Ardent Health, Inc.

September 30, 2026

(Unaudited)

1. Description of the Business and Basis of Presentation

Reporting Entity

Ardent Health, Inc. was initially formed in Delaware in 2015 as Ardent Health Partners, LLC. On July 17, 2024, Ardent

Health Partners, LLC converted from a Delaware limited liability company into a Delaware corporationin connection with its

initial public offering and changed its name to Ardent Health Partners, Inc. On June 3, 2025, Ardent Health Partners, Inc.

changed its name to Ardent Health, Inc. Ardent Health, Inc. is a holding company that has affiliates that operate acute care

hospitals and other healthcare facilities and employ physicians. The terms "Ardent," the "Company," "we," "our" and "us," as

used in these notes to the unaudited condensed consolidated financial statements, refer to Ardent Health, Inc. and its affiliates

unless stated otherwise or indicated by context. The term "affiliates" includes direct and indirect subsidiaries of Ardent and

partnerships and joint ventures in which such subsidiaries are equity owners. At September 30, 2026, the Company operated

30 acute care hospitals insix states, includingone managed hospital, two rehabilitation hospitals andtwo surgical hospitals.

Basis of Presentation

The financial statements include the unaudited condensed consolidated balance sheets, income statements, comprehensive

income (loss) statements, statements of cash flows and statements of changes in equity of the Company and its affiliates,

which are controlled by the Company through the Company's direct or indirect ownership of a majority equity interest and

rights granted to the Company through certain variable interests. All intercompany balances and transactions have been

eliminated in consolidation. In the opinion of management, all adjustments, which consist of normal recurring adjustments,

and disclosures considered necessary for a fair presentation have been included.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S.

generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q

and Rule 10-01 of Regulation S-X. Certain information and disclosures normally included in annual financial statements

presented in accordance with GAAP have been omitted in these interim financial statements pursuant to rules and regulations

of the Securities and Exchange Commission ("SEC"). Accordingly, these unaudited condensed consolidated financial

statements and related notes should be read in conjunction with the Company's audited consolidated financial statements and

notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025 (the"Annual

Report").

General and Administrative Costs

The majority of the Company's expenses are "cost of revenue" items. Costs that could be classified as general and

administrative by the Company include its corporate office costs and centralized corporate services, such as human resources,

information technology, and finance, which were$42.4 million and$36.5 million for the three months ended September 30,

2026 and 2025, respectively, and$152.2 million and$104.0 million for thenine months ended September 30, 2026 and 2025,

respectively. The increase in general and administrative costs for thenine months ended September 30, 2026 compared to the

prior year period was primarily attributable to increased salaries and benefits expense related to non-recurring severance costs

incurred for workforce reductions in connection with enterprise restructuring activity and transition of the Company's former

chief executive officer during the current period.

2. Summary of Significant Accounting Policies

Recent Accounting Pronouncements Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU")

2024-03, Disaggregation of Income Statement Expenses("ASU 2024-03"), which requires the disclosure of certain

disaggregated expenses within the notes to the financial statements. ASU 2024-03 is effective for annual periods beginning

after December 15, 2026, and interim reporting periods within fiscal years beginning after December 15, 2027. Adoption of

ASU 2024-03 can either be applied prospectively to consolidated financial statements issued for reporting periods after the

effective date of this standard or retrospectively to any or all prior periods presented in the consolidated financial statements.

Early adoption is also permitted. The Company is currently evaluating the standard to determine its impact on the Company’s

disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Topic 350):

Targeted Improvements to the Accounting for Internal-Use Software("ASU 2025-06"), which modernizes the current

internal-use software accounting guidance by removing all references to software project development stages. Under ASU

2025-06, an entity begins capitalizing software costs when (i) management has implicitly or explicitly authorized and

committed to funding a computer software project and (ii) it is probable the project will be completed and the software will

be used to perform the function intended (referred to as the"probable-to-complete recognition threshold"). This ASU is

effective for annual reporting periods beginning after December 15, 2027, and interim periods within those annual reporting

periods, with early adoption permitted. The Company is currently evaluating the standard to determine its impact on the

Company's disclosures.

Variable Interest Entities

Variable interest entities ("VIEs") must be consolidated if an entity’s interest in the VIE is a controlling financial interest.

Under the variable interest model, a controlling financial interest is determined based on which entity, if any, has (i) the

power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and (ii) the

obligation to absorb the losses, or the right to receive the benefits, from the VIE that could potentially be significant to the

VIE.

The Company performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company's

involvement with a VIE could cause the Company's consolidation conclusion to change. The consolidation status of the VIEs

with which the Company is involved may change as a result of such reassessments. Changes in consolidation status are

applied prospectively.

The Company, through its wholly-owned subsidiaries, owns majority interests in certain limited liability companies

("LLCs"), with each LLC owning and operating one or more hospitals. The noncontrolling interest is typically owned by a

not-for-profit medical system, university, academic medical center or foundation or combination thereof (individually or

collectively referred to as "minority member"). The employees that work for the LLC and the related hospital(s) are

employees of the Company, and the Company manages the day-to-day operations of the LLC and the hospital(s) pursuant to

a management services agreement ("MSA").

The LLCs are VIEs due to their structure as LLCs and the control that resides with the Company through the MSA. The

Company consolidates each of these LLCs as it is considered the primary beneficiary due to the MSA providing the

Company the right to direct the day-to-day operating and capital activities of the LLC and the respective hospital(s) that most

significantly impact the LLC’s economic performance. Additionally, the Company would absorb a majority of the entity's

expected losses, receive a majority of the entity's expected residual returns, or both, as a result of its majority ownership,

contractual or other financial interests in the entity. The MSAs are subject to termination only by mutual agreement of the

Company and minority member, except in the case of gross negligence, fraud or bankruptcy of the Company, in which case

the minority member can force termination of the MSA.

All of the Company's VIEs meet the definition of a business, and the Company holds a majority of their issued voting equity

interests. Their assets are not required to be used only for the settlement of VIE obligations as the Company has the ability to

direct the use of the VIE assets through its joint venture and cash management agreements.

The governance rights of the minority members are restricted to those that protect their financial interests and do not preclude

consolidation of the LLCs. The rights of minority members generally are limited to such items as the right to approve the

issuance of new ownership interests, calls for additional cash contributions, the acquisition or divestiture of significant assets

and the incurrence of debt in excess of levels not expected to be incurred in the normal course of business.

As of September 30, 2026 and December 31, 2025, nine of the Company's hospitals were owned and operated through LLCs

that have been determined to be VIEs and were consolidated by the Company. Consolidated assets at September 30, 2026 and

December 31, 2025 included total assets of VIEs equal to$1.3 billion. The Company's VIEs do not have creditors that have

recourse to the Company. As the structure and nature of business are very similar for each of the LLCs, they are discussed

and presented herein on a combined basis.

The total liabilities of VIEs included in the Company's unaudited condensed consolidated balance sheets are shown below (in

Income from operations before income taxes attributable to VIEs was$61.3 million and$75.7 million for the three months

ended September 30, 2026 and 2025, respectively, and$181.9 million and$206.3 million for thenine months ended

September 30, 2026 and 2025, respectively.

Accounting Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and judgments

that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. On

an ongoing basis, the Company evaluates its estimates. The Company bases its estimates on historical experience and on

various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for

making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual

results may differ from these estimates.

Revenue Recognition

Overview

The Company's revenue generally relates to contracts with patients in which its performance obligations are to provide

healthcare services to the patients. Revenue is recorded during the period the Company's obligations to provide healthcare

services are satisfied. Revenue for performance obligations satisfied over time is recognized based on charges incurred in

relation to total expected charges. The Company's performance obligations for inpatient services are generally satisfied over

periods that average approximately five days. The Company's performance obligations for outpatient services are generally

satisfied over a period of less thanone day. As the Company's performance obligations relate to contracts with a duration of

one year or less, the Company elected the optional exemption and, therefore, is not required to disclose the transaction price

for the remaining performance obligations at the end of the reporting period or when the Company expects to recognize

revenue. Additionally, the Company is not required to adjust the consideration for the existence of a significant financing

component when the period between the transfer of the services and the payment for such services is one year or less.

Change in Accounting Estimate

hindsight evaluations of historical collection trends resulted in a decrease in revenue of$42.6 million. During the three

months ended September 30, 2025, the Company implemented a new revenue accounting system that provided management

with additional information to more precisely estimate the collectability of accounts receivable, particularly with respect to

more timely consideration of payor denial and payment trends. The detailed information provided by the new system during

the three months ended September 30, 2025, along with the Company's recently completed analysis of historical collection

trends, indicated the current collection estimate differed from historical collection estimates thereby resulting in a change in

accounting estimate in accordance with ASC 250-10, Accounting Changes and Error Corrections, to be accounted for during

the three months ended September 30, 2025 (the period of change).

Contractual Adjustments, Discounts and Cost Report Settlements

Contractual relationships with patients, in most cases, involve a third party payor (Medicare, Medicaid and managed care

health plans), and the transaction prices for services provided are dependent upon the terms provided by (Medicare and

Medicaid) or negotiated with (managed care health plans) the third party payors. The payment arrangements with third party

payors for the services provided to the related patients typically specify payments at amounts less than the Company's

standard charges.

The Company's revenue is based upon the estimated amounts the Company expects to be entitled to receive from patients and

third party payors. Estimates of contractual adjustments under managed care insurance plans are based upon the contractual

payment terms specified in the related contractual agreements and the historical collection experience of each payor. Revenue

related to uninsured patients and copayment and deductible amounts for patients who have healthcare coverage may have

discounts applied (uninsured discounts and other discounts). The Company also records estimated implicit price concessions

(based primarily on historical collection experience) related to uninsured accounts to record self-pay revenue at the estimated

amounts expected to be collected.

Medicare and Medicaid regulations and various managed care contracts, under which the discounts from the Company's

standard charges must be calculated, are complex and subject to interpretation and adjustment. The classification and

documentation of healthcare services, as well as the medical necessity of the services authorized and provided, are also often

subject to interpretation. The Company estimates contractual adjustments on a payor-specific basis based on its interpretation

of the applicable regulations or contract terms and the historical collection experience of each payor, and these

interpretations may result in payments that differ from the Company's estimates. Because updated regulations and contract

renegotiations occur frequently, management continually reviews and assesses these estimates.

Final determination of amounts earned under Medicare, Medicaid and other third party payor programs often occurs in

subsequent years because of audits by the programs, rights of appeal, and the application of technical provisions. Estimated

reimbursement amounts, which are recorded within net patient service revenue in the period in which the related services are

rendered, are adjusted in subsequent periods as determined (in relation to certain government programs, primarily Medicare,

this is generally referred to as the "cost report" filing and settlement process). Differences between original estimates and

subsequent revisions, including final settlements, are recorded as adjustments to net patient service revenue in the period in

which such revisions become known. These adjustments resulted inan increase to net patient service revenue of$15.6

million and$4.5 million for the three months ended September 30, 2026 and 2025, respectively, andan increase to net patient

service revenue of$18.0 million and$13.7 million for thenine months ended September 30, 2026 and 2025, respectively.

At September 30, 2026 and December 31, 2025, the Company's settlements under reimbursement agreements with third party

payors were a net receivable of$13.3 million and a net payable of$7.8 million, respectively, reflecting a receivable of$29.8

million and$21.1 million, respectively, included in other current assets and a payable of$16.5 million and$28.9 million,

respectively, included in other accrued expenses and liabilities in the unaudited condensed consolidated balance sheets.

Amounts earned under prospective payment and other reimbursement activities remain subject to review by appropriate

governmental authorities or their agents. In the opinion of the Company's management, adequate provision has been made for

any adjustments that may result from such reviews.

Subsequent adjustments that are determined to be the result of an adverse change in the patient's or the payor's ability to pay

are recognized as bad debt expense. Bad debt expense for thethree and nine months ended September 30, 2026 and 2025 was

not material to the Company.

Currently, several states in which the Company operates utilize Medicaid supplemental payment programs for the purpose of

providing reimbursement to providers to offset a portion of the cost of providing care to Medicaid and indigent patients.

These programs, which are designed with input from and are subject to approval and periodic renewal by the Centers for

Medicare & Medicaid Services ("CMS"), are funded by a combination of state and federal resources, including, in certain

instances, fees or taxes levied on the providers. Under these supplemental programs, the Company recognizes revenue in the

period in which amounts are estimable and collection is reasonably assured such that a significant reversal of cumulative

revenue is not probable in the future. The Company recognizes supplemental program expenses in the period to which they

relate. Reimbursements under these programs are reflected in total revenue, and taxes or other program-related costs are

included in other operating expenses.

Payor Mix

The Company's total revenue is presented in the following table (dollars in thousands):

Charity Care

The Company provides care without charge to certain patients who qualify under the local charity care policy of the hospital

where the patient receives services. The Company estimates that its costs of care provided under its charity care programs

approximated$7.4 million and$6.4 million for the three months ended September 30, 2026 and 2025, respectively, and

$22.7 million and$50.2 million for thenine months ended September 30, 2026 and 2025, respectively. The Company does

not report a charity care patient's charges in revenue as it is the Company's policy not to pursue collection of amounts related

to these patients, and therefore contracts with these patients do not exist.

The Company's management estimates its costs of care provided under its charity care programs utilizing a calculated ratio of

costs to gross charges multiplied by the Company's gross charity care charges provided. The Company's gross charity care

charges include only services provided to patients who are unable to pay and qualify under the Company's local charity care

policies. To the extent the Company receives reimbursement through the various governmental assistance programs in which

it participates to subsidize its care of indigent patients, the Company does not include these patients' charges in its cost of care

provided under its charity care program.

Market Risks

The Company's revenue is subject to potential regulatory and economic changes in certain states where the Company

generates significant revenue. The following is an analysis by state of revenue as a percentage of the Company's total revenue

for those states in which the Company generates significant revenue:

Acquisitions

Acquisitions are accounted for using the acquisition method of accounting and the results of operations are included in the

unaudited condensed consolidated income statement from the respective dates of acquisition. The purchase price of these

transactions is allocated to the assets acquired, liabilities assumed, and, if applicable, noncontrolling interests based upon

their respective fair values as of the acquisition date. Provisional amounts may be adjusted during the measurement period as

additional information is obtained about facts and circumstances that existed as of the acquisition date. The measurement

period ends when the Company receives the information necessary to finalize the accounting, but may not exceed one year

from the acquisition date. The Company records the excess of the purchase price allocation over those fair values as

goodwill.

Divestitures

On September 28, 2026, the Company entered into a definitive agreement to sell its 70.5% equity interest in The University

of Kansas Health System – St. Francis Campus ("St. Francis") to the University of Kansas Hospital Authority for

$58.4 million. The sale is expected to close in the fourth quarter of 2026, subject to customary closing conditions. The results

of operations for St. Francis until the effective date of the sale are classified as part of continuing operations as the disposal

group did not meet the criteria for reporting as a discontinued operation.

The assets and liabilities of St. Francis were classified as held for sale within current assets and current liabilities on the

condensed consolidated balance sheet at September 30, 2026. Prior period amounts were not reclassified. The following table

presents the major classes of assets and liabilities of the held for sale disposal group (in thousands):

Investments in Equity Securities

The Company holds an option to acquire equity securities of a privately held company (the "Investment"), and the Investment

does not have a readily determinable fair value. The Company has elected to account for the Investment using the

measurement alternative. Under the measurement alternative, an investment is recorded at cost, less impairment, if any, and

adjusted for observable price changes in orderly transactions involving identical or similar equity securities of the same

issuer. The Investment is measured at fair value on a non-recurring basis as of the date observable price changes occur. Its

fair value is categorized as Level 2 within the fair value hierarchy because the valuation methods use inputs that are primarily

observable, such as the transaction price, and any unobservable inputs are not considered significant. Recording upward or

downward adjustments to the carrying value of the Investment as a result of observable price changes requires quantitative

assessments of the fair value using various valuation methodologies and involves the use of estimates.

During thefirst quarter of 2026, the Company recorded an upward adjustment of$10.9 million to the carrying value of the

Investment based on observable price changes in the form of equity financings of the privately held company. During the

third quarter of 2026, the Company acquired equity in the privately held company by partially exercising approximately 44%

of the option and concurrently sold the acquired equity for net proceeds of$9.6 million. The Company has not recognized

any impairments or downward adjustments related to the Investment.

The following is a summary of unrealized and realized gains on the Investment recognized during thethree and nine months

ended September 30, 2026 and 2025 (in thousands):

Unrealized and realized gains and losses on the Investment are recorded within other operating expenses on the condensed

consolidated income statements, and the carrying value of the Investment is recorded within other assets on the condensed

consolidated balance sheets. As of September 30, 2026, the carrying value of the remaining Investment was$13.6 million,

inclusive of$9.2 million of cumulative upward adjustments. As of December 31, 2025, the carrying value of the Investment

was$7.9 million.

Fair Value of Financial Instruments

Cash and cash equivalents, accounts receivable, inventories, prepaid expenses, other current assets, accounts payable, accrued

salaries and benefits, accrued interest and other accrued expenses and current liabilities (other than those pertaining to lease

liabilities) are reflected in the accompanying unaudited condensed consolidated financial statements at amounts that

approximate fair value because of the short-term nature of these instruments. The fair value of the Company’s revolving

credit facility also approximates its carrying value as it bears interest at current market rates. Refer to Note 5, Interest Rate

Swap Agreements, for discussion of the fair value measurement of the Company’s derivative instruments.

The carrying amounts and fair values of the Company’s senior secured term loan facility and its 5.75% Senior Notes due

2029 (the"5.75% Senior Notes") were as follows (in thousands):

The estimated fair values of the Company’s senior secured term loan facility and the 5.75% Senior Notes were based upon

quoted market prices at that date and are categorized as Level 2 within the fair value hierarchy.

Noncontrolling Interests

The financial statements include the financial position and results of operations of hospital and healthcare operations in which

the Company owned less than 100% of the equity interests, but maintained a controlling interest during the presented periods.

Earnings or losses attributable to the noncontrolling interests are presented separately in the consolidated income statements.

Holders of noncontrolling interests are considered to be equity holders in the consolidated company, pursuant to which

noncontrolling interests are classified as part of equity, unless the noncontrolling interests are redeemable. Certain redemptive

features associated with the noncontrolling interests for St. Francis could require the Company to deliver cash if the

redemptive features are exercised. These redemptive features could be exercised upon, among other things, the Company's

exclusion or suspension from participation in any federal or state government healthcare payor program. Therefore, the

noncontrolling interests balance for St. Francis is classified outside the permanent equity section of the Company's unaudited

condensed consolidated balance sheets.

The redeemable noncontrolling interests related to St. Francis have not been subsequently measured at fair value since the

acquisition date in 2017. The noncontrolling interests are not currently redeemable and it is not probable that the

noncontrolling interests will become redeemable as the possibility of the Company being excluded or suspended from

participation in any federal or state government healthcare payor program is remote.

Earnings Per Share

Basic netincome (loss) per share is computed by dividing netincome (loss) available to common stockholders by the

weighted-average common shares outstanding during the period. Diluted netincome (loss) per share takes into account the

potential dilution that could occur if securities or other contracts to issue shares, such as unvested restricted stock units, were

exercised and converted into shares. Diluted netincome (loss) per share is computed by dividing netincome (loss) available

to common stockholders by the weighted-average common shares outstanding during the period, increased by the number of

additional shares that would have been outstanding if the potential shares had been issued and were dilutive.

3. Related Party Transactions

Effective August 4, 2015, Ventas, Inc. ("Ventas"), through certain wholly-owned affiliates, acquired ownership of the

Company's real estate in exchange for a$1.4 billion payment from Ventas and the Company's agreement to lease the acquired

real estate back from Ventas (the "Ventas Master Lease"). The Ventas Master Lease is a 20-year master lease agreement

(with a renewal option for an additional 10 years) with certain subsidiaries of Ventas, pursuant to which the Company

currently leases 10 of the Company's hospitals. The Ventas Master Lease includes an annual rent escalator equal to the lesser

of four times the Consumer Price Index or 2.5%. Variable lease payments are excluded from the Company's minimum rental

payments used to determine the right-of-use assets and lease obligations and are recognized as expense when incurred. The

Ventas Master Lease includes a number of operating and financial restrictions on the Company. Management believes the

Company was in compliance with all financial covenants as of September 30, 2026.

The Company recorded rent expense related to the Ventas Master Lease and other lease agreements with Ventas for certain

medical office buildings of$39.0 million and$38.1 million for the three months ended September 30, 2026 and 2025,

respectively, and$116.4 million and$114.0 million for thenine months ended September 30, 2026 and 2025, respectively.

4. Long-Term Debt and Financing Matters

The Company's long-term debt consists of the following (in thousands):

5. Interest Rate Swap Agreements

Market risks relating to the Company's operations result primarily from changes in interest rates. The Company's exposure to

interest rate risk results from the entry into financial debt instruments that arose from transactions entered into during the

normal course of business. As part of an overall risk management program, the Company evaluates and manages exposure to

changes in interest rates on an ongoing basis. The Company has no intention of entering into financial derivative contracts,

other than to hedge a specific financial risk. To mitigate the Company's exposure to fluctuations in interest rates, the

Company uses pay-fixed interest rate swaps, which are designated as cash flow hedges of interest payments on floating rate

borrowings. Pay-fixed swaps effectively convert floating-rate borrowings to fixed-rate borrowings. Unrealized gains or losses

from the designated cash flow hedges and related tax effects are deferred in accumulated other comprehensive income

("AOCI") and recognized in earnings as the interest payments occur. The Company performs assessments of effectiveness for

its cash flow hedges on a quarterly basis to confirm that the hedges continue to meet the highly effective criteria required to

apply hedge accounting. Hedges and derivative financial instruments may continue to be used in the future in order to

manage interest rate exposure.

The valuation of these interest rate swap instruments is determined using widely accepted valuation techniques, including

discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of

the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and

implied volatilities. The Company has determined the inputs used to value its derivatives fall within Level 2 of the fair value

hierarchy.

On February 5, 2025, the Company executed interest rate swap agreements (the "February 2025 Agreements") with Truist

Bank and Royal Bank of Canada, as counterparties, with an effective date of June 30, 2025 and expiring June 26, 2029.

Under the February 2025 Agreements, the Company is required to make monthly fixed rate payments at annual rates ranging

from 3.97% to 3.98% and the counterparties are required to make monthly floating rate payments to the Company based on

one-month Term SOFR, each subject to a floor of 0.50%. During each of the income statement periods presented, the

notional amounts under the Company's active swap agreements totaled approximately$400 million.

The February 2025 Agreements are designated as cash flow hedges and recorded at fair value on the Company's unaudited

condensed consolidated balance sheets with changes in fair value included in AOCI as a component of equity and reclassified

into interest expense in the same periods during which the hedge transactions affect earnings.

The following table presents the effects of derivatives in cash flow hedging relationships on the Company's AOCI and

earnings (in thousands):

In the 12 months following September 30, 2026, the Company estimates that an additional$1.8 million will be reclassified as

a reduction to interest expense.

As of September 30, 2026 and December 31, 2025, the fair value of the Company's interest rate swap agreements reflected a

net asset balance of$7.4 million and anet liability balance of$4.9 million, respectively. The following table presents the fair

value of the Company's interest rate swap agreements as recorded in the unaudited condensed consolidated balance sheets (in

6. Income Taxes

The Company's income tax provision was an expense of$17.6 million, which equates to an effective tax rate of 21.8%, and

benefit of$3.4 million, which equates to an effective tax rate of 154.8%, for the three months ended September 30, 2026 and

2025, respectively. The decrease in the effective tax rate was driven by the pre-tax loss for the three months ended September

30, 2025 and the increase in noncontrolling interest earnings as a percentage of the pre-tax loss. The Company's income tax

provision was an expense of$42.3 million, which equates to an effective tax rate of 21.3%, and$38.1 million, which equates

to an effective tax rate of 19.6%, for thenine months ended September 30, 2026 and 2025, respectively.

At September 30, 2026 and December 31,2025, the Company hadno accrual for unrecognized tax benefits.

As of September 30, 2026, the Company had no ongoing or pending federal examinations for prior years. The Company has

outstanding federal income tax refund claims for the 2016 and 2018 tax years. On June 2, 2026, the Company was notified

that the Joint Committee on Taxation had completed its review of the refund claims and no changes were made to the refund

amounts claimed. In September 2026, the Company received$11.6 million related to the outstanding federal tax refunds plus

interest. The Company's tax years from 2022 through 2025 remain open to examination by federal and state taxing

authorities.

7. Self-Insured Liabilities

The liabilities for professional, general, workers' compensation and occupational injury liability risks are based on actuarially

determined estimates. Liabilities for professional, general, workers' compensation and occupational injury liability risks

represent the estimated ultimate cost of all reported and unreported losses incurred through the respective balance sheet dates.

The Company provides an accrual for actuarially determined claims reported but not paid and estimates of claims incurred

but not reported.

Professional and General Liability

The total costs for professional and general liability losses are based on the Company's premiums and retention costs and

were$30.5 million and$64.2 million for the three months ended September 30, 2026 and 2025, respectively, and$91.1

million and$105.5 million for thenine months ended September 30, 2026 and 2025, respectively. During the three andnine

months ended September 30, 2025, the Company recordedan accrual for loss contingencies of$47.2 million foradverse prior

period claim developments, particularly with respect to its New Mexico market, combined with increased social inflationary

pressures, contributing to higher professional and general liability losses in the prior year periods.

Workers' Compensation and Occupational Injury Liability

The total costs for workers' compensation liability insurance are based on the Company's premiums and retention costs and

were$2.3 million and$2.4 million for the three months ended September 30, 2026 and 2025, respectively, and$5.5 million

and$2.9 million for thenine months ended September 30, 2026 and 2025, respectively.

8. Employee Benefit Plans

Defined Contribution Plan

The Company maintains defined contribution retirement plans that cover its eligible employees. The Company incurred total

costs related to the retirement plans of$12.5 million for each of the three months ended September 30, 2026 and 2025, and

$41.4 million and$40.3 million for thenine months ended September 30, 2026 and 2025, respectively.

Employee Health Plan

The Company maintains a self-insured medical and dental plan for substantially all of its employees. The Company's reserve

for employee health costs includes amounts for reported claims, which are accrued upon occurrence, as well as a provision

for incurred but not reported claims, which are estimated based on an average lag time and experience. Accruals are based on

the estimated ultimate cost of settlement, including claim settlement expenses.

The total costs of employee health coverage were$46.3 million and$49.7 million for the three months ended September 30,

2026 and 2025, respectively, and$134.5 million and$139.7 million for thenine months ended September 30, 2026 and 2025,

respectively.

9. Commitments and Contingencies

Professional Liability Claims

On or about August 29, 2026, the Company reached a settlement on a professional liability suit involving four plaintiffs. The

settlement calls for$40.0 million to be paid to the plaintiffs prior to the end of 2026. Typically, depending on the insurance

carrier involved, the carriers either pay their portion of the settlement directly to the plaintiff(s) or reimburse the Company for

covered amounts paid to the plaintiff(s). In this situation, in reliance on the carriers’ agreement to fund the settlement, the

Company agreed to settle the case; however, certain carriers have subsequently refused to fund their portion of the settlement.

Management of the Company believes that this matter is fully covered by the Company's insurance and that any amounts paid

by the Company that exceed its self-insured retention are collectible. Management intends to pursue all available remedies to

receive full funding of the insured amount. At September 30, 2026, the Company's professional and general liability accrual

included$40.0 million related to the settlement in other accrued expenses and liabilities on the condensed consolidated

balance sheet and$34.0 million in other current assets that represents an estimate of the amounts above the Company's self-

insured retention that it expects to recover under its professional liability insurance policies. Although management believes

that the$34.0 million is recoverable, the timing and ultimate amount of such recovery will depend, in part, on the resolution

of the disputes with the applicable carriers.

Litigation and Regulatory Matters

From time to time, claims and suits arise in the ordinary course of the Company's business. The Company has been, is

currently, and may in the future be subject to claims, lawsuits, qui tam actions, civil investigative demands, subpoenas,

investigations, audits and other inquiries related to its operations. In certain of these actions, plaintiffs request punitive or

other damages against the Company that may not be covered by insurance. These claims, lawsuits, and proceedings are in

various stages of adjudication or investigation and involve a wide variety of claims and potential outcomes. Depending on

whether the underlying conduct in these or future inquiries or investigations could be considered systemic, their resolution

could have a material adverse effect on the Company's results of operations, financial position or liquidity.

The Company records accruals for such contingencies to the extent that the Company concludes it is probable that a liability

has been incurred and the amount of the loss can be reasonably estimated. Apart from ongoing litigation associated with

unresolved professional liability claims as described in Note 7 above, management does not believe that the Company is

party to any proceeding that, either individually or in the aggregate, could have a material adverse effect on its business,

financial condition, results of operations or liquidity. However, in light of the inherent uncertainties involved, it is possible

that the settlement of these unresolved claims could have a material adverse impact on the Company’s future results of

operations, financial position, or liquidity.

Securities Litigation

On January 7, 2026, a purported stockholder filed a putative securities class action against the Company and certain current

officers in the lawsuit styled Postiwala v. Ardent Health, Inc., et al., Case No. 3:26-cv-00022, which is pending in the United

States District Court for the Middle District of Tennessee, Nashville Division. An amended complaint was filed August 12,

2026. The complaint is brought on behalf of a putative class consisting of all persons (other than defendants) who purchased

Company securities between July 18, 2024 and November 12, 2025, and alleges that defendants violated Sections 11 and 15

of the Securities Act of 1933, as amended (the "Securities Act"), and Sections 10(b) and 20(a) of the Securities Exchange Act

of 1934, as amended (the "Exchange Act"), and Rule 10b-5 promulgated thereunder based on allegedly false and misleading

statements and omissions. Specifically, the complaint alleges that the Company made material misstatements and omissions

in the Company’s initial public offering registration statement on Form S-1 and incorrectly accounted for and reported on

certain accounts receivable and certain insurance reserves during 2024 and 2025 which caused its stock price to be inflated.

The complaint seeks unspecified monetary damages, recovery of fees and costs, and other relief that the court may find

appropriate.

The Company intends to vigorously defend the claims made; however, currently no assessment can be made as to the likely

outcome. At this time, the Company is not able to reasonably estimate the amount or range of the ultimate liability, if any, in

connection with this case.

On July 31, 2026, the Company received a letter from the Atlanta regional office of the SEC in connection with a non-public,

fact-finding inquiry, requesting that the Company voluntarily provide information regarding the$42.6 million decrease in

revenue related to the collectability of accounts receivable as reported in the Company's Form 10-Q filed on November 14,

2025. The Company is cooperating with the SEC's request. At this time, the Company cannot predict the timing or outcome

of this inquiry.

Derivative Action

On February 26, 2026, a stockholder derivative action styled Thompson v. Sotir, et al., Case No. 3:26-cv-00219 was filed in

the United States District Court for Middle District of Tennessee, Nashville Division, against certain current officers and

directors. The Company is named as a nominal defendant only. The factual basis of the complaint is largely the same as in the

Postiwala case mentioned above but includes some additional allegations. The complaint alleges breaches of fiduciary duties,

gross mismanagement, waste of corporate assets, unjust enrichment, and violation of Section 14(a) of the Exchange Act. The

complaint seeks unspecified monetary damages, restitution, the adoption of certain governance reforms, recovery of fees and

costs, and other relief that the court may find appropriate.

The Company intends to vigorously defend the claims made; however, currently no assessment can be made as to the likely

outcome. At this time, the Company is not able to reasonably estimate the amount or range of the ultimate liability, if any, in

connection with this case.

Cybersecurity Incident Litigation

In November 2023, the Company determined that a ransomware cybersecurity incident had impacted and disrupted a number

of the Company's operational and information technology systems (the "Cybersecurity Incident"). During this time, the

Company's hospitals remained operational and continued to deliver patient care utilizing established downtime procedures.

The Company immediately suspended user access to impacted information technology applications, executed cybersecurity

protection protocols, and took steps to restrict further unauthorized activity. Additionally, because of the time taken to contain

and remediate the Cybersecurity Incident, online electronic billing systems were not functioning at their full capacities and

certain billing, reimbursement and payment functions were delayed, which had an adverse impact on the Company's results

of operations and cash flows for 2023 and the first quarter of 2024.

As a result of the Cybersecurity Incident, three putative class actions were filed against the Company in the U.S. District

Court for the Middle District of Tennessee: Burke v. AHS Medical Holdings LLC, No. 3:23-cv-01308; Redd v. AHS Medical

Holdings, LLC, No. 3:23-cv-01342; and Epperson v. AHS Management Company, Inc., No. 3:24-cv-00396. These cases

were consolidated by the District Court on April 24, 2024, under the caption Hodge v. AHS Management Company, Inc., No.

3:23-cv-01308 (M.D. Tenn.). The complaint for the consolidated class action, filed on behalf of approximately 38,000

individuals who alleged their personal information and protected health information were affected by the Cybersecurity

Incident, generally asserted state common law claims of negligence, breach of implied contract, unjust enrichment, breach of

fiduciary duty, and invasion of privacy with respect to how the Company managed sensitive data. On October 4, 2024, the

Company executed a settlement agreement to resolve the consolidated class action litigation. On October 9, 2024, the District

Court preliminarily approved the settlement. Plaintiffs filed a Motion for Final Approval of the Settlement ("Motion for Final

Approval"), which the Company did not oppose. Following a hearing on the Motion for Final Approval that was conducted

on August 1, 2025, the Court ordered class counsel, the settlement administrator and the Company to implement the agreed

upon settlement of the consolidated case. Pursuant to the settlement, the Company made settlement payments, the total of

which did not have a material impact on the Company's results of operations, financial position or liquidity. Upon entry of the

Final Order, the clerk was ordered to close the case.

During thenine months ended September 30, 2025, the Company received$21.5 million of business insurance recovery

proceeds related to the Cybersecurity Incident, all of which was included in other non-operating gains on the Company's

condensed consolidated income statement. No business insurance recovery proceeds related to the Cybersecurity Incident

were received during thenine months ended September 30, 2026.

Acquisitions

The Company has acquired, and plans to continue to acquire, businesses with prior operating histories. Acquired companies

may have unknown or contingent liabilities, including liabilities for failure to comply with healthcare laws and regulations,

such as billing and reimbursement, fraud and abuse and anti-kickback laws. The Company has from time to time identified

certain past practices of acquired companies that do not conform to its standards. Although the Company institutes policies

designed to conform such practices to its standards following completion of acquisitions, there can be no assurance that the

Company will not become liable for the past activities of these acquired facilities that may later be asserted to be improper by

private plaintiffs or government agencies. Although the Company generally seeks to obtain indemnification from prospective

sellers covering such matters, there can be no assurance that any such matter will be covered by indemnification or, if

covered, that such indemnification will be adequate to cover potential losses and fines.

10. Segments

The Company hasone reportable segment, which is healthcare services. The healthcare services segment generates revenues

by delivering care to its customers, or patients, through its integrated network of hospitals, ambulatory facilities, and

physician practices. The Company's Chief Operating Decision Maker ("CODM") is its President and Chief Executive Officer,

who regularly reviews financial operating results on a consolidated basis for purposes of allocating resources and evaluating

financial performance. The Company's CODM manages the operations on a consolidated basis to make decisions about

overall Company resource allocation and to assess overall Company performance.

The CODM's assessment of segment performance and allocation of segment resources is based on consolidated net income

attributable to Ardent Health, Inc. The CODM uses this consolidated profitability measure to monitor budget versus actual

results, compare Company profitability period-over-period and make capital investment decisions.

The following table presents the composition of consolidated netincome (loss) attributable to Ardent Health, Inc. for the

healthcare services segment, including significant expenses that are regularly provided to and reviewed by the CODM (in

The measure of segment assets is reported on the unaudited condensed consolidated balance sheets as total assets. The

accounting policies for the segment are consistent with the consolidated accounting policies provided in Note 2.

As of September 30, 2026 and December 31, 2025, all of the Company's long-lived assets were located in the United States,

and for thethree and nine months ended September 30, 2026 and 2025, all revenue was earned in the United States.

11. Earnings Per Share

Basic netincome (loss) per share is computed by dividing netincome (loss) attributable to common stockholders by the

weighted-average number of common shares outstanding. Diluted netincome (loss) per share is computed by dividing net

income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding plus the

dilutive effect of outstanding securities, and such dilutive effect is computed using the treasury stock method.

The following table sets forth the computation of basic and diluted netincome (loss) per share (in thousands, except share

and per share amounts):

The following table sets forth the components of the denominator for the computation of basic and diluted netincome (loss)

per share for netincome (loss) attributable to Ardent Health, Inc. stockholders: