Claritev Corp

Previous wording

This item and other sections of this Quarterly Report on Form 10-Q contain forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), as amended, which are subject to the "safe harbor" created by those sections based on management’s beliefs and assumptions and on information currently available to management. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as "future," "anticipates," "believes," "estimates," "expects," "intends," "predicts," "will," "would," "could," "can," "may," and similar terms. Forward-looking statements are not guarantees of future performance and the Company’s actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in Part I, Item 1A of the 2025 Form 10-K under the heading "Risk Factors." Given these risks, uncertainties, and other factors, you should not place undue reliance on these forward-looking statements. Also, these forward-looking statements represent our estimates and assumptions only as of the date of this filing. We hereby qualify our forward-looking statements by these cautionary statements. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Current wording

This item and other sections of this Quarterly Report on Form 10-Q contain forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which are subject to the "safe harbor" created by those sections based on management’s beliefs and assumptions and on information currently available to management. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as "future," "anticipates," "believes," "estimates," "expects," "intends," "predicts," "will," "would," "could," "can," "may," and similar terms. Forward-looking statements are not guarantees of future performance and the Company’s actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in Part I, Item 1A of the 2025 Form 10-K and Part II, Item 1A of this Form 10-Q, in each case under the heading “Risk Factors.” Given these risks, uncertainties, and other factors, you should not place undue reliance on these forward-looking statements. Also, these forward-looking statements represent our estimates and assumptions only as of the date of this filing. We hereby qualify our forward-looking statements by these cautionary statements. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Previous wording

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the information included in the Company's 2025 Annual Report on Form 10-K and the condensed consolidated financial statements and accompanying notes included in Part I, Item 1 in this Quarterly Report on Form 10-Q and risks described elsewhere in this Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission.

Current wording

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the information included in the Company's 2025 Annual Report on Form 10-K and the condensed consolidated financial statements and accompanying notes included in Part I, Item 1 in this Quarterly Report on Form 10-Q and risks described elsewhere in this Quarterly Report on Form 10-Q and our other filings with the SEC.

Previous wording

Claritev is a technology, data and insights company focused on improving transparency, affordability and quality across the healthcare system. We bring objective, market-based insights to some of the healthcare system's most complex decisions based on decades of claims expertise. By applying data, analytics, and experience, we help organizations across the healthcare ecosystem better understand costs, pricing, and payment dynamics. This clarity enables more informed decision-making, reduces friction, and improves how the healthcare system functions in service of greater affordability, alignment, and long-term sustainability.

Current wording

Claritev is a healthcare technology, data and insights company focused on delivering affordability, transparency and quality across the healthcare system. We bring objective, market-based insights to some of the healthcare system's most complex decisions based on decades of claims expertise. By applying data, analytics, and experience, we help organizations across the healthcare ecosystem better understand costs, pricing, and payment dynamics. This clarity enables more informed decision-making, reduces friction, and improves how the healthcare system functions in service of greater affordability, alignment, and long-term sustainability.

Previous wording

The following table provides the results of operations for the periods indicated (in thousands):

Current wording

The following table provides the results of operations for the periods indicated (in thousands, except percentages):

Previous wording

Revenues increased by $13.3 million, or 5.8%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase in revenues was due to the increase in Claims intelligence solutions revenues of $12.9 million.

Current wording

Revenues increased by $15.9 million, or 6.6%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. This increase in revenues was due to the increase in Claims intelligence solutions revenues of $21.5 million.

Previous wording

Claims intelligence solutions revenues increased by $12.9 million, or 8.4%, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase in revenue was primarily due to an increase in Data iSight and partially offset by decrease in surprise bill services, primarily related to client and program attrition.

Current wording

Claims intelligence solutions revenues increased by $21.5 million, or 13.7%, for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. This increase in revenue was primarily due to an increase in Data iSight and Surprise Bill Services.

Previous wording

The increase in costs of services of $8.6 million for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily due to the increase in personnel expenses of $3.5 million and access and bill review fees of $3.4 million.

Current wording

The increase in costs of services of $6.8 million for thethree months ended June 30, 2026 as compared to thethree months ended June 30, 2025 was primarily due to the increase in personnel expenses of $6.5 million and other cost of service expenses of $1.7 million, offset by adecrease inaccess and bill review fees of $1.9 million.

Previous wording

The increase in general and administrative expenses of $10.9 million for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025 was primarily due to $10.2 million of legal expenses related to certain antitrust matters and other transaction expenses, increase in transformation costs of $4.1 million, offset by the decrease in personnel expenses of $5.0 million, due to more personnel assigned to capital and transformation projects, and lower stock compensation of $1.5 million.

Current wording

The increase in general and administrative expenses of $4.3 million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025 was primarily due to $3.8 million of legal expenses related to certain antitrust matters and other transaction expenses, as well as anincrease in transformation costs of $1.3 million, offset by a decrease in personnel expenses of $1.8 million, due to more personnel assigned to capital and transformation projects.

Previous wording

Network solutions revenues and Payment and revenue integrity solutions revenue remained stable in the three months ended March 31, 2026, as compared to the three months ended March 31, 2025.

Current wording

Interest expense remained stable in the three months ended June 30, 2026, as compared to the three months ended June 30, 2025.

Previous wording

The increase in interest expense of $7.9 million and 8.6% for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025 was primarily due to the increase in average indebtedness outstanding during the periods.

Current wording

The increase in interest expense of $8.4 million, or 4.4% for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 was primarily due to the increase in average indebtedness outstanding during the periods as a result of PIK interest charges.

Previous wording

As of March 31, 2026 and March 31, 2025, our total debt had an annualized weighted average cash interest rate of 6.88% and 6.96%, respectively, which decreased by 0.08%. As of December 31, 2025, our total debt had a weighted average cash interest rate of 6.92%.

Current wording

As of June 30, 2026 and June 30, 2025, our total debt had an annualized weighted average cash interest rate of 6.85% and 6.95%, respectively, which decreased by 0.10%. As of December 31, 2025, our total debt had a weighted average cash interest rate of 6.92%.

Previous wording

Net loss before income taxes for the three months ended March 31, 2026 of $92.7 million generated a benefit for income taxes of $19.2 million. Net loss before income taxes for the three months ended March 31, 2025 of $89.9 million generated a benefit for income taxes of $18.5 million.

Current wording

Net loss before income taxes for the three months ended June 30, 2026 of $76.6 million generated a benefit for income taxes of $17.4 million. Net loss before income taxes for the three months ended June 30, 2025 of $82.9 million generated a benefit for income taxes of $20.3 million.

Previous wording

The effective tax rate for the three months ended March 31, 2026 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, limitation on executive compensation and state taxes. The effective tax rate for the three months ended March 31, 2025 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, limitations on executive compensation and state taxes.

Current wording

The effective tax rate for the six months ended June 30, 2026 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, limitation on executive compensation and state taxes. The effective tax rate for the six months ended June 30, 2025 differed from the statutory rate primarily due to non-deductible stock-based compensation expense, limitations on executive compensation and state taxes.

Previous wording

EBITDA, Adjusted EBITDA, and Adjusted EPS are widely used measures of corporate profitability eliminating the effects of financing and capital expenditures from the operating results. We define EBITDA as netloss adjusted for interest expense, interest income, income tax (benefit) expense, depreciation, amortization of intangible assets, and non-income taxes. Non-income taxes includes personal property taxes, real estate taxes, sales and use taxes and franchise taxes which are included in cost of services and general and administrative expenses. We define Adjusted EBITDA as EBITDA further adjusted to eliminate the impact of certain items that we do not consider to be indicative of our core business, including other expenses, net, loss on sale of assets, including right-of-use assets, transformation costs, integration expenses, transaction costs related to refinancing transaction, loss on extinguishment of debt, and stock-based compensation, including cRSUs. See our condensed consolidated financial statements included in this Quarterly Report for more information regarding these adjustments. Adjusted EBITDA is used in our agreements governing our outstanding indebtedness for debt covenant compliance purposes. Our Adjusted EBITDA calculation is consistent with the definition of Adjusted EBITDA used in our debt instruments.

Current wording

EBITDA, Adjusted EBITDA, and Adjusted EPS are widely used measures of corporate profitability eliminating the effects of financing and capital expenditures from the operating results. We define EBITDA as netloss adjusted for interest expense, interest income, income tax (benefit) expense, depreciation, amortization of intangible assets, and non-income taxes. Non-income taxes includes personal property taxes, real estate taxes, sales and use taxes and franchise taxes which are included in cost of services and general and administrative expenses. We define Adjusted EBITDA as EBITDA further adjusted to eliminate the impact of certain items that we do not consider to be indicative of our core business, including legal expenses associated with antitrust matters, loss on disposal of assets, including right-of-use assets, transformation costs, integration expenses, transaction costs related to refinancing transaction, loss on extinguishment of debt, stock-based compensation, including cRSUs, and other expenses. See our condensed consolidated financial statements included in this Quarterly Report for more information regarding these adjustments. Adjusted EBITDA is used in our agreements governing our outstanding indebtedness for debt covenant compliance purposes. Our Adjusted EBITDA calculation is consistent with the definition of Adjusted EBITDA used in our debt instruments.

Previous wording

Adjusted EPS is used in reporting to our Board and executive management and as a component of the measurement of our performance. We believe that this measure provides useful information to investors because it is the profitability measure we use to evaluate earnings performance on a comparable year-to-year basis. Adjusted EPS is defined as netloss adjusted for amortization of intangible assets, other expenses, net, transformation costs, integration expenses, transaction costs related to refinancing transaction, loss on sale of assets, including right-of-use assets, loss on extinguishment of debt, stock-based compensation, including cRSUs, and tax effect of adjustments to arrive at adjusted net income divided by our basic weighted average number of shares outstanding.

Current wording

Adjusted EPS is used in reporting to our Board and executive management and as a component of the measurement of our performance. We believe that this measure provides useful information to investors because it is the profitability measure we use to evaluate earnings performance on a comparable year-to-year basis. Adjusted EPS is defined as netloss adjusted for amortization of intangible assets, legal expenses associated with antitrust matters, other expenses, net, transformation costs, integration expenses, transaction costs related to refinancing transaction, loss on disposal of assets, including right-of-use assets, loss on extinguishment of debt, stock-based compensation, including cRSUs, and tax effect of adjustments to arrive at adjusted net income divided by our basic weighted average number of shares outstanding.

Previous wording

(2)"Transformation costs" represent costs directly associated with our multi-year transformation program called Vision 2030 which includes internal personnel costs for employees that have been either hired or redeployed and are fully dedicated to transformation activities, as well as other non-recurring and duplicative costs. At such time that internal personnel are redeployed to non-transformation activities, they will no longer be included as an adjustment herein.

Current wording

(1)"Transformation costs" represent costs directly associated with our multi-year transformation program called Vision 2030 which includes internal personnel costs for employees that have been either hired or redeployed and are fully dedicated to transformation activities, as well as other non-recurring and duplicative costs. At such time that internal personnel are redeployed to non-transformation activities, they will no longer be included as an adjustment herein.

Previous wording

(1)"Other expenses, net" represents impairment of other assets, non-integration related severance costs, legal expenses associated with the antitrust matters, start-up costs related to international expansion and miscellaneous non-recurring expenses.

Current wording

(2)"Other expenses, net" represents impairment of other assets, non-integration related severance costs, start-up costs related to international expansion and miscellaneous non-recurring expenses..

Previous wording

(2)"Transformation costs" represent costs directly associated with our multi-year transformation program called Vision 2030 which includes internal personnel costs for employees that have been either hired or redeployed and are fully dedicated to transformation activities, as well as other non-recurring and duplicative costs. At such time that internal personnel are redeployed to non-transformation activities, they will no longer be included as an adjustment herein.

Current wording

(1)"Transformation costs" represent costs directly associated with our multi-year transformation program called Vision 2030 which includes internal personnel costs for employees that have been either hired or redeployed and are fully dedicated to transformation activities, as well as other non-recurring and duplicative costs. At such time that internal personnel are redeployed to non-transformation activities, they will no longer be included as an adjustment herein.

Previous wording

(1)"Other expenses, net" represents impairment of other assets, non-integration related severance costs, legal expenses associated with the antitrust matters, start-up costs related to international expansion and miscellaneous non-recurring expenses.

Current wording

(2)"Other expenses, net" represents impairment of other assets, non-integration related severance costs, start-up costs related to international expansion and miscellaneous non-recurring expenses..

Previous wording

As of March 31, 2026, we had a cash balance of$34.7 million, which includes cash and cash equivalents of$21.3 million and restricted cash of$13.4 million. Additionally, we have access to $218.6 million of the total $350.0 million loan availability under the 2025 Revolving Credit Facility.

Current wording

As of June 30, 2026, we had a cash balance of$27.7 million, which includes cash and cash equivalents of$14.4 million and restricted cash of$13.3 million. Additionally, we have access to $273.6 million of the total $350.0 million loan availability under the 2025 Revolving Credit Facility.

Previous wording

As of March 31, 2026, we have drawn $125.0 million under our 2025 Revolving Credit Facility Loan and we have $6.4 million of outstanding letters of credit under such facility. Of these outstanding irrevocable letters of credit, we have four which are used to satisfy real estate lease security deposit requirements for our offices in lieu of cash deposits in an aggregate amount of $4.4 million as of March 31, 2026 and December 31, 2025, respectively. The Company also has an irrevocable letter of credit to satisfy the obligations of a captive insurance subsidiary in the amount of $2.0 million as of March 31, 2026 and December 31, 2025.

Current wording

As of June 30, 2026, we had $70.0 million outstanding under our 2025 Revolving Credit Facility and $6.4 million of outstanding letters of credit under such facility. Of these outstanding irrevocable letters of credit, we have four which are used to satisfy real estate lease security deposit requirements for our office locations in lieu of cash deposits in an aggregate amount of $4.4 million as of June 30, 2026 and December 31, 2025, respectively. The Company also has an irrevocable letter of credit to satisfy the security requirements of a captive insurance subsidiary in the amount of $2.0 million as of June 30, 2026 and December 31, 2025.

Previous wording

Cash flows from oper ating activities decreased by $15.7 million, primarily due to unfavorable changes in working capital, partially offset by higher earnings once adjusted for non-cash items. Changes in our working capital requirements primarily reflect the timing of collection on trade accounts receivable, net and payment of accounts payable, accrued expenses and liabilities, and accrued interest.

Current wording

Cash flows from operating activities increased by $15.7 million, primarily due to favorable changes in deferred income tax, partially offset by unfavorable changes in working capital. Changes in our working capital requirements primarily reflect the timing of collection on trade accounts receivable, net and payment of accounts payable, accrued expenses and liabilities, and accrued interest.

Previous wording

Net cash used in investing activities increased by $7.9 million, as compared to the prior-year period, due to increased investments in technologies to support our transformation initiatives.

Current wording

Net cash used in investing activities increased by $21.4 million, as compared to the prior-year period, due to increased investments in technologies to support our transformation initiatives.

Previous wording

Net cash provided by financing activities increased by $25.8 million as compared to the prior-year period, primarily due to the increase in net borrowing of $25.0 million on our 2025 Revolving Credit Facility to fund the working capital needs.

Current wording

Net cash provided by financing activities decreased by $32.6 million as compared to the prior-year period, primarily due to the decrease in net borrowing of $30.0 million on our 2025 Revolving Credit Facility due to continuous efforts in working capital management.

Previous wording

One client individually accounted for 33.6% of revenue for the three months ended March 31, 2026. Two clients individually accounted for 29.2% and 10.4% of revenues for the year ended December 31, 2025. The loss of the business of one or more of our larger clients could have a material adverse effect on our results of operations. For further discussion on our client concentration, please refer to Part I, Item 1A. "Risk Factors" in our 2025 Annual Reporton Form 10-K.

Current wording

One client individually accounted for 35.0% of revenue for the three months ended June 30, 2026. Two clients individually accounted for 29.2% and 10.4% of revenues for the year ended December 31, 2025. The loss of the business of one or more of our larger clients could have a material adverse effect on our results of operations. For further discussion on our client concentration, please refer to Part I, Item 1A. "Risk Factors" in our 2025 Annual Reporton Form 10-K.