Cigna Group

Note 14 – Strategic Optimization Program

In the first quarter of 2025, the Company commenced an enterprise-wide initiative to evolve our business and deliver a more efficient and improved experience for our patients, providers and customers. This program is expected to continue through December 2026 and include severance and other employee costs, asset impairments and accelerated asset amortization, and the operating results of certain small non-strategic businesses that we plan to discontinue. As we continue to evaluate additional opportunities to improve the overall efficiency and effectiveness of our operations, we anticipate future charges.

During the three and six months ended June 30, 2025, we reported total costs of $129 million, pre-tax ($98 million, after-tax) and $344 million, pre-tax ($261 million, after-tax), respectively, associated with this initiative. During the three months ended June 30, 2025, the total costs included a charge in Selling, general and administrative ("SG&A") expenses of $88 million, pre-tax, that was primarily comprised of asset impairments. During the six months ended June 30, 2025, the total costs included a charge in SG&A expenses of $286 million, pre-tax, that was primarily associated with employee severance. The remainder for both periods reflects the operating results of certain non-strategic businesses. We expect substantially all of the accrued liability to be paid by the end of 2025. See Note 17 to the Consolidated Financial Statements for further details of the Strategic Optimization Program impact by segment.

The following table summarizes a roll forward of the accrued liability recorded in Accrued expenses and other liabilities during the six months ended June 30, 2025: