agilon health, inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. Business

Description of Business

agilon health, inc., together with its consolidated subsidiaries and variable interest entities (the “Company”), through its partnerships and purpose-built model provides the necessary capabilities, capital, and business model for existing physician groups to create a Medicare-centric, globally capitated line of business. As of December 31, 2025, the Company, through its contracted physician networks, provided care to approximately 511,000 Medicare Advantage (“MA”) members enrolled with private health plans in 12 states. Additionally, the Company participates in the Centers for Medicare & Medicaid Services' (“CMS”) Accountable Care Organization Realizing Equity, Access, and Community Health (“ACO REACH”) Model and Medicare Shared Savings Program (“MSSP,” and together with ACO REACH, the “CMS ACO Models”) through its equity method investments.

See Note 17 for additional information related to the Company’s involvement with VIEs.

The Company’s largest shareholder is an investment fund associated with Clayton Dubilier & Rice, LLC (“CD&R”), a private equity firm headquartered in New York, New York. All funds affiliated with CD&R are considered related parties.

On November 5, 2025, the Company received written notice (the “Notice”) from the New York Stock Exchange (the “NYSE”) informing the Company it is no longer in compliance with Section 802.01C of the NYSE Listed Company Manual because the average closing price of its common stock was less than $1.00 per share over a consecutive 30 trading-day period ended November 4, 2025 (the “Price Criteria for Capital or Common Stock”).

The Company can regain compliance at any time within the six-month period following receipt of the Notice if, on the last trading day of any calendar month during the cure period (or the last trading day of the cure period), it has a closing share price of at least $1.00 and an average closing share price of at least $1.00 over the prior 30 trading-day period ending on the last trading day of the applicable calendar month or the cure period. To regain compliance with the Price Criteria for Capital or Common Stock, the Company is pursuing a reverse stock split, subject to approval by its stockholders. On February 6, 2026, the Company filed a preliminary proxy statement indicating its intent to seek stockholder approval at a special meeting of stockholders for (i) an amendment to its Amended and Restated Certificate of Incorporation to effect a reverse stock split of its common stock at a ratio of one-for-five to one-for-twenty-five, with the exact ratio to be set within this range by the Company’s Board of Directors in its sole discretion without further stockholder approval, and (ii) authority to adjourn the special meeting, if necessary, to solicit additional proxies if there are insufficient votes to approve the amendment.

NOTE 2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Principles of Consolidation

The consolidated financial statements include the accounts of agilon health, inc., its wholly-owned subsidiaries and VIEs that it controls through voting rights or other means. Intercompany transactions and balances have been eliminated in consolidation.

The Company is required to continually evaluate its VIE relationships and consolidate the entities in which it holds a variable interest when it is determined to be the primary beneficiary of their operations. A VIE is broadly defined as an entity that has any of the following three characteristics:

i. the equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support;

ii. substantially all of the entity’s activities either involve or are conducted on behalf of an investor that has disproportionately few voting rights; or

iii. the equity investors as a group lack any of the following:

•the power through voting or similar rights to direct the activities of the entity that most significantly impact the entity’s economic performance;

•the obligation to absorb the expected losses of the entity; or

•the right to receive the expected residual returns of the entity.

The Company reassesses the designation of an entity as a VIE upon certain events, including, but not limited to:

i. a change to the terms or in the ability of a party to exercise its kick-out rights;

ii. a change in the capital structure of the entity; or

iii. acquisitions or sales of interests that constitute a change of control.

The Company is considered to be the primary beneficiary of a VIE if it has the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and has the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. The Company continuously assesses whether it is (or is not) the primary beneficiary of a VIE. That assessment involves the consideration of various factors, including, but not limited to, the form of the Company’s ownership interest, its representation on the VIE’s governing body, the size and seniority of its investment, its ability and the rights of other variable interest holders to participate in policy making decisions, its ability to manage its ownership interest relative to the other variable interest holders, and its ability to liquidate the entity.

Use of Estimates

Management is required to make estimates and assumptions in the preparation of financial statements. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates can include, among other things, those used to determine revenues and related receivables from risk adjustments, medical services expense and related payables (including the reserve for incurred but not reported (“IBNR”) claims), and the valuation and related recognition of impairments of long-lived assets, including goodwill. Management’s estimates for revenue recognition, medical services expense and other estimates, judgments, and assumptions may be materially and adversely different from actual results. These estimates are based on knowledge of current events and anticipated future events, and accordingly, actual results may ultimately differ materially from those estimates.

Revenue Recognition and Receivables

Medical services revenue consists of capitation fees under contracts with various Medicare Advantage payors (“payors”). Under the typical capitation arrangement, the Company is entitled to monthly per-member, per-month (“PMPM”) fees to provide a defined range of healthcare services for Medicare Advantage health plan members (“members”) attributed to the Company’s contracted primary care physicians. In certain of the Company’s payor arrangements, it is also financially responsible for Medicare Part D pharmaceutical costs for prescriptions rendered to members. PMPM fees are determined as a percentage of the premium payors receive from the CMS for these members. The Company generally accepts full financial risk for members attributed to its contracted primary care physicians and therefore is responsible for the cost of all healthcare services required by those members. Fees are generally recorded gross in revenue because the Company is acting as a principal in coordinating and controlling the range of services provided (other than clinical decisions) under its capitation contracts with payors. Capitation contracts with payors are generally multi-year arrangements and have a single performance obligation that constitutes a series, as defined by Accounting Standards Codification (“ASC”) 606, Revenue From Contracts With Customers (“ASC 606”), to stand ready on a monthly basis to provide all aspects of necessary medical care to members for the contracted period. The Company recognizes revenue in the month in which eligible members are entitled to receive healthcare benefits during the contract term.

The transaction price for the Company’s capitation contracts is variable, as the PMPM fees to which the Company is entitled are subject to periodic adjustment under CMS’s risk adjustment payment methodology. CMS deploys a risk adjustment model that determines premiums paid to all payors according to each member’s health status and certain demographic factors. Under this risk adjustment methodology, CMS calculates the risk adjusted premium payment using diagnosis data from various settings. The Company and healthcare providers collect and submit the necessary and available diagnosis data to payors and such data is utilized by the Company to estimate risk adjustment payments to be received in subsequent periods. Risk adjustment-related revenues are estimated using the most likely amount methodology and amounts are only included in revenue to the extent that it is probable that a significant reversal of cumulative revenue will not occur once any uncertainty is resolved. PMPM fees are also subject to adjustment for incentives or penalties based on the achievement of certain quality metrics defined in the Company’s contracts with payors. The Company recognizes incentive revenue as earned using the most likely amount methodology and only to the extent that it is probable that a significant reversal of incentive revenue will not occur once any uncertainty is resolved.

Neither the Company nor any of its affiliates is a registered insurance company because state law in the states in which it operates does not require such registration for risk-bearing providers.

Receivables

Receivables primarily consist of amounts due under capitation contracts with various payors. Receivables due under capitation contracts are recorded monthly based on reports received from payors and management’s estimate of risk adjustment payments to be received in subsequent periods for open performance years. Receivables are recorded at the amount expected to be realized.

Medical Services Expenses and Related Payables

Medical services expense represents costs incurred for medical services provided to members by physicians, hospitals and other ancillary providers for which the Company is financially responsible and are paid by payors with whom the Company has contracted. Medical services expenses are recognized in the period in which services are provided and include estimates of claims that have been incurred but have either not yet been received, processed, or paid and as such, not reported.

Such estimates are developed using actuarial methods commonly used by health insurance actuaries that include a number of factors and assumptions including medical service utilization trends, changes in membership, observed medical cost trends, historical claim payment patterns and other factors. Generally, for the most recent months, the Company estimates claim costs incurred by applying observed medical cost trend factors to the average PMPM medical costs incurred in prior months for which more complete claims data are available.

Each period, the Company re-examines previously established medical claims payable estimates based on actual claim submissions and other changes in facts and circumstances. As more complete claims information becomes available, the Company adjusts its estimates and recognizes those changes in estimates in the period in which the change is identified. The difference between the estimated liability and the actual settlements of claims is recognized in the period the claims are settled. The Company’s medical claims payable balance represents management’s best estimate of its liability for unpaid medical costs as of December 31, 2025 and 2024. The Company uses judgment to determine the appropriate assumptions for developing the required estimates.

The Company assesses the profitability of its managed care capitation arrangements to identify contracts where current operating results or forecasts indicate probable future losses. If anticipated future variable costs exceed anticipated future revenues, a loss contract reserve is recognized. Loss contract reserves as of December 31, 2025 and 2024 were $0 and $4.9 million, respectively.

Other medical expenses include: (i) partner physician compensation expense and (ii) other provider costs. Partner physician compensation expense relates to surplus sharing obligations to the Company’s physician partners. Other provider costs include payments for additional compensation to support physician-patient engagement and other care management expenses.

Amortizable Intangible Assets and Goodwill

Amortizable intangible assets primarily relate to health plan contracts, trade names, provider networks and noncompete enforcement agreements. Amortizable intangible assets are amortized using the straight-line method over the useful life of these assets, generally betweenone and 10 years. The Company considers the period of expected cash flows and related underlying data used to measure the fair value of the intangible assets (or the length of time for a noncompete agreement) when selecting a useful life.

Amortizable intangible assets are subject to impairment tests when events or circumstances indicate that the carrying value of the asset, or related asset group, may not be recoverable. The Company compares the carrying value of an amortizable intangible asset (or asset group) to the future undiscounted cash flows generated by the asset (or asset group). The expected future undiscounted cash flows are calculated using the lowest level of identifiable cash flows that are largely independent of the cash flows of other assets and liabilities. When the carrying value of an intangible asset (or asset group) exceeds its expected future undiscounted cash flows, an impairment charge is recognized to the extent that the carrying value of the asset (or asset group) exceeds its fair value.

The impairment tests are based on financial projections prepared by management that incorporate anticipated results from programs and initiatives being implemented. If projections are not met, or if negative trends occur that impact the outlook, the intangible assets may be impaired.

Goodwill represents the excess purchase price consideration over the estimated fair value of net assets acquired in a business combination. The Company tests goodwill for impairment annually in the fourth quarter, and on an interim basis when events or changes in circumstances indicate that the carrying value may not be recoverable. The Company first assesses qualitative factors to determine whether it is more likely than not that the carrying value of a reporting unit exceeds its fair value. Qualitative analysis involves assessing situations and developments that could affect key drivers used to evaluate whether the value of goodwill is impaired. The Company’s procedures include assessing its financial performance, macroeconomic conditions, industry and market considerations, various asset-specific factors, and entity-specific events. The Company may also elect to skip the qualitative testing and proceed directly to the quantitative testing.

In the quantitative assessment, the fair value of the reporting unit is determined primarily by an income approach, utilizing discounted cash flows and a market approach looking at comparable companies and related transactions. An impairment is recognized only to the extent that the carrying value of a reporting unit exceeds its fair value. If the fair value exceeds the carrying amount, goodwill is not considered impaired.

Cash, Cash Equivalents, and Restricted Cash Equivalents

Cash and cash equivalents consist of cash on hand and highly liquid financial instruments with maturities of three months or less when purchased, which includes investments in short-term money market funds. The Company maintains its cash on hand in bank deposit accounts which, at times, may exceed federally insured limits. Restricted cash and equivalents primarily consist of amounts used as collateral to secure letters of credit which the Company is required to maintain pursuant to contracts with payors. Such amounts are generally maintained in certificates of deposit to satisfy these obligations and are presented as restricted cash equivalents in the consolidated balance sheets. As of December 31, 2024, certificates of deposit totaled $5.5 million. There wereno certificates of deposit as of December 31, 2025.

Marketable Securities

The Company's investments in marketable debt securities are classified as available-for-sale and are carried at fair value, with the unrealized gains and losses reported as a component of accumulated other comprehensive income (loss) in total stockholders’ equity (deficit). The Company determines the appropriate classification of these investments at the time of purchase and reevaluates such designation at each balance sheet date. In general, the Company’s marketable securities are classified as current assets without regard to the securities’ contractual maturity dates because they may be readily liquidated.

Interest income, premium accretion/discount amortization, realized gains and losses on sales of securities, and credit-related impairment, if any, are included as a component of other income (expense), net in the consolidated statements of operations. The cost of securities sold is based on the specific identification method.

At each reporting period, the Company evaluates available-for-sale marketable securities for impairment when the fair value of the investment is less than its amortized cost. The Company evaluates the underlying credit quality and credit ratings of the issuers, and, if necessary, the expected cash flows of the financial instruments. When the Company determines that the decline in fair value of an investment is below the carrying value and this decline is credit-related, the Company reduces the carrying value of the marketable security it holds and records a loss for the amount of such decline. Non-credit related impairments are recorded through other comprehensive income. If the Company intends to sell the security, or if it is more-likely-than-not that the Company will be required to sell the security before recovery of its amortized cost, the entire impairment is included in earnings.

Property, Equipment, and Capitalized Software

Property and equipment are recorded at cost less accumulated depreciation. If acquired through a business combination, property and equipment are recorded at fair value at the date of acquisition. Costs incurred that significantly extend the useful life of the related assets are capitalized, while repairs and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Capitalized software consists of certain costs incurred in the development of internal-use software, including external direct costs of materials and services and applicable payroll costs of employees devoted to specific software development.

The following represents the estimated useful lives for property and equipment:

Leasehold improvements are depreciated over the shorter of the assets’ estimated useful life or term of the lease.

Issuance Costs

Debt issuance costs related to debt instruments (excluding line of credit arrangements) are deferred, recorded as a reduction of the related debt liability, and amortized to interest expense over the remaining term of the related debt liability utilizing the effective interest method. Debt issuance costs related to line of credit arrangements are deferred, included in other assets, and amortized to interest expense on a straight-line basis over the remaining term of the related line of credit arrangement. Costs incurred in connection with the issuance of common shares are recorded as a reduction of additional paid-in capital.

Net Income (Loss) Per Share

Basic net income (loss) per common share is computed by dividing net income (loss) attributable to common shares by the weighted average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is calculated by including the effect of dilutive securities using the treasury stock method. The treasury stock method assumes a hypothetical issuance of shares to settle stock-based awards, with the assumed proceeds used to purchase common stock at the average market price for the period. Assumed proceeds include the amount the employee must pay upon exercise and the average unrecognized compensation cost. The difference between the number of shares assumed issued and number of shares assumed purchased represents the dilutive shares. Basic net loss per share is the same as diluted net loss per share for the periods presented, as the inclusion of all potential common shares outstanding would have been anti-dilutive.

Stock-based Compensation

Stock-based compensation expense for common stock options is recognized based on the fair value of the award as determined on the grant date using the Black-Scholes option pricing model. Stock-based compensation expense is generally recognized on a straight-line basis over the vesting period. Compensation cost for options that vest based on performance conditions, in addition to the continued service period, is recognized when the related performance condition is deemed to be probable of achievement. The fair value of awards with market conditions are valued using the Monte Carlo simulation model. Forfeitures of stock-based awards are recognized as they occur.

Income Taxes

Current tax liabilities and assets are recognized for the estimated taxes payable or refundable, respectively, on the tax returns for the current year. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. The carrying value of the Company’s net deferred tax assets is based on whether it is more likely than not that the Company will generate sufficient future taxable income to realize the deferred tax assets. A valuation allowance is established for deferred tax assets, which the Company does not believe meet the “more likely than not” threshold. The Company’s judgments regarding future taxable income may change over time due to changes in market conditions, changes in tax laws, tax planning strategies, or other factors. If the Company’s assumptions and, consequently, its estimates, change in the future, the valuation allowance may materially increase or decrease, resulting in a decrease or increase, respectively, in income tax benefit and the related impact on the Company’s reported net income (loss).

The Company utilizes a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining whether the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than likely of being realized and effectively settled. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments, and that may not accurately forecast actual outcomes. The Company recognizes interest and penalties accrued related to unrecognized tax benefits as additional income taxes.

On July 4, 2025, the “One Big Beautiful Bill Act” was signed into law in the U.S., which contains a broad range of tax reform provisions. The One Big Beautiful Bill Act did not have a material impact on the Company's tax provision for the year ended December 31, 2025.

Fair Value Measurement

The Company’s financial instruments consist of cash and cash equivalents, restricted cash and cash equivalents, marketable securities (see Note 4), receivables, other liabilities, accounts payable, certain accrued expenses, and borrowings which consist of a term loan and a revolving credit facility (see Note 10). The carrying values of the financial instruments classified as current in the consolidated balance sheets approximate their fair values due to their short-term maturities. The fair values of the term loan and revolving credit facility approximate the carrying values because the interest rates on such borrowings approximate market rates as of the reporting date. Such borrowings are classified within Level 2 of the fair value hierarchy. During the years ended December 31, 2025 and 2024, there were no material transfers of financial assets or liabilities within the fair value hierarchy.

The Company measures and discloses the fair value of nonfinancial and financial assets and liabilities utilizing a hierarchy of valuation techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. This hierarchy requires the use of observable market data when available. These inputs have created the following fair value hierarchy:

•Level 1—quoted prices for identical instruments in active markets;

•Level 2—quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

•Level 3—fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The Company is responsible for determining fair value, as well as for assigning the appropriate level within the fair value hierarchy, based on the significance of unobservable inputs. The Company reviews methodologies, processes and controls of third-party pricing services and performs ongoing analyses of both prices received from third-party pricing services and those developed internally to determine whether they represent appropriate estimates of fair value.

Segment Reporting

The Company operates a Medicare-centric, capitated line of business and is organized as a single operating and reportable segment based on the manner in which the Company’s Chief Operating Decision Maker (“CODM”) evaluates performance and makes decisions about how to allocate resources. The Company’s CODM is the Office of the Chairman. Segment asset information, which is presented on the consolidated balance sheet, is not used by the CODM to assess performance and make decisions about how to allocate resources. The Company's segment measure of profit or loss is consolidated net income (loss). The CODM uses the segment measure of profit or loss to assess performance and make resource allocation decisions, primarily through periodic budgeting and company performance reviews. Significant expense categories included within the segment measure of profit or loss that are regularly provided to the CODM include medical services expense, other medical expense, and platform support costs. Medical services expense and other medical expense amounts are included in the consolidated statements of operations. Platform support costs were $160.0 million, $169.4 million, and $163.7 million for the years ended December 31, 2025, 2024, and 2023, respectively. For the years ended December 31, 2025, 2024, and 2023, other segment items, which consists of general and administrative expenses (excluding platform support costs), depreciation and amortization, other income (expense), net, income tax benefit (expense), and results from discontinued operations, were $71.3 million, $95.5 million, and $168.8 million, respectively.

Disposition of Hawaii Operations

On October 31, 2023, the Company completed the disposition of MDX Hawaii, Inc. (“MDX Hawaii”), a wholly-owned subsidiary, and its related operations. MDX Hawaii is a provider network with fully-delegated risk contracts and management services organization capabilities, including claims processing and utilization management. The Company’s decision to exit Hawaii and the Independent Practice Association line of business represents a strategic shift that had a major effect on its operations and financial results. As such, the Company’s Hawaii operations are reflected in the consolidated financial statements as discontinued operations. See Note 19 for additional information.

Recent Accounting Pronouncements

In December of 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes—Improvements to Income Tax Disclosures(“ASU 2023-09”), which amends certain disclosure requirements related to income taxes. The amendments in ASU 2023-09 require public business entities on an annual basis to: (i) disclose specific categories in the rate reconciliation and (ii) provide additional information for reconciling items that meet a quantitative threshold. The amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. The amendments in ASU 2023-09 can be applied on a prospective basis or retrospective application. Early adoption is permitted. The Company adopted the new guidance on a prospective basis effective January 1, 2025. The new guidance did not have an impact on the Company’s consolidated financial position, results of operations or cash flows.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses(“ASU 2024-03”). In January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). The amendments in ASU 2024-03 require public business entities to disclose, on an annual and interim basis, disaggregated information about certain income statement expense line items by breaking down certain expense line items into specified natural expense categories, including purchases of inventory, employee compensation, deprecation, intangible asset amortization, and depletion. The amendments in ASU 2024-03 can be applied on a prospective basis or retrospective basis and early adoption is permitted. The amendments in ASU 2025-01 clarify the effective date of ASU 2024-03 stating that all public business entities are required to adopt the update in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. ASU 2025-01 does not change the effective date of ASU 2024-03 but was issued to provide clarity on the effective date for public business entities that do not have a calendar year-end. The Company is currently evaluating the potential impact of the adoption of ASU 2024-03 and ASU 2025-01 on the disclosures in its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software(“ASU 2025-06”). The amendments in ASU 2025-06 modernize the guidance in Subtopic 350-40 to reflect the software development approaches currently used as software is not always developed in a linear manner. To clarify how the guidance applies to both linear and nonlinear software development, the amendments in ASU 2025-06 remove all references to the “development stages” from Subtopic 350-40 and instead requires that software development costs be capitalized when (i) management, with relevant authority, commits to funding a computer software project, and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in ASU 2025-06 also provide new guidance on how to evaluate whether the probable-to-complete recognition threshold has been met and specifies that the disclosure requirements in Subtopic 360-10, Property, Plant, and Equipment—Overall, are required for all capitalized internal-use software costs. The amendments in ASU 2025-06 are effective for annual reporting periods beginning after December 31, 2027, and interim reporting periods within those annual reporting periods. The amendments in ASU 2025-06 can be applied on a prospective, retrospective, or modified transition approach basis. The new guidance is not expected to have a material impact on the Company’s consolidated financial position, results of operations, cash flows, or disclosures.

NOTE 3. Concentration of Credit Risk

The Company is economically dependent on maintaining a base of primary care and specialty care physicians as well as capitation contracts with payors. The loss of certain of those contracts could have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

The Company contracts with various payors whereby the Company is entitled to monthly PMPM fees to provide a defined range of healthcare services for members attributed to its contracted primary care physicians. The Company generally accepts full financial risk for such members and therefore is responsible for the cost of all healthcare services required by them. Substantially all of the Company’s receivable balances are from a small number of payors.

Revenue from Medicare Advantage payors constitutes substantially all of the Company’s total revenue for the years ended December 31, 2025, 2024, and 2023.

The following table provides the Company’s revenue concentrations with respect to major payors as a percentage of the Company’s total revenues:

*Less than 10% of total revenues.

The following table provides the Company’s concentrations of credit risk with respect to major payors as a percentage of receivables, net:

*Less than 10% of total receivables.

NOTE 4. Marketable Securities and Fair Value Measurements

Marketable Securities

The following table summarizes the Company’s marketable securities (in thousands):

For the year ended December 31, 2025, the Company recognized total interest income, included in Other income (expense), net, of $14.7 million, of which $10.0 million was related to its marketable securities investments and $4.7 million was related to interest on cash and cash equivalent balances. For the year ended December 31, 2024, the Company recognized total interest income of $19.2 million, of which $13.4 million was related to its marketable securities investments and $5.8 million was related to interest on cash and cash equivalent balances. For the year ended December 31, 2023, the Company recognized total interest income of $27.9 million, of which $19.1 million was related to its marketable securities investments and $8.8 million was related to interest on cash and cash equivalent balances.

The following table summarizes the Company’s marketable securities maturity as of December 31, 2025 (in thousands):

The following table summarizes the Company’s marketable securities with gross unrealized losses by security type aggregated by the length of time the investments have been in a continuous unrealized loss position as of December 31, 2025 (in thousands):

The following table summarizes the Company’s marketable securities with gross unrealized losses by security type aggregated by the length of time the investments have been in a continuous unrealized loss position as of December 31, 2024 (in thousands):

The Company’s unrealized losses from marketable securities as of December 31, 2025 and 2024 were caused primarily by interest rate increases. As of December 31, 2025, all of the Company’s marketable securities carry an investment grade rating by nationally recognized statistical rating organizations. The Company does not intend to sell marketable securities that are in an unrealized loss position, and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost bases, which may be maturity. There wereno allowances for credit losses on available-for-sale marketable securities at December 31, 2025 and 2024.

Fair Value Measurements

The table below summarizes the Company’s financial instruments measured at fair value on a recurring basis (in thousands):

NOTE 5. Property, Equipment, and Capitalized Software, Net

The following table summarizes the Company’s property and equipment (in thousands):

For the years ended December 31, 2025, 2024, and 2023, the Company recognized $1.5 million, $1.7 million, and $1.8 million, respectively, in depreciation expense related to property and equipment, which is included in depreciation and amortization expense in the consolidated statements of operations. For the years ended December 31, 2025, 2024, and 2023, the Company recognized $13.7 million, $10.5 million, and $6.2 million, respectively, in amortization expense related to capitalized software, which is included in depreciation and amortization expense in the consolidated statements of operations.

NOTE 6. Goodwill and Amortizable Intangible Assets

The Company performs an annual assessment of its goodwill during the fourth quarter of each calendar year, or more frequently if indicators of potential impairment exist, such as an adverse change in business climate, declines in market capitalization or a decline in the overall industry demand, that would indicate it is more likely than not that the fair value of its single reporting unit is less than its carrying value.

For the year ended December 31, 2024, the Company completed the required annual goodwill impairment test during the fourth quarter andno impairment was recognized. For the year ended December 31, 2025, the Company completed the required annual goodwill impairment test during the fourth quarter and recorded a non-cash goodwill impairment charge of $24.1 million, which is included inimpairments in the consolidated statements of operations, and reduced the carrying value tozero. The results of the impairment test showed that the fair value of the My Personal Health Record Express, Inc. (“mphrx”) reporting unit was lower than its carrying value. The fair value of the mphrx reporting unit was determined using the income approach by employing the discounted cash flow method, which assumptions are categorized as Level 3 inputs within the fair value hierarchy. The significant estimates used in the discounted cash flows model included the Company’s weighted average cost of capital, projected cash flows and the long-term rate of growth. In addition to the lower financial projections, decline in the Company’s market capitalization and changes in macro-economic conditions contributed to the amount of the goodwill impairment charge.

In addition to the goodwill impairment charge mentioned above, as a result of the assessment during the fourth quarter of 2025, the Company recognized a $12.0 millionnon-cash impairment charge, which is included in impairments in the consolidated statements of operations, primarily related to the trade name.

The following table summarizes the Company’s amortizable intangible assets as of December 31, 2025 (dollars in thousands):

The following table summarizes the Company’s amortizable intangible assets as of December 31, 2024 (dollars in thousands):

For the years ended December 31, 2025, 2024, and 2023, the Company recognized $13.4 million, $12.3 million, and $8.0 million, respectively, in amortization expense, which is included in depreciation and amortization expense in the consolidated statements of operations.

The following table summarizes the estimated annual amortization for each of the five succeeding fiscal years and thereafter as of December 31, 2025 (in thousands):

NOTE 7. Other Assets

The following table summarizes the Company’sother assets (in thousands):

See Note 17 for additional information on equity method investments related to the Company’ CMS ACO Models investments.

Loans to Physician Partners

Loans to physician partners primarily represent loans in connection with taxes payable on shares distributed to them in connection with the Company’s initial public offering. These loans mature between 2026 and 2031 with nominal interest compounding annually and no prepayment penalties. At December 31, 2025, $27.6 million of these loans were reclassed to Prepaid expenses and other current assets, net on the consolidated balance sheet as the maturities were less than 12 months. Such loans are stated at the amount expected to be collected.

NOTE 8. Medical Claims and Related Payables

Medical claims and related payables include estimates for amounts owed for claims incurred for services provided to members by various providers. Changes in amounts reported for medical claims related to prior years result from claims being paid at amounts different than originally estimated. Liabilities are continually reviewed and re-estimated as information regarding actual claim payments becomes known. This information is compared to the originally established liability at year end. The following table presents the components of changes in medical claims and related payables (in thousands):

Beginning balance of medical claims and related payables disclosed above for December 31, 2023, include $45.9 million that are presented as current liabilities held for sale and discontinued operations. Ending balance of medical claims and related payables disclosed above for December 31, 2025 and 2024, includes $34.5 million and $13.3 million, respectively, that is recoverable from other parties under risk sharing arrangements and is presented as prepaid expenses and other current assets, net in the consolidated balance sheets.

NOTE 9. Other Liabilities

The following table summarizes the Company’s other liabilities (in thousands):

(1)Represents unasserted claims.

See Note 17 for additional information on equity method liabilities related to the Company's CMS ACO Models investments.

NOTE 10. Debt

Credit Facility

On February 18, 2021, the Company executed a credit facility agreement (as amended by the First Amendment to Credit Agreement, dated as of March 1, 2021 and the Second Amendment to Credit Agreement, dated as of May 25, 2023, the “Credit Agreement”), which includes: (i) a $100.0 million secured term loan facility (the “Secured Term Loan”) and (ii) a $100.0 million senior secured revolving credit facility (the “Secured Revolving Facility,” and together with the Secured Term Loan, the “Credit Facility”) with a capacity to issue standby letters of credit in certain circumstances up to a maximum of $100.0 million. Subject to specified conditions and receipt of commitments, the Secured Term Loan Facility may be expanded (or a new term loan facility, revolving credit facility or letter of credit facility added) by up to (i) $50.0 million plus (ii) an additional amount determined in accordance with a formula tied to repayment of certain of the Company’s indebtedness. The maturity date of the Credit Facility was February 18, 2026.

Effective with the Second Amendment to Credit Agreement on May 25, 2023, the Company transitioned to the Secured Overnight Financing Rate (“SOFR”) as a benchmark interest rate used in the Credit Agreement. At the Company’s option, borrowings under the Credit Facility can be either: (i) Term SOFR Rate Loans, (ii) Daily Simple SOFR Rate Loans, or (iii) Base Rate Loans, each as defined in the Credit Agreement. Daily Simple SOFR Rate Loans and Term SOFR Rate Loans bear interest at a rate equal to the sum of 3.50% and the higher of (a) SOFR, as defined in the Credit Agreement, and (b)0%. Base Rate Loans bear interest at a rate equal to the sum of 2.50% and the highest of: (a)0.50% in excess of the overnight federal funds rate, (b) the prime rate established by the administrative agent from time to time, (c) the one-month SOFR rate (adjusted for maximum reserves) plus 1.00% and (d)0%. Additionally, the Company pays a commitment fee on the unfunded Secured Revolving Facility amount of 0.375%. The Company must also pay customary letter of credit fees. As of December 31, 2025, the effective interest rate on the Secured Term Loan was 8.19%.

The Credit Facility is guaranteed by certain of the Company’s subsidiaries, including those identified as VIEs, and contain customary covenants including, among other things, limitations on restricted payments including: (i) dividends and distributions from restricted subsidiaries, (ii) requirements of minimum financial ratios, and (iii) limitation on additional borrowings based on certain financial ratios. Failure to meet any of these covenants could result in an event of default under the Credit Agreement. If an event of default occurs, the lenders could elect to declare all amounts outstanding under the Credit Agreement to be immediately due and payable. As of December 31, 2025, the Company was in compliance with all covenants under the Credit Facility.

As of December 31, 2025, the Company had $35.0 million outstanding under the Secured Term Loan and availability under the Secured Revolving Facility was $16.8 million, as the Company had outstanding letters of credit totaling $83.2 million. The standby letters of credit are automatically extended without amendment forone-year periods, unless the Company notifies the institution in advance of the expiration date that the letter will be terminated. No amounts have been drawn on the outstanding letters of credit as of December 31, 2025.

On February 10, 2026, the Company entered into the Third Amendment (the “Amendment”) to the Credit Agreement, which modified certain terms of the Credit Agreement. The Amendment, among other changes, (a) extended the stated maturity date from February 18, 2026 to February 18, 2028; (b) amended certain covenant “baskets” to be measured as a percentage of EBITDA rather than, or as an alternative to, Consolidated Total Assets; (c) required that Management maintain a minimum of $50.0 million in Total Cash as of the end of each Business Day; (d) conditioned certain payments, including dividends, to Holdings under the available amount “basket” on the Company achieving positive EBITDA for two consecutive trailing four-quarter periods each ending after the Third Amendment Effective Date; (e) required that any reduction in outstanding letters of credit be accompanied by a corresponding prepayment of term loans; (f) reduced the aggregate amount of revolving credit commitments from $100.0 million to $90.0 million; and (g) required cash collateralization at 103% of the amount of each letter of credit outstanding immediately prior to the Amendment effective date. Although the Secured Term Loan originally matured shortly after the balance sheet date, the Company completed the refinancing subsequent to December 31, 2025, but prior to the issuance of the consolidated financial statements that extended the contractual maturity of a portion of the obligation beyond one year. Accordingly, $15.8 million of the Secured Term Loan has been classified as long-term debt as of December 31, 2025, with the remaining $19.2 million classified as current.

The following table summarizes the Company’s stated term loan maturity and scheduled principal repayments as of December 31, 2025 (in thousands):

As of December 31, 2025, the Company had $10.2 million outstanding surety bonds related to health plan payor risk-bearing capital contributions.

NOTE 11. Commitments and Contingencies

Legal Proceedings

From time to time, the Company is a party to, or has a significant relationship to, legal proceedings, lawsuits, and other claims that are in the ordinary course of the Company’s business. Except as described below, the Company is not aware of any other legal proceedings or claims that it believes may have, individually or taken together, a material adverse effect on the Company’s business, prospects, financial condition, results of operations or cash flows. The Company’s policy is to expense legal costs as they are incurred.

In February and March 2024, three class action lawsuits were filed and later consolidated as one matter captioned In re agilon health, inc. Securities Litigation, 1:24-cv-00297 (W.D. Tex.) (the “Consolidated Securities Matter”). The Consolidated Securities Matter names the Company and certain current and former members of the Company’s executive team and Board of Directors as defendants, among others. The Consolidated Securities Matter generally asserts securities fraud claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, as amended (the “Securities Act”), in connection with statements made between April 2021 and February 2024 in the Company’s annual and quarterly reports, investor presentations, and earnings releases related to, among other things, the Company’s financial guidance, medical margin and Adjusted EBITDA results, growth strategy, and data management. The Consolidated Securities Matter seeks compensatory damages, judgment interest, attorney’s fees and costs, and other unspecified equitable and/or injunctive relief. The Company and other defendants filed motions to dismiss the complaint on November 8, 2024. On or about August 15, 2025, the court issued an order on the motions to dismiss, dismissing some of the claims against the defendants and allowing others to proceed into the discovery phase of litigation. The court dismissed all claims under the Securities Act and certain portions of plaintiffs’ Exchange Act claims. Following the order, the Company and certain of the individual defendants filed a motion requesting clarification as to whether any claims remained against the Company’s Chief Technology Officer and Chief Experience Officer. Separately, defendant CD&R and certain of its affiliates filed a motion for clarification and/or reconsideration regarding certain aspects of the Court’s order. Both motions have been fully briefed and remain pending. Discovery is ongoing, and the court has entered a case schedule that contemplates discovery continuing over the first three quarters of 2026.

On December 31, 2025, a separate putative securities class action, Vandersluis v. agilon health, Inc., 1:25-cv-07167 (E.D.N.Y.) was filed in the United States District Court for the Eastern District of New York (“Vandersluis”). Vandersluis names the Company and certain current and former members of the Company’s executive team and Board of Directors as defendants and alleges violations of Sections 10(b) and 20(a) of the Exchange Act in connection with statements made between February 2025 and August 2025 in the Company’s quarterly reports and earnings releases related to, among other things, the Company’s financial guidance, medical margin and Adjusted EBITDA results. The proposed class period is February 26 through August 4, 2025. Vandersluiswas filed on behalf of stockholders who purchased or otherwise acquired shares of the Company’s common stock between February 26 and August 4, 2025, and seeks monetary damages on behalf of the purported class.

The Company intends to vigorously oppose the Consolidated Securities Matter and Vandersluis matter, but is unable to predict the outcome or estimate any ultimate individual or aggregate amount of monetary liability or financial impact due to the early stages of the litigation.

In May and October 2024, two putative stockholder derivative class action lawsuits were filed: (1)Douglas v. Steven J. Sell et al., 1:24-cv-00531 (W.D. Tex.) and (2)Bingham v. Steven J. Sell et al., 1:24-cv-01181 (W.D. Tex.) (the “Consolidated Derivative Matters”). The Consolidated Derivative Matters name the Company and certain current and former members of the Company’s executive team and Board of Directors as defendants. The Consolidated Derivative Matters generally assert claims under Sections 14(a) and 10(b) of the Exchange Act, as well as common law claims including breach of fiduciary duty, among others, in connection with statements made between April 2021 and February 2024 in the Company’s annual and quarterly reports, investor presentations, and earnings releases related to, among other things, the Company’s financial guidance, medical margin and Adjusted EBITDA results, growth strategy, and data management. The Douglas lawsuit also asserts claims under Section 20(a) of the Exchange Act in connection with the same allegations and seeks contribution under Section 11(f) of the Securities Act and Section 21D of the Exchange Act. The Consolidated Derivative Matters seek compensatory damages, restitution, punitive damages, attorney’s fees and costs, and other relief. The plaintiff in the Douglas action also seeks corporate governance reforms. The Consolidated Derivative Matters were consolidated in November 2024 into In re agilon health, inc. Shareholder Derivative Litigation, 1:24-cv-00531-DII (W.D. Tex.). The Consolidated Derivative Matters were stayed during the motion to dismiss phase for the Consolidated Securities Matter. On or about December 17, 2025, defendants filed a motion to lift the stay after the parties were unable to reach agreement on the extent to which the stay should remain in place while the motions for clarification and/or reconsideration remain pending in the Consolidated Securities Matter. That motion is currently pending before the court, and the Plaintiffs have requested leave to amend their complaint

.

On or about September 18, 2025, a third putative stockholder derivative class action lawsuit was filed in federal court in Ohio, titled Bushansky v. Steven J. Sell et al., 2:25-cv-01068 (S.D. Ohio). The allegations in this lawsuit are substantially the same as those asserted in the Consolidated Derivative Matters, alongside new allegations including that the Company’s 2024 Proxy Statement contained misrepresentations. On January 14, 2026, the Court granted the defendants’ motion to transfer the Ohio lawsuit to the Western District of Texas, where it would likely be consolidated with the Consolidated Derivative Matters. On January 22, 2026, the plaintiff filed a Notice of Voluntary Dismissal of his Complaint pursuant to Federal Rule of Civil Procedure 41(a) and 23.1(c). The court dismissed the Bushansky case without prejudice on January 23, 2026.

On February 12, 2026, a putative stockholder derivative action lawsuit was filed in the United States District Court for the Eastern District of New York, titled Sinha v. Sell et al., 1:26-cv-00846 (E.D.N.Y.) (“Sinha”). Sinha names the Company and certain current and former members of the Company’s executive team and Board of Directors as defendants. Sinha generally asserts claims under Sections 14(a) and 10(b) of the Exchange Act, as well as common law claims including breach of fiduciary duty, among others, in connection with statements made between February 2025 and August 2025 in the Company’s quarterly reports and earnings releases related to, among other things, the Company’s financial guidance, medical margin, and Adjusted EBITDA results. Sinha seeks corporate governance reforms, restitution, attorney’s fees and costs, and other relief.

The Company intends to vigorously oppose the Consolidated Derivative Matters and Sinha matter but is unable to predict the outcome or estimate any ultimate individual or aggregate amount of monetary liability or financial impact due to the early stages of the litigation.

Regulatory Matters

The healthcare industry is subject to numerous laws and regulations of federal, state, and local governments. Violations of these laws and regulations could result in expulsion from government healthcare programs, together with the imposition of significant fines and penalties. Compliance with such laws and regulations can be subject to future government review and interpretation, as well as regulatory actions unknown or unasserted at this time.

The healthcare regulatory landscape is constantly changing. It is difficult to predict which final rules may be adopted and implemented by federal and state authorities, and if such final rules would result in any material adverse effect on the Company’s business, consolidated financial condition, results of operations or cash flows. Management is unable to determine how any future government spending cuts will affect Medicare reimbursement. There likely will continue to be legislative and regulatory proposals at the federal and state levels directed at containing or lowering the cost of healthcare that, if adopted, could have a material adverse effect on the Company’s consolidated financial statements.

CMS and the U.S. Department of Health and Human Services (“HHS”) Office of Inspector General perform audits of selected MA contracts related to risk adjustment diagnosis data. In these Risk-Adjustment Data Validation Audits (“RADV audits”), the government reviews medical records to determine whether physician medical record documentation and coding practices are compliant, which can result in the recovery of payments from managed care organizations if errors are identified and influence the calculation of premium payments by CMS to MA plans. On January 30, 2023, CMS released a final rule, announcing it may use extrapolation for payment years 2018 forward, for both RADV audits and Office of Inspector General audits and eliminated the application of a fee-for-service Adjuster in Part C contract-level RADV audits of Medicare Advantage organizations. The Company's payors are subject to audit by government health plans, including, but not limited to, CMS, in connection with the MA program. The Company is currently unable to predict the results of RADV audits on its financial condition, operating results, or cash flows.

Contractual Obligations

The following table summarizes the Company’s contractual obligations, excluding debt service obligations (see Note 10), as of December 31, 2025 (in thousands):

(1)Represents capital commitments to physician partners to support physician partner expansion and related purposes.

NOTE 12. Common Stock

Common Stock

As of December 31, 2025, the Company’s authorized capital stock consisted of 2.0 billion shares of common stock, par value $0.01 per share. Every holder of record of common stock entitled to vote at a meeting of stockholders is entitled toone vote for each share outstanding.

During the year ended December 31, 2025, the Company issued approximately 2.5 million shares of common stock primarily in connection with exercises and vesting of stock-based awards.

During the year ended December 31, 2024, the Company issued approximately 3.8 million shares of common stock primarily in connection with exercises and vesting of stock-based awards. Additionally, during 2024, the Company issued approximately 2.0 million shares of common stock to settle liabilities related to the exchange of common stock for reduced physician partner compensation percentage in certain ACO REACH entities.

During the year ended December 31, 2023, the Company issued approximately 3.6 million shares of common stock primarily in connection with exercises and vesting of stock-based awards.

Also in 2023, the Company repurchased 9.6 million shares of common stock for $200.0 million.

NOTE 13. Stock-Based Compensation

The Company offers certain employees the ability to purchase common stock of the Company and/or receive common stock options under its Amended and Restated Stock Incentive Plan (the “Plan”) that was approved by the stockholders. In connection with the Company’s initial public offering, the Company’s Board of Directors approved the agilon health, inc. 2021 Omnibus Equity Incentive Plan (the “Omnibus Incentive Plan”). As of December 31, 2025, the Company is authorized to grant 144.6 million shares related to employee stock options, of which 77.7 million shares remain available for grant as of December 31, 2025. Shares granted are not transferrable, except upon the employee’s death, repurchase by the Company, or with the Company’s consent.

The Omnibus Incentive Plan provides for the grant of stock options, restricted stock awards, restricted stock units (“RSUs”), performance-based awards, and other awards. Stock options expire 10 years after the date of grant and forfeiture of awards is recognized as it occurs. The stock options granted under the Plan generally consist of: (i) stock options that vest inthree tofour equal annual installments, subject to the employee’s continued service until the applicable vesting date (the “Base Options”), and (ii) stock options that vest if CD&R realizes a certain return on its investment, subject to the employee’s continuous employment through such date and beyond, in certain grants (the “Upside Options”).

Stock Options

Base Options. Compensation cost for Base Options is recognized on a straight-line basis generally over the requisite vesting period ofthree tofour years. The fair value of each Base Option was estimated on the date of grant using the Black-Scholes option pricing model. Expected volatilities are based on the historical equity volatility of comparable publicly traded companies. The expected term of Base Options is calculated via the simplified method and reflects the midpoint between the vesting date and the end of the contractual term, as our historical share option exercise experience does not provide a reasonable basis upon which to estimate the expected term. The risk-free rates utilized for periods throughout the contractual life of Base Options are based on U.S. Treasury security yields at the time of grant.

The assumptions used for the Black-Scholes option pricing model to determine the fair value of Base Options granted are as follows:

The Company’s outstanding Base Options consisted of the following (shares in thousands):

The weighted-average grant-date fair value of Base Options granted during the years ended December 31, 2025, 2024, and 2023 was $4.00, $3.03, and $15.30, respectively, per option. The total intrinsic value of Base Options exercised for the years ended December 31, 2025, 2024, and 2023 was $23.3 thousand, $1.2 million, and $27.0 million, respectively. During the year ended December 31, 2025, the Company recognized $7.9 million of stock-based compensation expense related to Base Options. During the year ended December 31, 2024, the total stock-based compensation expense related to Base Options was $8.3 million. During the year ended December 31, 2023, the total stock-based compensation expense related to Base Options was $10.0 million, of which $0.1 million is recorded in income (loss) from discontinued operations in the consolidated statements of operations.

As of December 31, 2025, the Company had $9.7 million of total unrecognized compensation cost related to non-vested Base Options, which is expected to be recognized over a weighted-average period of approximatelytwo years.

Upside Options. Upside Options vested when CD&R realized a certain return on its investment, subject to the employee’s continuous employment through such date and beyond, in certain grants. During the years ended December 31, 2025, 2024, and 2023, the Company recognized $0.3 million, $1.0 million, and $1.6 million, respectively, of stock-based compensation expense related to Upside Options. The fair value of Upside Options was estimated on the date of grant using the Monte Carlo simulation model.

The Company’s outstanding Upside Options consisted of the following (shares in thousands):

Restricted Stock Units

Restricted stock awards, including RSUs and performance stock units are granted subject to certain restrictions. Conditions of vesting are determined at the time of grant. The fair market value of RSUs, both time vesting and those subject to specific performance criteria, are expensed over the period of vesting. RSUs, which vest based solely upon passage of time and requisite service generally vest over the requisite period ofthree tofour years. Performance stock units, which are RSUs that vest dependent upon attainment of various levels of performance that equal or exceed threshold levels, generally vest in their entirety at the end of the relevant performance period, generally three years. The number of shares that ultimately vest can vary from 0% to 400% of target depending on the level of achievement of the performance criteria. The fair value of RSUs and performance stock units are determined based on the closing market price of the Company’s shares on the grant date. The value of the shares withheld to settle tax withholding obligations is dependent on the closing market price of the Company’s common stock on the trading date prior to the relevant transaction occurring.

The following table summarizes employee restricted stock award activity, including performance stock units, for the year ended December 31, 2025 (units in thousands):

For the years ended December 31, 2025, 2024, and 2023, the Company recognized $28.5 million, $18.0 million, and $25.0 million (of which $0.1 million is recorded in income (loss) from discontinued operations in the consolidated statements of operations), respectively, of stock-based compensation expense related to RSUs, including performance-based units. The weighted-average grant-date fair value of RSUs granted during the years ended December 31, 2025, 2024, and 2023 was $3.76, $4.68, and $26.36, respectively. The total fair value of RSUs vested during 2025 was $21.3 million. As of December 31, 2025, the Company had $89.1 million of total unrecognized compensation cost related to RSUs, which is expected to be recognized over a weighted-average period of approximately three years.

Certain of the Company’s agreements provide for the granting of certain stock-based instruments to third parties (the “Physician Partners Equity Awards”). The Company’s Board of Directors approved 13.7 million shares to be granted as Physician Partners Equity Awards, of which 4.3 million shares remain available for grant as of December 31, 2025. The fair market value of restricted stock units, both time vesting and those subject to specific performance criteria, are expensed over the period of vesting. RSUs, which vest based solely upon passage of time and requisite service generally vest over the requisite period oftwo years. Performance stock units, which are restricted stock units that vest dependent upon attainment of various levels of performance that equal or exceed threshold levels, generally vest in their entirety at the end of the relevant performance period, fromone tofour years. The number of shares that ultimately vest can vary from 0% to 125% of target depending on the level of achievement of the performance criteria. The fair value of RSUs, including performance stock units, are determined based on the closing market price of the Company’s shares on the grant date. No shares are withheld to settle tax withholding obligations of the physician partners.

The following table summarizes Physician Partners Equity Awards activity, including performance stock units, for the year ended December 31, 2025 (units in thousands):

For the years ended December 31, 2025, 2024, and 2023 the Company recognized $12.4 million, $23.4 million, $32.9 million, respectively, of stock-based compensation expense related to Physician Partner Equity Awards. The weighted-average grant-date fair value of Physician Partner Equity Awards granted during the years ended December 31, 2024 and 2023 was $8.65, and $16.99, respectively. There were no Physician Partner Equity Awards granted during the year ended December 31, 2025. As of December 31, 2025, the Company had $45.2 million of total unrecognized compensation cost related to Physician Partner Equity Awards, which is expected to be recognized over a weighted-average period of approximatelytwo years.

NOTE 14. Income Taxes

The components of income before income tax provision, based on tax jurisdiction, consisted of the following (in thousands):

The Company applied the intra-period tax allocation rules to allocate income taxes between continuing operations, discontinued operations, and other comprehensive income as prescribed by U.S. GAAP, where the tax effect of income (loss) before income taxes is computed without regard to the tax effects of income (loss) before income taxes from the other categories. Income tax expense (benefit) from continuing operations consisted of the following (in thousands):

A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S. federal income tax rate to income before income taxes after the adoption of ASU 2023-09 is as follows (in thousands):

(1)State taxes in Florida and Kentucky made up the majority (greater than 50%) of the tax effect in this category.

A reconciliation of the provision for income taxes to the amount computed by applying the 21% statutory U.S. federal income tax rate to income before income taxes for years prior to the adoption of ASU 2023-09 is as follows (in thousands):

The net deferred tax liability comprises the tax effect of temporary differences between U.S. GAAP and tax reporting related to the recognition of income and expenses. The net deferred income tax liabilities are included in other liabilities in the consolidated balance sheets. Components of the net deferred tax liability consisted of the following (in thousands):

The Company regularly reviews its deferred tax assets for recoverability and establishes a valuation allowance when it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. In making this assessment, the Company is required to consider all available positive and negative evidence to determine whether, based on such evidence, it is more likely than not that some portion or all of the net deferred tax assets will not be realized in future periods. As of December 31, 2025 and 2024, the Company believed that it is more likely than not that its deferred tax assets in excess of deferred tax liabilities will not be realized. Accordingly, the Company has provided a valuation allowance of $504.0 million and $428.7 million on the Company’s deferred tax assets as of December 31, 2025 and 2024, respectively. The increase in valuation allowance of $75.3 million recorded in current year activities is primarily attributable to current year losses. The net deferred tax liability as of December 31, 2025 principally relates to deferred tax liabilities associated with long-term investments in partnerships and affiliates, which are expected to reverse against net operating losses which can only offset 80% of taxable income. The Company evaluated the impact of goodwill impairment on tax-deductible goodwill and determined that it did not materially impact the tax provision due to a full valuation allowance on its United States federal and state net deferred tax assets.

As of December 31, 2025, the Company has federal, state, and foreign net operating losses of $2.0 billion, $1.2 billion, and $0.3 million, respectively. As of December 31, 2024, the Company has federal and state operating losses of $1.7 billion and $1.1 billion, respectively. As of December 31, 2025, $1.9 billion of the total federal net operating losses are carried forward as indefinite-lived net operating losses. The remaining net operating losses are carried forward and will expire beginning in 2027 if unutilized. Utilization of these operating loss carryforwards may be subject to an annual limitation based on changes in ownership, as defined by Section 382 of the Internal Revenue Code of 1986, as amended. As of December 31, 2025, $51.4 million and $52.1 million of the Company’s federal and state net operating loss carryforward, respectively, are attributable to prior acquisition transactions and are subject to Section 382 limitations. The Company’s analysis indicates that none of the acquired net operating loss carryforwards will expire unutilized solely as a result of the Section 382 limitations.

Unrecognized Tax Benefits

As of December 31, 2025, the Company had unrecognized tax benefits of $5.4 million, $1.0 million of which, if recognized, would impact its effective tax rate. As of December 31, 2024, the Company had unrecognized tax benefits of $5.3 million, $1.0 million of which, if recognized, would impact its effective tax rate. As of December 31, 2023, the Company had unrecognized tax benefits of $5.5 million, $1.0 million of which, if recognized, would impact its effective tax rate.

The following table summarizes the activity related to the Company’s unrecognized tax benefits (in thousands):

As of December 31, 2025, the Company recorded a liability for unrecognized tax benefit of $1.0 million. As of December 31, 2024, the Company recorded a liability for unrecognized tax benefit of $1.0 million. As of December 31, 2023, the Company recorded a liability for unrecognized tax benefit of $1.4 million, inclusive of $0.8 million of accrued interest and penalties. During the year ended December 31, 2024, the Company reversed $0.3 million of tax liability, $0.2 million of accrued interest, and $0.1 million of penalties on unrecognized tax benefits due to payments of an amended state return related to the period ended June 30, 2016 and statute of limitation release on state return related to period ended June 30, 2015. During the year ended December 31, 2023, the Company reversed $0.5 million of tax liability, $0.2 million of accrued interest, and $0.2 million of penalties on unrecognized tax benefits due to payments of an amended state return related to the period ended June 30, 2016.

The Company operates in several taxing jurisdictions, including U.S. federal, multiple U.S. states, and foreign jurisdictions. The statute of limitations has expired for all tax years prior to 2022 for federal, prior to 2021 for various state tax purposes, and prior to 2020 for non-U.S. jurisdictions. However, the net operating loss generated on the Company’s federal and state tax returns in prior years may be subject to adjustments by the federal and state tax authorities.

For additional information regarding income taxes and unrecognized tax benefits related to discontinued operations, see Note 19.

As of December 31, 2025 and 2024, the Company has unremitted earnings from subsidiaries outside of the U.S. on which no deferred tax liability has been recorded. The Company’s intention is to indefinitely reinvest these earnings outside the United States. Upon distribution of those earnings in the form of a dividend or otherwise, the Company would be subject to both state income taxes and withholding taxes payable to various foreign countries. The amounts of such tax liabilities that might be payable upon repatriation of foreign earnings are not material.

For the year ended December 31, 2025, income taxes paid by (refunded to) the Company consisted of the following (in thousands):

For the years ended December 31, 2024 and 2023, the Company paid income taxes of $1.8 million and $5.4 million, respectively.

On October 8, 2021, the Organization for Economic Cooperation and Development (“OECD”) released the Pillar Two model rules introducing a 15% global minimum tax under the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting. In December 2022, the European Union (“EU”) Member States formally adopted the EU Pillar Two Framework (“Pillar Two Framework”). Certain countries have enacted this tax law change, with an effective date starting January 1, 2024 and January 1, 2025, for certain aspects of the directive. The Company considered the applicable tax law changes on Pillar Two implementation in the relevant countries, and concluded there was no material impact to its tax provision for 2025.

NOTE 15. Net Income (Loss) Per Common Share

Basic net income (loss) per common share (“EPS”) is computed based upon the weighted average number of common shares outstanding. Diluted net income (loss) per common share is computed based upon the weighted average number of common shares outstanding plus the impact of common shares issuable from the assumed conversion of stock options, certain performance RSUs and unvested RSUs. Only those instruments having a dilutive impact on basic EPS are included in diluted EPS during the periods presented.

The following table illustrates the computation of basic and diluted EPS (in thousands, except per share amounts):

Basic net income (loss) per share is the same as diluted net income (loss) per share for the years ended December 31, 2025, 2024, and 2023 as the inclusion of all potential common shares outstanding would have been anti-dilutive. The following table provides the potential shares of common stock that were excluded from the calculation of diluted net income (loss) per share attributable to common stockholders because their effect would have been anti-dilutive (in thousands):

(1)Market and performance conditions were satisfied during 2021.

NOTE 16. Supplemental Cash Flow Information

The following table provides supplemental cash flow information (in thousands):

(1)For additional information regarding stock issuance, see Note 17.

The following table summarizes cash, cash equivalents and restricted cash equivalents (in thousands):

NOTE 17. Variable Interest Entities

Consolidated Variable Interest Entities

agilon health, inc.’s consolidated assets and liabilities as of December 31, 2025 and 2024 include certain assets of VIEs that can only be used to settle the liabilities of the related VIE. The VIE creditors do not have recourse to agilon health, inc.

agilon health, inc.’s consolidated assets and liabilities include VIE assets and liabilities as follows (in thousands):

Risk-bearing Entities. At December 31, 2025, the Company operates 33 wholly owned risk-bearing entities (“RBEs”) for the purpose of entering into risk-bearing contracts with payors. Each RBE’s equity at risk is considered insufficient to finance its activities without additional support, and, therefore, each RBE is considered a VIE. The Company consolidates the RBEs as it has determined that it is the primary beneficiary because it has: (i) the ability to control the activities that most significantly impact the RBEs’ economic performance; and (ii) the obligation to absorb losses or right to receive benefits that could potentially be significant to the RBEs. Specifically, the Company has the unilateral ability and authority, through the RBE governance and management agreements, to make significant decisions about strategic and operating activities of the RBEs, including negotiating and entering into risk-bearing contracts with payors, and approving the RBEs’ annual operating budgets. The Company also has the obligation to fund losses of the RBEs and the right to receive a significant percentage of any financial surplus generated by the RBEs. The assets of the RBEs primarily consist of cash and cash equivalents, receivables, net, intangible assets, net, and other assets. Its obligations primarily consist of medical claims and related payables as well as operating expenses of the RBEs (accounts payable and accrued expenses), including incentive compensation obligations to the Company’s physician partners. On February 18, 2021, the Company executed the Credit Facility, which is guaranteed by certain of the Company’s VIEs. Assets generated by the RBEs (primarily from medical services revenues) may be used, in certain limited circumstances, to settle the Company’s contractual debt obligations.

Unconsolidated Variable Interest Entities

As of December 31, 2025, the Company had 11 equity method investments (liabilities), including nine wholly owned CMS ACO Models entities discussed below, that were deemed to be VIEs. The Company has determined that the activities that most significantly impact the performance of these VIEs consist of the allocation of resources to and other decisions related to clinical activities and provider contracting decisions. Because the Company does not have the ability to control these activities due to another party’s control of the VIEs’ board of directors, the Company has determined that it is not the primary beneficiary of and therefore does not consolidate these VIEs. The Company provided support to assist its CMS ACO Models investments in obtaining surety bonds related to risk-bearing capital contributions to CMS. As of December 31, 2025 and 2024, the CMS ACO Models investments had $131.6 million and $65.2 million, respectively, outstanding surety bonds. The Company's maximum loss exposure as a result of the Company’s involvement with the VIEs cannot be quantified as the Company has the obligation to provide ongoing operational support to the unconsolidated VIEs, as needed.

Equity Method Investments

The following table summarizes the Company’s equity method investees (in thousands):

(1)Included in Other assets, net in the consolidated balance sheets.

(2)Included in Other liabilities in the consolidated balance sheets.

The Company is a partner innine wholly owned CMS ACO Models investments in collaboration with 13 of its physician group partners operating in 12 geographies as of December 31, 2025. The combined summarized operating results of the Company’s CMS ACO Models investments, which are recognized as equity income (loss), are as follows (in thousands):

(1)The years ended December 31, 2025, 2024, and 2023, include physician compensation expenses of $58.9 million, $58.4 million, and $53.7 million, respectively. The year ended December 31, 2023, includes $15.2 million of physician compensation expenses to reduce the physician partners’ compensation percentage in current and future years in exchange for the Company’s common stock. The Company recognized such liability in accounts payable and accrued expenses as of December 31, 2023. The common stock shares were issued in February 2024.

(2)The years ended December 31, 2025, 2024, and 2023, include operating and administrative expenses for services provided by the Company of $50.1 million, $14.9 million, and $2.9 million, respectively.

(3)Included in Income (loss) from equity method investments in the condensed consolidated statements of operations.

The combined summarized balance sheet of the Company’s CMS ACO Models investments are as follows (in thousands):

NOTE 18. Related Party Transactions

Significant Stockholders

During the year ended December 31, 2023, the Company recognized general and administrative expenses of $1.7 million to administered secondary offerings of shares of its common stock sold by CD&R and did not receive any proceeds from any sale of shares of its common stock. CD&R controls Gentiva Health Services (“Gentiva”). Gentiva wholly owns Illumia Health, LLC (“Illumia”). For the year ended December 31, 2025, the Company incurred expenses of $8.4 million for provider services delivered by Illumia. As of December 31, 2025, the Company had an outstanding receivable from Illumia of $5.2 million. The Company has not entered into any other material transactions with CD&R for the periods presented.

Equity Method Investments

For the years ended December 31, 2025, 2024, and 2023, the Company incurred expenses of $7.0 million, $8.0 million, and $8.9 million, respectively for provider services delivered by Population Health, LLC, which is accounted for under the equity method based on a 49% equity ownership interest held by the Company. As of December 31, 2025 and 2024, the Company had an outstanding payable to Population Health, LLC of $0.6 million and $1.2 million, respectively.

For the years ended December 31, 2025, 2024, and 2023, the Company recognized revenue of $3.5 million, $3.9 million, and $1.6 million, respectively, for technology services rendered to its CMS ACO Models investments. For the years ended December 31, 2025, 2024, and 2023, the Company recognized other income of $50.1 million, $14.9 million, and $2.9 million, respectively, for operational and administrative services provided by the Company. As of December 31, 2025 and 2024, the Company had an outstanding receivable from the CMS ACO Models of $51.3 million and $7.0 million, respectively.

NOTE 19. Discontinued Operations

Discontinued operations is a component of an entity that has either been disposed of or is deemed held-for-sale and, (i) the operations and cash flows of the component have been or will be eliminated from ongoing operations as a result of the disposal transaction, and (ii) the entity will not have any significant continuing involvement in the operations of the component after the disposal transaction.

On October 31, 2023, the Company completed the disposition of MDX Hawaii and its related operations. The Company’s decision to exit Hawaii and the Independent Practice Association line of business represented a strategic shift that had a major effect on its operations and financial results. As such, the Company’s Hawaii operations are reflected in the consolidated financial statements as discontinued operations for all periods presented.

The results of discontinued operations are as follows (in thousands):

The following table provides significant non-cash operating items for discontinued operations that are included in the consolidated statements of cash flows (in thousands) for the year ended December 31, 2023: