What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-12 compared with 2026-06-02 · 178 added, 84 removed, 312 unchanged (46% of the section changed)

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with more than 100 years of operating history.

With approximately 34,000 employees as of March 31, 2026, we deliver compassionate, quality medical care, meeting a patient’s unplanned and planned care needs.

With approximately 34,000 employees as of June 30, 2026, we deliver compassionate, quality medical care, meeting a patient’s unplanned and planned care needs.

We provide emergent, non-emergent, disaster response and event medical services, utilizing our more than 24,000 clinicians, fleets of air and ground assets for medical transportation and offer innovative solutions such as Nurse Navigation to provide comprehensive care to our patients in their time of need.

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● The only national, fully-integrated air and ground EMS provider with operations spanning approximately 1,400 U.S.

counties, covering both rural and urban communities which are home to approximately 60% of the U.S.

counties, covering both rural and urban communities which are home to more than 60% of the U.S.

● At the front line of the healthcare continuum, encountering approximately 15,000 patients per day or approximately 5.5 million patients annually and our clinicians perform a critical care intervention every 88 seconds.

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● Team of more than 24,000 clinicians serves as the first line of care, providing lifesaving treatment at crucial moments.

● In the three months ended March 31, 2026, revenue increased by $90.2 million, or 6.6%, to $1,457.6 million year-over-year.

● In the three months ended March 31, 2026, net income increased by $68.3 million, or 179.7%, to $106.3 million year-over-year.

● In the three months ended March 31, 2026, Adjusted EBITDA increased by $27.0 million, or 9.7%, to $305.1 million year-over-year.

● In the three months ended June 30, 2026, revenue increased by $48.3 million, or 3.3%, to $1,490.3 million year-over-year.

In the six months ended June 30, 2026, revenue increased by $138.5 million, or 4.9%, to $2,947.9 million year-over-year.

● In the three months ended June 30, 2026, net income decreased by $109.1 million, or 135.0%, to a net loss of $28.3 million year-over-year.

In the six months ended June 30, 2026, net income decreased by $40.7 million, or 34.3%, to $78.1 million year-over-year.

● In the three months ended June 30, 2026, Adjusted EBITDA decreased by $38.1 million, or 11.8%, to $284.5 million year-over-year.

In the six months ended June 30, 2026, Adjusted EBITDA decreased by $11.0 million, or 1.8%, to $589.6 million year-over-year.

Initial Public Offering

On May 14, 2026, we completed our initial public offering (“IPO”), in which we issued and sold 31,914,893 shares of our Class A common stock, par value $0.0001 per share, at an initial public offering price of $15.00 per share.

The Company received net proceeds of $454.8 million for the Class A common stock, after deducting underwriting discounts and commissions of $23.9 million.

The Company received net proceeds of $446.8 million for the Class A common stock, after deducting underwriting discounts and commissions, and other offering-related expenses of $31.9 million.

See Note 9 of our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q.

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Our operations depend upon third-party reimbursement programs, including government-sponsored and private insurance programs, to pay for most of the services rendered to patients.

For the three months ended March 31, 2026 and 2025, we derived approximately 57% and 56%, of our net transport revenue, respectively, from commercial insurance and managed care, 34% and 35%, respectively, from government-sponsored healthcare programs, primarily Medicare and Medicaid, and 2% and 2%, respectively, from self-pay patients.

For the three months ended June 30, 2026 and 2025, we derived approximately 54% and 59% of our net transport revenue, respectively, from commercial insurance and managed care, 35% and 32%, respectively, from government-sponsored healthcare programs, primarily Medicare and Medicaid, and 2% and 2%, respectively, from self-pay patients.

For the six months ended June 30, 2026 and 2025, we derived approximately 56% and 58% of our net transport revenue, respectively, from commercial insurance and managed care, 34% and 33%, respectively, from government-sponsored healthcare programs, primarily Medicare and Medicaid, and 2% and 2%, respectively, from self-pay patients.

Commercial Healthcare Reimbursement

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The resolution process for out of network air ambulance claims is dictated by the No Surprises Act, which prohibits patient balance billing and creates an Independent Dispute Resolution (“IDR”) process to handle payment disputes that cannot be resolved through direct negotiation between the provider and the insurer.

Since the implementation of the No Surprises Act in 2022, we have won approximately 90% of IDR rulings, highlighting the defensibility of our commercial air reimbursement.

Since the implementation of the No Surprises Act in 2022, we have won more than 90% of IDR rulings, highlighting the defensibility of our commercial air reimbursement.

Our experience with the IDR process to date has contributed to greater predictability in air reimbursement and has informed our approach to strategically enter into in-network contracts that holistically reflect the value of our services and optimize reimbursement.

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In addition, inclement weather typically reduces human activity levels (such as driving, recreational activities and farming) that are associated with requests for medical services.

For the three months ended March 31, 2026 and 2025, patient air transport requests cancelled due to poor weather conditions were 17.1%, and 17.9% of total patient air transport requests, respectively.

For the three months ended June 30, 2026 and 2025, patient air transport requests cancelled due to poor weather conditions were 15.5% and 18.5% of total patient air transport requests, respectively.

For the six months ended June 30, 2026 and 2025, patient air transport requests cancelled due to poor weather conditions were 16.3% and 18.2% of total patient air transport requests, respectively.

In certain instances of inclement weather, our integrated operations may allow us to shift our air clinical crews to our ground ambulance fleet to continue to meet patients’ needs.

Historically, we have observed higher air services demand in the summer months and higher ground services demand during the winter flu season, which contributes to the seasonality of our operations.

Historically, we have observed

higher air services demand in the summer months and higher ground services demand during the winter flu season, which contributes to the seasonality of our operations.

Ground transport volume is largely influenced by shifts in overall community conditions.

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Typically, adverse weather reduces activities like driving, recreation, and farming, which are correlated with requests for emergency ground services.

Our complementary revenue is subject to variations over time depending on a number of factors, including but not limited to, the timing of events and other emergency response services, the number of natural disasters we respond to, and

any pandemic-related or other one-time services we provide.

Pandemic-related services were last provided in the first quarter of 2022.

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Three Months Ended

(in thousands)

Six Months Ended

Patient encounters

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Wheelchair transports

Nurse Navigation encounters

Non-transport

Total patient encounters

of which, Nurse Navigation encounters

Net transport revenue per ambulance transport

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Emergent air transport requests

Air base count

Weather cancellation rate for emergent air transports

Same market revenue growth

Net cash capital expenditures

Cash used in aircraft financing arrangements

Net cash capital expenditures (in thousands)

Cash used in aircraft financing arrangements (in thousands)

Payor mix (as a percentage of net transport revenue):

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Not all transport requests result in a patient transport due to factors such as weather and other uncontrollable cancellations, in addition to staffing availability, maintenance and other controllable cancellations.

37.4% and 37.8% of cancellations of emergent air requests were attributable to weather and other uncontrollable factors for the three months ended March 31, 2026 and 2025, respectively.

17.5% and 17.9% of cancellations of emergent air requests were attributable to staffing availability, maintenance and other controllable factors for the three months ended March 31, 2026 and 2025, respectively.

36.4% and 39.0% of cancellations of emergent air requests were attributable to weather and other uncontrollable factors for the three months ended June 30, 2026 and 2025, respectively.

19.2% and 17.5% of cancellations of emergent air requests were attributable to staffing availability, maintenance and other controllable factors for the three months ended June 30, 2026 and 2025, respectively.

36.8% and 38.4% of cancellations of emergent air requests were attributable to weather and other uncontrollable factors for the six months ended June 30, 2026 and 2025, respectively.

18.4% and 17.7% of cancellations of emergent air requests were attributable to staffing availability, maintenance and other controllable factors for the six months ended June 30, 2026 and 2025, respectively.

Weather Cancellation Rate for Emergent Air Transports:

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Three Months Ended

Six Months Ended

Statement of Operations Data (in thousands other than percentages):

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Net income (loss)

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Total revenue for the three months ended March 31, 2026 was $1,457.6 million compared to $1,367.4 million for the three months ended March 31, 2025.

Net transport revenue increased $90.7 million, or 6.8%, to $1,416.9 million for the three months ended March 31, 2026, compared to $1,326.2 million for the same prior year period primarily driven by improved net revenue per transport of 7.9% year-over-year driven by a positive mix shift from non-emergent to emergent transports within ground, and strong underlying air and ground net revenue per transport improvement on a like-for-like basis.

Additionally, there was a 1.1% increase in emergent air transport volume due to better weather period-over-period.

These factors were partially offset by a 1.1% decrease in total ground transports driven by a reduction in non-emergent transports as part of a deliberate shift in focus towards emergent ground services.

Complementary revenue decreased $0.5 million, or 1.2%, to $40.7 million for the three months ended March 31, 2026, compared to $41.2 million due to decreased wheelchair transport volume period-over-period.

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Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025

Total revenue for the three months ended June 30, 2026 was $1,490.3 million compared to $1,442.0 million for the three months ended June 30, 2025.

Net transport revenue increased $40.3 million, or 2.9%, to $1,435.9 million for the

three months ended June 30, 2026, compared to $1,395.6 million for the same prior year period.

The increase in net transport revenue was attributable to a 1.4% increase in net revenue per transport, driven by a favorable mix shift from non-emergent to emergent transports and improvements in net revenue per transport on a comparable basis.

In addition, air transport volume increased 6.9%, primarily due to strong demand and improved capture rate compared to the prior-year period, while ground transport volume increased 1.3%.

Comparability between periods was affected by changes in estimates related to revenues subject to the No Surprises Act ("NSA").

Favorable changes in revenue estimates recognized during the three months ended June 30, 2026 were approximately $74.3 million lower than those recognized in the prior-year period.

The prior-year period benefited from favorable developments in estimated collections associated with claims from earlier dates of service.

As a result, the year-over-year growth in net transport revenue was partially offset by a less favorable contribution from changes in revenue estimates related to NSA claims.

Complementary revenue increased $8.0 million, or 17.2%, to $54.4 million for the three months ended June 30, 2026, compared to $46.4 million for the same prior year period due primarily to increased standby and special events.

Operating Expenses

Employee wages, benefits and taxes.

Employee wages, benefits and taxes expense increased $35.2 million, or 4.8% to $770.0 million for the three months ended March 31, 2026, compared to $734.8 million for the same prior year period.

The increase period-over-period was primarily driven by merit and other wage adjustments to attract and retain staff of $22.0 million and increased health insurance expense of $8.8 million, driven by premium costs and claims volume year-over-year.

Employee wages, benefits and taxes expense increased $181.9 million, or 24.5%, to $924.5 million for the three months ended June 30, 2026, compared to $742.6 million for the same prior year period.

The increase period-over-period was primarily driven by increased stock award expense of $129.6 million driven by the vesting of restricted stock units and non-cash settled performance stock units triggered upon the consummation of the IPO on May 14, 2026 and achievement of certain performance targets on such date, as applicable.

Additionally, during the three months ended June 30, 2026, there were merit and other wage adjustments to attract and retain staff of approximately $26.0 million and increased health insurance expense of $11.2 million, driven by premium costs and claims volume year-over-year.

Maintenance, fuel and other direct expenses.

Maintenance, fuel and other direct expenses increased $6.8 million, or 6.1%, to $118.6 million for the three months ended March 31, 2026, compared to $111.8 million for the same prior year period.

The increase was primarily driven by increased fuel unit costs period-over-period of $2.6 million and by increased cost related to medical supplies of $1.6 million.

Maintenance, fuel and other direct expenses increased $23.8 million, or 21.1%, to $136.4 million for the three months ended June 30, 2026, compared to $112.6 million for the same prior year period.

The increase was primarily driven by increased fuel unit and volume costs period-over-period of $10.1 million and $1.6 million, respectively, and increased aircraft maintenance expense of $9.2 million primarily related to timing of scheduled maintenance events.

Insurance expense .

Insurance expense increased $9.3 million, or 27.7%, to $43.0 million for the three months ended March 31, 2026, compared to $33.7 million for the same prior year period, primarily driven by increased professional liability related claims and third-party premium expenses.

Insurance expense decreased $0.4 million, or 0.8%, to $50.9 million for the three months ended June 30, 2026, compared to $51.3 million for the same prior year period.

Other operating expenses .

Other operating expenses increased $12.3 million, or 5.7%, to $228.1 million for the three months ended March 31, 2026, compared to $215.8 million for the same prior year period.

Other operating expenses increased $11.0 million, or 5.0%, to $231.9 million for the three months ended June 30, 2026, compared to $220.9 million for the same prior year period.

Other operating expenses primarily consist of outside services expense and general and administrative expense.

Outside services expense increased $1.3 million, or 3.1%, to $43.4 million for the three months ended March 31, 2026, compared to $42.1 million for the same prior year period.

General and administrative expense increased $11.0 million, or 6.3%, to $184.7 million for the three months ended March 31, 2026, compared to $173.7 million for the same prior year period, primarily driven by increased systems integration and enhancement expenses of $3.4 million, software licensing and development of $2.5 million and freight of $1.2 million.

Outside services expense remained consistent at $42.4 million for the three months ended June 30, 2026 and 2025, respectively.

General and administrative expense increased $11.0 million, or 6.2%, to $189.5 million for the three months ended June 30, 2026, compared to $178.5 million for the same prior year period, primarily driven by increased systems integration and enhancement expenses of $2.0 million, software licensing and development of $2.6 million and travel expenses of $2.7 million.

Depreciation and amortization.

Depreciation and amortization expenses increased $0.3 million, or 0.3%, to $75.4 million for the three months ended March 31, 2026, compared to $75.1 million for the same prior year period.

Depreciation expense of property and equipment increased $4.3 million, or 8.4%, to $55.6 million for the three months ended March 31, 2026, compared to $51.3 million for the same prior year period.

Depreciation and amortization of finance right-of-use assets decreased $0.5 million, or 12.2%, to $3.6 million for the three months ended March 31, 2026, compared to $4.1 million for the same prior year period.

Amortization expense decreased $3.5 million, or 17.8%, to $16.2 million for the three months ended March 31, 2026, compared to $19.7 million for the same prior year period, driven by acceleration of amortization related to a prior period acquisition no longer in operation.

Depreciation and amortization expenses increased $4.5 million, or 6.1%, to $77.0 million for the three months ended June 30, 2026, compared to $72.5 million for the same prior year period.

Depreciation expense of property and equipment increased $5.6 million, or 10.8%, to $57.4 million for the three months ended June 30, 2026, compared to $51.8 million for the same prior year period.

Depreciation and amortization of finance right-of-use assets decreased $0.5 million, or 12.8%, to $3.4 million for the three months ended June 30, 2026, compared to $3.9 million for the same prior year period.

Amortization expense decreased $0.6 million, or 3.6%, to $16.2 million for the three months ended June 30, 2026, compared to $16.8 million for the same prior year period, driven by acceleration of amortization related to a prior period acquisition no longer in operation.

Impairment of assets held for sale and other investments.

There was no impairment of assets held for sale or strategic cost investments for the three months ended March 31, 2026.

For the three months ended March 31, 2025, impairment charges of $14.1 million were recorded related to a strategic cost investment.

There was no impairment of assets held for sale or strategic cost investments for the three months ended June 30, 2026 or 2025, respectively.

Acquisition, integration and other charges.

Acquisition, integration and other charges decreased $0.7 million, or 16.0%, to $3.6 million for the three months ended March 31, 2026, compared to $4.3 million for the same prior year period.

The period-over-period decrease was driven by reduced fees associated with previously divested business units.

Acquisition, integration and other charges increased $11.8 million, or 1,125.1%, to $12.9 million for the three months ended June 30, 2026, compared to $1.1 million for the same prior year period.

The period-over-period increase was driven by $12.7 million in fees associated with the IPO on May 14, 2026.

Interest expense, net.

Interest expense, net decreased $30.5 million, or 26.8%, to $83.2 million for the three months ended March 31, 2026, compared to $113.7 million for the same prior year period.

The decrease was driven by lower interest rates achieved in conjunction with 2025 debt refinancing transaction, in addition to mark-to-market changes on our interest rate swap agreements.

Interest expense, net decreased $31.7 million, or 29.2%, to $76.8 million for the three months ended June 30, 2026, compared to $108.5 million for the same prior year period.

The decrease was driven by lower interest rates achieved in conjunction with 2025 debt refinancing transaction, the $670.0 million paydown of the term loans outstanding during the three months ended June 30, 2026, and mark-to-market changes on our interest rate swap agreements.

Other (income) loss, net.

Other (income) loss, net increased $5.4 million, or 588.1%, to income of $6.3 million for the three months ended March 31, 2026, compared to income of $0.9 million for the same prior year period.

The increase was primarily driven by a $6.9 million gain on the sale of a cost investment during the three months ended March 31, 2026.

Other (income) loss, net increased $10.9 million, or 104.1%, to income of $0.4 million for the three months ended June 30, 2026, compared to a loss of $10.5 million for the same prior year period.

There was a loss on divestiture of businesses of $5.3 million for the three months ended June 30, 2025, mainly driven by the net working capital finalization for the divestiture of our fire services business.

Additionally, there was a loss on a strategic cost investment of $6.2 million for the three months ended June 30, 2025.

Income Tax (benefit) expense .

Income tax expense increased $6.8 million, or 23.3%, to an expense of $36.2 million for the three months ended March 31, 2026, compared to an expense of $29.4 million for the same prior year period.

effective tax rate was 25.4% for the three months ended March 31, 2026, compared to an effective tax rate of 43.6% for the same prior year period.

The difference in our effective tax rate is primarily driven by the amount of 2026 net income before income taxes and a current year benefit related to a decrease in the valuation allowance.

Income tax expense decreased $32.6 million, or 78.4%, to an expense of $9.0 million for the three months ended June 30, 2026, compared to an expense of $41.5 million for the same prior year period.

Our effective tax rate was 46.5% for the three months ended June 30, 2026, compared to an effective tax rate of 34.0% for the same prior year period.

The difference in our effective tax rate was primarily driven by the amount of 2026 net income before income taxes, current year non-deductible executive compensation, and a current year benefit related to a decrease in the valuation allowance.

Results of Operations

We reported net income of $106.3 million for the three months ended March 31, 2026, compared to net income of $38.0 million for the same prior year period.

Operating income for the three months ended March 31, 2026 was $218.9 million, an increase of $41.0 million, or 23.1%, over the same prior year period.

The year-over-year increase in net income and operating income was primarily due to $90.2 million of increased net revenues, partially offset by increased operating expenses associated with employee wages, benefits and taxes of $35.2 million, and certain other operating expenses.

We reported net loss of $28.3 million for the three months ended June 30, 2026, compared to net income of $80.8 million for the same prior year period.

Operating income for the three months ended June 30, 2026 was $56.7 million, a decrease of $184.3 million, or 76.5%, over the same prior year period.

The year-over-year decrease in net income and operating income was primarily due to increased operating expenses primarily associated with employee wages, benefits and taxes of $181.9 million, and certain other operating expenses, partially offset by $48.3 million of increased net revenues.

Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025

Total revenue for the six months ended June 30, 2026 was $2,947.9 million compared to $2,809.4 million for the six months ended June 30, 2025.

Net transport revenue increased $131.0 million, or 4.8%, to $2,852.8 million for the six months ended June 30, 2026, compared to $2,721.8 million for the same prior year period.

The increase in net transport revenue was attributable to a 4.5% increase in net revenue per transport, driven by a favorable mix shift from non-emergent to emergent transports and improvements in net revenue per transport on a comparable basis.

In addition, air transport volume increased 4.0%, primarily due to strong demand and improved capture rate compared to the prior-year period, while total ground transports increased 0.1% as increased emergent ground volumes were partially offset by non-emergent ground contract exits.

Comparability between periods was affected by changes in estimates related to revenues subject to the NSA.

Favorable changes in revenue estimates recognized during the six months ended June 30, 2026 were approximately $113.5 million lower than those recognized in the prior-year period.

The prior-year period benefited from favorable developments in estimated collections associated with claims from earlier dates of service.

As a result, the year-over-year growth in net transport revenue was partially offset by a less favorable contribution from changes in revenue estimates related to NSA claims.

Complementary revenue increased $7.5 million, or 8.6%, to $95.1 million for the six months ended June 30, 2026, compared to $87.6 million due to standby and special event and other non-transport related revenue.

Operating Expenses

Employee wages, benefits and taxes.

Employee wages, benefits and taxes expense increased $217.1 million, or 14.7%, to $1,694.5 million for the six months ended June 30, 2026, compared to $1,477.4 million for the same prior year period.

The increase period-over-period was primarily driven by increased stock award expense of $126.9 million driven by vesting of restricted stock units and non-cash settled performance stock units triggered upon the consummation of the IPO on May 14, 2026 and achievement of certain performance targets on such date, as applicable.

Additionally, during the six months ended June 30, 2026, there were merit and other wage adjustments to attract and retain staff of approximately $51.7 million and increased health insurance expense of $20.1 million, driven by premium costs and claims volume year-over-year.

Maintenance, fuel and other direct expenses.

Maintenance, fuel and other direct expenses increased $30.6 million, or 13.6%, to $255.0 million for the six months ended June 30, 2026, compared to $224.4 million for the same prior year period.

The increase was primarily driven by increased fuel unit and volume costs period-over-period of $12.8 million and $1.3 million, respectively, increased aircraft maintenance expense of $9.9 million, and increased costs related to medical supplies of $3.9 million.

Insurance expense .

Insurance expense increased $8.9 million, or 10.5%, to $93.9 million for the six months ended June 30, 2026, compared to $85.0 million for the same prior year period, primarily driven by increased professional liability related claims and third-party premium expenses.

Other operating expenses .

Other operating expenses increased $23.3 million, or 5.3%, to $460.0 million for the six months ended June 30, 2026, compared to $436.7 million for the same prior year period.

Other operating expenses primarily consist of outside services expense and general and administrative expense.

Outside services expense increased $1.2 million, or 1.4%, to $85.8 million for the six months ended June 30, 2026, compared to $84.6 million for the same prior year period.

General and administrative expense increased $22.1 million, or 6.3%, to $374.2 million for the six months ended June 30, 2026, compared to $352.1 million for the same prior year period, primarily driven by increased systems integration and enhancement expenses of $5.4 million, software licensing and development of $5.1 million, travel expenses of $4.3 million, and freight of $2.0 million.

Depreciation and amortization.

Depreciation and amortization expenses increased $4.7 million, or 3.2%, to $152.3 million for the six months ended June 30, 2026, compared to $147.6 million for the same prior year period.

Depreciation expense of property and equipment increased $9.8 million, or 9.5%, to $113.0 million for the six months ended June 30, 2026, compared to $103.2 million for the same prior year period.

Depreciation and amortization of finance right-of-use assets decreased $0.9 million, or 11.4%, to $7.0 million for the six months ended June 30, 2026, compared to $7.9 million for the same prior year period.

Amortization expense decreased $4.2 million, or 11.5%, to $32.3 million for the six months ended June 30, 2026, compared to $36.5 million for the same prior year period, driven by acceleration of amortization related to a prior period acquisition no longer in operation.

Impairment of assets held for sale and other investments.

There was no impairment of assets held for sale or strategic cost investments for the six months ended June 30, 2026.

For the six months ended June 30, 2025, impairment charges of $14.1 million were recorded related to a strategic cost investment.

Acquisition, integration and other charges.

Acquisition, integration and other charges increased $11.2 million, or 208.8%, to $16.5 million for the six months ended June 30, 2026, compared to $5.4 million for the same prior year period.

The period-over-period increase was driven by fees associated with the IPO on May 14, 2026.

Interest expense, net.

Interest expense, net decreased $62.2 million, or 28.0%, to $160.0 million for the six months ended June 30, 2026, compared to $222.2 million for the same prior year period.

The decrease was driven by lower interest rates achieved in conjunction with 2025 debt refinancing transaction, the $670.0 million paydown of term loans outstanding during the six months ended June 30, 2026, in addition to mark-to-market changes on our interest rate swap agreements.

Other (income) loss, net.

Other (income) loss, net increased $16.3 million, or 170.9%, to income of $6.8 million for the six months ended June 30, 2026, compared to a loss of $9.5 million for the same prior year period.

There was market volatility on investments held by our captive insurance program for each of the six months ended June 30, 2026 and 2025.

There was a loss on divestiture of businesses of $3.8 million for the six months ended June 30, 2025, mainly driven by the net working capital finalization for the divestitures of businesses during 2024.

Additionally, there was a loss on a strategic cost investment of $6.2 million for the six months ended June 30, 2025.

Income Tax (benefit) expense .

Income tax expense decreased $25.7 million, or 36.3%, to an expense of $45.2 million for the six months ended June 30, 2026, compared to an expense of $70.9 million for the same prior year period.

Our effective tax rate was 36.7% for the six months ended June 30, 2026, compared to an effective tax rate of 37.4% for the same prior year period.

The difference in our effective tax rate was primarily driven by the amount of 2026 net income before taxes, current year non-deductible executive compensation, and a current year benefit related to a decrease in the valuation allowance.

Results of Operations

We reported net income of $78.1 million for the six months ended June 30, 2026, compared to net income of $118.8 million for the same prior year period.

Operating income for the six months ended June 30, 2026 was $275.6 million, a decrease of $143.3 million, or 34.2%, over the same prior year period.

The year-over-year decrease in net income and operating income was primarily due to increased operating expenses primarily associated with employee wages, benefits and taxes of $217.1 million, and certain other operating expenses, partially offset by $138.5 million of increased net revenues and decreased interest expense of $62.2 million.

Non-GAAP Measures and Reconciliation

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Moreover, we present EBITDA and Adjusted EBITDA because we believe that investors consider them to be important supplemental measures of our performance and believe these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

Adjusted EBITDA is an analytical indicator used by management and the healthcare industry to evaluate company performance, allocate resources and measure leverage.

Adjusted EBITDA is an analytical indicator used by management and the healthcare industry to evaluate company performance and allocate resources.

Adjusted EBITDA should not be considered in isolation or as an alternative to net income (loss), cash flows from operations, investing or financing activities, or other financial statement data presented in the unaudited condensed consolidated financial statements as indicators of financial performance.

Because Adjusted EBITDA is not a measure determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted EBITDA as presented may not be comparable to other similarly titled measures of other companies and may not be comparable to similarly titled measures used in debt compliance calculations.

Because Adjusted EBITDA is not a measure determined in accordance with GAAP and is thus susceptible to varying calculations, Adjusted

EBITDA as presented may not be comparable to other similarly titled measures of other companies and may not be comparable to similarly titled measures used in debt compliance calculations.

Net income (loss) is the financial measure calculated and presented in accordance with GAAP that is most comparable to Adjusted EBITDA, as defined.

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Three Months Ended

Six Months Ended

(in thousands)

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Lender Defined Adjusted EBITDA

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(1) Represents management/director fees paid to directors and KKR in connection with the ownership and financial management of the Company and procurement diagnostics and operational support provided by KKR and its affiliates, including under the Monitoring Agreement (as defined in the IPO Prospectus).

The Monitoring Agreement was terminated upon completion of the IPO.

(2) Represents the stock compensation expense associated with the vesting of stock options and other equity awards, as well as the estimate of achievement of the cash-settled performance stock units as discussed in Note 14 of our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q.

(2) Represents the stock compensation expense associated with the vesting of stock options and other equity awards, related primarily to the vesting of certain awards based on the consummation of the IPO and achievement of certain performance targets on such date, as applicable, as well as the estimate of achievement of the cash-settled performance stock units as discussed in Note 15 of our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q.

(3) Represents fees and expenses incurred in connection with certain business combinations and divestitures, as well as other fees and expenses incurred in connection with distinct transactions and matters unrelated to our normal and continued business operations, as further described below:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

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Legal settlements and government affairs (iii)

Initial public offering related fees paid to third parties (iv)

Total professional fees and other expenses for non-recurring matters

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Such costs are specific to acquisition and divestiture activity that would not have otherwise been incurred in connection with our ordinary course business operations.

(ii) Fees incurred in the three months ended March 31, 2026 and 2025 primarily related to severance costs in connection with our targeted market exit strategies executed during such periods, in each case, to optimize our cost structure and enhance our operating effectiveness.

(ii) Fees incurred in the three and six months ended June 30, 2026 and 2025 primarily related to severance costs in connection with our targeted market exit strategies executed during such periods, in each case, to optimize our cost structure and enhance our operating effectiveness.

These activities were undertaken to meet specific business objectives.

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(iii) For the periods presented, amounts primarily relate to certain regulatory initiatives in California that are non-routine and not expected to continue.

(iv) Represents other third-party fees and expenses incurred in connection with distinct transactions and matters unrelated to our normal and continued business operations, including major system implementation and enhancements relating to the integration of our timekeeping and electronic patient care charting systems.

(iv) Represents third party fees and expenses incurred in connection with the IPO, which was consummated on May 14, 2026.

(v) Represents other third-party fees and expenses incurred in connection with distinct transactions and matters unrelated to our normal and continued business operations, including major system implementation and enhancements relating to the integration of our timekeeping and electronic patient care charting systems.

(4) Represents fees associated with our long-term debt refinancing consummated during fiscal year 2025, which primarily consisted of fees incurred for third party legal, accounting and tax consulting in connection with the debt refinancing.

(5) Impairment of assets held for sale and other investments includes impairment charges of $14.1 million related to a strategic cost investment for the three months ended March 31, 2025.

There was no impairment on assets held for sale or strategic cost investments for the three months ended March 31, 2026.

(6) (Gain) loss on divestiture of businesses for the three months ended March 31, 2025 was $1.4 million related to net working capital finalization for the divestiture of our coordinated care business.

For the three months ended March 31, 2026, there was no (gain) loss on divestiture of businesses recorded.

(7) Realized and unrealized (gain) loss, net represents changes in the fair value of equity securities for the three months ended March 31, 2026 and 2025.

Additionally, during the three months ended March 31, 2026, a certain cost method investment was sold for a (gain) of ($6.9) million.

(5) Impairment of assets held for sale and other investments includes impairment charges of $14.1 million related to a strategic cost investment for the six months ended June 30, 2025.

There was no impairment on assets held for sale or strategic cost investments for the three and six months ended June 30, 2026.

(6) (Gain) loss on divestiture of businesses for the three and six months ended June 30, 2025 was $5.3 million and $3.8 million, respectively, related to net working capital finalization for the divestiture of our coordinated care and fire businesses.

There was no (gain) loss on divestiture of businesses recorded for the three and six months ended June 30, 2026.

(7) Realized and unrealized (gain) loss, net represents changes in the fair value of equity securities for the three and six months ended June 30, 2026 and 2025, respectively.

Additionally, during the six months ended June 30, 2026, a certain cost method investment was sold for a (gain) of ($6.9) million.

There was a loss on a strategic cost investment of $6.2 million for the six months ended June 30, 2025.

(8) We use the equity method of accounting to recognize our proportionate share of net income (loss) generated by our noncontrolling interest in Banner health system emergency air joint venture in Arizona.

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Liquidity and Capital Resources

As of March 31, 2026, we had cash and cash equivalents totaling $426.1 million.

As of March 31, 2026, the maximum amount available under the A&R ABL Facility (as defined below) was $800.0 million, with $108.4 million of letters of credit outstanding, which impact the available credit under the A&R ABL Facility and a maximum amount available to draw under the A&R ABL Facility of $691.6 million.

As of June 30, 2026, we had cash and cash equivalents totaling $420.0 million.

As of June 30, 2026, the maximum amount available under the A&R ABL Facility (as defined below) was $800.0 million, with $103.7 million of letters of credit outstanding, which impact the available credit under the A&R ABL Facility and a maximum amount available to draw under the A&R ABL Facility of $696.3 million.

These letters of credit primarily secure the obligations of AMR’s operations and the Company’s captive insurance program.

As of March 31, 2026, we had $372.5 million purchase commitments for aircraft, of which $175.7 million were scheduled to be payable during the year ending December 31, 2026.

As of June 30, 2026, we had $348.0 million of purchase commitments for aircraft, of which $147.9 million were scheduled to be payable during the year ending December 31, 2026.

Liquidity Arrangements

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Additionally, we will continue to monitor the capital markets, including equity capital markets, for additional sources of liquidity and fundraising opportunities across the capital structure.

Tax Receivable Agreement

The Company is party to a Tax Receivable Agreement ("TRA") under which it is generally required to make payments to participating stockholders and certain management party participants based on a specified percentage of tax benefits realized from certain tax attributes existing as of the IPO date.

The amount and timing of future payments under the TRA depend on a number of factors, including the generation of future taxable income, the utilization of covered tax attributes, applicable tax rates, and changes in the Company's assessment of the realizability of related deferred tax assets.

As of June 30, 2026, the Company had a TRA liability of $468.4 million.

Future payments under the TRA are expected to be funded through cash flows from operations.

Because payments are generally based on tax benefits actually realized by the Company, management believes the associated tax savings will provide a source of liquidity to satisfy these obligations.

However, actual payments may differ from current estimates as a result of changes in taxable income, tax laws, tax rates, utilization of tax attributes, valuation allowance assessments, or other factors affecting the realization of the underlying tax benefits.

Accordingly, the TRA may have a material impact on the Company's future liquidity and capital resources.

Beginning with the 2026 taxable year, annual TRA payments are generally determined upon the filing of the applicable income tax returns and bear interest from the original due date of the return through the payment date at a rate equal to SOFR plus 1.0%.

Management believes that existing cash balances, cash generated from operations, and available borrowing capacity will be sufficient to meet anticipated obligations under the TRA as they become due.

Long-term borrowings as of the dates shown consisted of the following:

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Total long-term debt (inclusive of finance lease obligations)

(1) Excludes $108.4 million of letters of credit outstanding as of March 31, 2026.

We were in compliance with all applicable financial covenants as of March 31, 2026.

(1) Excludes $103.7 million of letters of credit outstanding as of June 30, 2026.

We were in compliance with all applicable financial covenants as of June 30, 2026.

2032 First Lien Term Loan

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The 2032 First Lien Term Loan will mature on October 1, 2032.

Borrowings of 2032 First Lien Term Loans under the A&R First Lien Credit Agreement bear interest at a rate per annum equal to, at GMR, Inc.’s option, (a) the forward-looking term SOFR rate published by CME Group Benchmark Administration Limited for the interest period relevant to such borrowing (“Term SOFR”) plus an additional margin equal to 3.50% or (b) a base rate (the “Base Rate”) determined by reference to the highest of (1) the prime lending rate, (2) the federal funds effective rate plus 0.50% and (3) Term SOFR for a one-month interest period plus 1.00%, in each case, plus

an additional margin equal to 2.50%, in each case of clauses (a) and (b) above, subject to a 0.25% reduction following achievement of a public corporate family rating by Moody’s equal to or higher than B1.

On May 18, 2026, Moody’s upgraded GMR’s corporate family rating to B1 from B2.

Pursuant to the terms of the Company’s senior secured term loan due 2032, the ratings upgrade resulted in a 25 basis point reduction in the applicable interest rate, effective upon the upgrade.

Interest payments under the 2032 First Lien Term Loan are due (i) for loans bearing interest determined by reference to Term SOFR, on the last day of the applicable interest period and, in the case of an interest period in excess of three months, on each date occurring at three-month intervals after the first day of such interest period and (ii) for loans bearing interest based on the Base Rate, quarterly.

Additionally, a payment of a principal amount of 2032 First Lien Term Loan equal to the aggregate outstanding principal amount of the initial borrowing multiplied by 0.25% is required quarterly, commencing March 31, 2026.

Additionally, a payment of a principal amount of 2032 First Lien Term Loan

equal to the aggregate outstanding principal amount of the initial borrowing multiplied by 0.25% is required quarterly, commencing March 31, 2026.

A&R ABL Facility

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The following summarizes our primary sources (uses) of cash in the periods presented (in thousands):

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows provided by (used in) operating activities

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Cash flows provided by (used in) financing activities

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025

Operating activities.

Cash provided by operating activities decreased $60.6 million to $128.7 million for the three months ended March 31, 2026, compared to $189.3 million for the same prior year period.

The decrease in operating cash

flow was primarily driven by timing of interest payments and employee retention bonus payments during the three months ended March 31, 2026.

Cash provided by operating activities decreased $1.4 million to $217.3 million for the six months ended June 30, 2026, compared to $218.7 million for the same prior year period.

Investing activities.

Cash used in investing activities increased $3.1 million to $51.5 million for the three months ended March 31, 2026, compared to $48.4 million for the same prior year period.

The increase was primarily driven by increased purchases of property and equipment during the three months ended March 31, 2026 and proceeds from divestitures received in the prior year, partially offset by the sale of a cost investment during 2026.

Cash used in investing activities increased $18.7 million to $126.4 million for the six months ended June 30, 2026, compared to $107.7 million for the same prior year period.

The increase was primarily driven by increased purchases of property and equipment during the six months ended June 30, 2026, partially offset by the sale of a cost investment during 2026.

Financing activities.

Cash used in financing activities increased $235.7 million to $264.8 million for the three months ended March 31, 2026, compared to $29.1 million for the same prior year period.

The increase was primarily driven by the redemption of Series B Preferred Stock of $250.0 million during 2026.

Cash used in financing activities increased $280.0 million to $286.1 million for the six months ended June 30, 2026, compared to $6.1 million for the same prior year period.

The increase was primarily driven by the

paydown of approximately $670.0 million outstanding borrowings under the 2032 First Lien Term Loan, and cash redemptions of Series B Preferred Stock of $549.5 million during 2026, offset by proceeds received from the issuance of common stock of $446.8 million in our IPO, and proceeds received from the issuance of private placement warrants of $500.0 million.

Contractual Obligations and Other Commitments

As of March 31, 2026, there have been no significant changes to our contractual obligations and other commitments as disclosed in the IPO Prospectus, other than as described elsewhere in this Form 10-Q and other payments made in the ordinary course of business.

As of June 30, 2026, there have been no significant changes to our contractual obligations and other commitments as disclosed in the IPO Prospectus, other than as described elsewhere in this Form 10-Q and other payments made in the ordinary course of business.

Off-Balance Sheet Arrangements

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Tax Receivable Agreement

Following the IPO, we expect to utilize certain pre-IPO tax assets (including federal, state and local net operating losses, deferred interest deductions, tax basis in amortizable or depreciable assets, and certain deductible expenses attributable to the transactions related to the IPO) that arose prior to or in connection with the IPO, which tax benefits are expected to reduce our future tax payments.

Following the IPO, we expect to utilize certain pre-IPO tax assets (including federal net operating losses, deferred interest deductions, tax basis in amortizable or depreciable assets, and certain deductible expenses attributable to the transactions related to the IPO) that arose prior to or in connection with the IPO, which tax benefits are expected to reduce our future tax payments.

In connection with the IPO, we entered into a Tax Receivable Agreement with the TRA parties that will provide for the payment by the Company to such TRA parties of 85% of the benefits, if any, that the Company or our subsidiaries actually realize, or are deemed to realize (calculated using certain assumptions), as a result of savings in U.S.

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for Thomas Cook, 0.27%, representing approximately $1.29 million and $1.43 million of the expected future payments under the Tax Receivable Agreement;

for Lisa Jacoba, 0.16%, representing approximately $0.77 million and $0.85 million of the expected future payments under the Tax Receivable Agreement.

and for Lisa Jacoba, 0.16%, representing approximately $0.77 million and $0.85 million of the expected future payments under the Tax Receivable Agreement.

The Pre-IPO Tax Benefits may reduce the amount of tax that the Company would otherwise be required to pay in the future.

Actual tax benefits realized by the Company and our subsidiaries may differ from tax benefits calculated under the Tax Receivable Agreement as a result of the use of certain assumptions in the Tax Receivable Agreement, including the use of an assumed weighted-average state and local income tax rate to calculate tax benefits.

The payment obligation under the Tax Receivable Agreement is an obligation of the Company and not of our subsidiaries.

The payment obligation under the Tax Receivable Agreement is an obligation of the Company and not of our

subsidiaries.

The Company expects to benefit from the remaining 15% of cash tax benefits, if any, it realizes from the Pre-IPO Tax Benefits.

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We consider our critical accounting policies and estimates to be those that involve significant judgments and uncertainties and may potentially result in material different results under different assumptions and conditions.

There have been no material changes to our critical accounting policies and estimates from those disclosed in the IPO Prospectus which is hereby incorporated by reference.

There have been no material changes to our critical accounting policies and estimates from those disclosed in the IPO Prospectus which is hereby incorporated by reference, except as discussed below.

Income Taxes and Tax Receivable Agreement Liability

The Company is also party to a TRA, under which future payments are based on the realization of certain tax benefits.

As a result, the estimated TRA liability is dependent upon many of the same assumptions used in assessing the realizability of the related deferred tax assets.

Changes in management’s assessment of the valuation allowance may have a corresponding impact on the estimated TRA liability.

For example, increases in the

valuation allowance may reduce the amount of tax benefits expected to be realized and therefore decrease the estimated TRA liability, while decreases in the valuation allowance may increase expected future tax benefit realization and result in an increase in the estimated TRA liability.

Accordingly, the measurement of both deferred tax assets and the TRA liability requires significant judgment and is sensitive to changes in assumptions regarding future operating results, taxable income, tax rates, and other factors affecting the realizability of deferred tax assets.

Recent Accounting Pronouncements

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis