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Item 1. Financial Statements

2025-05-02 compared with 2024-10-31 · 298 added, 610 removed, 670 unchanged (58% of the section changed)

2 unchanged sentences

Consolidated Statements of Income

Unaudited Unaudited

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In millions, except per share amounts) 2025 2024

11 unchanged sentences

Income from operations

2,576 2,240 7,244 6,476

Interest expense and other ( 362 ) ( 322 )

Loss on sale of businesses

( 87 ) ( 21 ) ( 106 ) ( 21 )

Net realized investment losses

Gain (loss) on sale of businesses

Net investment losses

( 2 ) ( 1,836 )

Income before income taxes

1,192 1,840 3,260 5,325

TOTAL INCOME TAXES 239 291

Net income (loss)

1,409 ( 212 )

Net income attributable to noncontrolling interests

86 41 232 130

SHAREHOLDERS’ NET INCOME $ 739 $ 1,408 $ 2,010 $ 4,135

Shareholders' net income per share

SHAREHOLDERS' NET INCOME (LOSS) $ 1,323 $ ( 277 )

Shareholders' net income (loss) per share

Basic $ 4.88 $ ( 0.97 )

3 unchanged sentences

Consolidated Statements of Comprehensive Income

Unaudited Unaudited

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In millions) 2025

Net income $ 825 $ 1,449 $ 2,242 $ 4,265

Net income (loss) $ 1,409 $ ( 212 )

Other comprehensive income (loss), net of tax

Net unrealized appreciation (depreciation) on securities and derivatives

264 ( 192 ) 493 22

Net unrealized (depreciation) appreciation on securities and derivatives

Net long-duration insurance and contractholder liabilities measurement adjustments ( 168 ) ( 560 )

Net translation gains (losses) on foreign currencies

39 ( 29 ) 8 ( 32 )

Postretirement benefits liability adjustment 6 5

Other comprehensive income (loss), net of tax

Other comprehensive loss, net of tax

( 249 ) ( 460 )

Total comprehensive income

Total comprehensive income (loss)

1,160 ( 672 )

Comprehensive income (loss) attributable to noncontrolling interests

Net income attributable to redeemable noncontrolling interests — 37 — 116

Net income attributable to other noncontrolling interests 86 4 232 14

Total comprehensive income attributable to noncontrolling interests 86 41 232 130

SHAREHOLDERS' COMPREHENSIVE INCOME

Net income attributable to noncontrolling interests 86 65

SHAREHOLDERS' COMPREHENSIVE INCOME (LOSS)

$ 1,074 $ ( 737 )

2 unchanged sentences

Consolidated Balance Sheets

September 30, As of

March 31, As of

(In millions) 2025 2024

13 unchanged sentences

Separate account assets 7,277 7,278

Assets of businesses held for sale, non-current — 2,922

TOTAL ASSETS $ 150,658 $ 155,881

11 unchanged sentences

Separate account liabilities 7,277 7,278

Liabilities of businesses held for sale, non-current — 591

TOTAL LIABILITIES 110,244 114,638

Contingencies — Note 16

Redeemable noncontrolling interests — 107

Shareholders' equity

5 unchanged sentences

TOTAL SHAREHOLDERS' EQUITY 40,226 41,033

Other noncontrolling interests 203 21

Noncontrolling interests 188 210

Total equity 40,414 41,243

1 unchanged sentence

(1) Par value per share, $ 0.01 ;

shares issued, 402 million as of September 30, 2024 and 400 million as of December 31, 2023;

shares issued, 404 million as of March 31, 2025 and 403 million as of December 31, 2024;

authorized shares, 600 million.

2 unchanged sentences

Consolidated Statements of Changes in Total Equity

Three Months Ended September 30, 2024

(In millions) Common Stock Additional Paid-in Capital Accumulated Other Comprehensive (Loss) Retained Earnings Treasury Stock Shareholders' Equity Other Non- controlling Interests Total Equity Redeemable Noncontrolling Interests

Balance at June 30, 2024 $ 4 $ 31,048 $ ( 2,442 ) $ 42,132 $ ( 29,410 ) $ 41,332 $ 195 $ 41,527 $ —

Three Months Ended March 31, 2025

(In millions) Common

Stock Additional

Capital Accumulated

Comprehensive

(Loss) Retained

Earnings Treasury

Stock Shareholders'

Equity Noncontrolling

Interests Total

Equity Redeemable

Noncontrolling

Balance at December 31, 2024 $ 4 $ 31,288 $ ( 2,341 ) $ 43,519 $ ( 31,437 ) $ 41,033 $ 210 $ 41,243 $ —

Effects of issuing stock for employee benefit plans 155 ( 107 ) 48 48

Other comprehensive income 279 279 279 —

739 739 86 825 —

Common dividends declared (per share:

( 391 ) ( 391 ) ( 391 )

Repurchase of common stock — — — —

Other transactions impacting noncontrolling interests — — ( 78 ) ( 78 ) —

Balance at September 30, 2024 $ 4 $ 31,186 $ ( 2,163 ) $ 42,480 $ ( 29,412 ) $ 42,095 $ 203 $ 42,298 $ —

Three Months Ended September 30, 2023

Balance at June 30, 2023

$ 4 $ 30,436 $ ( 1,878 ) $ 39,936 $ ( 23,053 ) $ 45,445 $ 19 $ 45,464 $ 62

Effect of issuing stock for employee benefit plans 127 ( 5 ) 122 122

Other comprehensive loss ( 249 ) ( 249 ) ( 249 ) —

Net income 1,408 1,408 4 1,412 37

Common dividends declared (per share:

1,323 1,323 86 1,409 —

Repurchase of common stock — ( 681 ) ( 681 ) ( 681 )

Other transactions impacting noncontrolling interests — — ( 12 ) ( 12 ) ( 35 )

Balance at September 30, 2023 $ 4 $ 30,563 $ ( 2,119 ) $ 40,982 $ ( 23,739 ) $ 45,691 $ 11 $ 45,702 $ 64

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

The Cigna Group

Consolidated Statements of Changes in Total Equity

Nine Months Ended September 30, 2024

Balance at December 31, 2023

$ 4 $ 30,669 $ ( 1,864 ) $ 41,652 $ ( 24,238 ) $ 46,223 $ 21 $ 46,244 $ 107

Effect of issuing stock for employee benefit plans 517 ( 117 ) 400 400

Other comprehensive loss ( 299 ) ( 299 ) ( 299 ) —

Net income 2,010 2,010 232 2,242 —

Common dividends declared (per share:

2 unchanged sentences

Other transactions impacting noncontrolling interests — — ( 108 ) ( 108 ) —

Balance at September 30, 2024 $ 4 $ 31,186 $ ( 2,163 ) $ 42,480 $ ( 29,412 ) $ 42,095 $ 203 $ 42,298 $ —

Nine Months Ended September 30, 2023

Balance at March 31, 2025 $ 4 $ 31,443 $ ( 2,590 ) $ 44,434 $ ( 33,065 ) $ 40,226 $ 188 $ 40,414 $ —

Three Months Ended March 31, 2024

(In millions) Common

Stock Additional

Capital Accumulated

Comprehensive

(Loss) Retained

Earnings Treasury

Stock Shareholders'

Equity Noncontrolling

Interests Total

Equity Redeemable

Noncontrolling

Balance at December 31, 2023

2 unchanged sentences

Other comprehensive loss ( 460 ) ( 460 ) ( 460 ) —

Net income 4,135 4,135 14 4,149 116

Net (loss) income ( 277 ) ( 277 ) 65 ( 212 ) —

Common dividends declared (per share:

2 unchanged sentences

Other transactions impacting noncontrolling interests — — 83 83 ( 107 )

Balance at September 30, 2023 $ 4 $ 30,563 $ ( 2,119 ) $ 40,982 $ ( 23,739 ) $ 45,691 $ 11 $ 45,702 $ 64

Balance at March 31, 2024 $ 4 $ 30,292 $ ( 2,324 ) $ 40,978 $ ( 27,769 ) $ 41,181 $ 169 $ 41,350 $ —

The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.

1 unchanged sentence

Consolidated Statements of Cash Flows

Nine Months Ended September 30,

Three Months Ended March 31,

(In millions) 2025

Cash Flows from Operating Activities

Net income $ 2,242 $ 4,265

Adjustments to reconcile net income to net cash provided by operating activities:

Net income (loss) $ 1,409 $ ( 212 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Depreciation and amortization 674 741

Realized investment losses, net

Investment losses, net

Deferred income tax benefit

( 216 ) ( 102 )

Loss on sale of businesses

(Gain) loss on sale of businesses

Net changes in assets and liabilities, net of non-operating effects:

20 unchanged sentences

Property and equipment purchases, net ( 327 ) ( 300 )

Acquisitions, net of cash acquired ( 132 ) ( 443 )

Divestitures, net of cash sold 2,346 —

Renewable energy tax credit equity investments ( 92 ) ( 104 )

Other, net ( 1 ) ( 8 )

NET CASH USED IN INVESTING ACTIVITIES ( 1,911 ) ( 4,734 )

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 1,197 ( 495 )

Cash Flows from Financing Activities

12 unchanged sentences

Cash, cash equivalents and restricted cash January 1, (1)

Cash, cash equivalents and restricted cash, September 30, (2)

Cash, cash equivalents and restricted cash, March 31, (1)

Cash and cash equivalents reclassified to assets of businesses held for sale

Cash, cash equivalents and restricted cash September 30, per Consolidated Balance Sheets (2)

Cash, cash equivalents and restricted cash March 31, per Consolidated Balance Sheets (1)

$ 8,376 $ 8,484

2 unchanged sentences

Interest paid $ 379 $ 336

(1) Includes $ 467 million reported in Assets of businesses held for sale as of January 1, 2024.

(1) Restricted cash and cash equivalents were reported in other long-term investments.

8 unchanged sentences

4 Supplier Finance Program

Assets and Liabilities of Businesses Held for Sale

5 Divestiture

6 Earnings Per Share

2 unchanged sentences

9 Insurance and Contractholder Liabilities

10 Reinsurance

11 Investments

12 Fair Value Measurements

Variable Interest Entities

13 Accumulated Other Comprehensive Income (Loss)

W ORKFORCE M ANAGEMENT AND C OMPENSATION

14 Strategic Optimization Program

C OMPLIANCE , R EGULATION AND C ONTINGENCIES

15 Income Taxes

16 Contingencies and Other Matters

6 unchanged sentences

Our subsidiaries offer a differentiated set of pharmacy, medical, behavioral, dental, and related products and services.

The majority of these products and services are offered through employers and other entities such as governmental and non-governmental organizations, unions and associations.

The majority of these products and services are offered through employers and other entities, such as governmental and nongovernmental organizations, unions and associations.

Cigna Healthcare ® also offers health and dental insurance products to individuals in the United States and select international markets.

1 unchanged sentence

A full description of our segments follows:

The Evernorth Health Services reportable segment includes the Pharmacy Benefit Services and the Specialty and Care Services operating segments, which partner with health plans, employers, governmental organizations and health care providers to solve challenges in the areas of pharmacy benefits, home delivery pharmacy, specialty pharmacy, specialty distribution, and care delivery and management solutions.

The Evernorth Health Services ® reportable segment includes the Pharmacy Benefit Services and the Specialty and Care Services operating segments, which provide independent and coordinated health solutions and capabilities to enable the health care system to work better and help people live richer, healthier lives.

Pharmacy Benefit Services drives high-quality, cost-effective pharmacy care through various services, such as drug claim adjudication, retail pharmacy network administration, benefit design consultation, drug utilization review, drug formulary management and access to our home delivery pharmacy.

Specialty and Care Services provides specialty drugs for the treatment of complex and rare diseases, specialty distribution of pharmaceuticals and medical supplies, as well as clinical programs to help our clients drive better whole-person health outcomes through Care Delivery and Management Solutions.

The Company's reporting units remain aligned with its operating segments and Evernorth Health Services' goodwill was allocated on a relative fair value basis during the three months ended March 31, 2024.

The Cigna Healthcare reportable segment includes the U.S.

Healthcare and International Health operating segments, which provide comprehensive medical and coordinated solutions to clients and customers.

Healthcare provides medical plans and specialty benefits and solutions for insured and self-insured clients, Medicare Advantage, Medicare Supplement and Medicare Stand-Alone Prescription Drug Plans for seniors and individual health insurance plans.

Healthcare provides medical plans and other benefits and solutions for insured clients, self-insured clients and individual health insurance plans.

International Health provides health care solutions in our international markets, as well as health care benefits for globally mobile individuals and employees of multinational organizations.

In January 2024, the Company entered into a definitive agreement to sell the Medicare Advantage, Medicare Stand-Alone Prescription Drug Plans, Medicare and Other Supplemental Benefits and CareAllies businesses within the U.S.

Healthcare operating segment to Health Care Service Corporation ("HCSC") for approximately $ 3.3 billion cash, subject to applicable regulatory approvals and other customary closing conditions, including adjustments to align with the final balance sheet of the divested businesses (the "HCSC transaction").

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

Other Operations comprises the remainder of our business operations, which includes our continuing business (corporate-owned life insurance ("COLI")) and our run-off and other non-strategic businesses.

Our run-off businesses include (i) variable annuity reinsurance business that was effectively exited through reinsurance with Berkshire Hathaway Life Insurance Company of Nebraska ("Berkshire") in 2013, (ii) settlement annuity business, and (iii) individual life insurance and annuity and retirement benefits businesses which were sold through reinsurance agreements.

Healthcare also included the Medicare Advantage and related businesses until the divestiture of such businesses to Health Care Services Corporation ("HCSC") on March 19, 2025 (see Note 5 to the Consolidated Financial Statements for further information).

Other Operations comprises the remainder of our business operations, which includes certain continuing (corporate-owned life insurance ("COLI")), run-off and other non-strategic businesses.

Our run-off businesses include the (i) variable annuity reinsurance business that was effectively exited through reinsurance with Berkshire Hathaway Life Insurance Company of Nebraska ("Berkshire") in 2013, (ii) settlement annuity business, and (iii) individual life insurance and annuity and retirement benefits businesses, which were sold through reinsurance agreements.

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

4 unchanged sentences

These Consolidated Financial Statements were prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP").

Certain amounts in the Consolidated Statements of Cash Flows have been reclassified to conform to current year presentation and did not have a significant impact on our Consolidated Financial Statements.

Amounts recorded in the Consolidated Financial Statements necessarily reflect management's estimates and assumptions about medical costs, investment, tax and receivable valuations, interest rates, and other factors.

Significant estimates are discussed throughout

Significant estimates are discussed throughout these Notes;

however, actual results could differ from those estimates.

2 unchanged sentences

The interim Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes included in the 2024 Annual Report on Form 10-K ("2024 Form 10-K").

The Company has not included certain footnote disclosures that would substantially duplicate the disclosures contained in its 2024 Form 10-K, unless the information in those disclosures materially changed or is required by GAAP.

The preparation of interim Consolidated Financial Statements necessarily relies heavily on estimates.

5 unchanged sentences

The following amounts were included within Accounts receivable, net:

(In millions) September 30, 2024 December 31, 2023

Pharmaceutical manufacturers receivables $ 13,708 $ 8,169

(In millions) March 31, 2025 December 31, 2024

Noninsurance customer receivables $ 13,357 $ 11,879

Pharmaceutical manufacturers receivables 11,393 10,914

Insurance customer receivables 1,488 3,199

2 unchanged sentences

Accounts receivable, net classified as assets of businesses held for sale

( 1,532 ) ( 1,122 )

Total $ 26,929 $ 24,227

These accounts receivable are reported net of our allowances of $ 4.6 billion as of September 30, 2024 and $ 3.7 billion as of December 31, 2023.

These accounts receivable are reported net of our allowances of $ 5.7 billion and $ 5.0 billion as of March 31, 2025 and December 31, 2024, respectively.

These allowances include contractual allowances for certain rebates receivable with pharmaceutical manufacturers and certain accounts receivable from third-party payors, discounts and claims adjustments issued to customers in the form of client credits, an allowance for current expected credit losses and other non-credit adjustments.

The Company's allowance for current expected credit losses was $ 88 million as of September 30, 2024 and $ 90 million as of December 31, 2023.

The Company's allowance for current expected credit losses was $ 296 million as of March 31, 2025 and $ 84 million as of December 31, 2024.

Accounts Receivable Factoring Facility

1 unchanged sentence

The Facility began in July 2023 with an initial term of two years , followed by automatic one-year renewal terms unless terminated by either party.

The Facility's total capacity at inception was $ 1.0 billion and was amended to $ 1.5 billion during the three months ended June 30, 2024.

Further information regarding the accounting policy for the Facility can be found in Note 3 in the Company's 2023 Form 10-K.

We sold accounts receivable under the Facility of $ 1.3 billion and $ 1.0 billion for the three months ended September 30, 2024 and 2023, respectively, and $ 4.5 billion and $ 1.0 billion for the nine months ended September 30, 2024 and 2023, respectively.

For the three and nine months ended September 30, 2024 and 2023, factoring fees paid were not material.

As of September 30, 2024, there were $ 258 million of sold accounts receivable that have not been collected from pharmaceutical manufacturers and have been removed from the Company's Consolidated Balance Sheets.

At December 31, 2023, all sold accounts receivable had been collected from pharmaceutical manufacturers.

As of September 30, 2024 and December 31, 2023, there were $ 1.1 billion and $ 515 million, respectively, of collections from pharmaceutical manufacturers that have not been remitted to the financial institution.

The Facility's total capacity is $ 1.5 billion.

We sold manufacturer accounts receivable under the Facility of $ 1.4 billion and $ 1.9 billion for the three months ended March 31, 2025 and 2024, respectively.

For the three months ended March 31, 2025 and 2024, factoring fees paid were not material.

As of March 31, 2025 and December 31, 2024, all sold accounts receivable had been collected from pharmaceutical manufacturers.

As of March 31, 2025, all collections had been remitted to the financial institution.

As of December 31, 2024, there was $ 1.0 billion of collections from pharmaceutical manufacturers that have not been remitted to the financial institution.

Such amounts are recorded within Accrued expenses and other liabilities in the Consolidated Balance Sheets.

1 unchanged sentence

The Company facilitates a voluntary supplier finance program (the "Program") that provides suppliers the opportunity to sell their accounts receivable due from us (i.e., our payment obligations to the suppliers) to a financial institution, on a non-recourse basis, in order to be paid earlier than our payment terms require.

Further information regarding the Program's terms can be found in Note 4 in the Company's 2023 Form 10-K.

As of September 30, 2024 and December 31, 2023, $ 1.6 billion and $ 1.5 billion, respectively, of the Company's outstanding payment obligations were confirmed as valid within the Program by the financial institution and are reflected in Accounts payable in the Consolidated Balance Sheets.

As of each of March 31, 2025 and December 31, 2024, $ 1.6 billion of the Company's outstanding payment obligations were confirmed as valid within the Program by the financial institution and are reflected in Accounts payable in the Consolidated Balance Sheets.

The amounts confirmed as valid for both periods are predominately associated with one supplier.

As of September 30, 2024, we have been informed by the financial institution that $ 534 million of the Company's outstanding payment obligations were voluntarily elected by suppliers to be sold to the financial institution under the Program.

Note 5 – Assets and Liabilities of Businesses Held for Sale

In January 2024, the Company entered into the HCSC transaction for a purchase price of approximately $ 3.3 billion cash, subject to applicable regulatory approvals and other customary closing conditions, including adjustments to align with the final balance sheet of the divested businesses.

The transaction is expected to close in the first quarter of 2025.

The assets and liabilities of businesses held for sale were as follows:

(In millions) September 30, 2024 December 31, 2023

As of March 31, 2025, we have been informed by the financial institution that $ 563 million of the Company's outstanding payment obligations were voluntarily elected by suppliers to be sold to the financial institution under the Program.

Note 5 – Divestiture

On March 19, 2025, the Company completed the sale of our Medicare Advantage, Medicare Individual Stand-Alone Prescription Drug Plans, Medicare and Other Supplemental Benefits, and CareAllies ® businesses (the "Disposal Group" or the "HCSC transaction").

The purchase price increased from $ 3.3 billion to $ 4.8 billion, subject to post-closing contractual adjustments, reflecting higher statutory surplus for the legal entities when conveyed to HCSC.

For the three months ended March 31, 2025, the Company recognized a gain of $ 37 million pre-tax ($ 112 million after-tax) within Gain (loss) on sale of businesses in the Consolidated Statements of Income.

The Company received $ 4.2 billion cash proceeds at closing.

We expect receipt of the remaining $ 0.6 billion in the fourth quarter of 2025 upon HCSC's collection of amounts due from the Centers for Medicare and Medicaid Services.

The Company determined that the Disposal Group met the criteria to be classified as held for sale and aggregated and classified the assets and liabilities as held for sale in our Consolidated Balance Sheets as of December 31, 2024.

The assets and liabilities held for sale as of December 31, 2024 were as follows:

(In millions) December 31, 2024

Cash and cash equivalents $ 1,339

6 unchanged sentences

Total liabilities of businesses held for sale $ 2,410

(1) Includes Goodwill of $ 396 million as of September 30, 2024 and December 31, 2023.

(1) Includes Goodwill of $ 94 million as of December 31, 2024.

Integration and Transaction-Related Costs

In 2025 and 2024, the Company incurred transaction-related costs associated with the HCSC transaction.

In 2023, the Company also incurred net costs mainly related to the sale of our international life, accident and supplemental benefits businesses ("Chubb transaction").

These costs incurred in both 2024 and 2023 consisted primarily of certain projects to separate or integrate the Company's systems, products and services, fees for legal, advisory and other professional services and certain employment-related costs.

These costs were $ 77 million pre-tax ($ 59 million after-tax) for the three months ended and $ 177 million pre-tax ($ 135 million after-tax) for the nine months ended September 30, 2024, compared with $ 13 million pre-tax ($ 9 million after-tax) for the three months ended and $ 20 million pre-tax ($ 15 million after-tax) for the nine months ended September 30, 2023.

These costs incurred consisted primarily of certain projects to separate the Company's systems, products and services;

fees for legal, advisory and other professional services;

and certain employment-related costs.

These costs were $ 216 million pre-tax ($ 164 million after-tax) for the three months ended March 31, 2025, compared with $ 37 million pre-tax ($ 29 million after-tax) for the three months ended March 31, 2024.

Note 6 – Earnings Per Share

1 unchanged sentence

Three Months Ended

September 30, 2024 September 30, 2023

(Shares in thousands, dollars in millions, except per share amounts) Basic Effect of

Dilution Diluted Basic Effect of

Dilution Diluted

Shareholders' net income $ 739 $ 739 $ 1,408 $ 1,408

Weighted average 278,457 278,457 294,058 294,058

Common stock equivalents 2,939 2,939 3,073 3,073

Total shares 278,457 2,939 281,396 294,058 3,073 297,131

Earnings per share $ 2.65 $ ( 0.02 ) $ 2.63 $ 4.79 $ ( 0.05 ) $ 4.74

Nine Months Ended

September 30, 2024 September 30, 2023

March 31, 2025 March 31, 2024

(Shares in thousands, dollars in millions, except per share amounts) Basic Effect of

1 unchanged sentence

Dilution Diluted

Shareholders' net income

Shareholders' net income (loss)

$ 1,323 $ 1,323 $ ( 277 ) $ ( 277 )

3 unchanged sentences

Earnings per share $ 4.88 $ ( 0.03 ) $ 4.85 $ ( 0.97 ) $ — $ ( 0.97 )

The following outstanding employee stock options were not included in the computation of diluted earnings per share because their effect was anti-dilutive:

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2024 2023 2024 2023

Anti-dilutive options 0.8 0.9 1.0 0.9

The Company held approximately 122.5 million shares of common stock in treasury at September 30, 2024, 107.4 million shares as of December 31, 2023 and 105.7 million shares as of September 30, 2023.

The increase in Treasury stock as of September 30, 2024 and the reduction in weighted average shares outstanding for the three and nine months ended September 30, 2024 was driven in part by 9.3 million shares of our common stock repurchased under the accelerated share repurchase agreements (the "ASR agreements").

S ee Note 8 for additional information.

For the three months ended March 31, 2025, 2.3 million outstanding employee stock options were excluded in the computation of diluted earnings per share because their effect was anti-dilutive.

For the three months ended March 31, 2024, due to the Shareholders' net loss, 8.2 million outstanding employee stock options, unvested restricted stock grants and units, and strategic performance shares were excluded in the computation of diluted earnings per share because their effect was anti-dilutive.

The Company held approximately 134.1 million shares of common stock in treasury as of March 31, 2025, 128.7 million shares as of December 31, 2024 and 117.8 million shares as of March 31, 2024.

Note 7 – Debt

The outstanding amounts of debt (net of issuance costs, discounts or premiums) and finance leases were as follows:

(In millions) September 30, 2024 December 31, 2023

Short-term debt

Commercial paper $ 1,635 $ 1,237

$ 500 million, 0.613 % Notes due March 2024

$ 790 million, 3.500 % Notes due June 2024 (1)

$ 900 million, 3.250 % Notes due April 2025 (2)

Other, including finance leases 44 42

Total short-term debt $ 2,572 $ 2,775

Long-term debt

$ 900 million, 3.250 % Notes due April 2025 (2)

$ 1,216 million, 4.125 % Notes due November 2025 (1)

$ 1,284 million, 4.500 % Notes due February 2026 (1)

$ 550 million, 1.250 % Notes due March 2026 (1)

$ 700 million, 5.685 % Notes due March 2026

$ 1,500 million, 3.400 % Notes due March 2027

$ 259 million, 7.875 % Debentures due May 2027

$ 600 million, 3.050 % Notes due October 2027

$ 3,800 million, 4.375 % Notes due October 2028

$ 1,000 million, 5.000 % Notes due May 2029

$ 1,400 million, 2.400 % Notes due March 2030 (1) (2)

$ 1,500 million, 2.375 % Notes due March 2031 (2)

$ 750 million, 5.125 % Notes due May 2031

$ 45 million, 8.080 % Step Down Notes due January 2033

$ 800 million, 5.400 % Notes due March 2033

$ 1,250 million, 5.250 % Notes due February 2034 (2)

$ 190 million, 6.150 % Notes due November 2036

$ 2,200 million, 4.800 % Notes due August 2038

$ 750 million, 3.200 % Notes due March 2040

$ 121 million, 5.875 % Notes due March 2041

$ 448 million, 6.125 % Notes due November 2041

$ 317 million, 5.375 % Notes due February 2042

$ 1,500 million, 4.800 % Notes due July 2046

$ 1,000 million, 3.875 % Notes due October 2047

$ 3,000 million, 4.900 % Notes due December 2048

$ 1,250 million, 3.400 % Notes due March 2050

$ 1,500 million, 3.400 % Notes due March 2051

$ 1,500 million, 5.600 % Notes due February 2054

Other, including finance leases 50 66

Total long-term debt $ 30,230 $ 28,155

(1) Included in the February 2024 debt tender offers discussed below.

(2) The Company has entered into interest rate swap contracts hedging a portion of these fixed-rate debt instruments.

See Note 11 to the Consolidated Financial Statements for further information about the Company's interest rate risk management and these derivative instruments.

Short-term and Credit Facilities Debt

Short-Term and Long-Term Debt.

During the three months ended March 31, 2025, the Company redeemed at par its $ 700 million 5.685 % senior notes that were due March 2026.

For more information regarding our short-term and long-term debt, see Note 7 of the Company's 2024 Form 10-K.

Revolving Credit Agreements.

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

As of September 30, 2024, there were no outstanding balances under these revolving credit agreements.

In April 2024, The Cigna Group replaced its previous revolving credit agreements and entered into the following (the "Credit Agreements"):

• a $ 5.0 billion five-year revolving credit and letter of credit agreement that will mature in April 2029 with an option to extend the maturity date for additional one-year periods, subject to consent of the banks.

As of March 31, 2025, there were no outstanding balances under these revolving credit agreements.

In April 2025, the Company replaced its previous revolving credit agreements and entered into a $ 6.5 billion, five-year revolving credit and letter of credit agreement that will mature in April 2030, with an option to extend the maturity date for additional one-year periods, subject to consent of the banks (the "Credit Agreement").

The Company can borrow up to $ 6.5 billion under the Credit Agreement for general corporate purposes, with up to $ 500 million available for issuance of letters of credit.

• a $ 1.5 billion 364-day revolving credit agreement that will mature in April 2025.

The Company can borrow up to $ 1.5 billion under the credit agreement for general corporate purposes.

This agreement includes the option to "term out" any revolving loans that are outstanding at maturity by converting them into a term loan maturing on the one-year anniversary of conversion.

Each of the Credit Agreements include an option to increase commitments in an aggregate amount of up to $ 1.5 billion across both facilities for a maximum total commitment of $ 8.0 billion.

The Credit Agreements allow for borrowings at either a base rate or an adjusted term Secured Overnight Funding Rate ("SOFR") plus, in each case, an applicable margin based on the Company's senior unsecured credit ratings.

Each of the two facilities is diversified among 22 large commercial banks, all of which had an A- equivalent or higher rating by at least one Nationally Recognized Statistical Rating Organization ("NRSRO") as of September 30, 2024.

Each facility also contains customary covenants and restrictions, including a financial covenant that the Company's leverage ratio, as defined in the Credit Agreements, may not exceed 60 % subject to certain exceptions upon the consummation of an acquisition.

The Credit Agreement includes an option to increase commitments up to $ 1.5 billion for a maximum total commitment of $ 8.0 billion.

The Credit Agreement allows for borrowings at either a base rate, term Secured Overnight Financing Rate ("SOFR") or daily simple SOFR plus, in each case, an applicable margin based on the Company's senior unsecured credit ratings.

The Credit Agreement also contains customary covenants and restrictions, including a financial covenant that the Company's leverage ratio, as defined in the Credit Agreement, may not exceed 60 %, subject to certain exceptions upon the consummation of an acquisition.

Commercial Paper.

Under our commercial paper program, we may issue short-term, unsecured commercial paper notes privately placed on a discounted basis through certain broker-dealers at any time not to exceed an aggregate amount of $ 6.5 billion.

Our commercial paper program size was increased from $ 5.0 billion to $ 6.5 billion during the third quarter 2024.

Amounts available under the program may be borrowed, repaid and re-borrowed from time to time.

The net proceeds of issuances have been and are expected to be used for general corporate purposes.

The weighted average interest rate of our commercial paper was 5.33 % at September 30, 2024.

Long-term debt

Debt Issuance and Debt Tender Offers.

In February 2024, we issued $ 4.5 billion of new senior notes, as detailed in the table below.

The proceeds from this debt were used to pay the consideration for the cash tender offers as described below.

We used the remaining net proceeds to fund the repayment of our senior notes that matured in March 2024 and for general corporate purposes, including repayment of indebtedness and repurchases of shares of our common stock.

Interest on this debt is paid semi-annually.

Principal Maturity Date Interest Rate Net Proceeds Redeemable Date (1)

"Make whole" premium basis points over U.S.

Treasury rate (2)

$ 1,000 million

May 15, 2029 5.000 % $ 995 million April 15, 2029 15

$ 750 million

May 15, 2031 5.125 % $ 746 million March 15, 2031 15

$ 1,250 million

February 15, 2034 5.250 % $ 1,244 million November 15, 2033 20

$ 1,500 million

February 15, 2054 5.600 % $ 1,485 million August 15, 2053 20

(1) Redeemable at any time prior to this date at a "make whole" premium, defined below.

Redeemable at par on or after this date.

(2) "Make whole" premium calculated using the most directly comparable U.S.

Treasury rate plus the amount of basis points set forth in this column.

In the first quarter of 2024, the Company completed the repurchase of a total of $ 1.8 billion in aggregate principal amount of existing senior notes that were tendered to the Company pursuant to cash tender offers.

Interest Expense

Interest expense on corporate financing was $ 380 million for the three months ended and $ 1.1 billion for the nine months ended September 30, 2024, compared with $ 353 million for the three months ended and $ 1.0 billion for the nine months ended September 30, 2023.

There was no commercial paper outstanding balance as of March 31, 2025.

Debt Covenants.

The Company was in compliance with its debt covenants as of September 30, 2024.

The Company was in compliance with its debt covenants as of March 31, 2025.

Interest Expense.

Interest expense on long-term and short-term debt was $ 362 million for the three months ended March 31, 2025 and $ 369 million for the three months ended March 31, 2024.

Note 8 – Common and Preferred Stock

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March 5, 2025 March 20, 2025 $ 1.51 $ 412

June 4, 2024 June 20, 2024 $ 1.40 $ 392

September 4, 2024 September 19, 2024 $ 1.40 $ 390

March 6, 2024 March 21, 2024 $ 1.40 $ 401

June 7, 2023 June 22, 2023 $ 1.23 $ 362

September 6, 2023 September 21, 2023 $ 1.23 $ 362

On October 23, 2024, the Board of Directors declared the fourth quarter cash dividend of $ 1.40 per share of The Cigna Group common stock to be paid on December 19, 2024 to shareholders of record on December 4, 2024.

The Company 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 The Cigna Group and its shareholders.

On April 23, 2025, the Board of Directors declared the second quarter cash dividend of $ 1.51 per share of The Cigna Group common stock to be paid on June 18, 2025 to shareholders of record on June 3, 2025.

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

The decision of whether to pay future dividends and the amount of any such dividends will be based on the Company's financial position, results of operations, cash flows, capital requirements, the requirements of applicable law and any other factors the Board may deem relevant.

Accelerated Share Repurchase Agreements

In February 2024, as part of our share repurchase program, we entered into separate accelerated share repurchase agreements with Deutsche Bank AG and Bank of America, N.A.

(collectively, the "Counterparties") to repurchase $ 3.2 billion of common stock in aggregate.

The total number of shares of our common stock repurchased under the agreements was approximately 9.3 million, at $ 344.98 per share.

The per share amount was calculated based on the daily volume-weighted average share price of our common stock over the term of the agreements, less a discount.

Note 9 – Insurance and Contractholder Liabilities

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The Company's insurance and contractholder liabilities were comprised of the following:

September 30, 2024 December 31, 2023 September 30, 2023

March 31, 2025 December 31, 2024 March 31, 2024

(In millions) Current Non-current Total Current Non-current Total Total

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$ 4,452 $ 56 $ 4,508 $ 4,932 $ 86 $ 5,018 $ 5,863

Other Operations 162 150 312 99 154 253 274

Other 172 194 366 147 144 291 260

Future policy benefits

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Total insurance and contractholder liabilities $ 5,984 $ 10,309 $ 16,293 $ 5,388 $ 10,254 $ 15,642 $ 16,429

(1) Amounts classified as liabilities of businesses held for sale include $ 937 million of Unpaid claims, $ 422 million of Future policy benefits, $ 98 million of Unearned premiums and $ 111 million of Contractholder deposit funds as of September 30, 2024 and $ 823 million of Unpaid claims, $ 429 million of Future policy benefits, $ 261 million of Unearned premiums and $ 123 million of Contractholder deposit funds as of December 31, 2023.

(1) Amounts classified as liabilities of businesses held for sale include $ 983 million of Unpaid claims, $ 408 million of Future policy benefits, $ 85 million of Unearned premiums and $ 103 million of Contractholder deposit funds as of December 31, 2024 and $ 1,378 million of Unpaid claims, $ 427 million of Future policy benefits, $ 161 million of Unearned premiums and $ 115 million of Contractholder deposit funds as of March 31, 2024.

Insurance and contractholder liabilities expected to be paid within one year are classified as current.

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This liability reflects estimates of the ultimate cost of claims that have been incurred but not reported, expected development on reported claims, claims that have been reported but not yet paid (reported claims in process), and other medical care expenses and services payable that are primarily comprised of accruals for incentives and other amounts payable to health care professionals and facilities.

The total of incurred but not reported liabilities plus expected development on reported claims and reported claims in process was $ 4.7 billion at September 30, 2024 and $ 5.0 billion at September 30, 2023.

The total of incurred but not reported liabilities plus expected development on reported claims and reported claims in process was $ 4.4 billion at March 31, 2025 and $ 5.4 billion at March 31, 2024.

The decrease was driven by the HCSC transaction.

Activity, net of intercompany transactions, in the unpaid claims liability for the Cigna Healthcare segment was as follows:

Nine Months Ended September 30,

Three Months Ended March 31,

(In millions) 2025 (1)

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Total paid 9,550 8,424

Divestiture and other 1,323 —

Ending balance, net 4,370 5,658

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Ending balance $ 4,508 $ 5,863

(1) Includes unpaid claims amounts classified as liabilities of businesses held for sale.

As of September 30, 2024 and December 31, 2023, $ 937 million and $ 823 million classified as liabilities of businesses held for sale, respectively.

(1) Includes unpaid claims amounts classified as liabilities of businesses held for sale prior to the completion of the HCSC transaction.

As of December 31, 2024, March 31, 2024 and December 31, 2023, includes $ 983 million and $ 1,378 million, $ 823 million classified as liabilities of businesses held for sale, respectively.

Reinsurance and other amounts recoverable reflect amounts due from reinsurers and policyholders to cover incurred but not reported and pending claims of certain business for which the Company administers the plan benefits without any right of offset.

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Variances in incurred costs related to prior years' unpaid claims and claim expenses that resulted from the differences between actual experience and the Company's key assumptions were as follows:

Nine Months Ended September 30,

Three Months Ended March 31,

(Dollars in millions) $ % (1)

Actual completion factors and other

$ 96 0.3 % $ 76 0.2 %

Medical cost trend 126 0.3 150 0.4

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Cigna Healthcare

The weighted average interest rates applied and duration for future policy benefits in the Cigna Healthcare segment, consisting primarily of supplemental health products including individual Medicare supplement, limited benefit health products and individual private medical insurance, were as follows:

September 30, 2024 September 30, 2023

Interest accretion rate 2.83 % 2.85 %

Current discount rate 4.50 % 6.03 %

Weighted average duration 9.0 years 7.0 years

The net liability for future policy benefits for the segment's supplemental health products represents the present value of benefits expected to be paid to policyholders, net of the present value of expected net premiums, which is the portion of expected future gross premium expected to be collected from policyholders that is required to provide for all expected future benefits and expenses.

The present values of expected net premiums and expected future policy benefits for the Cigna Healthcare segment were as follows:

Nine Months Ended September 30,

(In millions) 2024 (1)

Present value of expected net premiums

Beginning balance $ 9,233 $ 8,557

Reversal of effect of beginning of period discount rate assumptions 1,154 1,537

Effect of assumption changes and actual variances from expected experience (2)

Issuances and lapses 1,392 822

Net premiums collected ( 1,065 ) ( 1,019 )

Interest and other (3)

Ending balance at original discount rate 11,397 10,269

Effect of end of period discount rate assumptions ( 865 ) ( 1,681 )

Ending balance (4)

$ 10,532 $ 8,588

Present value of expected policy benefits

Beginning balance $ 9,633 $ 8,945

Reversal of effect of discount rate assumptions 1,220 1,611

Effect of assumption changes and actual variances from expected experience (2)

Issuances and lapses 1,316 902

Benefit payments ( 1,096 ) ( 1,017 )

Interest and other (3)

Ending balance at original discount rate 11,856 10,737

Effect of discount rate assumptions ( 926 ) ( 1,765 )

Ending balance (5)

$ 10,930 $ 8,972

Liability for future policy benefits $ 398 $ 384

Total liability for future policy benefits (1)(7)

(1) Includes $ 422 million and $ 429 million of future policy benefits classified as liabilities of businesses held for sale in the Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively.

(2) Includes the effect of actual variances from expectations, which decreased the total liability for future policy benefits by $( 43 ) million and $( 12 ) million, respectively, for the nine months ended September 30, 2024 and September 30, 2023.

(3) Includes the foreign exchange rate impact of translating from transactional and functional currency to United States dollar and the impact of flooring the liability at zero.

The flooring impact is calculated at the cohort level after discounting the reserves at the current discount rate.

(4) As of September 30, 2024 and September 30, 2023, undiscounted expected future gross premiums were $ 20.7 billion and $ 18.5 billion, respectively.

As of September 30, 2024 and September 30, 2023, discounted expected future gross premiums were $ 14.4 billion and $ 12.5 billion, respectively.

(5) As of September 30, 2024 and September 30, 2023, undiscounted expected future policy benefits were $ 15.6 billion and $ 13.1 billion, respectively.

(6) The liability for future policyholder benefits includes immaterial businesses shown as reconciling items above, most of which are in run-off.

(7) $ 73 million and $ 154 million reported in Reinsurance recoverables in the Consolidated Balance Sheets as of September 30, 2024 and September 30, 2023, respectively, relate to the liability for future policy benefits.

Additionally, $ 78 million of reinsurance recoverables are reported in assets of businesses held for sale in the Consolidated Balance Sheets as of September 30, 2024.

Future policy benefits for the Cigna Healthcare segment were primarily related to the businesses divested to HCSC on March 19, 2025.

Excluding the divestiture, changes in the future policy benefits for the three months ended March 31, 2025 and March 31, 2024 were not material.

Other Operations

The weighted average interest rates applied and duration for future policy benefits in Other Operations, consisting of annuity and life insurance products, were as follows:

September 30, 2024 September 30, 2023

March 31, 2025 March 31, 2024

Interest accretion rate 5.64 % 5.64 %

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therefore, future policy benefit reserves represent the present value of expected future policy benefits, discounted using the current discount rate, and the remaining amortizable deferred profit liability.

Future policy benefits for Other Operations includes deferred profit liability of $ 0.4 billion as of both September 30, 2024 and September 30, 2023.

Future policy benefits excluding deferred profit liability were $ 3.1 billion as of September 30, 2024, $ 3.0 billion as of September 30, 2023, and $ 3.2 billion as of both December 31, 2023, and December 31, 2022.

The decrease in future policy benefit reserve as of both September 30, 2024 and September 30, 2023 was primarily driven by benefit payments and for the nine months ended September 30, 2023 current discount rate increases were an additional factor contributing to the decrease in future policy benefit reserve.

For both periods, the decreases were partially offset by interest accretion.

Undiscounted expected future policy benefits were $ 4.3 billion as of September 30, 2024 and $ 4.5 billion as of September 30, 2023.

As of September 30, 2024 and September 30, 2023, $ 0.9 billion and $ 1.0 billion, respectively, of the future policy benefit reserve was recoverable through treaties with external reinsurers.

Future policy benefits for Other Operations includes deferred profit liability of $ 359 million as of March 31, 2025 and $ 379 million as of March 31, 2024.

Future policy benefits excluding deferred profit liability were $ 3.0 billion as of March 31, 2025, $ 3.1 billion as of March 31, 2024, $ 2.9 billion as of December 31, 2024, and $ 3.2 billion as of December 31, 2023.

Undiscounted expected future policy benefits were $ 4.3 billion as of March 31, 2025 and $ 4.4 billion as of March 31, 2024.

As of March 31, 2025 and March 31, 2024, $ 0.9 billion and $ 1.0 billion, respectively, of the future policy benefit reserve was recoverable through treaties with external reinsurers.

Contractholder Deposit Funds

Contractholder deposit fund liabilities within Other Operations were $ 6.3 billion as of September 30, 2024, $ 6.5 billion as of December 31, 2023, $ 6.6 billion as of September 30, 2023 and $ 6.7 billion as of December 31, 2022.

Contractholder deposit fund liabilities within Other Operations were $ 6.3 billion as of both as of March 31, 2025 and December 31, 2024 and $ 6.5 billion as of both March 31, 2024 and December 31, 2023.

Approximately 38 % of the balance is reinsured externally.

Activity in these liabilities is presented net of reinsurance in the Consolidated Statements of Cash Flows.

The net year-to-date decrease in contractholder deposit fund liabilities generally relates to withdrawals and benefit payments from contractholder deposit funds, partially offset by deposits and interest credited to contractholder deposit funds.

As of September 30, 2024, the weighted average crediting rate, net amount at risk and cash surrender value for contractholder deposit fund liabilities not effectively exited through reinsurance were 3.33 %, $ 2.9 billion and $ 2.8 billion, respectively.

The comparative amounts as of September 30, 2023 were 3.27 %, $ 3.1 billion and $ 2.8 billion, respectively.

More than 99 % of the $ 4.0 billion liability as of September 30, 2024 and the $ 4.1 billion liability as of September 30, 2023 not reinsured externally is for contracts with guaranteed interest rates of 3 % - 4 %, and approximately $ 1.1 billion and $ 1.2 billion, as of September 30, 2024 and September 30, 2023, respectively, represented contracts with policies at the guarantee.

As of both September 30, 2024 and September 30, 2023, $ 1.2 billion was 50 - 150 basis points ("bps") above the guarantee and the remaining $ 1.7 billion represented contracts above the guarantee that pay the policyholder based on the greater of a guaranteed minimum cash value or the actual cash value.

As of both September 30, 2024 and September 30, 2023, more than 90 % of these contracts have actual cash values of at least 110% of the guaranteed cash value.

Changes in contractholder deposit fund liabilities generally relates to withdrawals and benefit payments, partially offset by deposits and interest credited.

As of March 31, 2025, the weighted average crediting rate, net amount at risk and cash surrender value for contractholder deposit fund liabilities not effectively exited through reinsurance were 3.20 %, $ 2.8 billion and $ 2.8 billion, respectively.

The comparative amounts as of March 31, 2024 were 3.33 %, $ 3.0 billion and $ 2.8 billion, respectively.

More than 99 % of the $ 4.0 billion liability as of both March 31, 2025 and March 31, 2024 not reinsured externally is for contracts with guaranteed interest rates of 3 % - 4 %, and approximately $ 1.2 billion as of both March 31, 2025 and March 31, 2024 represented contracts with policies at the guarantee.

As of both March 31, 2025 and March 31, 2024, $ 1.2 billion was 50 - 150 basis points ("bps") above the guarantee and the remaining $ 1.6 billion represented contracts above the guarantee that pay the policyholder based on the greater of a guaranteed minimum cash value or the actual cash value.

As of both March 31, 2025 and March 31, 2024, more than 90 % of these contracts have actual cash values of at least 110% of the guaranteed cash value.

Market Risk Benefits

Liabilities for market risk benefits consist of variable annuity reinsurance contracts in Other Operations.

Liabilities for market risk benefits ("MRBs") consist of variable annuity reinsurance contracts in Other Operations.

These liabilities arise under annuities and riders to annuities written by ceding companies that guarantee the benefit received at death and, for a subset of policies, also provide contractholders the option, within 30 days of a policy anniversary after the appropriate waiting period, to elect minimum income payments.

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Market risk benefits activity was as follows:

Nine Months Ended September 30,

(Dollars in millions) 2024 2023

Three Months Ended March 31,

(In millions) 2025 2024

Balance, beginning of year $ 785 $ 1,003

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Changes due to policyholder behavior versus expected — ( 14 )

Assumption changes 37 ( 16 )

Balance, end of period, before the effect of changes in nonperformance risk (own credit risk) 878 955

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The Company should be reimbursed in full for these payments unless the Berkshire reinsurance limit is exceeded, as discussed further in Note 10 to the Consolidated Financial Statements.

(Dollars in millions, excludes impact of reinsurance ceded) September 30, 2024 September 30, 2023

(Dollars in millions, excludes impact of reinsurance ceded) March 31, 2025 March 31, 2024

Net amount at risk $ 1,412 $ 1,441

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The Company regularly evaluates the financial condition of its reinsurers and monitors concentrations of its credit risk.

Reinsurance Recoverables

The majority of the Company's reinsurance recoverables resulted from acquisition and disposition transactions in which the underwriting company was not acquired.

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The Company reviews its reinsurance arrangements and establishes reserves against the recoverables primarily for expected credit losses.

The Company's reinsurance recoverables as of September 30, 2024 are presented at amount due by range of external credit rating and collateral level in the following table, with reinsurance recoverables that are market risk benefits separately presented at fair value:

The Company's reinsurance recoverables as of March 31, 2025 are presented at amount due by range of external credit rating and collateral level in the following table, with reinsurance recoverables that are market risk benefits separately presented at fair value:

(In millions) Fair Value of Collateral Contractually Required to Meet or Exceed Carrying Value of Recoverable

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Not rated 101 3 3 107

Total recoverables related to ongoing operations 143 18 300 461

Acquisition, disposition or run-off activities

BBB+ equivalent and higher current ratings (2)(3)

Lincoln National Life and Lincoln Life & Annuity of New York — 2,548 — 2,548

Empower Annuity Insurance Company — — 123 123

Prudential Insurance Company of America 320 — — 320

Life Insurance Company of North America — 311 — 311

Other 155 19 14 188

304 2,804 208 3,316

Not rated — 6 1 7

Total recoverables related to acquisition, disposition or run-off activities 475 2,884 141 3,500

Total reinsurance recoverables before market risk benefits $ 405 $ 2,819 $ 452 $ 3,676

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(1) Includes collateral provisions requiring the reinsurer to fully collateralize its obligation if its external credit rating is downgraded to a specified level.

(2) Certified by an NRSRO.

(3) Includes $ 188 million of current reinsurance recoverables that are reported in Other current assets and $ 194 million of reinsurance recoverables classified as assets of businesses held for sale.

Collateral levels are defined internally based on the fair value of the collateral relative to the carrying amount of the reinsurance recoverable, the frequency at which collateral is required to be replenished and the potential for volatility in the collateral's fair value.

Effective Exit of Variable Annuity Reinsurance Business

(2) Certified by a nationally recognized statistical ratings organization ("NRSRO").

(3) Comprised of six reinsurers of which 75 % is held by two reinsurers, Lincoln National Life Insurance Company and Lincoln Life and Annuity Company of New York.

(4) Includes $ 146 million of current reinsurance recoverables that are reported in Other current assets.

The Company entered into an agreement with Berkshire to effectively exit the variable annuity reinsurance business via a reinsurance transaction in 2013.

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Berkshire reinsured 100 % of the Company's future cash flows in this business, net of other reinsurance arrangements existing at that time.

The reinsurance agreement is subject to an overall limit with approximately $ 3.0 billion remaining at September 30, 2024.

The reinsurance agreement is subject to an overall limit, with approximately $ 3.0 billion remaining at March 31, 2025.

As a result of the reinsurance transaction, amounts payable are offset by a corresponding reinsurance recoverable, provided the increased recoverable remains within the overall Berkshire limit.

(In millions)

Reinsurer (1)

September 30, 2024 December 31, 2023 Collateral and Other Terms

at September 30, 2024

Berkshire $ 836 $ 873 80 % were secured by assets in a trust.

Sun Life Assurance Company of Canada 75 92

Liberty Re (Bermuda) Ltd.

87 104 100 % were secured by assets in a trust.

SCOR SE 29 31 65 % were secured by a letter of credit.

Market risk benefits (2)

$ 1,027 $ 1,100

(1) All reinsurers are rated A- equivalent and higher by an NRSRO.

(2) Includes incurred but not reported ("IBNR") and outstanding claims of $ 19 million as of September 30, 2024 and $ 19 million as of December 31, 2023.

These amounts are excluded from market risk benefits as of September 30, 2024 in Note 9 and Note 10A to the Consolidated Financial Statements.

The impact of nonperformance risk (i.e., the risk that a counterparty might default) on the variable annuity reinsurance asset was immaterial for the three and nine months ended September 30, 2024 and September 30, 2023.

As of both March 31, 2025 and 2024, market risk benefits (shown in the table net of nonperformance risk as of March 31, 2025) were predominantly reinsured by Berkshire, which is rated AA+ by an NRSRO.

As of March 31, 2025, approximately 90 % of the Berkshire recoverable is secured by assets in a trust.

Note 11 – Investments

The Cigna Group's investment portfolio consists of a broad range of investments including debt securities, equity securities, commercial mortgage loans, policy loans, other long-term investments, short-term investments and derivative financial instruments.

The sections below provide more detail regarding our investment balances and realized investment gains and losses.

See Note 12 to the Consolidated Financial Statements for information about the valuation of the Company's investment portfolio.

Further information about our accounting policies for investment assets can be found in Note 12 in the Company's 2023 Form 10-K.

The following table summarizes the Company's investments by category and current or long-term classification:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(In millions) Current Long-Term Total Current Long-Term Total

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Investments per Consolidated Balance Sheets $ 727 $ 15,350 $ 16,077 $ 665 $ 15,128 $ 15,793

(1) Investments related to the HCSC transaction that were held for sale as of September 30, 2024.

These investments were primarily comprised of debt securities and commercial mortgage loans, and to a lesser extent, other long-term investments.

(1) Investments related to the HCSC transaction that were held for sale as of December 31, 2024.

These investments were primarily comprised of debt securities.

Investment Portfolio

Debt Securities

The amortized cost and fair value by contractual maturity periods for debt securities were as follows as of September 30, 2024:

The amortized cost and fair value by contractual maturity periods for debt securities were as follows as of March 31, 2025:

(In millions) Amortized

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Depreciation Fair

September 30, 2024

March 31, 2025

Federal government and agency $ 211 $ — $ 16 $ ( 4 ) $ 223

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Review of Declines in Fair Value.

Management reviews debt securities in an unrealized loss position to determine whether a credit loss allowance is needed based on criteria that include:

• severity of decline;

Management reviews debt securities in an unrealized loss position to determine whether a credit loss allowance is needed based on criteria that include severity of decline;

financial health and specific prospects of the issuer;

• changes in the regulatory, economic or general market environment of the issuer's industry or geographic region.

and changes in the regulatory, economic or general market environment of the issuer's industry or geographic region.

The table below summarizes debt securities with a decline in fair value from amortized cost for which an allowance for credit losses has not been recorded (by investment grade and the length of time these securities have been in an unrealized loss position).

Unrealized depreciation on these debt securities is primarily due to declines in fair value resulting from increasing interest rates since these securities were purchased.

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(Dollars in millions) Fair

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The following table provides the values of the Company's equity security investments:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

(In millions) Cost Carrying Value Cost Carrying Value

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Total $ 3,854 $ 559 $ 3,850 $ 561

We are a minority owner in VillageMD, a provider of primary, multi-specialty and urgent care services that is majority-owned by Walgreens Boots Alliance, Inc.

These securities are included in equity securities with no readily determinable fair value in the above table.

We determined our investment in VillageMD was fully impaired and recorded a $ 2.7 billion loss in Net realized investment losses in the Company's Consolidated Statements of Income .

Commercial Mortgage Loans

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The following table summarizes the credit risk profile of the Company's commercial mortgage loan portfolio:

(Dollars in millions) September 30, 2024 December 31, 2023

(Dollars in millions) March 31, 2025 December 31, 2024

Loan-to-Value Ratio Carrying Value Average Debt Service Coverage Ratio Average Loan-to-Value Ratio Carrying Value Average Debt Service Coverage Ratio Average Loan-to-Value Ratio

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Carrying Value as of

(In millions) September 30, 2024 December 31, 2023

(In millions) March 31, 2025 December 31, 2024

Real estate investments $ 1,808 $ 1,763

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The Company also uses derivative financial instruments to hedge the risk of changes in the net assets of certain of its foreign subsidiaries due to changes in foreign currency exchange rates and to hedge the interest rate risk of certain long-term debt.

As of September 30, 2024, the notional value of interest rate swap contracts increased to $ 2.1 billion compared to $ 1.5 billion as of December 31, 2023.

There have been no other material changes to the Company's derivative financial instruments during the nine months ended September 30, 2024.

As of March 31, 2025, the notional value of interest rate swap contracts increased to $ 3.0 billion compared to $ 2.7 billion as of December 31, 2024.

There were no other material changes to the Company's derivative financial instruments during the three months ended March 31, 2025.

Please refer to the Company's 2024 Form 10-K for further discussion of the types of derivative financial instruments and associated accounting policies.

The effects of derivative financial instruments used in our individual hedging strategies were not material to the Consolidated Financial Statements as of September 30, 2024 and December 31, 2023.

The effects of derivative financial instruments used in our individual hedging strategies were not material to the Consolidated Financial Statements as of March 31, 2025 and December 31, 2024.

The gross fair values of our derivative financial instruments are presented in Note 12 to the Consolidated Financial Statements.

Realized Investment Gains and Losses

The following realized gains and losses on investments exclude realized gains and losses attributed to the Company's separate accounts because those gains and losses generally accrue directly to separate account policyholders:

Three Months Ended September 30, Nine Months Ended September 30,

(In millions) 2024 2023 2024 2023

Net realized investment gains (losses), excluding credit (loss)/recovery and other investment write-downs

$ 25 $ ( 9 ) $ 32 $ ( 29 )

Credit (loss)/recovery and other investment write-downs ( 946 ) ( 5 ) ( 2,837 ) ( 15 )

Net realized investment (losses), before income taxes

$ ( 921 ) $ ( 14 ) $ ( 2,805 ) $ ( 44 )

Net realized investment losses for the three and nine months ended September 30, 2024 were primarily driven by the impairment of equity securities, as described above.

Investment Gains and Losses

Net investment losses before income taxes were $ 2 million for the three months ended March 31, 2025 versus $ 1,836 million for the three months ended March 31, 2024.

This decrease was primarily driven by the impairment of equity securities in 2024.

These amounts exclude investment gains and losses attributed to the Company's separate accounts because those gains and losses generally accrue directly to separate account policyholders.

Note 12 – Fair Value Measurements

The Company carries certain financial instruments at fair value in the financial statements including debt securities, certain equity securities, short-term investments and derivatives.

Other financial instruments are measured at fair value only under certain conditions, such as when impaired or when there are observable price changes for equity securities with no readily determinable fair value.

Fair value is defined as the price at which an asset could be exchanged in an orderly transaction between market participants at the balance sheet date.

A liability's fair value is defined as the amount that would be paid to transfer the liability to a market participant, not the amount that would be paid to settle the liability with the creditor.

The Company's financial assets and liabilities carried at fair value have been classified based upon a hierarchy defined by GAAP.

The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3).

An asset's or a liability's classification is based on the lowest level of input that is significant to its measurement.

For example, a

financial asset or liability carried at fair value would be classified in Level 3 if unobservable inputs were significant to the instrument's fair value, even though the measurement may be derived using inputs that are both observable (Levels 1 and 2) and unobservable (Level 3).

For a description of the policies, methods and assumptions that are used to estimate fair value and determine the fair value hierarchy for each class of financial instruments, see Note 12 in the Company's 2024 Form 10-K.

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(Level 3) Total

September 30,

2024 December 31, 2023 September 30,

2025 December 31, 2024 March 31,

2025 December 31, 2024

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Unobservable inputs reflect the Company's best estimate of what hypothetical market participants would use to determine a transaction price for the asset or liability at the reporting date.

Additionally, as discussed in Note 9E to the Consolidated Financial Statements, the Company classifies variable annuity assets and liabilities in Level 3 of the fair value hierarchy.

Additionally, as discussed in Note 9E in the Company's 2024 Form 10-K, the Company classifies variable annuity assets and liabilities in Level 3 of the fair value hierarchy.

Quantitative Information about Unobservable Inputs

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The range and weighted average basis point amounts for liquidity reflect the Company's best estimates of the unobservable adjustments a market participant would make to calculate these fair values.

An increase in liquidity spread adjustments would result in a lower fair value measurement, while a decrease would result in a higher fair value measurement.

Fair Value as of Unobservable Adjustment Range (Weighted Average by Quantity) as of

(Fair value in millions) September 30, 2024 December 31, 2023 Unobservable Input September 30, 2024 September 30, 2024 December 31, 2023

(Fair value in millions) March 31,

2025 December 31,

2024 Unobservable Input

March 31, 2025

2025 December 31,

Debt securities

3 unchanged sentences

bps 100 - 550 ( 280 )

Other debt securities — 1

Total Level 3 debt securities $ 373 $ 417

An increase in liquidity spread adjustments would result in a lower fair value measurement, while a decrease would result in a higher fair value measurement.

Changes in Level 3 Financial Assets and Financial Liabilities Carried at Fair Value

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Gains and losses reported in the table may include net changes in fair value that are attributable to both observable and unobservable inputs.

Three Months Ended September 30, Nine Months Ended

September 30,

Three Months Ended

(In millions) 2025 2024

Debt and Equity Securities

Debt securities

Beginning balance $ 417 $ 447

Losses included in Shareholders' net income

( 10 ) ( 1 ) ( 71 ) ( 1 )

Gains (losses) included in Other comprehensive income (loss)

Losses included in Shareholders' net income (loss)

( 10 ) ( 21 )

Gains (losses) included in Other comprehensive loss

Purchases, sales and settlements

Purchases 2 —

Sales ( 2 ) — ( 2 ) —

Settlements ( 31 ) ( 14 )

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Ending balance $ 373 $ 422

Total losses included in Shareholders' net income attributable to instruments held at the reporting date

$ ( 9 ) $ ( 1 ) $ ( 71 ) $ ( 1 )

Change in unrealized gain or (loss) included in Other comprehensive income (loss) for assets held at the end of the reporting period

Total losses included in Shareholders' net income (loss) attributable to instruments held at the reporting date

$ ( 13 ) $ ( 21 )

Total gains and losses included in Shareholders' net income in the tables above are reflected in the Consolidated Statements of Income as Net realized investment losses and Net investment income.

Gains and losses included in Other comprehensive income (loss), net of tax in the tables above are reflected in Net unrealized appreciation (depreciation) on securities and derivatives in the Consolidated Statements of Comprehensive Income.

Change in unrealized gain or (loss) included in Other comprehensive loss for assets held at the end of the reporting period

Total gains and losses included in Shareholders' net income (loss) in the tables above are reflected in the Consolidated Statements of Income as Net investment losses and Net investment income.

Gains and losses included in Other comprehensive loss, net of tax in the tables above are reflected in Net unrealized (depreciation) appreciation on securities and derivatives in the Consolidated Statements of Comprehensive Income.

Transfers into or out of the Level 3 category occur when unobservable inputs, such as the Company's best estimate of what a market participant would use to determine a current transaction price, become more or less significant to the fair value measurement.

Market activity typically decreases during periods of economic uncertainty, and this decrease in activity reduces the availability of market observable data.

As a result, the level of unobservable judgment that must be applied to the pricing of certain instruments increases

and is typically observed through the widening of liquidity spreads .

As a result, the level of unobservable judgment that must be applied to the pricing of certain instruments increases and is typically observed through the widening of liquidity spreads.

Transfers between Level 2 and Level 3 during 2025 and 2024 primarily reflected changes in liquidity estimates for certain private placement issuers across several sectors.

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The investment income and fair value gains and losses of Separate account assets generally accrue directly to the contractholders and, together with their deposits and withdrawals, are excluded from the Company's Consolidated Statements of Income and Cash Flows.

The separate account activity for the nine months ended September 30, 2024 and 2023 was primarily driven by changes in the market values of the underlying separate account investments.

The separate account activity for the three months ended March 31, 2025 and 2024 was primarily driven by changes in the market values of the underlying separate account investments.

Fair values of Separate account assets were as follows:

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(Level 3) Total

(In millions) September 30, 2024 December 31, 2023 September 30, 2024 December 31, 2023 September 30, 2024 December 31, 2023 September 30, 2024 December 31, 2023

(In millions) March 31,

2025 December 31,

2024 March 31,

2025 December 31,

2024 March 31,

2025 December 31,

2024 March 31,

2025 December 31,

Guaranteed separate accounts (See Note 16)

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Subtotal $ 502 $ 498 $ 5,887 $ 5,920 $ 255 $ 228 6,644 6,646

Non-guaranteed separate accounts priced at net asset value ("NAV") as a practical expedient (1)

Non-guaranteed separate accounts priced at net asset value as a practical expedient (1)

Total $ 7,277 $ 7,278

(1) Non-guaranteed separate accounts include $ 4.0 billion as of both September 30, 2024 and December 31, 2023 in assets supporting the Company's pension plans, including $ 0.2 billion classified in Level 3 as of both September 30, 2024 and December 31, 2023.

(1) Non-guaranteed separate accounts include $ 3.8 billion as of each of March 31, 2025 and December 31, 2024 in assets supporting the Company's pension plans, including $ 0.2 billion classified in Level 3 as of each of March 31, 2025 and December 31, 2024, respectively.

Non-guaranteed separate accounts are primarily comprised of securities partnerships, real estate and real estate funds.

Separate account assets classified in Level 3 primarily support the Company's pension plans and include certain newly issued, privately placed, complex or illiquid securities that are priced using methods discussed above, as well as commercial mortgage loans.

Activity, including transfers into and out of Level 3, was not material for the three and nine months ended September 30, 2024 or 2023.

Separate account investments in securities partnerships, real estate, real estate funds and hedge funds are generally valued based on the separate account's ownership share of the equity of the investee (NAV as a practical expedient), including changes in the fair values of its underlying investments.

Substantially all of these assets support the Company's pension plans.

The following table provides additional information on these investments:

Fair Value as of Unfunded Commitment as of September 30, 2024 Redemption Frequency

(if currently eligible) Redemption Notice

(In millions) September 30, 2024 December 31, 2023

Securities partnerships $ 413 $ 419 $ 224 Not applicable Not applicable

Real estate and real estate funds 237 258 3 Quarterly 30 - 90 days

Hedge funds 1 3 — Up to annually, varying by fund 30 - 90 days

Total $ 651 $ 680 $ 227

As of September 30, 2024, the Company does not have plans to sell any of these assets at less than fair value.

These investments are structured to satisfy longer-term investment objectives.

Securities partnerships are contractually non-redeemable and the underlying investment assets are expected to be liquidated by the fund managers within ten years after inception.

Activity, including transfers into and out of Level 3, was not material for the three months ended March 31, 2025 or 2024.

Assets and Liabilities Measured at Fair Value under Certain Conditions

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However, these financial assets and liabilities may be measured using fair value under certain conditions, such as when investments become impaired and are written down to their fair value, or when there are observable price changes from orderly market transactions of equity securities that otherwise had no readily determinable fair value.

For the nine months ended September 30, 2024, we determined our investment in VillageMD was fully impaired and recorded a $ 2.7 billion loss in Net realized investment losses in the Company's Consolidated Statements of Income.

For the nine months ended

September 30, 2023, impairments recognized requiring the assets and liabilities described above to be measured at fair value were not material.

Observable price changes for equity securities with no readily determinable fair value were not material for the nine months ended September 30, 2024 and September 30, 2023.

For the three months ended March 31, 2025, impairments recognized requiring the assets and liabilities described above to be measured at fair value were not material.

In the first quarter of 2024, we determined our investment in VillageMD was impaired and recorded a $ 1.8 billion loss in Net investment losses in the Company's Consolidated Statements of Income.

Observable price changes for equity securities with no readily determinable fair value were not material for the three months ended March 31, 2025 and March 31, 2024.

Fair Value Disclosures for Financial Instruments Not Carried at Fair Value

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In addition to universal life products and finance leases, financial instruments that are carried in the Company's Consolidated Balance Sheets at amounts that approximate fair value are excluded from the following table.

Classification in Fair Value Hierarchy September 30, 2024 December 31, 2023

Classification in Fair Value Hierarchy March 31, 2025 December 31, 2024

(In millions) Fair Value Carrying Value Fair Value Carrying Value

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Long-term debt, including current maturities, excluding finance leases Level 2 $ 28,149 $ 30,371 $ 28,392 $ 31,008

Note 13 – Variable Interest Entities

We perform ongoing qualitative analyses of our involvement with variable interest entities to determine if consolidation is required.

The Company determined that it was no t a primary beneficiary in any material variable interest entity as of September 30, 2024 or December 31, 2023.

The Company's involvement with variable interest entities for which it is not the primary beneficiary has not materially changed from December 31, 2023.

For details of our accounting policy for variable interest entities and the composition of variable interest entities with which the Company is involved, refer to Note 14 in the Company's 2023 Form 10-K.

The Company has not provided, and does not intend to provide, financial support to any of these variable interest entities in excess of its maximum exposure.

Note 13 – Accumulated Other Comprehensive Income (Loss)

Accumulated Other Comprehensive Income (Loss) ("AOCI") includes net unrealized appreciation (depreciation) on securities and derivatives, change in discount rate and instrument-specific credit risk for certain long-duration insurance contractholder liabilities (Note 9 to the Consolidated Financial Statements), foreign currency translation and the net postretirement benefits liability adjustment.

Accumulated Other Comprehensive Income (Loss) ("AOCI") includes net unrealized (depreciation) appreciation on securities and derivatives, change in discount rate and instrument-specific credit risk for certain long-duration insurance contractholder liabilities (see Note 9 to the Consolidated Financial Statements), foreign currency translation, and the net postretirement benefits liability adjustment.

AOCI includes the Company's share from unconsolidated entities reported on the equity method.

Generally, tax effects in AOCI are established at the currently enacted tax rate and reclassified to Shareholders' net income in the same period that the related pre-tax AOCI reclassifications are recognized.

Shareholders' other comprehensive loss, net of tax, for the three and nine months ended September 30, 2024 and September 30, 2023, is primarily attributable to the change in discount rates for certain long-duration liabilities (following the adoption of Targeted Improvements to the Accounting for Long-Duration Contracts in 2023) and unrealized changes in the market values of securities and derivatives, including the impacts from unconsolidated entities reported on the equity method.

Generally, tax effects in AOCI are established at the currently enacted tax rate and reclassified to Shareholders' net income (loss) in the same period that the related pre-tax AOCI reclassifications are recognized.

Shareholders' other comprehensive loss, net of tax, for the three months ended March 31, 2025 and March 31, 2024 is primarily attributable to the change in discount rates for certain long-duration liabilities and unrealized changes in the market values of securities and derivatives, including the impacts from unconsolidated entities reported on the equity method.

Changes in the components of AOCI were as follows:

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2025 2024

1 unchanged sentence

Beginning balance $ 832 $ 171

Unrealized appreciation (depreciation) on securities and derivatives

319 ( 257 ) 568 2

Tax (expense) benefit

( 65 ) 57 ( 133 ) ( 9 )

Net unrealized appreciation (depreciation) on securities and derivatives

254 ( 200 ) 435 ( 7 )

Reclassification adjustment for losses included in Shareholders' net income (Net realized investment losses)

Reclassification adjustment for (gains) included in Shareholders' net income (Selling, general and administrative expenses)

— ( 1 ) — ( 1 )

Reclassification adjustment for tax (benefit) included in Shareholders' net income

( 2 ) ( 3 ) ( 15 ) ( 8 )

Net losses reclassified from AOCI to Shareholders' net income

Other comprehensive income (loss), net of tax

264 ( 192 ) 493 22

Unrealized (depreciation) appreciation on securities and derivatives, before reclassification, net of tax benefit (expense) of $ 49 and $( 39 ), respectively

Amounts reclassified to Shareholders' net income (loss), net of tax (benefit) of $( 9 ) and $( 5 ), respectively

Other comprehensive (loss) income, net of tax

Ending balance $ 732 $ 292

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2024 2023 2024 2023

Net long-duration insurance and contractholder liabilities measurement adjustments

Beginning balance $ ( 2,038 ) $ ( 971 )

Current period change in discount rate for certain long-duration liabilities ( 34 ) ( 27 ) ( 1,054 ) ( 585 )

Net current period change in discount rate for certain long-duration liabilities ( 31 ) ( 15 ) ( 789 ) ( 436 )

Current period change in instrument-specific credit risk for market risk benefits 3 ( 17 ) ( 15 ) ( 50 )

Net current period change in instrument-specific credit risk for market risk benefits 3 ( 13 ) ( 11 ) ( 40 )

Net current period change in discount rate for certain long-duration liabilities, before reclassification, net of tax benefit of $ 33 and $ 186 , respectively

( 108 ) ( 546 )

Amounts reclassified to Shareholders' net income (loss), net of tax expense of $ 16 and $ — , respectively

Net current period change in discount rate for certain long-duration liabilities, net of tax benefit of $ 49 and $ 186 , respectively

( 164 ) ( 546 )

Net current period change in instrument-specific credit risk for market risk benefits, net of tax benefit of $ 1 and $ 4 , respectively

Other comprehensive (loss), net of tax

1 unchanged sentence

Ending balance $ ( 2,206 ) $ ( 1,531 )

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2024 2023 2024 2023

Translation of foreign currencies

Beginning balance $ ( 198 ) $ ( 149 )

Translation of foreign currencies 41 ( 31 ) 13 ( 36 )

Tax (expense) benefit

( 2 ) 2 ( 5 ) 4

Other comprehensive income (loss), net of tax

39 ( 29 ) 8 ( 32 )

Net translation of foreign currencies, before reclassification, net of tax (expense) of $( 6 ) and $( 2 ), respectively

Ending balance $ ( 185 ) $ ( 175 )

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2024 2023 2024 2023

Postretirement benefits liability

Beginning balance $ ( 937 ) $ ( 915 )

Reclassification adjustment for amortization of net prior actuarial losses and prior service costs (Interest expense and other) 9 11 24 35

Reclassification adjustment for tax (benefit) included in Shareholders' net income

( 5 ) ( 3 ) ( 8 ) ( 9 )

Net adjustments reclassified from AOCI to Shareholders' net income

Valuation update ( 1 ) — ( 21 ) ( 2 )

Net change due to valuation update — — ( 16 ) ( 1 )

Other comprehensive income, net of tax

Amounts reclassified to Shareholders' net income, net of tax (benefit) of $( 2 ) and $( 3 ), respectively

Ending balance $ ( 931 ) $ ( 910 )

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2024 2023 2024 2023

Total Accumulated other comprehensive loss

Beginning balance $ ( 2,341 ) $ ( 1,864 )

Shareholders' other comprehensive income (loss), net of tax

Shareholders' other comprehensive (loss), net of tax benefit of $ 82 and $ 141 , respectively

( 249 ) ( 460 )

Ending balance $ ( 2,590 ) $ ( 2,324 )

Note 14 – Strategic Optimization Program

In 2025, the Company commenced an enterprise-wide initiative to evolve our business and deliver a more efficient and improved experience for our patients, providers and customers.

This program is expected to continue through December 2026 and include severance and other employee costs, accelerated asset amortization, and the operating results of certain small non-strategic businesses that we plan to discontinue.

As we continue to evaluate additional opportunities to improve the overall efficiency and effectiveness of our operations, we anticipate future charges.

During the three months ended March 31, 2025, we reported total costs of $ 215 million, pre-tax ($ 163 million, after-tax) associated with this initiative, including a charge in Selling, general and administrative expenses of $ 198 million, pre-tax ($ 150 million, after-tax) that was primarily associated with employee severance.

The remainder reflects the operating results of certain non-strategic businesses.

We expect substantially all of the accrued liability to be paid by the end of 2025.

The following table summarizes a roll forward of the accrued liability recorded in Accrued expenses and other liabilities during the three months ended March 31, 2025:

(In millions)

Balance, December 31, 2024

First quarter 2025 charge

2025 payments

Balance, March 31, 2025

Note 15 – Income Taxes

Income Tax Expense

The 30.8 % and 31.2 % effective tax rates for the three and nine months ended September 30, 2024, respectively, were higher than the 21.3 % and 19.9 % rates for the three and nine months ended September 30, 2023, respectively.

These increases were primarily driven by the establishment of a valuation allowance on the tax benefit related to the impairment of equity securities.

As of September 30, 2024, we had approximately $ 836 million in deferred tax assets ("DTAs") associated with the impairment of equity securities as well as unrealized investment losses which are partially recorded in Accumulated other comprehensive loss.

A valuation allowance of $ 635 million, established in the nine months ended September 30, 2024, drove the higher effective tax rate and was almost entirely related to the impairment of equity securities discussed in Note 11 to the Consolidated Financial Statements.

For the remainder of the DTAs, we have determined that a valuation allowance is not currently required based on the Company's ability to carry back losses and ability and intent to hold certain securities until recovery.

The 14.5 % effective tax rate for the three months ended March 31, 2025 was lower than the 368.4 % rate for the three months ended March 31, 2024 primarily due to the absence of a valuation allowance related to the impairment of equity securities in 2024, partially offset by the absence of tax benefits recorded in 2024 related to the release of tax reserves following favorable state audit resolutions and the impact related to the HCSC transaction.

As of March 31, 2025, we had approximately $ 856 million in deferred tax assets ("DTAs") associated with the impairment of equity securities as well as unrealized investment losses.

A valuation allowance of $ 636 million, of which $ 427 million was established in the three months ended March 31, 2024, drove the higher effective tax rate and was almost entirely related to the impairment of equity securities discussed in Note 11 to the Consolidated Financial Statements.

We have determined that a valuation allowance against the remaining DTAs is not currently required based on the Company's loss carryback capacity and ability and intent to hold certain securities until recovery.

We continue to monitor and evaluate the need for any additional valuation allowance.

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If employers fail to do so, the Company or an affiliate of the buyer of the retirement benefits business has the right to redirect the management of the related assets to provide for benefit payments.

As of September 30, 2024, employers maintained assets that generally exceeded the benefit obligations under these arrangements of approximately $ 410 million.

As of March 31, 2025, employers maintained assets that generally exceeded the benefit obligations under these arrangements of approximately $ 410 million.

An additional liability is established if management believes that the Company will be required to make payments under the guarantees;

there were no additional liabilities required for these guarantees, net of reinsurance, as of September 30, 2024.

there were no additional liabilities required for these guarantees, net of reinsurance, as of March 31, 2025.

Separate account assets supporting these guarantees are classified in Levels 1 and 2 of the GAAP fair value hierarchy.

1 unchanged sentence

Certain Other Guarantees

The Company had indemnification obligations as of September 30, 2024 in connection with acquisition and disposition transactions.

The Company had indemnification obligations as of March 31, 2025 in connection with acquisition and disposition transactions.

These indemnification obligations are triggered by the breach of representations or covenants provided by the Company, such as representations for the presentation of financial statements, filing of tax returns, compliance with laws or regulations, or identification of outstanding litigation.

2 unchanged sentences

The Company does not believe that it is possible to determine the maximum potential amount due under these obligations because not all amounts due under these indemnification obligations are subject to limitation.

There were no recorded liabilities for these indemnification obligations as of September 30, 2024.

There were no recorded liabilities for these indemnification obligations as of March 31, 2025.

Guaranty Fund Assessments

1 unchanged sentence

The Company's exposure to assessments for certain obligations of insolvent insurance companies to policyholders and claimants is based on its share of business written in the relevant jurisdictions.

There were no material charges or credits resulting from existing or new guaranty fund assessments for the nine months ended September 30, 2024.

There were no material charges or credits resulting from existing or new guaranty fund assessments for the three months ended March 31, 2025.

Legal and Regulatory Matters

2 unchanged sentences

Disputed tax matters arising from audits by the Internal Revenue Service or other state and foreign jurisdictions, including those resulting in litigation, are accounted for under GAAP guidance for uncertain tax positions.

Pending litigation and legal or regulatory matters that the Company has identified with a reasonably possible material loss and certain other material litigation matters are described below.

For those matters that the Company has identified with a reasonably possible

material loss, the Company provides disclosure in the aggregate of accruals and range of loss, or a statement that such information cannot be estimated.

The Company's accrual for the matter discussed below under "Litigation Matters" is not material.

Due to numerous uncertain factors presented in this case, it is not possible to estimate an aggregate range of loss (if any) for this matter at this time.

In light of the uncertainties involved in this matter, there is no assurance that its ultimate resolution will not exceed the amount currently accrued by the Company.

An adverse outcome in this matter could be material to the Company's results of operations, financial condition or liquidity for any particular period.

The outcomes of lawsuits are inherently unpredictable and we may be unsuccessful in this ongoing litigation matter or any future claims or litigation.

Litigation Matters

Express Scripts Litigation with Elevance .

In March 2016, Elevance filed a lawsuit in the United States District Court for the Southern District of New York alleging various breach of contract claims against Express Scripts relating to the parties' rights and obligations under the periodic pricing review section of the pharmacy benefit management agreement between the parties including allegations that Express Scripts failed to negotiate new pricing concessions in good faith, as well as various alleged service issues.

Elevance also requested that the court enter declaratory judgment that Express Scripts is required to provide Elevance competitive benchmark pricing, that Elevance can terminate the agreement and that Express Scripts is required to provide Elevance with post-termination services at competitive benchmark pricing for one year following any termination by Elevance.

Elevance claimed it is entitled to $ 13 billion in additional pricing concessions over the remaining term of the agreement, as well as $ 1.8 billion for one year following any contract termination by Elevance and $ 150 million damages for service issues ("Elevance's Allegations").

On April 19, 2016, in response to Elevance's complaint, Express Scripts filed its answer denying Elevance's Allegations in their entirety and asserting affirmative defenses and counterclaims against Elevance.

The court subsequently granted Elevance's motion to dismiss two of six counts of Express Scripts' amended counterclaims.

Express Scripts filed its Motion for Summary Judgment on August 27, 2021.

Elevance completed filing of its Response to Express Scripts' Motion for Summary Judgment on October 16, 2021.

Express Scripts filed its Reply in Support of its Motion for Summary Judgment on November 19, 2021.

On March 31, 2022, the court granted summary judgment in favor of Express Scripts on all of Elevance's pricing claims for damages totaling $ 14.8 billion and on most of Elevance's claims relating to service issues.

Elevance's only remaining service claims relate to the review or processing of prior authorizations, with alleged damages over $ 100 million.

On November 1, 2023, the parties signed a settlement agreement pursuant to which Express Scripts agreed to resolve the service-related claims.

The settlement agreement is not an admission of liability or fault by Express Scripts, the Company or its subsidiaries.

Following the settlement, Elevance retained the right to appeal the pricing-related claims that were previously dismissed by the court and Express Scripts retained the ability to reassert its own pricing-related claims in the event any appeal by Elevance is successful.

Elevance filed its Notice of Appeal of its pricing-related claims on December 12, 2023.

Elevance filed its opening appellate brief on April 24, 2024.

Express Scripts filed its answering appellate brief on July 24, 2024.

Oral arguments before the Second Circuit were held on October 22, 2024.

Note 17 – Segment Information

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Intersegment revenues primarily reflect pharmacy and care services transactions between the Evernorth Health Services and Cigna Healthcare segments.

The Company uses "pre-tax adjusted income (loss) from operations" and "adjusted revenues" as its principal financial measures of segment operating performance because management believes these metrics reflect the underlying results of business operations and facilitate analysis of trends in underlying revenue, expenses and profitability.

We define pre-tax adjusted income (loss) from operations as income (loss) before income taxes excluding pre-tax income (loss) attributable to noncontrolling interests, net realized investment results, amortization of acquired intangible assets and special items.

The Cigna Group's share of certain realized investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting are also excluded.

Special items are matters that management believes are not representative of the underlying results of operations due to their nature or size.

The Chairman and Chief Executive Officer is the chief operating decision maker ("CODM") responsible for making decisions about resources to be allocated to the segment and assessing its performance.

The Company uses "pre-tax adjusted income (loss) from operations" and "adjusted revenues" as its principal financial measures of segment operating performance because management, including the CODM, believes these metrics reflect the underlying results of business operations and facilitate analysis of trends in underlying revenue, expenses and profitability to enable resource allocation decisions.

We define pre-tax adjusted income (loss) from operations as income (loss) before income taxes excluding pre-tax income (loss) attributable to noncontrolling interests, net investment gains/losses, amortization of acquired intangible assets and special items.

The Cigna Group's share of certain investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting are also excluded.

Special items are matters that management, including the CODM, believes are not representative of the underlying results of operations due to their nature or size.

Adjusted income (loss) from operations is measured on an after-tax basis for consolidated results and on a pre-tax basis for segment results.

The Company defines adjusted revenues as total revenues excluding the following adjustments:

special items and The Cigna Group's share of certain realized investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting.

Special items are matters that management believes are not representative of the underlying results of operations due to their nature or size.

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

The Company does not report total assets by segment because this is not a metric used to allocate resources or evaluate segment performance.

special items and The Cigna Group's share of certain investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting.

Special items are matters that management, including the CODM, believes are not representative of the underlying results of operations due to their nature or size.

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

The Company does not report total assets by segment because this is not a metric used by the CODM to allocate resources or evaluate segment performance.

The following table presents the special items charges (benefits) recorded by the Company, as well as the respective financial statement line items impacted:

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

(In millions) Pre-tax After-tax Pre-tax After-tax Pre-tax After-tax Pre-tax After-tax

Impairment of dividend receivable

(Net investment income) $ 182 $ 138 $ — $ — $ 182 $ 138 $ — $ —

Integration and transaction-related costs

(Selling, general and administrative expenses) 77 59 13 9 177 135 20 15

Loss on sale of businesses 87 62 21 19 106 19 21 19

Deferred tax expenses, net

(Income taxes, less amount attributable to noncontrolling interests) — 41 — — — 75 — —

Charges associated with litigation matters

(Selling, general and administrative expenses) — — 201 171 — — 201 171

Three Months Ended March 31,

(In millions) Pre-tax After-tax Pre-tax After-tax

Integration and transaction-related costs (Selling, general and administrative expenses) $ 216 $ 164 $ 37 $ 29

Strategic optimization program (primarily Selling, general and administrative expenses) 215 163 — —

Deferred tax expenses, net (Income taxes, less amount attributable to noncontrolling interests) — 17 — 17

(Gain) loss on sale of businesses ( 41 ) ( 115 ) 19 ( 43 )

Total impact from special items $ 390 $ 229 $ 56 $ 3

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Corporate and Eliminations

Three months ended September 30, 2024

Revenues from external customers $ 51,552 $ 11,919 $ 137 $ 1 $ 63,609

Intersegment revenues 1,045 1,279 18 ( 2,342 )

Net investment (loss) income

( 142 ) 142 79 6 85

Total revenues 52,455 13,340 234 ( 2,335 ) 63,694

Net realized investment results from certain equity method investments — ( 177 ) — — ( 177 )

Special item related to impairment of dividend receivable 182 — — — 182

Adjusted revenues $ 52,637 $ 13,163 $ 234 $ ( 2,335 ) $ 63,699

Income (loss) before income taxes

$ 631 $ 1,073 $ ( 10 ) $ ( 502 ) $ 1,192

Pre-tax adjustments to reconcile to adjusted income from operations

(Income) attributable to noncontrolling interests

( 99 ) — — — ( 99 )

Net realized investment losses (gains) (1)

748 ( 8 ) 4 — 744

Amortization of acquired intangible assets 414 22 — — 436

Special items

Impairment of dividend receivable 182 — — — 182

Integration and transaction-related costs — — — 77 77

Loss on sale of businesses — 87 — — 87

Pre-tax adjusted income (loss) from operations $ 1,876 $ 1,174 $ ( 6 ) $ ( 425 ) $ 2,619

(In millions) Evernorth Health Services

Cigna Healthcare

Other Operations

Corporate and Eliminations

Three months ended September 30, 2023

Three months ended March 31, 2025

Revenues from external customers $ 52,002 $ 13,168 $ 94 $ — $ 65,264

3 unchanged sentences

Total revenues 53,681 14,532 175 ( 2,886 ) 65,502

Net realized investment results from certain equity method investments — 30 — — 30

Adjusted revenues $ 38,596 $ 12,768 $ 147 $ ( 2,433 ) $ 49,078

Income (loss) before income taxes

Net investment results from certain equity method investments

— ( 50 ) — — ( 50 )

Pre-tax adjustments to reconcile to adjusted income from operations

Adjusted revenues $ 53,681 $ 14,482 $ 175 $ ( 2,886 ) $ 65,452

Pharmacy and other service costs 51,121 —

Medical costs — 10,385

Selling, general and administrative expenses 1,024 2,812

Other segment items (1)

Interest (expense) and other — 2

Income attributable to noncontrolling interests 102 —

( 44 ) — — — ( 44 )

Net realized investment losses (1)

Amortization of acquired intangible assets 443 11 — — 454

Special items

Integration and transaction-related costs — — — 13 13

Loss on sale of businesses — — 21 — 21

Charges associated with litigation matters 44 157 — — 201

Pre-tax adjusted income (loss) from operations 1,434 1,287 — ( 411 ) 2,310

(1) Includes Net realized investment losses/gains as presented in our Consolidated Statements of Income, as well as the Company's share of certain realized investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting, which are presented within Fees and other revenues in our Consolidated Statements of Income.

(In millions) Evernorth Health Services

Cigna Healthcare

Other Operations

Corporate and Eliminations

Nine months ended September 30, 2024

Revenues from external customers $ 144,689 $ 35,752 $ 333 $ 2 $ 180,776

Intersegment revenues 3,558 3,606 63 ( 7,227 )

Net investment (loss) income

( 18 ) 463 231 20 696

Total revenues 148,229 39,821 627 ( 7,205 ) 181,472

Net realized investment results from certain equity method investments

— ( 238 ) — — ( 238 )

Special item related to impairment of dividend receivable 182 — — — 182

Adjusted revenues $ 148,411 $ 39,583 $ 627 $ ( 7,205 ) $ 181,416

Income (loss) before income taxes

3 unchanged sentences

( 102 ) — — — ( 102 )

Net realized investment losses (1)

Net investment (gains) losses (2)

( 4 ) ( 47 ) 3 — ( 48 )

1 unchanged sentence

Special items

Impairment of dividend receivable 182 — — — 182

Integration and transaction-related costs — — — 216 216

Loss on sale of businesses — 106 — — 106

Strategic optimization program 21 — 17 177 215

(Gain) on sale of businesses ( 4 ) ( 37 ) — — ( 41 )

Pre-tax adjusted income (loss) from operations $ 1,434 $ 1,287 $ — $ ( 411 ) $ 2,310

Other segment information

Depreciation and amortization $ 584 $ 83 $ 2 $ 5 $ 674

(1) Other segment items represent the difference between segment adjusted revenues less significant segment expenses and pre-tax adjusted income (loss) from operations, and they do not represent significant segment items relative to the CODM's review and oversight.

(2) Includes Net investment gains/losses as presented in our Consolidated Statements of Income, as well as the Company's share of certain investment results of its joint ventures reported in the Cigna Healthcare segment using the equity method of accounting, which are presented within Fees and other revenues in our Consolidated Statements of Income.

(In millions) Evernorth Health Services

2 unchanged sentences

Corporate and Eliminations

Nine months ended September 30, 2023

Three months ended March 31, 2024

Revenues from external customers $ 44,886 $ 12,012 $ 66 $ 1 $ 56,965

$ 108,462 $ 34,581 $ 232 $ — $ 143,275

Intersegment revenues 1,281 1,124 25 ( 2,430 )

2 unchanged sentences

Total revenues 46,226 13,285 166 ( 2,422 ) 57,255

Net realized investment results from certain equity method investments — 22 — — 22

Net investment results from certain equity method investments — ( 8 ) — — ( 8 )

Adjusted revenues $ 46,226 $ 13,277 $ 166 $ ( 2,422 ) $ 57,247

Income (loss) before income taxes

Pharmacy and other service costs 43,838 —

Medical costs — 9,219

Selling, general and administrative expenses 951 2,720

Other segment items (1)

Interest (expense) and other — 2

income attributable to noncontrolling interests 77 —

Pre-tax adjusted income (loss) from operations 1,360 1,340 18 ( 409 ) 2,309

(Loss) income before income taxes

$ ( 436 ) $ 943 $ 18 $ ( 446 ) $ 79

2 unchanged sentences

( 77 ) — — — ( 77 )

Net realized investment losses (1)

Net investment losses (2)

1,456 372 — — 1,828

Amortization of acquired intangible assets 417 6 — — 423

2 unchanged sentences

Loss on sale of businesses

Charges associated with litigation matters 44 157 — — 201

Pre-tax adjusted income (loss) from operations $ 1,360 $ 1,340 $ 18 $ ( 409 ) $ 2,309

Other segment information

Depreciation and amortization $ 606 $ 124 $ 1 $ 10 $ 741

Revenue from external customers includes Pharmacy revenues, Premiums and Fees and other revenues.

The following table presents these revenues by product, premium and service type:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In millions) 2025 2024

5 unchanged sentences

50,226 43,170

Total Other Operations

Intercompany eliminations ( 982 ) ( 1,109 ) ( 3,238 ) ( 3,890 )

Other Operations

Corporate and eliminations ( 1,606 ) ( 1,151 )

Total Pharmacy revenues

10 unchanged sentences

Total Cigna Healthcare 12,628 11,531

Other 122 70 285 225

Intercompany eliminations 18 17 73 51

Other Operations 81 48

Corporate and eliminations 27 24

Total Premiums

12,736 11,603

Services (Fees) (ASC 606)

Services (Fees) (ASC 606) and Other revenues (1)

Evernorth Health Services

3,314 2,862 9,508 8,199

Cigna Healthcare

1,671 1,639 4,850 4,847

Other Operations

Other revenues 267 43 509 172

Intercompany eliminations ( 1,378 ) ( 1,347 ) ( 4,062 ) ( 3,647 )

Corporate and eliminations ( 1,312 ) ( 1,302 )

Total Fees and other revenues (1)

3,889 3,198 10,862 9,574

Total revenues from external customers $ 65,264 $ 56,965

(1) Cigna Healthcare includes the U.S.

Healthcare and International Health operating segments, which provide comprehensive medical and coordinated solutions to clients and customers.

During the fourth quarter of 2023, the U.S.

Commercial and U.S.

Government operating segments merged to form the U.S.

Healthcare operating segment.

Information presented for the three and nine months ended September 30, 2023 has been restated to conform to the new operating segment presentation.

(1) Other revenues for the three months ended March 31, 2025 and 2024 were $ 162 million and $ 90 million, respectively.

Financial and performance guarantees.

4 unchanged sentences

Historically, adjustments to original estimates have not been material.

This guarantee liability was $ 2.0 billion as of September 30, 2024 and $ 1.6 billion as of December 31, 2023.

Major customers.

Revenues from a single pharmacy benefit client were approximately 16 % of consolidated revenues for the three and nine months ended September 30, 2024.

These amounts were reported in the Evernorth Health Services segment.

Additionally, revenues from U.S.

Federal Government agencies, under a number of contracts, were approximately 10 % and 11 % of consolidated revenues for the three and nine months ended September 30, 2024, respectively.

These amounts were reported in the Evernorth Health Services and Cigna Healthcare segments.

See Note 25 in the Company's 2023 Form 10-K for prior year revenue concentration information.

This guarantee liability was $ 1.9 billion as of both March 31, 2025 and December 31, 2024.

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 1. Financial Statements