Lumexa Imaging Holdings, Inc.

Previous wording

We are one of the largest national providers of diagnostic imaging services. Our platform is integrated, scalable and has a proven track record of creating value for our stakeholders. As of March 31, 2026, we operated the second largest outpatient imaging center footprint in the United States. It spans 189 centers in 13 states and includes eight joint venture partnerships with health systems.

Current wording

We are one of the largest national providers of diagnostic imaging services. Our platform is integrated, scalable and has a proven track record of creating value for our stakeholders. As of June 30, 2026, we operated the second largest outpatient imaging center footprint in the United States. It spans 192 centers in 14 states and includes nine joint venture partnerships with health systems.

Previous wording

Our primary source of income is fees paid by patients, insurance companies or other payors in exchange for our centers providing imaging studies and radiologists’ interpretations of those studies. We also earn revenue from payors when our radiologists interpret an imaging study performed in another facility, often the imaging department of a hospital. In addition, we earn a monthly fee from centers that we operate, but do not consolidate for accounting purposes, in exchange for managing their operations. We also earn fees from third-party hospitals for providing radiology and administrative support. How these income streams affect our consolidated financial statements depends on whether we consolidate the center generating the fee for accounting purposes. Because our ownership levels and rights vary from center to center, as of March 31, 2026, we consolidated 103 of the 189 centers that we operated and accounted for our investments in the remaining 86 centers under the equity method of accounting. As of March 31, 2025, we consolidated 99 of the 182 centers that we operated and accounted for our investments in the remaining 83 centers under the equity method of accounting.

Current wording

Our primary source of income is fees paid by patients, insurance companies or other payors in exchange for our centers providing imaging studies and radiologists’ interpretations of those studies. We also earn revenue from payors when our radiologists interpret an imaging study performed in another facility, often the imaging department of a hospital. In addition, we earn a monthly fee from centers that we operate, but do not consolidate for accounting purposes, in exchange for managing their operations. We also earn fees from third-party hospitals for providing radiology and administrative support. How these income streams affect our consolidated financial statements depends on whether we consolidate the center generating the fee for accounting purposes. Because our ownership levels and rights vary from center to center, as of June 30, 2026, we consolidated 104 of the 192 centers that we operated and accounted for our investments in the remaining 88 centers under the equity method of accounting. As of June 30, 2025, we consolidated 99 of the 184 centers that we operated and accounted for our investments in the remaining 85 centers under the equity method of accounting.

Previous wording

Demand for advanced imaging in our geographies. Our operations and profitability depend in part on our ability to increase the amount of patient volume from advanced imaging scans. According to industry estimates, demand for advanced imaging continues to grow and outpaces routine imaging growth. MRI and CT accounted for 31% of our consolidated imaging volumes and 37% of our system-wide imaging volumes, and 52% of our consolidated revenue and 63% of our system-wide revenues during the three months ended March 31, 2026. MRI and CT accounted for 29% of our consolidated imaging volumes and 36% of our system-wide imaging volumes, and 52% of our consolidated revenue and 62% of our system-wide revenue during the three months ended March 31, 2025. We believe that our centers, equipment, personnel and strategy will enable advanced imaging to continue to increase as a percentage of our imaging volumes and revenues over time.

Current wording

Demand for advanced imaging in our geographies. Our operations and profitability depend in part on our ability to increase the amount of patient volume from advanced imaging scans. According to industry estimates, demand for advanced imaging continues to grow and outpaces routine imaging growth. We believe that our centers, equipment, personnel and strategy will enable advanced imaging to continue to increase as a percentage of our imaging volumes and revenues over time. The following tables show our consolidated and system-wide outpatient MRI and CT volumes as a percentage of our total outpatient consolidated imaging revenue and total outpatient system-wide imaging revenue for the periods indicated:

Previous wording

Favorable and Sustainable Reimbursement. Our revenues depend on achieving broad coverage and reimbursement for our imaging exams from third-party payors, including both commercial and government payors. Payment from third-party payors differs depending on whether we have entered into a contract with the payor as a “participating provider” or do not have a contract and are considered a “non-participating provider.” Payors will often reimburse non-participating providers, if at all, at a lower rate than participating providers. We operate in geographies with attractive payor dynamics that support sustainable commercial reimbursement. 57% of our consolidated revenue during the three months ended March 31, 2026 came from commercial payors, with government payors making up an incremental 28% and the remaining portion of our consolidated revenue during the three months ended March 31, 2026 coming from self-pay, liens and other payors. 61% of our system-wide revenue during the three months ended March 31, 2026 came from commercial payors, with government payors making up an incremental 23% and the remaining portion of our system-wide revenue during the three months ended March 31, 2026 coming from self-pay, liens and other payors. 57% of our consolidated revenue during the three months ended March 31, 2025 came from commercial payors, with government payors making up an incremental 29% and the remaining portion of our consolidated revenue during the three months ended March 31, 2025 coming from self-pay, liens and other payors. 63% of our system-wide revenue during the three months ended March 31, 2025 came from commercial payors, with government payors making up over 24% and the remaining portion of our system-wide revenue during the three months ended March 31, 2025 coming from self-pay, liens and other payors. We are broadly diversified across over 600 payor contracts and have a dedicated managed care team, focused on securing competitive reimbursement rates and contract terms for our centers using a data-driven approach. If we are not able to obtain or maintain coverage and adequate reimbursement from commercial payors, we may not be able to effectively increase our patient volume and revenue as expected. Additionally, retrospective reimbursement adjustments can negatively impact our revenue and cause our financial results to fluctuate, though we have not experienced any material adjustments of that nature.

Current wording

Favorable and Sustainable Reimbursement. Our revenues depend on achieving broad coverage and reimbursement for our imaging exams from third-party payors, including both commercial and government payors. Payment from third-party payors differs depending on whether we have entered into a contract with the payor as a “participating provider” or do not have a contract and are considered a “non-participating provider.” Payors will often reimburse non-participating providers, if at all, at a lower rate than participating providers. We operate in geographies with attractive payor dynamics that support sustainable commercial reimbursement. The following tables disaggregate consolidated and system-wide net patient service revenue by third-party payor source for the periods indicated:

Previous wording

While each of these factors present significant opportunities for us, they are not the only factors that may adversely affect our revenues and they also pose significant risks and challenges that we must address. See the section titled “Risk Factors” for more information.

Current wording

While each of these factors presents significant opportunities for us, they are not the only factors that may adversely affect our revenues and they also pose significant risks and challenges that we must address. See the section titled “Risk Factors” for more information.

Previous wording

We operate outpatient imaging centers, some of which we wholly own and others that we own in partnership with health system joint ventures. As of March 31, 2026, we managed 83 of our 86 outpatient imaging centers owned by joint ventures on a day-to-day basis through management services contracts. As of March 31, 2025, we managed 80 of our 83 outpatient imaging centers owned by joint ventures on a day-to-day basis through management services contracts. Our role as an owner and day-to-day manager provides us with significant influence over those centers’ operations. This influence does not represent control of the center, so we account for our investment in each such center under the equity method of accounting as an unconsolidated affiliate. We controlled the other 103 and 99 centers at March 31, 2026 and 2025, respectively, and accounted for these investments as consolidated subsidiaries. For consolidated subsidiaries, our condensed consolidated statements of operations and comprehensive income (loss) reflect, within each revenue and expense line item, 100% of the revenues and expenses of each such subsidiary, after the elimination of intercompany amounts. Our condensed consolidated statements of operations and comprehensive income (loss) reflect our earnings from our unconsolidated affiliates in only two line items:

Current wording

We operate outpatient imaging centers, some of which we wholly own and others that we own in partnership with health system joint ventures. As of June 30, 2026, we managed 85 of our 88 outpatient imaging centers owned by joint ventures on a day-to-day basis through management services contracts. As of June 30, 2025, we managed 82 of our 85 outpatient imaging centers owned by joint ventures on a day-to-day basis through management services contracts. Our role as an owner and day-to-day manager provides us with significant influence over those centers’ operations. This influence does not represent control of the center, so we account for our investment in each such center under the equity method of accounting as an unconsolidated affiliate. We controlled the other 104 and 99 centers at June 30, 2026 and 2025, respectively, and accounted for these investments as consolidated subsidiaries. For consolidated subsidiaries, our condensed consolidated statements of operations and comprehensive income (loss) reflect, within each revenue and expense line item, 100% of the revenues and expenses of each such subsidiary, after the elimination of intercompany amounts. Our condensed consolidated statements of operations and comprehensive income (loss) reflect our earnings from our unconsolidated affiliates in only two line items:

Previous wording

Our business model of partnering with health system joint venture partners results in our accounting for 86 (as of March 31, 2026) and 83 (as of March 31, 2025) of our outpatient imaging centers under the equity method of accounting rather than consolidating their results.

Current wording

Our business model of partnering with health system joint venture partners results in our accounting for 88 (as of June 30, 2026) and 85 (as of June 30, 2025) of our outpatient imaging centers under the equity method of accounting rather than consolidating their results.

Previous wording

As described above, our earnings from an outpatient imaging center, whether consolidated or accounted for using the equity method of accounting, are driven by the same factors: the center’s underlying profits and revenue and our ownership percentage in that center. Accordingly, to assess our overall operating results, we often utilize system-wide and same-center measures, which include both consolidated centers and unconsolidated affiliates. Our consolidated revenue growth and system-wide revenue growth were 3.1% and 4.0%, respectively, between the three months ended March 31, 2026 and the three months ended March 31, 2025. Our system-wide revenue includes all centers and physician practices that we operate; our GAAP revenue (or consolidated revenue) only includes consolidated centers, which represented 54% of our centers as of both March 31, 2026 and March 31, 2025, respectively, and all physician practices that we operate.

Current wording

As described above, our earnings from an outpatient imaging center, whether consolidated or accounted for using the equity method of accounting, are driven by the same factors: the center’s underlying profits and revenue and our ownership percentage in that center. Accordingly, to assess our overall operating results, we often utilize system-wide and same-center measures, which include both consolidated centers and unconsolidated affiliates. Our consolidated revenue growth and system-wide revenue growth were 5.1% and 6.0%, respectively, between the three months ended June 30, 2026 and the three months ended June 30, 2025. Our system-wide revenue includes all centers and physician practices that we operate; our GAAP revenue (or consolidated revenue) only includes consolidated centers, which represented 54% of our centers as of both June 30, 2026 and June 30, 2025, respectively, and all physician practices that we operate.

Previous wording

Net patient service revenue increased by $4.8 million, or 2.6%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase was largely due to an increase in consolidated same-center revenues of 2.8%, which was driven by volume growth of 0.5% and an increase in net revenue per scan of 2.3%. Net patient service revenue also increased $2.5 million related to ten consolidated de novo centers added during 2024 and 2025.

Current wording

Net patient service revenue increased by $5.6 million, or 2.9%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was largely due to an increase in consolidated same-center revenues of 2.2%, which was driven by volume growth of 1.6% and an increase in net revenue per scan of 0.6%. Net patient service revenue also increased $1.5 million related to 11 consolidated de novo centers added during 2024, 2025 and 2026.

Previous wording

Management fee and other revenue, related party increased by $2.2 million, or 4.6%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase was primarily due to increased pass-through costs at BTDI related to information technology and leased employees and growth in the business.

Current wording

Management fee and other revenue, related party increased by $3.3 million, or 6.9%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was primarily due to increased pass-through costs at the joint ventures we manage related to information technology and leased employees and growth in the business.

Previous wording

Cost of operations, excluding depreciation and amortization, is comprised of costs incurred to operate outpatient imaging centers and physician practices, primarily salaries, wages and benefits for clinicians and direct patient support personnel, occupancy costs, such as rent and utilities, medical supplies and other operating expenses. Cost of operations, excluding depreciation and amortization increased by $9.4 million, or 4.5%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, driven by increased volumes. The increase was primarily due to a $5.1 million increase in salaries and wages, a $1.0 million increase in medical supplies and a $3.0 million increase in physician compensation.

Current wording

Cost of operations, excluding depreciation and amortization, is comprised of costs incurred to operate outpatient imaging centers and physician practices, primarily salaries, wages and benefits for clinicians and direct patient support personnel, occupancy costs, such as rent and utilities, medical supplies and other operating expenses. Cost of operations, excluding depreciation and amortization increased by $13.0 million, or 6.1%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, driven by increased volumes. The increase was primarily due to a $3.5 million increase in salaries and wages, a $1.3 million increase in medical supplies and a $5.1 million increase in physician compensation.

Previous wording

General and administrative expenses include salaries, wages and benefits of executive leadership, finance and accounting, human resources, legal, information technology, professional fees, transaction costs, severance and other overhead and corporate expenses. General and administrative expenses increased by $2.8 million, or 16.3%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase is primarily due to an increase in stock-based compensation as a result of resetting some of our legacy stock-based compensation plans after our IPO, offset by reductions in transaction related costs. We expect general and administrative expenses to increase in the near term as a result of operating as a public company. That increase in expenses will be associated with compliance with the rules and regulations of the SEC, and an increase in legal, audit, insurance, investor relations, professional services and other administrative expenses.

Current wording

General and administrative expenses include salaries, wages and benefits of executive leadership, finance and accounting, human resources, legal, information technology, professional fees, transaction costs, severance and other overhead and corporate expenses. General and administrative expenses increased by $5.7 million, or 30.5%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase is primarily due to an increase in stock-based compensation as a result of resetting some of our legacy stock-based compensation plans after our IPO. We expect general and administrative expenses to increase in the near term as a result of operating as a public company. That increase in expenses will be associated with compliance with the rules and regulations of the SEC, and an increase in legal, audit, insurance, investor relations, professional services and other administrative expenses.

Previous wording

Depreciation and amortization expense consists of depreciation of property and equipment assets (medical office equipment, computer and software, and furniture and fixtures) and amortization of acquired intangible assets, such as facility contracts and trade names. Depreciation and amortization expense increased by $0.9 million, or 9.6%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase is primarily driven by additions to property and equipment during the period.

Current wording

Depreciation and amortization expense consists of depreciation of property and equipment assets (medical office equipment, computer and software, and furniture and fixtures) and amortization of acquired intangible assets, such as facility contracts and trade names. Depreciation and amortization expense increased by $0.8 million, or 8.7%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase is primarily driven by additions to property and equipment during the period.

Previous wording

Interest expense decreased by $13.5 million, or 45.3%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to our refinancing of our Existing Credit Agreement (as further described below) in December 2025.

Current wording

Interest expense decreased by $13.9 million, or 46.1%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, primarily due to our refinancing of our Existing Credit Agreement (as further described below) in December 2025.

Previous wording

We recorded an income tax provision of $1.4 million and $3.4 million for the three months ended March 31, 2026 and 2025, respectively. Despite having a pretax loss in 2025, the impact of non-deductible stock-based compensation and the increase in the valuation allowance recorded against certain of our deferred tax assets resulted in tax expense for the period. The primary items impacting tax expense in 2026 are non-deductible compensation and the change in the valuation allowance.

Current wording

We recorded an income tax provision of $3.0 million and $4.8 million for the three months ended June 30, 2026 and 2025, respectively. Despite having a pretax loss in 2025, the impact of non-deductible stock-based compensation and the increase in the valuation allowance recorded against certain of our deferred tax assets resulted in tax expense for the period. The primary items impacting tax expense in 2026 are non-deductible compensation and the change in the valuation allowance.

Previous wording

Our outpatient imaging center segment generates revenue by performing imaging studies and providing radiologists’ interpretations of those studies. The following table shows our outpatient imaging center segment’s revenue and Adjusted EBITDA for the periods indicated (in thousands):

Current wording

Our outpatient imaging center segment generates revenue by performing imaging studies and providing radiologists’ interpretations of those studies. The following tables show our outpatient imaging center segment’s revenue and Adjusted EBITDA for the periods indicated (in thousands):

Previous wording

The following table shows the outpatient imaging center segment’s system-wide same-center growth rates for the following metrics for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025:

Current wording

The following table shows the outpatient imaging center segment’s system-wide same-center growth rates for the following metrics for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025 and six months ended June 30, 2026, as compared to the six months ended June 30, 2025:

Previous wording

Our outpatient imaging center segment’s operating results for the three months ended March 31, 2026 reflect a 2.8% system-wide same-center revenue growth. The segment’s consolidated GAAP revenue growth for the three months ended March 31, 2026 was 3.9%.

Current wording

Our outpatient imaging center segment’s operating results for the three months ended June 30, 2026 and six months ended June 30, 2026 reflect a 4.4% and 3.6% system-wide same-center revenue growth, respectively. The segment’s consolidated GAAP revenue growth for the three months ended June 30, 2026 and six months ended June 30, 2026 was 4.8% and 4.4%, respectively.

Previous wording

Net patient service revenue for the outpatient imaging center segment increased by $4.7 million, or 3.5%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily driven by an increase in consolidated same-center revenues of 2.8%, which was comprised of volume growth of 0.5% and an increase in net revenue per scan of 2.3%. Net patient service revenue for the outpatient imaging center segment also increased $2.5 million related to ten consolidated de novo centers added during 2024 and 2025.

Current wording

Net patient service revenue for the outpatient imaging center segment increased by $4.8 million, or 3.5%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, primarily driven by an increase in consolidated same-center revenues of 2.2%, which was comprised of volume growth of 1.6% and an increase in net revenue per scan of 0.6%. Net patient service revenue for the outpatient imaging center segment also increased $1.5 million related to 11 consolidated de novo centers added during 2024, 2025 and 2026.

Previous wording

Management fee and other revenue for the outpatient imaging center segment increased by $2.4 million, or 5.1%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase was primarily due to increased pass-through costs at BTDI related to information technology and leased employees and improved financial performance. Our management fees are usually quantified as a percentage of the unconsolidated affiliate’s net revenue.

Current wording

Management fee and other revenue for the outpatient imaging center segment increased by $4.2 million, or 8.6%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. The increase was primarily due to increased pass-through costs at BTDI related to information technology and leased employees and improved financial performance. Our management fees are usually quantified as a percentage of the unconsolidated affiliate’s net revenue.

Previous wording

As further discussed below, Adjusted EBITDA removes non-cash and non-recurring charges that occur in the affected period and provides a basis for management to measure our core financial performance against other periods. Adjusted EBITDA for the outpatient imaging center segment decreased by $3.4 million, or 8.2%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The decrease in Adjusted EBITDA was driven by an increase in salaries and wages and medical supplies.

Current wording

As further discussed below, Adjusted EBITDA removes non-cash and non-recurring charges that occur in the affected period and provides a basis for management to measure our core financial performance against other periods. Adjusted EBITDA for the outpatient imaging center segment decreased by $4.1 million, or 4.6%, for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025. The decrease in Adjusted EBITDA was driven by an increase in salaries and wages and medical supplies.

Previous wording

The following table shows the professional services segment’s consolidated same-practice growth rates for the following metrics for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025:

Current wording

The following table shows the professional services segment’s consolidated same-practice growth rates for the following metrics for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025 and six months ended June 30, 2026, as compared to the six months ended June 30, 2025:

Previous wording

Our professional services segment’s operating results for the three months ended March 31, 2026, reflect an 4.4% consolidated professional same-practice revenue growth. The segment’s consolidated GAAP revenue growth for the three months ended March 31, 2026 was 3.4%.

Current wording

Our professional services segment’s operating results for the three months ended June 30, 2026, reflects a 5.1% consolidated professional same-practice revenue growth. The segment’s consolidated GAAP revenue growth for the three months ended June 30, 2026 was 8.9%.

Previous wording

Net patient service revenue for the professional services segment increased by $2.2 million, or 3.6%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025 due to year-over-year increase in volumes.

Current wording

Net patient service revenue for the professional services segment increased by $2.9 million, or 4.7%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025 due to year-over-year increase in volumes.

Previous wording

As further discussed below, Adjusted EBITDA removes non-cash and non-recurring charges that occur in the affected period and provides a basis for management to measure our core financial performance against other periods. Adjusted EBITDA for the professional services segment increased by $3.6 million, or 39.8%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.

Current wording

As further discussed below, Adjusted EBITDA removes non-cash and non-recurring charges that occur in the affected period and provides a basis for management to measure our core financial performance against other periods. Adjusted EBITDA for the professional services segment increased by $4.4 million, or 24.0%, for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to increased volumes.

Previous wording

The following tables summarize our key operating metrics for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025:

Current wording

The following tables summarize our key operating metrics for both the three months ended and the six months ended June 30, 2026, as compared to the three months ended and six months ended June 30, 2025:

Previous wording

Adjusted EBITDA removes non-cash and non-recurring charges that occur in the affected period and provides a basis for measuring our core financial performance against other periods. We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, as adjusted to exclude loss or gain on the disposal of property and equipment, other income or losses, loss on debt extinguishment, gain on sale of outpatient imaging centers and non-cash equity compensation. Adjusted EBITDA includes equity in earnings of unconsolidated affiliates (and adds back our proportional share of depreciation and amortization, interest expense and losses on the disposal of assets at unconsolidated affiliates) and is adjusted for non-cash or non-recurring events that take place during the period that, in our judgement, significantly impact the period-over-period assessment of performance and operating results.

Current wording

Adjusted EBITDA removes non-cash and non-recurring charges that occur in the affected period and provides a basis for measuring our core financial performance against other periods. We define Adjusted EBITDA as earnings before interest, taxes, depreciation and amortization, as adjusted to exclude loss or gain on the disposal of property and equipment, other income or losses, loss on debt extinguishment and modification, gain on sale of outpatient imaging centers and non-cash stock compensation. Adjusted EBITDA includes equity in earnings of unconsolidated affiliates (and adds back our proportional share of depreciation and amortization, interest expense and losses on the disposal of assets at unconsolidated affiliates) and is adjusted for non-cash or non-recurring events that take place during the period that, in our judgment, significantly impact the period-over-period assessment of performance and operating results.

Previous wording

Includes third-party consulting, implementation, and integration expenses incurred as part of our strategic transformation and optimization initiatives, specifically related to the deployment of a new technology system and labor model, as well as the development, customization, and integration of a new enterprise resource planning system. For the three months ended March 31, 2026 and 2025, $0.7 million and $0.4 million of these costs, respectively, are included in general and administrative expense in our condensed consolidated statements of operations and comprehensive income (loss). For the three months ended March 31, 2026 and 2025, $0.1 million and $0.5 million of these costs, respectively, are included in cost of operations, excluding depreciation and amortization expense in our condensed consolidated statements of operations and comprehensive income (loss).

Current wording

Includes third-party consulting, implementation, and integration expenses incurred as part of our strategic transformation and optimization initiatives, specifically related to the deployment of a new technology system, as well as the development, customization, and integration of a new enterprise resource planning system. For the three months ended June 30, 2026 and 2025, $2.7 million and $0.6 million of these costs, respectively, are included in general and administrative expense in our condensed consolidated statements of operations and comprehensive income (loss). For the three months ended 2025, $0.4 million of these costs are included in cost of operations, excluding depreciation and amortization expense in our condensed consolidated statements of operations and comprehensive income (loss). For the six months ended June 30, 2026 and 2025, $3.4 million and $1.1 million of these costs, respectively, are included in general and administrative expense in our condensed consolidated statements of operations and comprehensive income (loss). For the six months ended June 30, 2026 and 2025, $0.1 million and $0.8 million of these costs, respectively, are included in cost of operations, excluding depreciation and amortization expense in our condensed consolidated statements of operations and comprehensive income (loss).

Previous wording

Includes costs for third party non-recurring IPO costs, buy-side and sell-side due diligence activities to evaluate and execute potential mergers and acquisitions, integrate acquired businesses and one-time employee retention bonuses related to potential mergers and acquisitions. For the three months ended March 31, 2026 and 2025, $2.6 million and $3.5 million of these costs, respectively, are included in general and administrative expense in our condensed consolidated statements of operations and comprehensive income (loss). For the three months ended March 31, 2025, $0.1 million of these costs was included in cost of operations, excluding depreciation and amortization expense in our condensed consolidated statements of operations and comprehensive income (loss).

Current wording

Includes costs for third party non-recurring IPO costs, buy-side and sell-side due diligence activities to evaluate and execute potential mergers and acquisitions, integrate acquired businesses and one-time employee retention bonuses related to potential mergers and acquisitions. For the three months ended June 30, 2026 and 2025, $0.7 million and $3.8 million of these costs, respectively, are included in general and administrative expense in our condensed consolidated statements of operations and comprehensive income (loss). For the three months ended June 30, 2025, $0.1 million of these costs are included in cost of operations, excluding depreciation and amortization expense in our condensed consolidated statements of operations and comprehensive income (loss). For the six months ended June 30, 2026 and 2025, $3.3 million and $7.2 million of these costs, respectively, are included in general and administrative expense in our condensed consolidated statements of operations and comprehensive income (loss). For the six months ended June 30, 2025, $0.3 million of these costs was included in cost of operations, excluding depreciation and amortization expense in our condensed consolidated statements of operations and comprehensive income (loss).

Previous wording

We finance our operations through cash provided by operating activities along with long term debt, including senior secured credit facilities and equipment promissory notes. Our principal uses of cash and cash equivalents in recent periods have been to fund our operations. During the three months ended March 31, 2026, we earned net income of $1.7 million and net cash provided by operations was $2.9 million. During the three months ended March 31, 2025, we incurred a net loss of $7.7 million and net cash used in operations was $14.0 million. We expect our existing capital resources, anticipated cash from operations and our borrowing capacity under the Amended Revolving Credit Facility will be sufficient to sustain our operations for the next twelve months and the foreseeable future.

Current wording

We finance our operations through cash provided by operating activities along with long term debt, including senior secured credit facilities and equipment promissory notes. Our principal uses of cash and cash equivalents in recent periods have been to fund our operations. During the six months ended June 30, 2026, we earned net income of $4.5 million and net cash provided by operations was $35.7 million. During the six months ended June 30, 2025, we incurred a net loss of $14.9 million and net cash used in operations was $11.9 million. We expect our existing capital resources, anticipated cash from operations and our borrowing capacity under the Amended Revolving Credit Facility will be sufficient to sustain our operations for the next twelve months and the foreseeable future.

Previous wording

During the three months ended March 31, 2026, our operating activities provided $2.9 million of net cash as compared to net cash used in operating activities of $14.0 million during the three months ended March 31, 2025. The increase in net cash provided by operating activities of $16.9 million during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, was primarily driven by a reduction in interest payments. The interest payment reduction was the result of the paydown and refinancing of our Existing Term Loan (defined below) in December 2025. We anticipate that the paydown and refinancing of the Existing Term Loan will benefit operating cash flows in 2026, given that our term loan borrowings were reduced from $1.2 billion under the Existing Term Loan as of December 17, 2025 (the date of refinancing) to $822.9 million under the Refinancing Term Loan (defined below) as of March 31, 2026 and our interest rate decreased from SOFR plus 4.75% per annum under the Existing Term Loan to SOFR plus 3.00% per annum under the Refinancing Term Loan.

Current wording

During the six months ended June 30, 2026, our operating activities provided $35.7 million of net cash as compared to net cash used in operating activities of $11.9 million during the six months ended June 30, 2025. The increase in net cash provided by operating activities of $47.6 million during the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, was primarily driven by a reduction in interest payments. The interest payment reduction was the result of the paydown and refinancing of our Existing Term Loan (defined below) in December 2025. We anticipate that the paydown and refinancing of the Existing Term Loan will benefit operating cash flows in 2026, given that our term loan borrowings were reduced from $1.2 billion under the Existing Term Loan as of December 17, 2025 (the date of refinancing) to $825.0 million under the Refinancing Term Loan (defined below) and our interest rate decreased from SOFR plus 4.75% per annum under the Existing Term Loan to SOFR plus 3.0% per annum under the Refinancing Term Loan. Our interest rate was further reduced to SOFR plus 2.5% as a result of the debt repricing that was finalized on June 30, 2026.

Previous wording

During the three months ended March 31, 2026 and 2025, our operating cash flows were reduced by $4.4 million and $5.8 million, respectively, primarily due to transaction costs, severance and executive recruiting, and strategic initiatives and implementation costs. We expect that some of these activities, including our ERP and other IT implementations, as well as executive recruiting, will continue through part of 2026.

Current wording

During the six months ended June 30, 2026 and 2025, our operating cash flows were reduced by $9.6 million and $11.4 million, respectively, primarily due to transaction costs, severance and executive recruiting, litigation and settlements and strategic initiatives and implementation costs. We expect that some of these activities, including our ERP and other IT implementations, as well as executive recruiting, will continue through part of 2026.

Previous wording

During the three months ended March 31, 2026 and 2025, our investing activities used $5.3 million and $0.7 million of net cash, respectively. The cash used in investing activities was attributable to purchases of property and equipment in the amounts of $5.3 million and $1.0 million during the three months ended March 31, 2026 and 2025, respectively. We also finance acquisitions of equipment using finance lease arrangements as described below in Noncash Equipment Purchases.

Current wording

During the six months ended June 30, 2026 and 2025, our investing activities used $18.9 million and $4.9 million of net cash, respectively. The cash used in investing activities was attributable to purchases of property and equipment in the amounts of $15.0 million and $5.6 million during the six months ended June 30, 2026 and 2025, respectively. We also finance acquisitions of equipment using finance lease arrangements as described below in Noncash Equipment Purchases.

Previous wording

We seek to optimize our use of cash to advance our growth strategy while also reducing the size of our debt relative to our Adjusted EBITDA. As part of this strategy, we make cash purchases for equipment, which for our wholly owned centers are classified within investing activities, as described above. We also acquire equipment under finance lease arrangements. Assets acquired by our wholly owned centers under finance lease arrangements, which do not involve an up-front cash outlay, totaled $10.8 million and $4.0 million during the three months ended March 31, 2026 and 2025, respectively. Purchases of property and equipment in accounts payable and accrued expenses was $6.9 million and $2.0 million for the three months ended March 31, 2026 and 2025.

Current wording

We seek to optimize our use of cash to advance our growth strategy while also reducing the size of our debt relative to our Adjusted EBITDA. As part of this strategy, we make cash purchases for equipment, which for our wholly owned centers are classified within investing activities, as described above. We also acquire equipment under finance lease arrangements. Assets acquired by our wholly owned centers under finance lease arrangements, which do not involve an up-front cash outlay, totaled $18.0 million and $4.4 million during the six months ended June 30, 2026 and 2025, respectively. Purchases of property and equipment in accounts payable and accrued expenses was $4.8 million and $4.0 million for the six months ended June 30, 2026 and 2025, respectively.

Previous wording

The centers we operate in partnership with health systems, which we often call JV centers, are accounted for as unconsolidated affiliates, due to our minority ownership position in them. These centers generally distribute cash quarterly, and our pro rata share of these distributions was $17.7 million and $18.3 million during the three months ended March 31, 2026 and 2025, respectively. Distributions from the joint ventures received by us are made from the actual cash flow of the joint ventures after their cash capital expenditures, equipment lease payments, net working capital changes and interest expense, if any. These distributions are included in our condensed consolidated statements of cash flows from operating activities as one line item: “Distributions from investments in unconsolidated affiliates.”

Current wording

The centers we operate in partnership with health systems, which we often call JV centers, are accounted for as unconsolidated affiliates, due to our minority ownership position in them. These centers generally distribute cash quarterly, and our pro rata share of these distributions was $36.9 million and $32.8 million during the six months ended June 30, 2026 and 2025, respectively. Distributions from the joint ventures received by us are made from the actual cash flow of the joint ventures after their cash capital expenditures, equipment lease payments, net working capital changes and interest expense, if any. These distributions are included in our condensed consolidated statements of cash flows from operating activities as one line item: “Distributions from investments in unconsolidated affiliates.”

Previous wording

Our earnings from JVs are also shown in one line on our condensed consolidated statements of operations and comprehensive income (loss): “Equity in earnings of unconsolidated affiliates.” These earnings were $15.0 million and $15.3 million for the three months ended March 31, 2026 and 2025, respectively. While the timing of our distributions from our JV centers can vary based on capital and other planning of JV level cash needs, and there were timing differences in 2026 and 2025, the total distributions from investments in unconsolidated affiliates that we received during these two periods together, were approximately $5.6 million higher than our equity in earnings from unconsolidated affiliates as shown in the table below (in thousands):

Current wording

Our earnings from JVs are also shown in one line on our condensed consolidated statements of operations and comprehensive income (loss): “Equity in earnings of unconsolidated affiliates.” These earnings were $33.6 million and $31.8 million for the six months ended June 30, 2026 and 2025, respectively. While the timing of our distributions from our JV centers can vary based on capital and other planning of JV level cash needs, and there were timing differences in 2026 and 2025, the total distributions from investments in unconsolidated affiliates that we received during these two periods together, were approximately $4.2 million higher than our equity in earnings from unconsolidated affiliates as shown in the table below (in thousands):

Previous wording

As with our wholly owned centers, our JV centers add equipment and fund de novo centers through a combination of cash purchases and finance lease arrangements, which do not involve an up-front cash outlay. Equipment purchases under both methods totaled $14.9 million and $8.4 million for our JV centers during three months ended March 31, 2026 and 2025, of which our pro rata ownership share was $6.9 million and $4.1 million, respectively.

Current wording

As with our wholly owned centers, our JV centers add equipment and fund de novo centers through a combination of cash purchases and finance lease arrangements, which do not involve an up-front cash outlay. Equipment purchases under both methods totaled $30.7 million and $20.0 million for our JV centers during the six months ended June 30, 2026 and 2025, respectively, of which our pro rata ownership share was $13.9 million and $9.5 million, respectively.

Previous wording

During the three months ended March 31, 2026 and 2025, our financing activities used $5.3 million and $4.1 million of net cash, respectively. The primary use of cash in financing activities was payments on long-term debt and finance leases.

Current wording

During the six months ended June 30, 2026 and 2025, our financing activities used $5.9 million and $4.6 million of net cash, respectively. The primary use of cash in financing activities was payments on long-term debt and finance leases.

Previous wording

In December 2025, LII and LIOI entered into Amendment No. 5 to the Existing Senior Secured Credit Facility with Barclays Bank PLC, as administrative agent and collateral agent, and the other lenders party thereto. Our “Amended Credit Agreement” provides for (i) a secured term loan facility of $825.0 million (the “Refinancing Term Loan”) and (ii) a secured revolving line of credit of $250.0 million (the “Amended Revolving Credit Facility” and, together with the Refinancing Term Loan, the “Refinancing Senior Secured Credit Facility”). The Refinancing Senior Secured Credit Facility bears interest at a rate per annum equal to SOFR plus 3.0%. The Refinancing Term Loan is to mature in December 2032. The Amended Revolving Credit Facility matures in December 2030. As of March 31, 2026, $822.9 million was outstanding on the Refinancing Term Loan. No amounts were outstanding under the Amended Revolving Credit Facility as of March 31, 2026.

Current wording

In December 2025, LII and LIOI entered into Amendment No. 5 to the Existing Senior Secured Credit Facility with Barclays Bank PLC, as administrative agent and collateral agent, and the other lenders party thereto. Our “Amended Credit Agreement” provides for (i) a secured term loan facility of $825.0 million (the “Refinancing Term Loan”) and (ii) a secured revolving line of credit of $250.0 million (the “Amended Revolving Credit Facility” and, together with the Refinancing Term Loan, the “Refinancing Senior Secured Credit Facility”). The Refinancing Senior Secured Credit Facility’s initial interest rate per annum was equal to SOFR plus 3.0%. The Refinancing Term Loan is to mature in December 2032. The Amended Revolving Credit Facility matures in December 2030. As of June 30, 2026, $822.9 million was outstanding on the Refinancing Term Loan. No amounts were outstanding under the Amended Revolving Credit Facility as of June 30, 2026. On June 30, 2026, we entered into Amendment No. 7 (the “7th Amendment”). The 7th Amendment reduced the Refinancing Term Loan’s and Amended Revolving Credit Facility’s interest rates from SOFR plus 3.0% to SOFR plus 2.5%.

Previous wording

As a result of our strategy of partnering with health systems, we do not own controlling interests (and are also not the primary beneficiary) in a number of our outpatient imaging centers. As of March 31, 2026, we accounted for 86 of our 189 outpatient imaging centers under the equity method of accounting. As of March 31, 2025, we accounted for 83 of our 182 outpatient imaging centers under the equity method of accounting. Similar to our consolidated outpatient imaging centers, our unconsolidated imaging centers have debts, including finance lease obligations, that are generally non-recourse to us. The debts of our unconsolidated outpatient imaging centers are not included in our consolidated financial statements. As of March 31, 2026 and December 31, 2025, the total debt on the balance sheets of our unconsolidated affiliates was $81.8 million and $69.1 million, respectively.

Current wording

As a result of our strategy of partnering with health systems, we do not own controlling interests (and are also not the primary beneficiary) in a number of our outpatient imaging centers. As of June 30, 2026, we accounted for 88 of our 192 outpatient imaging centers under the equity method of accounting. As of June 30, 2025, we accounted for 85 of our 184 outpatient imaging centers under the equity method of accounting. Similar to our consolidated outpatient imaging centers, our unconsolidated imaging centers have debts, including finance lease obligations, that are generally non-recourse to us. The debts of our unconsolidated outpatient imaging centers are not included in our consolidated financial statements. As of June 30, 2026 and December 31, 2025, the total debt on the balance sheets of our unconsolidated affiliates was $81.2 million and $69.1 million, respectively.