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Item 2. Management’s Discussion and Analysis

2026-07-30 compared with 2026-04-30 · 113 added, 95 removed, 373 unchanged (36% of the section changed)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide information to assist you in better understanding and evaluating our financial condition as of March 31, 2026 compared with December 31, 2025 and our results of operations for the three months ended March 31, 2026 compared with the same period last year, and is intended to help you understand the ongoing trends in our business.

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide information to assist you in better understanding and evaluating our financial condition as of June 30, 2026 compared with December 31, 2025 and our results of operations for the three and six months ended June 30, 2026 compared with the same periods last year, and is intended to help you understand the ongoing trends in our business.

We encourage you to read this MD&A in conjunction with our Consolidated Financial Statements included in Part I, Item 1 in this Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2025 ("2025 Form 10-K").

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Unless otherwise indicated, financial information in this MD&A is presented in accordance with accounting principles generally accepted in the United States of America ("GAAP").

See Note 2 to the Consolidated Financial Statements in our 2025 Form 10-K for additional information regarding the Company's significant accounting policies and see Note 2 to the Consolidated Financial

Statements in this Form 10-Q for updates to those policies resulting from adopting new accounting guidance, if any.

See Note 2 to the Consolidated Financial Statements in our 2025 Form 10-K for

additional information regarding the Company's significant accounting policies and see Note 2 to the Consolidated Financial Statements in this Form 10-Q for updates to those policies resulting from adopting new accounting guidance, if any.

The preparation of interim consolidated financial statements necessarily relies heavily on estimates.

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changes in drug pricing or industry pricing benchmarks;

our ability to maintain relationships with one or more key pharmaceutical manufacturers or if payments made or discounts provided decline;

changes in the pharmacy provider

marketplace or pharmacy networks;

our ability to maintain relationships with one or

more key pharmaceutical manufacturers or if payments made or discounts provided decline;

changes in the pharmacy provider marketplace or pharmacy networks;

the potential for actual claims to exceed our estimates related to expected medical claims;

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Consolidated Results of Operations (GAAP basis)

Three Months Ended March 31,

(Dollars in millions) 2026 2025 Change

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

(Dollars in millions) 2026 2025 Change 2026 2025 Change

Pharmacy revenues $ 57,172 $ 53,649 7 % $ 111,209 $ 102,282 9 %

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Gain on sale of businesses

Net investment gains (losses)

6 — N/M 17 41 (59)

Net investment (losses) gains

(69) 52 N/M 189 50 278

Income before income taxes

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Net income attributable to noncontrolling interests

215 100 115 422 186 127

Shareholders' net income

$ 1,660 $ 1,532 8 % $ 3,314 $ 2,855 16 %

Consolidated effective tax rate 18.0 % 14.5 % 350 bps

Consolidated effective tax rate 16.9 % 19.2 % (230) bps 17.5 % 17.1 % 40 bps

Reconciliation of Shareholders' Net Income (GAAP) to Adjusted Income from Operations

Three Months Ended March 31,

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

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

2026 2025 2026 2025

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

Shareholders' net income

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34 26 74 56 69 53 290 220

Charges associated with litigation matters

77 60 — — 66 52 — —

Deferred tax expenses, net

— 17 — 17 — 33 — 34

(Gain) on sale of businesses

(6) (3) — — (6) (6) (41) (115)

(Benefits) associated with litigation matters

Total special items $ 175 153 $ 203 171 $ 579 475 $ 593 400

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Reconciliation of Shareholders' Net Income (GAAP) to Adjusted Income from Operations

Three Months Ended March 31,

(Diluted earnings per share) Pre-tax After-tax Pre-tax After-tax

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

2026 2025 2026 2025

(Diluted earnings per share) Pre-tax After-tax Pre-tax After-tax Pre-tax After-tax Pre-tax After-tax

Shareholders' net income

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0.13 0.10 0.28 0.21 0.26 0.20 1.07 0.81

Charges associated with litigation matters

0.28 0.23 — — 0.25 0.20 — —

Deferred tax expenses, net

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(0.02) (0.01) — — (0.02) (0.02) (0.15) (0.43)

(Benefits) associated with litigation matters

(0.04) (0.03) — —

Total special items $ 0.66 0.58 $ 0.76 0.64 $ 2.19 1.80 $ 2.19 1.48

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Financial highlights by segment

Three Months Ended March 31,

(Dollars in millions, except per share amounts) 2026 2025 Change

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

(Dollars in millions, except per share amounts) 2026 2025 Change 2026 2025 Change

Adjusted revenues by segment

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Adjusted revenues 71,558 67,134 7 140,075 132,586 6

Net investment results from certain equity method investments (23) 50 N/M

Net investment results from certain equity method investments 110 44 150 87 94 (7)

Total revenues $ 71,668 $ 67,178 7 % $ 140,162 $ 132,680 6 %

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Cigna Healthcare 1,276 1,094 17 2,790 2,381 17

Other Operations 27 — N/M

Other Operations 21 25 (16) 48 25 92

Corporate, net of eliminations (410) (382) 7 (814) (793) 3

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Income attributable to noncontrolling interests

230 117 97 456 219 108

Net investment gains (1)

41 96 (57) 276 144 92

Amortization of acquired intangible assets (389) (422) (8) (779) (844) (8)

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(1) 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.

Three Months Ended March 31, 2026 versus Three Months Ended March 31, 2025

The commentary presented below, and the segment commentaries that follow, compare results for the three months ended March 31, 2026 with results for the three months ended March 31, 2025.

Three and Six Months Ended June 30, 2026 versus Three and Six Months Ended June 30, 2025

The commentary presented below, and the segment commentaries that follow, compare results for the three and six months ended June 30, 2026 with results for the three and six months ended June 30, 2025.

Commentary regarding percentage changes (or bps) and dollar variances represents the driver's impact on the overall category.

Shareholders' net income increased 25%, primarily reflecting higher adjusted income from operations in Cigna Healthcare, as well as Evernorth Health Services.

Shareholders' net income increased 8% and 16% for the three and six months ended, respectively, primarily reflecting higher adjusted income from operations in Cigna Healthcare.

See discussion of segment results in the "Segment Reporting" section.

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See discussion of segment results in the "Segment Reporting" section.

Pharmacy revenues increased 11%, primarily reflecting changes in claims composition (defined in the "Segment Reporting" section) within our Pharmacy Benefit Services operating segment.

Premiums decreased 23%, primarily driven by the impact of the HCSC transaction (defined in the "Segment Reporting" section) (-30%), offset primarily by higher premium rates within our ongoing U.S.

Healthcare businesses.

Fees and other revenues increased 14%, primarily reflecting growth in fee-based services within our Pharmacy Benefit Services operating segment.

Net investment income decreased 15%, primarily due to lower average assets, due to the impact of the HCSC transaction.

Pharmacy and other service costs increased 12%, primarily reflecting changes in claims composition within our Pharmacy Benefit Services operating segment.

Medical costs and other benefit expenses decreased 25%, primarily driven by the impact of the HCSC transaction (-32%), offset primarily by higher medical costs within our ongoing U.S.

Healthcare businesses.

Selling, general and administrative ("SG&A") expenses decreased 12%, primarily impacted by the HCSC transaction.

Investment results increased, primarily due to fair value changes of derivative instruments associated with certain equity securities.

The effective tax rate increased, primarily due to the absence of a benefit related to the HCSC transaction.

Pharmacy revenues increased 7% and 9% for the three and six months ended, respectively, primarily reflecting changes in claims composition (defined in the "Segment Reporting" section) within our Pharmacy Benefit Services operating segment.

Premiums increased 8% for the three months ended, primarily driven by higher premium rates within Cigna Healthcare, and decreased 10% for the six months ended, primarily driven by the impact of the HCSC transaction (defined in the "Segment Reporting" section) (-17%), offset primarily by higher premium rates within Cigna Healthcare.

Fees and other revenues increased 6% for the three months ended, primarily reflecting growth in fee-based services within Cigna Healthcare, and increased 10% for the six months ended, primarily reflecting growth in fee-based services within Evernorth Health Services.

Net investment income for the three months ended increased 15% due to strong returns on real estate investments and securities partnerships.

Net investment income for the six months ended was flat, with the stronger returns on real estate investments and securities partnerships in the second quarter mostly offset by lower average assets due to the impact of the HCSC transaction.

Pharmacy and other service costs increased 6% and 9% for the three and six months ended, respectively, primarily reflecting changes in claims composition within our Pharmacy Benefit Services operating segment.

Medical costs and other benefit expenses increased 9% for the three months ended, primarily reflecting higher medical costs within Cigna Healthcare, and decreased 10% for the six months ended, primarily driven by the impact of the HCSC transaction (-18%), offset primarily by higher medical costs within Cigna Healthcare.

Selling, general and administrative ("SG&A") expenses increased slightly by 1% for the three months ended and decreased 6% for the six months ended, primarily driven by the impact of the HCSC transaction.

Investment results for the three and six months ended were primarily impacted by fair value changes of derivative instruments associated with certain equity securities.

The effective tax rate decreased 2% for the three months ended, primarily driven equally by tax benefits related to equity investments and the absence of prior-period charges related to state tax audits.

The effective tax rate increased less than 1% for the six months ended, primarily due to the absence of a prior-period benefit related to the HCSC transaction (+2%), partially offset by the absence of prior-period charges related to state tax audits (-1%).

S EGMENT REPORTING

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Key factors that impact both Pharmacy Benefit Services and Specialty and Care Services:

• Pharmacy claim volume (also referred to as utilization) relates to processing prescription claims filled by retail pharmacies in our network and dispensing prescription claims from our home delivery and specialty pharmacies, along with other claims.

• Pharmacy claims volume (also referred to as utilization) relates to processing prescription claims filled by retail pharmacies in our network and dispensing prescription claims from our home delivery and specialty pharmacies, along with other claims.

Pharmacy claim volume is impacted by new clients or organic customer growth through the expansion of existing clients or through the loss of customers and business.

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Three Months Ended

(Dollars in millions) 2026 2025 Change

June 30, Six Months Ended

(Dollars in millions) 2026 2025 Change 2026 2025 Change

Adjusted revenues (1)

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Pre-tax margin (1)(2)

2.5 % 2.7 % (20) bps

2.7 % 2.9 % (20) bps 2.6 % 2.8 % (20) bps

SG&A expense ratio (3)

1.8 % 1.9 % (10) bps

1.7 % 1.9 % (20) bps 1.7 % 1.9 % (20) bps

(1) See Note 15 to the Consolidated Financial Statements for reconciliation of adjusted revenues and pre-tax adjusted income from operations to Total revenues and Income before income taxes, respectively.

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Three Months Ended

March 31, Change

June 30, Change Six Months Ended

June 30, Change

(Dollars and adjusted scripts in millions) 2026 2025 2026 2025

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All other network and specialty prescriptions are counted as one claim.

Three Months Ended March 31, 2026 versus Three Months Ended March 31, 2025

Three and Six Months Ended June 30, 2026 versus Three and Six Months Ended June 30, 2025

Commentary in parentheses regarding percentage changes (or bps) represents the driver's impact on the overall category.

Adjusted revenues increased 9%, primarily reflecting an increase due to claims composition in Pharmacy Benefit Services (+7%) and higher claims volume from customer growth in Specialty and Care Services (+2%).

Pre-tax adjusted income from operations increased 2%, primarily reflecting growth in Specialty and Care Services (+13%), partially offset by client- and customer-focused initiatives in Pharmacy Benefits Services (-8%) and a decrease in claims volume in Pharmacy Benefit Services (-3%).

The SG&A expense ratio decreased 10 bps, primarily reflecting higher adjusted revenues as discussed above.

Adjusted revenues increased 6% and 8% for the three and six months ended, respectively, primarily reflecting an increase due to claims composition in Pharmacy Benefit Services (+7% and +8%, respectively) and higher claims volume from customer growth in Specialty and Care Services (+1% and +2%, respectively), partially offset by lower claims volume in Pharmacy Benefit Services (-2% for both periods).

Pre-tax adjusted income from operations decreased 2% and was flat for the three and six months ended, respectively, primarily reflecting client- and customer-focused initiatives in Pharmacy Benefits Services (-11% and -9%, respectively) and a decrease in claims volume in Pharmacy Benefit Services (-2% for both periods), partially offset by growth in Specialty and Care Services (+7% and +9%, respectively) and operating efficiencies in Specialty and Care Services (+4% and +2%, respectively).

The SG&A expense ratio decreased 20 bps for both the three and six months ended, primarily reflecting higher adjusted revenues as discussed above.

Cigna Healthcare Segment

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As described in the MD&A introduction, performance of the Cigna Healthcare segment is measured using adjusted revenues and pre-tax adjusted income from operations.

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 within the U.S.

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 within the U.S.

Healthcare operating segment (the "HCSC transaction").

In April 2026, the Company announced its planned exit from the Individual and Family Plans medical business as of January 1, 2027.

Key Factors Affecting Segment Performance

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• Higher medical costs (also referred to as higher medical cost trend) are impacted by utilization (the quantity of medical services consumed by our customers), unit costs (the cost per medical service) and mix of services.

• MCR represents medical costs as a percentage of premiums for our segment's insured businesses, and it is impacted by medical cost trend and premium rates.

• MCR represents medical costs as a percentage of premiums for our segment's insured businesses, and it is impacted by medical cost trend, premium rates and mix of business.

Affordability initiatives that serve to mitigate medical cost inflation also impact the MCR.

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Three Months Ended

March 31, Change

June 30, Change Six Months Ended

June 30, Change

(Dollars in millions) 2026 2025 2026 2025

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Pre-tax margin (1)(2)

13.2 % 8.9 % 430 bps

Medical care ratio 79.8 % 82.2 % (240) bps

10.9 % 10.2 % 70 bps 12.0 % 9.4 % 260 bps

Medical care ratio 84.5 % 83.2 % 130 bps 82.2 % 82.6 % (40) bps

SG&A expense ratio (3)

20.0 % 19.4 % 60 bps

19.6 % 20.3 % (70) bps 19.8 % 19.8 % — bps

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See Note 15 to the Consolidated Financial Statements for further details.

Three Months Ended March 31, 2026 versus Three Months Ended March 31, 2025

Three and Six Months Ended June 30, 2026 versus Three and Six Months Ended June 30, 2025

Commentary regarding percentage changes (or bps) and dollar variances represents the driver's impact on the overall category.

Adjusted revenues decreased 21%, or $3,005 million, primarily due to the impact of the HCSC transaction (-$3,850 million), partially offset by higher premiums within employer insured (+$308 million) and stop loss (+$248 million), primarily reflecting premium rate increases.

Pre-tax adjusted income from operations increased 18%, or $227 million, primarily due to higher contributions from U.S.

Healthcare, reflecting improved margins in both the U.S.

Employer and Individual and Family Plans businesses.

The medical care ratio decreased 240 bps, due to the impact of the HCSC transaction.

The SG&A expense ratio increased 60 bps, primarily due to the impact of the HCSC transaction (+170 bps), partially offset by expense management efficiencies (-70 bps) and revenue growth outpacing volume-related expenses within the ongoing businesses (-60 bps).

Adjusted revenues increased 9%, or $974 million, for the three months ended, driven by higher premiums (+$664 million), mostly within employer insured (+$305 million) and stop loss (+$259 million), primarily reflecting premium rate increases.

Adjusted revenues decreased 8%, or $2,031 million, for the six months ended, primarily due to the impact of the HCSC transaction (-$3,850 million), partially offset by higher premiums (+$1,419 million), mostly within employer insured (+$613 million) and stop loss (+$507 million), primarily reflecting premium rate increases.

Pre-tax adjusted income from operations increased 17% for both the three and six months ended, primarily due to an improved margin within our U.S.

Employer business.

The medical care ratio increased 130 bps for the three months ended, primarily reflecting higher prior year risk adjustment benefits within our Individual and Family Plans business recognized in second quarter 2025.

The medical care ratio decreased 40 bps for the six months ended, primarily due to the impact of the HCSC transaction (-120 bps) and a lower MCR within our Individual and Family Plans business (-60 bps), partially offset by a higher MCR within our U.S.

Employer business (+100 bps), primarily due to mix of business.

The SG&A expense ratio decreased 70 bps for the three months ended, primarily due to operating efficiencies (-110 bps) and revenue growth outpacing volume-related expenses (-90 bps), partially offset by higher spend on investments to support growth (+90 bps).

The SG&A expense ratio was flat for the six months ended, primarily due to operating efficiencies (-90 bps) and revenue growth

outpacing volume-related expenses (-70 bps), mostly offset by the impact of the HCSC transaction (+110 bps) and higher spend on investments to support growth (+40 bps).

Medical Customers

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Unpaid Claims and Claim Expenses

Our unpaid claims and claim expenses liability increased to $4,920 million as of March 31, 2026 from $4,241 million as of December 31, 2025, primarily due to stop loss seasonality.

Our unpaid claims and claim expenses liability increased to $5,228 million as of June 30, 2026 from $4,241 million as of December 31, 2025, primarily due to stop loss seasonality.

Other Operations

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Financial Summary

Three Months Ended

March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(Dollars in millions) 2026 2025 2026 2025

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Pre-tax adjusted income from operations

$ 27 $ — N/M %

Pre-tax margin 22.5 % — % 2,250 bps

Three Months Ended March 31, 2026 versus Three Months Ended March 31, 2025

Adjusted revenues decreased and Pre-tax adjusted income from operations increased, primarily driven by the discontinuation of certain small non-strategic businesses.

$ 21 $ 25 (16) % $ 48 $ 25 92 %

Pre-tax margin 16.0 % 13.6 % 240 bps 19.1 % 7.0 % 1,210 bps

Three and Six Months Ended June 30, 2026 versus Three and Six Months Ended June 30, 2025

Adjusted revenues decreased for both periods, primarily driven by the discontinuation of certain small non-strategic businesses.

Pre-tax adjusted income from operations decreased for the three months ended, primarily driven by unfavorable COLI claims experience, and increased for the six months ended, primarily driven by the discontinuation of certain small non-strategic businesses.

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.

Financial Summary

Three Months Ended

March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(In millions) 2026 2025 2026 2025

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$ (410) $ (382) 7 % $ (814) $ (793) 3 %

Three Months Ended March 31, 2026 versus Three Months Ended March 31, 2025

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

Three and Six Months Ended June 30, 2026 versus Three and Six Months Ended June 30, 2025

Pre-tax adjusted loss from operations increased for both periods, primarily due to higher interest expense.

LIQUIDITY AND CAPITAL RESOURCES

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and using proceeds from issuing debt and common stock.

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

Three Months Ended March 31,

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

Six Months Ended June 30,

(In millions) 2026 2025

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Financing activities $ (934) $ (5,014)

The following discussion explains variances in the various categories of cash flows for the three months ended March 31, 2026 compared with the same period in 2025.

The following discussion explains variances in the various categories of cash flows for the six months ended June 30, 2026 compared with the same period in 2025.

Operating Activities.

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

Operating cash flows decreased for the three months ended March 31, 2026, primarily due to the unfavorable net cash flow impact related to the Inflation Reduction Act, lower insurance liabilities, and the timing of pharmaceutical manufacturer receivables.

These decreases are partially offset by the favorable timing of noninsurance customer receivables and accounts receivable factoring settlements.

Operating cash flows increased for the six months ended June 30, 2026, primarily driven by impact of accounts receivable, in part due to timing, and factoring facilities settlements.

These increases are largely offset by unfavorable net cash flow impact related to the Inflation Reduction Act and lower insurance liabilities.

Investing Activities.

The increase in cash used in investing activities reflects the absence of the net proceeds from the HCSC transaction.

The increase in cash used in investing activities primarily reflects the absence of the net proceeds from the HCSC transaction.

Financing Activities.

The decrease in net cash used in financing activities in 2026 is primarily driven by the absence of share repurchases as well as lower debt repayments.

The decrease in net cash used in financing activities in 2026 is primarily driven by lower share repurchases and net debt financing activities.

Capital Resources

Our capital resources consist primarily of cash, cash equivalents and investments maintained at regulated subsidiaries required to underwrite insurance risks, cash flows from operating activities, our commercial paper program, revolving credit facility, and the issuance of long-term debt and equity securities.

Our businesses generate significant cash flows from operations, some of which is

subject to regulatory restrictions relative to the amount and timing of dividend payments to the parent company.

Dividends received from U.S.-regulated subsidiaries were $0.5 billion for the three months ended March 31, 2026 and 2025.

Our businesses generate significant cash flows from operations, some of which is subject to regulatory restrictions relative to the amount and timing of dividend payments to the parent company.

Dividends received

from U.S.-regulated subsidiaries were $0.8 billion and $0.5 billion, respectively, for the six months ended June 30, 2026 and 2025.

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

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Commercial Paper Program .

There was no commercial paper outstanding balance as of March 31, 2026.

The commercial paper program had an outstanding balance of $1.0 billion as of June 30, 2026.

Revolving Credit Agreement.

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See Note 6 to the Consolidated Financial Statements for further information on our credit agreement and commercial paper program.

As of March 31, 2026, we had $6.5 billion of undrawn committed capacity under our revolving credit agreement (these amounts are available for general corporate purposes, including providing liquidity support for our commercial paper program), $6.5 billion of remaining capacity under our commercial paper program, and $7.3 billion in cash and short-term investments, approximately $1.1 billion of which was held by the parent company or certain non-regulated subsidiaries.

Our debt-to-capitalization ratio (calculated as Short-term debt and Long-term debt ("Total debt") as a percentage of Total shareholders' equity and Total debt ("Total capitalization")) was 42.3% and 43.0% as of March 31, 2026 and December 31, 2025, respectively.

As of June 30, 2026, we had $6.5 billion of undrawn committed capacity under our revolving credit agreement (these amounts are available for general corporate purposes, including providing liquidity support for our commercial paper program), $5.5 billion of remaining capacity under our commercial paper program, and $6.6 billion in cash and short-term investments, approximately $0.8 billion of which was held by the parent company or certain non-regulated subsidiaries.

Our debt-to-capitalization ratio (calculated as Short-term debt and Long-term debt ("Total debt") as a percentage of Total shareholders' equity and Total debt ("Total capitalization")) was 42.8% and 43.0% as of June 30, 2026 and December 31, 2025, respectively.

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

Subsidiary Borrowings.

In addition to the sources of liquidity discussed above, the parent company can borrow an additional $1.4 billion from its subsidiaries without further approvals as of March 31, 2026.

In addition to the sources of liquidity discussed above, the parent company can borrow an additional $1.2 billion from its subsidiaries without further approvals as of June 30, 2026.

Regulatory Restrictions.

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Capital Expenditures .

Capital expenditures for property, equipment and computer software were $0.3 billion in both the three months ended March 31, 2026 and 2025.

Capital expenditures for property, equipment and computer software were $0.6 billion in both the six months ended June 30, 2026 and 2025.

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

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The Company maintains a share repurchase program authorized by our Board, under which it may repurchase shares of its common stock from time to time.

There were no share repurchases during the three months ended March 31, 2026, compared with repurchases of 5.0 million shares for approximately $1.5 billion during the three months ended March 31, 2025.

We repurchased 0.9 million shares for approximately $250 million during the six months ended June 30, 2026, compared with repurchases of 8.2 million shares for approximately $2.6 billion during the six months ended June 30, 2025.

Risks to Liquidity and Capital Resources

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See Note 14 to the Consolidated Financial Statements for discussion of various guarantees.

During the three months ended March 31, 2026, there were no material changes to the guarantees and contractual obligations set forth in our 2025 Form 10-K.

During the six months ended June 30, 2026, there were no material changes to the guarantees and contractual obligations set forth in our 2025 Form 10-K.

CRITICAL ACCOUNTING ESTIMATES

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Our most critical accounting estimates, as well as the effect of hypothetical changes in material assumptions used to develop each estimate, are described in our 2025 Form 10-K.

As of March 31, 2026, there were no significant changes to the critical accounting estimates from what was reported in our 2025 Form 10-K.

As of June 30, 2026, there were no significant changes to the critical accounting estimates from what was reported in our 2025 Form 10-K.

INVESTMENT ASSETS

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Debt Securities

The carrying value of our debt securities portfolio decreased from $8.4 billion as of December 31, 2025 to $8.3 billion as of March 31, 2026 .

The carrying value of our debt securities portfolio increased from $8.4 billion as of December 31, 2025 to $8.5 billion as of June 30, 2026 .

Our portfolio remains in a net unrealized depreciation position due to generally increasing interest rates over the past few years.

As of March 31, 2026, $7.3 billion, or 88%, of the debt securities in our investment portfolio were investment grade (Baa and above, or equivalent) and the remaining $1.0 billion were below investment grade.

As of June 30, 2026, $7.5 billion, or 88%, of the debt securities in our investment portfolio were investment grade (Baa and above, or equivalent) and the remaining $1.0 billion were below investment grade.

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

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Commercial Mortgage Loans

As of March 31, 2026, our $1.3 billion commercial mortgage loan portfolio consisted of approximately 40 fixed-rate loans.

As of June 30, 2026, our $1.2 billion commercial mortgage loan portfolio consisted of approximately 40 fixed-rate loans.

Given the quality and diversity of the underlying real estate, positive debt service coverage, loan-to-value ratio and significant borrower cash invested in the property generally ranging between 30% and 40%, we remain confident that the vast majority of borrowers will

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Other Long-Term Investments

Other long-term investments of $5.2 billion as of March 31, 2026 included investments in securities limited partnerships and real estate limited partnerships, direct investments in real estate joint ventures, and other deposit activity that is required to support various insurance and health services businesses.

Other long-term investments of $5.2 billion as of June 30, 2026 included investments in securities limited partnerships and real estate limited partnerships, direct investments in real estate joint ventures, and other deposit activity that is required to support various insurance and health services businesses.

These limited partnership entities typically invest in mezzanine debt or equity of privately held companies and equity real estate.

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We account for this joint venture under the equity method of accounting.

Our 50% share of the investment portfolio supporting the joint venture's liabilities was approximately $19.1 billion as of March 31, 2026.

Our 50% share of the investment portfolio supporting the joint venture's liabilities was approximately $20.9 billion as of June 30, 2026.

These investments were comprised of approximately 70% debt securities, including government and corporate debt diversified by issuer, industry and geography;

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We continuously review the joint venture's investment strategy and its execution.

There were no investments with a material unrealized loss as of March 31, 2026.

There were no investments with a material unrealized loss as of June 30, 2026.

See Note 14 to the Consolidated Financial Statements in our 2025 Form 10-K for additional information regarding unconsolidated subsidiaries.

Financial Instruments

Our assets and liabilities include financial instruments subject to the risk of potential losses from adverse changes in market rates and prices.

Our primary market risk exposure is interest rate risk.

We encourage you to read this in conjunction with "Market Risk – Financial Instruments" included in the MD&A section in our 2025 Form 10-K.

As of March 31, 2026, there was no material change in our risk exposure as reported in our 2025 Form 10-K.

We encourage you to read this in conjunction with "Market Risk" included in the MD&A section in our 2025 Form 10-K.

As of June 30, 2026, there was no material change in our risk exposure as reported in our 2025 Form 10-K.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

1 unchanged sentence

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis