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Our revolving credit agreements provide us with the ability to borrow amounts for general corporate purposes, including for the purpose of providing liquidity support if necessary under our commercial paper program discussed above.

As of April 2022, Cigna's revolving credit agreements include:

As of June 30, 2022, Cigna's revolving credit agreements include:

a $3.0 billion five-year revolving credit and letter of credit agreement that expires in April 2027;

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and a $1.0 billion 364-day revolving credit agreement that expires in April 2023.

As of March 31, 2022, we had $5.0 billion of undrawn committed capacity under our revolving credit agreements that have since been replaced with the revolving credit agreements described above (these amounts are available for general corporate purposes, including providing liquidity support for our commercial paper program), $3.4 billion of remaining capacity under our commercial paper program and $4.6 billion in cash and short-term investments, approximately $0.7 billion of which was held by the parent company or certain non-regulated subsidiaries.

As of June 30, 2022, we had $5.0 billion of undrawn committed capacity under our revolving credit agreements (these amounts are available for general corporate purposes, including providing liquidity support for our commercial paper program), $3.2 billion of remaining capacity under our commercial paper program and $4.6 billion in cash and short-term investments, approximately $0.7 billion of which was held by the parent company or certain non-regulated subsidiaries.

See Note 7 to the Consolidated Financial Statements for further information on our credit agreements and commercial paper program.

Our debt-to-capitalization ratio was 41.9% at March 31, 2022 and 41.7% at December 31, 2021.

Our debt-to-capitalization ratio was 42.1% at June 30, 2022 and 41.7% at December 31, 2021.

We actively monitor our debt obligations and engage in issuance or redemption activities as needed in accordance with our capital management strategy.

Subsidiary Borrowings.

In addition to the sources of liquidity discussed above, the parent company can borrow an additional $2.2 billion from its subsidiaries without further approvals as of March 31, 2022.

In addition to the sources of liquidity discussed above, the parent company can borrow an additional $2.5 billion from its subsidiaries without further approvals as of June 30, 2022.

Use of Capital Resources

Capital Expenditures .

Capital expenditures for property, equipment and computer software were $288 million in the three months ended March 31, 2022 compared to $242 million in the three months ended March 31, 2021.

Capital expenditures for property, equipment and computer software were $612 million in the six months ended June 30, 2022 compared to $500 million in the six months ended June 30, 2021.

We expect to continue to invest in technology that we believe will drive future growth.

Anticipated capital expenditures will be funded primarily from operating cash flow.

In the first quarter of 2022, Cigna declared and paid quarterly cash dividends of $1.12 per share of Cigna common stock.

During the first six months of 2022, Cigna declared and paid quarterly cash dividends of $1.12 per share of Cigna common stock.

See Note 8 to the Consolidated Financial Statements for further information on our dividend payments.

On April 27, 2022, the Board of Directors declared the second quarter cash dividend of $1.12 per share of Cigna common stock to be paid on June 23, 2022 to shareholders of record on June 8, 2022.

On July 27, 2022, the

Board of Directors declared the third quarter cash dividend of $1.12 per share of Cigna common stock to be paid on September 22, 2022 to shareholders of record on September 7, 2022.

Cigna currently intends to pay regular quarterly dividends, with future declarations subject to approval by its Board of Directors and the Board's determination that the declaration of dividends remains in the best interests of Cigna and its shareholders.

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The timing and actual number of shares repurchased will depend on a variety of factors including price, general business and market conditions and alternate uses of capital.

The share repurchase program may be effected through open market purchases in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, including through Rule 10b5-1 trading plans or privately negotiated transactions.

The share repurchase program may be effected through open market purchases in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including through Rule 10b5-1 trading plans or privately negotiated transactions.

The program may be suspended or discontinued at any time.

In February 2022, the Board increased repurchase authority by an additional $6.0 billion.

We repurchased 5.8 million shares for approximately $1.3 billion during the three months ended March 31, 2022, compared to 12.7 million shares for approximately $2.8 billion during the three months ended March 31, 2021.

From April 1, 2022 through May 5, 2022, we repurchased 1.9 million shares for approximately $470 million.

Share repurchase authority was $9.4 billion as of May 5, 2022.

We repurchased 9.7 million shares for approximately $2.3 billion during the six months ended June 30, 2022, compared to 16.3 million shares for approximately $3.7 billion during the six months ended June 30, 2021.

From July 1, 2022 through August 3, 2022, we repurchased 10.4 million shares through the initial delivery under the accelerated share repurchase agreements ("ASR agreements") discussed below.

Share repurchase authority was $5.3 billion as of August 3, 2022.

On June 15, 2022, as part of our existing share repurchase program, we entered into separate ASR agreements with Mizuho Markets Americas LLC and Morgan Stanley & Co.

LLC (collectively, the "Counterparties") to repurchase $3.5 billion of common stock in aggregate.

In July 2022, in accordance with the ASR agreements we remitted $3.5 billion to the Counterparties and received an initial delivery of 10.4 million shares of our common stock.

We expect final settlement under the ASR agreements to occur in the fourth quarter of 2022.

See Note 8 to the Consolidated Financial Statements for further information on our ASR agreements.

Strategic investments.

In 2022, we committed an additional $450 million (which in aggregate represents a $700 million commitment) to Cigna Ventures, our strategic corporate venture fund.

Cigna Ventures will use this new funding to continue to invest in companies making progress in insights and analytics, digital health and experience, and care delivery and enablement.

Sale of life, accident and supplemental benefits businesses in six countries.

We entered into a definitive agreement in October 2021 to sell our life, accident and supplemental benefits businesses in several countries to Chubb.

Subject to applicable regulatory approvals and customary closing conditions, we expect to complete the sale of these businesses in the second quarter of 2022.

Cigna estimates it will receive approximately $5.4 billion of net after-tax proceeds from this transaction and expects to utilize the after-tax proceeds primarily for share repurchases.

Cigna Ventures will use this funding to drive continuous health care transformation, innovation and growth.

Sale of international life, accident and supplemental benefits businesses in six countries.

Cigna estimates it will receive approximately $5.1 billion of net after-tax proceeds from this transaction and expects to utilize the after-tax proceeds primarily for share repurchases, with $3.5 billion used to fund the purchases of our common stock pursuant to the ASR agreements (as described above).

Risks to our liquidity and capital resources outlook include cash projections that may not be realized and the demand for funds could exceed available cash if our ongoing businesses experience unexpected shortfalls in earnings or we experience material adverse effects from one or more risks or uncertainties described more fully in the "Risk Factors" section of our 2021 Form 10-K.

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No guarantees are provided by Cigna or any of our subsidiaries under the program.

We have been informed by the financial institution that $341 million as of March 31, 2022 and $331 million as of December 31, 2021 of our outstanding payment obligations were voluntarily elected by suppliers to be sold to the financial institution under the program.

We have been informed by the financial institution that $133 million as of June 30, 2022 and $331 million as of December 31, 2021 of our outstanding payment obligations were voluntarily elected by suppliers to be sold to the financial institution under the program.

These amounts are reflected in Accounts payable in Cigna's Consolidated Balance Sheets.

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See Note 18 to the Consolidated Financial Statements for discussion of various guarantees.

During the three months ended March 31, 2022, there was no material change to the contractual obligations reported in our 2021 Form 10-K.

During the six months ended June 30, 2022, there was no material change to the contractual obligations reported in our 2021 Form 10-K.

CRITICAL ACCOUNTING ESTIMATES

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Our most critical accounting estimates, as well as the effect of hypothetical changes in material assumptions used to develop each estimate, are described in the 2021 Form 10-K.

As of March 31, 2022, there were no significant changes to the critical accounting estimates from what was reported in our 2021 Form 10-K.

As of June 30, 2022, there were no significant changes to the critical accounting estimates from what was reported in our 2021 Form 10-K.

SEGMENT REPORTING

The following section of this MD&A discusses the results of each of our segments.

We entered into a definitive agreement in October 2021 to sell our life, accident and supplemental benefits businesses in several countries to Chubb.

In connection with the pending Chubb Transaction, we revised our business reporting structure.

As such, we adjusted our segment reporting effective in the fourth quarter of 2021 and segment results for the three months ended March 31, 2021 have been restated to conform to the new segment presentation.

During the fourth quarter of 2021, in connection with the Chubb Transaction, we revised our business reporting structure and adjusted our segment reporting accordingly.

Segment results for the three and six months ended June 30, 2021 have been restated to conform to the new segment presentation.

See Note 1 to the Consolidated Financial Statements for further description of our segments.

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Evernorth Segment

Evernorth includes a broad range of coordinated and point solution health services and capabilities, as well as those from partners across the health care system, in pharmacy solutions, benefits management solutions, care delivery and care management solutions and intelligence solutions.

Evernorth includes a broad range of coordinated and point solution health services and capabilities, as well as those from partners across the health care system, in pharmacy benefits services, specialty pharmacy and care services.

As described in the introduction to Segment Reporting, Evernorth's performance is measured using adjusted revenues and pre-tax adjusted income (loss) from operations.

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• The mix of claims generally considers the type of drug and distribution method used for dispensing and fulfilling.

Types of drugs can have an impact on our pharmacy revenues, pharmacy and other service costs and gross profit, including amounts payable under certain financial and performance guarantees with our clients.

Types of drugs can have an impact on our pharmacy revenues, pharmacy and other service costs and gross profit, including amounts

payable under certain financial and performance guarantees with our clients.

In addition to the types of drugs, the mix of generic claims (i.e., generic fill rate) also impacts our gross profit.

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Financial Summary Three Months Ended

March 31, Change Favorable

June 30, Change Favorable

(Unfavorable) Six Months Ended

June 30, Change Favorable

(Unfavorable)

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Pre-tax adjusted income from operations $ 1,475 $ 1,413 4 % $ 2,777 $ 2,636 5 %

Pre-tax adjusted margin 3.9 % 4.0 % (10) bps

Pre-tax adjusted margin 4.2 % 4.3 % (10) bps 4.1 % 4.2 % (10) bps

Adjusted expense ratio (2)

2.1 % 2.0 % 10 bps

1.9 % 2.0 % (10) bps 2.0 % 2.0 % — bps

Three Months Ended

March 31, Change Favorable

June 30, Change Favorable

(Unfavorable) Six Months Ended

June 30, Change Favorable

(Unfavorable)

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Adjusted network revenues (1)

$ 16,107 $ 16,166 — % $ 31,638 $ 31,304 1 %

Adjusted home delivery and specialty revenues (1)

15,268 13,341 14 29,967 26,115 15

Other pharmacy revenues 1,667 1,619 3 3,379 3,007 12

Total adjusted pharmacy revenues (1)

$ 33,042 $ 31,126 6 % $ 64,984 $ 60,426 8 %

Adjusted fees and other revenues (1)

1,805 1,461 24 3,439 2,778 24

Net investment income 16 5 220 26 8 225

Adjusted revenues (1)

$ 34,863 $ 32,592 7 % $ 68,449 $ 63,212 8 %

Pharmacy script volume (3)

Adjusted network scripts 323 339 (5) % 638 662 (4) %

315 323 (2) %

Adjusted home delivery and specialty scripts 69 71 (3) 139 141 (1)

Total adjusted scripts 392 410 (4) % 777 803 (3) %

385 393 (2) %

Generic fill rate (4)

Network 87.2 % 87.3 % (10) bps

Home delivery 85.4 % 86.0 % (60) bps

Overall generic fill rate 87.0 % 87.2 % (20) bps

Network 87.6 % 85.3 % 230 bps 87.4 % 86.3 % 110 bps

Home delivery 85.8 % 85.7 % 10 bps 85.6 % 85.8 % (20) bps

Overall generic fill rate 87.5 % 85.4 % 210 bps 87.2 % 86.2 % 100 bps

(1) Total revenues and gross profit were equal to adjusted revenues and adjusted gross profit as there were no special items in the periods presented.

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(4) Generic fill rate is defined as the total number of generic scripts divided by the total overall scripts filled.

Three Months Ended March 31, 2022 versus Three Months Ended March 31, 2021

Adjusted network revenues increased, reflecting increased prices, due to inflation on branded drugs.

This increase was partially offset by lower claims volume and a slight change in claims mix due to an increase in the generic fill rate after excluding the impact of COVID-19 vaccines.

Adjusted home delivery and specialty revenues increased, reflecting higher specialty claims volume due in part to our collaboration with Prime Therapeutics, as well as increased prices, primarily due to inflation on branded drugs, and a change in claims mix, primarily due to a decrease in the home delivery generic fill rate.

Three and Six Months Ended June 30, 2022 versus Three and Six Months Ended June 30, 2021

Adjusted network revenues increased for the six months ended June 30, 2022, reflecting increased prices due to inflation on branded drugs;

partially offset by lower claims volume and a slight change in claims mix due to an increase in the generic fill rate.

Adjusted network revenues decreased for the three months ended, reflecting lower claims volume and a slight change in claims mix due to an increase in the generic fill rate;

partially offset by increased prices due to inflation on branded drugs.

These increases were partially offset by slightly lower home delivery claims volume.

Other pharmacy revenues increased, reflecting higher volume from our CuraScript SD business.

Adjusted fees and other revenues increased, reflecting customer growth from our formulary rebate administrative services and the acquisition of MDLIVE in the second quarter of 2021.

Adjusted fees and other revenues increased, reflecting customer growth from our Pharmacy Rebate Program services and the acquisition and subsequent growth of the MDLIVE business.

Adjusted gross profit and pre-tax adjusted income from operations increased, reflecting continued contract affordability improvements and business growth.

The increase in pre-tax adjusted income from operations was partially offset by strategic investments in expanding our services portfolio and digital capabilities.

The increase was partially offset by strategic investments in expanding our services portfolio and digital capabilities as well as lower volume in our network and home delivery businesses.

Pre-tax adjusted income from operations also increased due to expense favorability.

The adjusted expense ratio was flat, reflecting higher revenues as well as increased strategic investments in expanding our services portfolio and digital capabilities.

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Results of Operations

Financial Summary Three Months Ended March 31, Change Favorable

Financial Summary Three Months Ended June 30, Change Favorable

(Unfavorable) Six Months Ended June 30, Change Favorable

(Unfavorable)

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Pre-tax adjusted income from operations $ 1,240 $ 1,049 18 % $ 2,519 $ 2,091 20 %

Pre-tax adjusted margin 11.2 % 9.4 % 180 bps

Medical care ratio 81.5 % 80.9 % (60) bps

Adjusted expense ratio 20.7 % 22.2 % 150 bps

Three Months Ended March 31, 2022 versus Three Months Ended March 31, 2021

Adjusted revenues increased reflecting increases in U.S.

Pre-tax adjusted margin 10.9 % 9.4 % 150 bps 11.1 % 9.4 % 170 bps

Medical care ratio 80.7 % 84.4 % 370 bps 81.1 % 82.7 % 160 bps

Adjusted expense ratio 20.6 % 18.9 % (170) bps 20.6 % 20.6 % — bps

Three and Six Months Ended June 30, 2022 versus Three and Six Months Ended June 30, 2021

Adjusted revenues increased for the three months and six months ended June 30, 2022, reflecting increases in U.S.

Commercial partially offset by decreases in U.S.

The increase in U.S.

Commercial adjusted revenues reflects increased specialty contributions and higher premium rates due to anticipated underlying medical cost trend.

The decrease in U.S.

The increases in U.S.

Commercial adjusted revenues reflects increased specialty contributions, higher premium rates due to anticipated underlying medical cost trend as well as customer growth.

The decreases in U.S.

Government adjusted revenues reflects the disposition of the Medicaid business.

Pre-tax adjusted income from operations increased primarily reflecting increased specialty contributions in U.S.

The medical care ratio increased due to a higher loss ratio in U.S.

Government reflecting risk adjustment updates related to prior years and higher medical costs associated with our Individual business.

These increases were partially offset by lower direct COVID-19 costs in U.S.

The adjusted expense ratio decreased primarily reflecting the absence of litigation expenses recorded in 2021 as well as efficiencies from continued disciplined expense management.

Pre-tax adjusted income from operations increased for the three months and six months ended June 30, 2022, reflecting increased contributions from U.S.

Commercial, U.S.

Government and International Health.

These increases were primarily due to lower medical care ratios and increased specialty contributions in U.S.

partially offset by the absence of favorable non-recurring items recorded in 2021.

The medical care ratio decreased for the three months and six months ended June 30, 2022, primarily due to medical costs that have moderated since 2021, including lower direct COVID-19 costs and effective execution in pricing and affordability initiatives, in U.S.

Commercial as well as improved Medicare Advantage risk adjustment revenues.

The decrease for the six months ended June 30, 2022 was partially offset by U.S.

Government risk adjustment updates related to prior years that were recognized in the first quarter of 2022.

The adjusted expense ratio increased for the three months ended June 30, 2022, primarily reflecting the absence of favorable litigation developments recor ded in 2021.

The adjusted expense ratio was flat for the six months ended June 30, 2022.

Medical Customers

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• has medical claims that are administered by us.

As of March 31,

Effective in the second quarter of 2022, the Company updated its U.S.

Commercial market segments as follows:

the National segment comprises employers with 3,000 or more eligible employees, and the Middle Market segment comprises employers with 500 to 2,999 eligible employees, Taft-Hartley plans, and other groups.

Previously, the National segment comprised multi-state employers with 5,000 or more eligible employees and the Middle Market segment comprised employers with 500 to 4,999 eligible employees, single-site employers with more than 5,000 employees, Taft-Hartley plans and other groups.

There have been no updates to the Select (employers generally with 51 to 499 eligible employees) or Small Group (employers generally with 2 to 50 eligible employees) market segments.

As of June 30,

(In thousands) 2022 2021 % Change

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Total 17,806 16,921 5 %

(1) International Health excludes medical customers served by less than 100% owned subsidiaries and customers that are part of the businesses to be sold pursuant to the Chubb Transaction.

Three Months Ended March 31, 2022 versus Three Months Ended March 31, 2021

Our medical customer base increased driven by a higher customer base in our Middle Market, Select and International Health segments.

(1) International Health excludes medical customers served by less than 100% owned subsidiaries and customers that are part of the businesses sold pursuant to the Chubb Transaction.

Our medical customer base increased at June 30, 2022, reflecting growth in our Middle Market, Select and International Health market segments;

partially offset by the disposition of the Medicaid business.

Unpaid Claims and Claim Expenses

(In millions) As of March 31, 2022 As of December 31, 2021 % Change

(In millions) As of June 30, 2022 As of December 31, 2021 % Change

Unpaid claims and claim expenses – Cigna Healthcare

$ 4,490 $ 4,261 5 %

Our unpaid claims and claim expenses liability was higher as of March 31, 2022 compared with December 31, 2021, primarily due to stop loss seasonality.

Our unpaid claims and claim expenses liability was higher as of June 30, 2022, primarily due to stop loss seasonality;

partially offset by Medicare Part D invoice cycle timing and the disposition of the Medicaid business.

Other Operations

Other Operations includes International businesses to be sold, Corporate Owned Life Insurance ("COLI"), our interest in a joint venture in Turkey and the Company's run-off operations.

Other Operations includes the International businesses sold to Chubb on July 1, 2022, Corporate Owned Life Insurance ("COLI"), our interest in a joint venture in Türkiye and the Company's run-off operations.

As described in the introduction of Segment Reporting, performance of Other Operations is measured using adjusted revenues and pre-tax adjusted income from operations.

Results of Operations

Financial Summary Three Months Ended

March 31, Change

Financial Summary Three Months Ended June 30, Change

(Unfavorable) Six Months Ended

June 30, Change

(Unfavorable)

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Pre-tax adjusted income from operations $ 233 $ 215 8 % $ 459 $ 446 3 %

Pre-tax adjusted margin 23.1 % 23.0 % 10 bps

Three Months Ended March 31, 2022 versus Three Months Ended March 31, 2021

Adjusted revenues decreased primarily due to unfavorable foreign currency movements in the International businesses and lower premiums in run-off businesses, largely offset by business growth and higher net investment income in the International businesses.

Pre-tax adjusted income from operations declined due to lower earnings in run-off businesses, partially offset by higher earnings in the International businesses.

Other Items Related to International Businesses Subject to Definitive Purchase Agreement

For the three months ended March 31, 2022, 85% of Other Operations' adjusted revenues and 92% of its pre-tax adjusted income from operations was associated with International businesses held for sale.

Pre-tax adjusted margin 24.6 % 21.7 % 290 bps 23.8 % 22.4 % 140 bps

Three and Six Months Ended June 30, 2022 versus Three and Six Months Ended June 30, 2021

Adjusted revenues decreased primarily due to unfavorable foreign currency movements, largely offset by business growth and higher net investment income in the International businesses.

Pre-tax adjusted income from operations increased primarily due to higher earnings in the Run-off businesses and COLI.

Other Items Related to International Businesses Sold to Chubb

For the three months ended June 30, 2022 , 84% of Other Operations' adjusted revenues and 85% of its pre-tax adjusted income from operations was associated with International businesses sold to Chubb on July 1, 2022.

For the six months ended June 30, 2022, 84% of Other Operations' adjusted revenues and 88% of its pre-tax adjusted income from operations was associated with sold International businesses;

as a result of the sale, Other Operations' adjusted revenues and pre-tax adjusted income from operations will decrease in future periods.

Corporate reflects amounts not allocated to operating segments, including net interest expense (defined as interest on corporate debt less net investment income on investments not supporting segment and other operations), certain litigation matters, expense associated with our frozen pension plans, charitable contributions, severance, certain overhead and enterprise-wide project costs and intersegment eliminations for products and services sold between segments.

Financial Summary Three Months Ended March 31, Change Favorable (Unfavorable)

Financial Summary Three Months Ended

June 30, Change Favorable (Unfavorable) Six Months Ended June 30, Change Favorable (Unfavorable)

(In millions) 2022 2021 2022 2021

Pre-tax adjusted loss from operations $ (401) $ (344) (17) % $ (744) $ (698) (7) %

Three Months Ended March 31, 2022 versus Three Months Ended March 31, 2021

Pre-tax adjusted loss from operations decreased primarily due to lower interest expense.

Three and Six Months Ended June 30, 2022 versus Three and Six Months Ended June 30, 2021

Pre-tax adjusted loss from operations increased, reflecting an increase in operating expenses for enterprise-wide initiatives.

INVESTMENT ASSETS

The following table presents our investment asset portfolio excluding separate account assets as of March 31, 2022 and December 31, 2021.

The following table presents our investment asset portfolio excluding separate account assets as of June 30, 2022 and December 31, 2021.

Additional information regarding our investment assets is included in Notes 11, 12, 13 and 14 to the Consolidated Financial Statements.

(In millions) March 31,

(In millions) June 30,

2022 December 31, 2021

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See Note 5 to the Consolidated Financial Statements for additional information.

Investment Outlook

We continue to actively monitor current economic conditions driven by the pace of the pandemic recovery, recent geopolitical events and fiscal and monetary policy responses (including the resulting supply chain and labor market dynamics), and the portfolio impact of recent higher levels of both interest rates and inflation.

Future realized and unrealized investment results will be driven largely by market conditions and these future conditions are not reasonably predictable.

We believe that the vast majority of our investments will continue to perform under their contractual terms.

Based on our strategy to match the duration of invested assets to the duration of insurance and contractholder liabilities, we expect to hold a significant portion of these assets for the long-term.

The below discussion addresses the strategies and risks associated with our various classes of investment assets.

Although future declines in investment fair values resulting from interest rate movements and credit deterioration due to both investment-specific and the global economic uncertainties in the following discussion remain possible, we do not expect these losses to have a material adverse effect on our financial condition or liquidity.

Debt Securities

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More detailed information about debt securities by type of issuer and maturity dates is included in Note 11 to the Consolidated Financial Statements.

The following table reflects our portfolio of debt securities by type of issuer as of March 31, 2022 and December 31, 2021:

(In millions) March 31,

The following table reflects our portfolio of debt securities by type of issuer as of June 30, 2022 and December 31, 2021:

(In millions) June 30,

2022 December 31,

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Total $ 13,950 $ 16,958

Our debt securities portfolio decreased during the three months ended March 31, 2022, reflecting a decrease in valuations driven by a significant rise in treasury rates (in response to increased inflation), a modest increase in credit spreads, and net sales activity.

As of March 31, 2022, $13.4 billion, or 87% of the debt securities in our investment portfolio were investment grade (Baa and above, or equivalent) and the remaining $2 billion were below investment grade.

Our debt securities portfolio decreased during the six months ended June 30, 2022, reflecting a decrease in valuations driven by a significant rise in treasury rates and credit spreads, and net sales activity.

As of June 30, 2022, $12.0 billion, or 86% of the debt securities in our investment portfolio were investment grade (Baa and above, or equivalent) and the remaining $1.9 billion were below investment grade.

The majority of the bonds that are below investment grade are rated at the higher end of the non-investment grade spectrum.

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On an aggregate basis, the debt securities portfolio continues to perform according to original investment expectations.

However, due to the economic impacts of the COVID-19 pandemic, there are certain issuers, particularly within the aviation, energy and hospitality sectors, that have shown signs of distress, primarily in the form of requests for temporary covenant relief.

There were no material unrealized losses in any of these sectors as of the reporting date.

We continue to monitor the economic environment and its effect on our portfolio and consider the impact of various factors in determinin g the allowance for credit losses on debt securities, which is discussed in Note 11 to the Consolidated Financial Statements.

Elevated global inflation rates experienced during 2022, as well as continuing supply chain disruptions have displaced the ongoing impacts of the COVID-19 pandemic as the primary risks that many of the issuers in our portfolio are facing.

To date, most issuers have been successful in managing the cost escalation and product shortages without undue margin pressure.

We continue to monitor the economic environment and its effect on our portfolio and consider the impact of various factors in determining the allowance for credit losses on debt securities, which is discussed in Note 11 to the Consolidated Financial Statements.

Foreign government obligations are concentrated in Asia, primarily South Korea and Taiwan, consistent with our risk management practice and local regulatory requirements of our international business operations.

We expect the amount of these foreign government obligations to decrease significantly during 2022 upon the close of our sale of certain international businesses as discussed in Note 5 to the Consolidated Financial Statements.

We expect the amount of these foreign government obligations to decrease significantly upon the close of our sale of certain international businesses during the third quarter of 2022 as discussed in Note 5 to the Consolidated Financial Statements.

Commercial Mortgage Loans

As of March 31, 2022, the $1.6 billion commercial mortgage loan portfolio consisted of approximately 50 loans that are in good standing.

Our commercial mortgage loans are fixed rate loans, diversified by property type, location and borrower.

As of June 30, 2022, the $1.6 billion commercial mortgage loan portfolio consisted of approximately 50 fixed rate loans, diversified by property type, location and borrower.

Given the quality and diversity of the underlying real estate, positive debt service coverage and significant borrower cash invested in the property generally ranging between 30 and 40%, we remain confident that the vast majority of borrowers will continue to perform as expected under their contract terms.

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The review performed in the second quarter of 2022 confirmed ongoing strong overall credit quality in line with the previous year’s results.

COVID-19 has negatively impacted commercial real estate fundamentals and capital market activity with concentrated weakness in hotels and regional malls.

Our mortgage loan portfolio is well diversified by property type and geography with no material exposure to hotels and no exposure to regional shopping malls.

We continue to monitor the long-term impacts surrounding the office sector fundamentals due to multiple headwinds that may impact future valuations:

We continue to monitor the long-term impacts of COVID-19 on office sector fundamentals due to multiple headwinds that may impact future valuations:

expanded work from home flexibility, shorter term leases, elevated tenant improvement allowances and corporate migration to lower cost states.

Our mortgage loans secured by office properties are in good standing.

Additionally, the current macroeconomic headwinds are impacting capital markets and reducing investor appetite for capital intensive assets (e.g., office and regional shopping malls).

Our commercial mortgage loan portfolio has no exposure to regional shopping malls and less than 30% exposure to office properties.

Other Long-term Investments

Other long-term investments of $3.8 billion as of March 31, 2022 included investments in securities limited partnerships and real estate limited partnerships, direct investments in real estate joint ventures and other deposit activity that is required to support various insurance and health services businesses.

Other long-term investments of $4.1 billion as of June 30, 2022 included investments in securities limited partnerships and real estate limited partnerships, direct investments in real estate joint ventures and other deposit activity that is required to support various insurance and health services businesses.

The increase in other long-term investments of $0.5 billion since December 31, 2021 is primarily driven by net additional funding activity and value creation in the underlying investments.

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Given our subordinate position in the capital structure of these underlying entities, we assume a higher level of risk for higher expected returns.

To mitigate risk, these investments are diversified across approximately 210 separate partnerships and approximately 110 general partners who manage one or more of these partnerships.

To mitigate risk, these investments are diversified across approximately 200 separate partnerships and 100 general partners who manage one or more of these partnerships.

Also, the underlying investments are diversified by industry sector or property type and geographic region.

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Income from our limited partnership investments is generally reported on a one quarter lag due to the timing of when financial information is received from the general partner or manager of the investments.

Accordingly, our net investment income in the first quarter largely reflects the underlying financial information from the fourth quarter of 2021.

The broad recovery since the beginning of the outbreak of the COVID-19 pandemic has resulted in strong corporate earnings and higher public and private asset valuations.

Accordingly, our net investment income in the second quarter largely reflects the underlying financial information from the first quarter of 2022.

We expect continued volatility in private equity and real estate fund performance going forward as fair market valuations are adjusted to reflect market and portfolio transactions.

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We account for this joint venture under the equity method of accounting and report our share of the net assets of $1.0 billion in Other assets.

Our 50% share of the investment portfolio supporting the joint venture's liabilities is approximately $8.8 billion as of March 31, 2022.

Our 50% share of the investment portfolio supporting the joint venture's liabilities is approximately $9.0 billion as of June 30, 2022.

These investments were comprised of approximately 75% debt securities, including government and corporate debt diversified by issuer, industry and geography;

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We participate in the approval of the joint venture's investment strategy and continuously review its execution.

There were no investments with a material unrealized loss as of March 31, 2022.

Investment Outlook

We continue to actively monitor the economic impact of the pandemic, including supply chain, labor market and inflation dynamics, as well as fiscal and monetary responses and their potential impact on the portfolio.

Future realized and unrealized investment results will be driven largely by market conditions that exist when a transaction occurs or at the reporting date.

These future conditions are not reasonably predictable;

however, we believe that the vast majority of our investments will continue to perform under their contractual terms.

Based on our strategy to match the duration of invested assets to the duration of insurance and contractholder liabilities, we expect to hold a significant portion of these assets for the long-term.

Although future declines in investment fair values resulting from interest rate movements and credit deterioration due to both investment-specific and the global economic uncertainties discussed above remain possible, we do not expect these losses to have a material adverse effect on our financial condition or liquidity.

There were no investments with a material unrealized loss as of June 30, 2022.

Financial Instruments

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We encourage you to read this in conjunction with "Market Risk – Financial Instruments" included in the MD&A section of our 2021 Form 10-K.

Due to the decrease in fair value of our long-term debt since December 31, 2021, in the event of a hypothetical 100 basis point increase in interest rates, the fair value of the Company's long-term debt would decrease approximately $2.5 billion at March 31, 2022 compared to approximately $2.9 billion at December 31, 2021.

Due primarily to decreases in the fair value of our debt securities and long-term debt since December 31, 2021, the effect of hypothetical changes in market rates or prices on the fair value of certain financial instruments has changed.

In the event of a hypothetical 100 basis point increase in interest rates, the fair value of certain non-insurance financial instruments would decrease approximately $1.1 billion at June 30, 2022 compared to $1.4 billion at December 31, 2021.

Further, under the same hypothetical 100 basis point increase in interest rates scenario, the fair value of the Company's long-term debt would decrease approximately $2.0 billion at June 30, 2022 compared to approximately $2.9 billion at December 31, 2021.

Changes in the fair value of our long-term debt do not impact our financial position or operating results.

Otherwise, there were no material changes in our risk exposures from those reported in our 2021 Form 10-K.

After the Chubb Transaction we expect reductions in our risk exposures to interest rates and foreign currency exchange rates.

The impact of a hypothetical 100 basis point increase in interest rates on the fair value of certain non-insurance financial instruments of a $1.1 billion decrease cited above would decline to a $0.8 billion decrease excluding the businesses held for sale as of June 30, 2022.

The impact of a hypothetical 10% strengthening in the U.S.

dollar to foreign currencies excluding the businesses held for sale would be an insignificant amount as of June 30, 2022 as compared to a decrease of approximately $0.3 billion as of December 31, 2021.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis