Alignment Healthcare, Inc.

Previous wording

We have grown Health Plan Membership, which we define as members enrolled in our health maintenance organization ("HMO") and preferred provider organization ("PPO") contracts (the "Alignment Health Plan"), from approximately 13,000 members at inception to 294,100 members as of June 30, 2026, representing a 30% compound annual growth rate. Our ultimate goal is to bring this differentiated, advocacy-driven healthcare experience to millions of senior consumers in the United States and to become the most trusted senior healthcare brand in the country.

Current wording

We have grown Health Plan Membership, which we define as members enrolled in our health maintenance organization ("HMO") and preferred provider organization ("PPO") contracts (the "Alignment Health Plan"), from approximately 13,000 members at inception to 301,200 members as of September 30, 2026, representing a 30% compound annual growth rate. Our ultimate goal is to bring this differentiated, advocacy-driven healthcare experience to millions of senior consumers in the United States and to become the most trusted senior healthcare brand in the country.

Previous wording

For the 2026 plan year, Alignment offers plans in 45 markets across California (22 markets), North Carolina (16 markets), Nevada (2 markets), Arizona (3 markets) and Texas (2 markets). There are approximately 8.5 million Medicare-eligible seniors in our current markets.

Current wording

For the 2026 plan year, Alignment offers plans in 45 markets across California (22 markets), North Carolina (16 markets), Nevada (2 markets), Arizona (3 markets) and Texas (2 markets). There are approximately 8.6 million Medicare-eligible seniors in our current markets.

Previous wording

•Capitalize on Our Existing Market Growth Opportunity: Our ability to attract and retain members to grow in our existing markets depends on our ability to offer a superior value proposition. We routinely take market share from large established players in highly competitive markets, a key source of our health plan membership growth in excess of the industry average. We believe that there are still significant opportunities for future growth even in some of our most mature markets where we have approximately 10-30% market share. As of June 30, 2026, we have approximately 294,100 Health Plan Members, which, according to CMS data, represent only 6% market share of Medicare Advantage enrollees in our markets.

Current wording

•Capitalize on Our Existing Market Growth Opportunity: Our ability to attract and retain members to grow in our existing markets depends on our ability to offer a superior value proposition. We routinely take market share from large established players in highly competitive markets, a key source of our health plan membership growth in excess of the industry average. We believe that there are still significant opportunities for future growth even in some of our most mature markets where we have approximately 10-30% market share. As of September 30, 2026, we have approximately 301,200 Health Plan Members, which, according to CMS data, represent only 6% market share of Medicare Advantage enrollees in our markets.

Previous wording

•Provide Superior Service, Care and Consumer Satisfaction: We are highly focused on providing superior service and care to our members and on maintaining high levels of consumer satisfaction, which are key to our financial performance and growth. The CMS Five Star Quality Rating System provides economic incentives to Medicare Advantage plans that achieve higher Star ratings by (i) meeting certain care criteria (such as completing particular preventative screening procedures or ensuring proper follow-up care is provided for specific conditions or episodes) and (ii) receiving high member satisfaction ratings. These incentives impact financial performance in the year following the CMS Rating Year (for example, CMS’s announcement of the 2026 Ratings occurred in the second half of 2025 and will impact our financial performance in 2027). One hundred percent of our health plan members are enrolled in plans rated 4 stars and above, meaning our members consistently receive a high-quality care experience, as defined under CMS star measurement criteria. The California HMO plan has achieved a 4 star or greater rating for nine consecutive years.

Current wording

•Provide Superior Service, Care and Consumer Satisfaction: We are highly focused on providing superior service and care to our members and on maintaining high levels of consumer satisfaction, which are important drivers of our financial performance and growth. The CMS Five Star Quality Rating System provides economic incentives to Medicare Advantage plans that achieve Star ratings of 4.0 or higher by (i) meeting certain care criteria (such as completing particular preventative screening procedures or ensuring proper follow-up care is provided for specific conditions or episodes) and (ii) receiving high member satisfaction ratings. These incentives impact financial performance in the year following the CMS Rating Year (for example, CMS’s announcement of the 2027 Ratings occurred in the second half of 2026 and will impact our financial performance in 2028). As of the current 2026 rating year, one hundred percent of our health plan members are enrolled in plans rated 4 stars and above. With respect to the 2027 rating year, CMS recently announced that the Company’s California HMO health plan contract (H3815), which serves approximately 75% of the Company’s health plan membership, was awarded a 3.5-Star Rating. The Company retained a 4.0-Star or higher rating in each of its six other eligible plans, including three plans that achieved a 4.5-Star Rating, for the 2027 rating year. The Company has and will continue to implement enterprise-wide initiatives, including to enhance member and provider engagement, expand care gap closure programs and provide additional quality oversight. The Company believes these actions will strengthen its business and position H3815 to return to at least a 4.0-Star rating in future rating years. The Company has commenced litigation challenging certain Star Ratings measures and methodologies that it believes are inconsistent with applicable law and CMS’s statutory authority.

Previous wording

(1)Amortization expense for the six months ended June 30, 2025 includes $0.6 million in impairment expense related to the remeasurement of goodwill associated with one of our subsidiaries. There was no impairment expense for the three months ended June 30, 2025.

Current wording

(1)Amortization expense for the nine months ended September 30, 2025 includes $0.6 million in impairment expense related to the remeasurement of goodwill associated with one of our subsidiaries. There was no impairment expense for the three months ended September 30, 2025.

Previous wording

(1)Amortization expense for the six months ended June 30, 2025 includes $0.6 million in impairment expense related to the remeasurement of goodwill associated with one of our subsidiaries. There was no impairment expense for the three months ended June 30, 2025.

Current wording

(1)Amortization expense for the nine months ended September 30, 2025 includes $0.6 million in impairment expense related to the remeasurement of goodwill associated with one of our subsidiaries. There was no impairment expense for the three months ended September 30, 2025.

Previous wording

Earned Premiums. Earned premium revenues were $1,326.6 million and $1,006.2 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $320.4 million or 31.8%. Earned premium revenues were $2,553.2 million and $1,924.2 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $628.9 million or

Current wording

Earned Premiums. Earned premium revenues were $1,348.3 million and $983.7 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $364.6 million or 37.1%. Earned premium revenues were $3,901.4 million and $2,907.9 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of

Previous wording

32.7%. The increase was primarily driven by growth in our Health Plan membership, which increased 31.5% between June 30, 2025 and June 30, 2026.

Current wording

$993.5 million or 34.2%. The increase was primarily driven by growth in our Health Plan membership, which increased 31.2% between September 30, 2025 and September 30, 2026.

Previous wording

Other Revenue. Other revenue decreased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, a decrease of 0.8%. Other revenue decreased $0.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025, a decrease of 1.9%. The decrease is mainly attributable to the Company no longer participating in the ACO Reach program and a decrease in revenue from services provided to third-party providers. This decrease was offset by an increase in our average interest earning cash balances and current investments. Cash and cash equivalents, and other current investments were $701.7 million as of June 30, 2026 compared to $503.7 million as of June 30, 2025.

Current wording

Other Revenue. Other revenue increased $0.02 million for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, an increase of 0.2%. Other revenue decreased $0.3 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025, a decrease of 1.1%. For the three and nine months ended September 30, 2026, other revenue decreased as a result of the Company no longer participating in the ACO Reach program and a decrease in revenue from services provided to third-party providers. This decrease was offset by an increase in our average interest earning cash balances and current investments. Cash and cash equivalents, and other current investments were $743.0 million as of September 30, 2026 compared to $644.1 million as of September 30, 2025.

Previous wording

Medical Expenses Medical expenses were $1,154.7 million and $881.7 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $272.9 million, or 31.0%. Medical expenses were $2,245.4 million and $1,702.6 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $542.8 million, or 31.9%. The increase was driven primarily by the growth in Alignment’s Health Plan membership, which increased 31.5% between June 30, 2025 and June 30, 2026 The increase was also due to higher benefits for members in certain plans and an increase in unit costs.

Current wording

Medical Expenses. Medical expenses were $1,217.6 million and $868.0 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $349.6 million, or 40.3%. Medical expenses were $3,463.0 million and $2,570.7 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $892.3 million, or 34.7%. The increase was driven primarily by the growth in Alignment’s Health Plan membership, which increased 31.2% between September 30, 2025 and September 30, 2026. The increase was also due to medical cost trends that were higher than expected in certain cost categories.

Previous wording

Selling, General and Administrative Expenses. Selling, general and administrative expenses were $131.0 million and $103.8 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $27.2 million, or 26.2%. Selling, general and administrative expenses were $252.1 million and $207.6 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $44.5 million, or 21.4%. The increase was primarily due to an increase in ongoing investments and expenditures in operations, technology, network development, and sales and marketing to drive the growth of Alignment's Health Plan membership. Selling, general, and administrative expenses as a percentage of revenue decreased from 10.2% to 9.8% for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, and from 10.7% to 9.8% for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The decrease as a percentage of revenues is mainly attributable to economies of scale gained from Alignment's membership growth.

Current wording

Selling, General and Administrative Expenses. Selling, general and administrative expenses were $136.4 million and $110.0 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $26.4 million, or 24.0%. Selling, general and administrative expenses were $388.5 million and $317.6 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $70.9 million, or 22.3%. The increase was primarily due to an increase in ongoing investments and expenditures in operations, technology, network development, and sales and marketing to drive the growth of Alignment's Health Plan membership. Selling, general, and administrative expenses as a percentage of revenue decreased from 11.1% to 10.0% for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, and from 10.8% to 9.9% for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The decrease as a percentage of revenues is mainly attributable to economies of scale gained from Alignment's membership growth.

Previous wording

Depreciation and Amortization. Depreciation and amortization expense was $7.9 million and $7.0 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $0.9 million, or 12.2%. Depreciation and amortization expense was $15.7 million and $14.6 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $1.1 million, or 7.5%. The increase was primarily due to the amount and timing of our capital expenditures and the associated depreciation relative to 2025. The six month increase was offset by a decrease in amortization expense. For the six months ended June 30, 2025, we recorded impairment expense of $0.6 million related to the remeasurement of goodwill associated with one of our subsidiaries. The goodwill impairment was recorded to amortization expense.

Current wording

Depreciation and Amortization. Depreciation and amortization expense was $8.1 million and $8.0 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $0.1 million, or 1.6%. Depreciation and amortization expense was $23.8 million and $22.6 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $1.2 million, or 5.4%. The increase was primarily due to the amount and timing of our capital expenditures and the associated depreciation relative to 2025. The nine-month increase was offset by a decrease in amortization expense. For the nine months ended September 30, 2025, we recorded impairment expense of $0.6 million related to the remeasurement of goodwill associated with one of our subsidiaries. The goodwill impairment was recorded to amortization expense.

Previous wording

Interest expense. Interest expense was $4.3 million and $4.0 million for the three months ended June 30, 2026 and 2025, respectively, an increase of $0.3 million or 7.5%. Interest expense was $8.3 million and $7.9 million for the six months ended June 30, 2026 and 2025, respectively, an increase of $0.4 million or 5.1%. The increase in interest expense was mainly attributable to an increase in debt issuance cost amortization related to the Revolving Credit Facility that was entered into in February 2026.

Current wording

Interest expense. Interest expense was $4.3 million and $4.0 million for the three months ended September 30, 2026 and 2025, respectively, an increase of $0.3 million or 7.5%. Interest expense was $12.6 million and $11.9 million for the nine months ended September 30, 2026 and 2025, respectively, an increase of $0.7 million or 5.9%. The increase in interest expense was mainly attributable to an increase in debt issuance cost amortization related to the Revolving Credit Facility that was entered into in February 2026.

Previous wording

Other income, net. Other income was $0.0 million and $0.1 million for the three months ended June 30, 2026 and 2025, respectively. Other income was $0.0 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively. The decrease was mainly attributable to gains on the sale of property and equipment during the three and six months ended June 30, 2025 that did not recur in 2026.

Current wording

Other income, net. Other income was $0.0 million and $0.0 million for the three months ended September 30, 2026 and 2025, respectively. Other income was $0.0 million and $0.1 million for the nine months ended September 30, 2026 and 2025, respectively. The decrease was mainly attributable to gains on the sale of property and equipment during the nine months ended September 30, 2025 that did not recur in 2026.

Previous wording

To date, we have financed our operations principally through our IPO, private placements of our equity securities, revenues, and convertible notes (described below). As of June 30, 2026, we had $701.7 million in cash, cash equivalents and short-term investments.

Current wording

To date, we have financed our operations principally through our IPO, private placements of our equity securities, revenues, and convertible notes (described below). As of September 30, 2026, we had $743.0 million in cash, cash equivalents and short-term investments.

Previous wording

We operate as a holding company in a highly regulated industry. Alignment Healthcare, Inc., the parent company, is dependent upon dividends and administrative expense reimbursements from our subsidiaries, most of which are subject to regulatory restrictions. We maintain significant levels of aggregate excess statutory capital and surplus in our state-regulated operating subsidiaries. As of June 30, 2026, the operating parent company (an indirect wholly owned subsidiary of the parent company) had $135.4 million in cash, cash equivalents and short-term investments.

Current wording

We operate as a holding company in a highly regulated industry. Alignment Healthcare, Inc., the parent company, is dependent upon dividends and administrative expense reimbursements from our subsidiaries, most of which are subject to regulatory restrictions. We maintain significant levels of aggregate excess statutory capital and surplus in our state-regulated operating subsidiaries. As of September 30, 2026, the operating parent company (an indirect wholly owned subsidiary of the parent company) had $140.6 million in cash, cash equivalents and short-term investments.

Previous wording

Certain states in which we operate as a CMS-licensed Medicare Advantage company may require us to meet certain capital adequacy performance standards and tests. The National Association of Insurance Commissioners has adopted rules which, if implemented by the states, set minimum capitalization requirements for insurance companies, HMOs, and other entities bearing risk for healthcare coverage. The requirements take the form of risk-based capital (“RBC”) rules, which may vary from state to state. Certain states in which our health plans or risk bearing entities operate have adopted the RBC rules. Other states in which our health plans or risk bearing entities operate have chosen not to adopt the RBC rules, but instead have designed and implemented their own rules regarding capital adequacy, such as the tangible net equity ("TNE") requirements for our health plans in California. As of June 30, 2026, our health plans or risk-bearing entities were in compliance with the minimum capital requirements.

Current wording

Certain states in which we operate as a CMS-licensed Medicare Advantage company may require us to meet certain capital adequacy performance standards and tests. The National Association of Insurance Commissioners has adopted rules which, if implemented by the states, set minimum capitalization requirements for insurance companies, HMOs, and other entities bearing risk for healthcare coverage. The requirements take the form of risk-based capital (“RBC”) rules, which may vary from state to state. Certain states in which our health plans or risk bearing entities operate have adopted the RBC rules.

Previous wording

On November 22, 2024 (the "Effective Date"), the Company completed the sale of $330.0 million of its 4.25% Convertible Senior Notes (the "Notes"). The Notes were issued pursuant to an indenture (the "Indenture"), dated as of November 22, 2024, between the Company and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"). The Notes are senior, unsecured obligations of the Company, and interest will be payable semi-annually in arrears at a rate of 4.25% per annum beginning on May 15, 2025. The Notes will mature on November 15, 2029, unless earlier repurchased, redeemed or converted in accordance with their terms. The net cash proceeds from the sale of the Notes was approximately $321.1 million, after subtracting fees, discounts and estimated expenses in connection with the transaction.

Current wording

On November 22, 2024, the Company completed the sale of $330.0 million of its 4.25% Convertible Senior Notes (the "Notes"). The Notes were issued pursuant to an indenture (the "Indenture"), dated as of November 22, 2024, between the Company and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"). The Notes are senior, unsecured obligations of the Company, and interest will be payable semi-annually in arrears at a rate of 4.25% per annum beginning on May 15, 2025. The Notes will mature on November 15, 2029, unless earlier repurchased, redeemed or converted in accordance with their terms. The net cash proceeds from the sale of the Notes was approximately $321.1 million, after subtracting fees, discounts and estimated expenses in connection with the transaction.

Previous wording

For the six months ended June 30, 2026, net cash provided by operating activities was $111.4 million, an increase of $65.6 million compared to net cash provided by operating activities of $45.7 million for the six months ended June 30, 2025. The increase is mainly attributable to an increase in membership and net income and the timing of accounts receivable settlements. This increase was partially offset by the timing of our medical expense payments and an increase in accrued compensation and prepaid expenses and other current assets.

Current wording

For the nine months ended September 30, 2026, net cash provided by operating activities was $158.4 million, a decrease of $31.9 million compared to net cash provided by operating activities of $190.3 million for the nine months ended September 30, 2025. The decrease is mainly attributable to the timing of our medical expense payments in the third quarter of 2026 compared to the third quarter of 2025 and an increase in accrued compensation and prepaid expenses and other current assets. The decrease was partially offset by an increase in net income and timing of accounts receivable settlements.

Previous wording

For the six months ended June 30, 2026, net cash provided by investing activities was $3.0 million, an increase of $13.1 million compared to net cash used in investing activities of $10.1 million for the six months ended June 30, 2025. The increase primarily relates to a decrease in investment purchases during the six months ended June 30, 2026. This increase was partially offset by a decrease in investment maturities.

Current wording

For the nine months ended September 30, 2026, net cash used in investing activities was $12.3 million, an increase of $4.5 million compared to net cash used in investing activities of $7.8 million for the nine months ended September 30, 2025. The increase primarily relates to a decrease in investment maturities and an increase in capital expenditures for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The increase was partially offset by a decrease in investment purchases.

Previous wording

For the six months ended June 30, 2026, net cash provided by financing activities was $3.3 million, an increase of $1.5 million, compared to net cash provided by financing activities of $1.8 million for the six months ended June 30, 2025. The increase is primarily attributable to an increase in proceeds from stock option exercises for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was offset by an increase in debt issuance costs related to the revolving credit facility.

Current wording

For the nine months ended September 30, 2026, net cash provided by financing activities was $5.8 million, an increase of $3.1 million, compared to net cash provided by financing activities of $2.7 million for the nine months ended September 30, 2025. The increase is primarily attributable to an increase in proceeds from stock option exercises for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. This increase was offset by an increase in debt issuance costs related to the revolving credit facility.

Previous wording

See Note 2 to our condensed consolidated financial statements, “Summary of Significant Accounting Policies—Recent Accounting Pronouncements Adopted” for more information.

Current wording

See Note 2 to our condensed consolidated financial statements, “Summary of Significant Accounting Policies—Recent Accounting Pronouncements Issued” for more information.