Claritev Corporation
11/07/2025 | Press release | Distributed by Public on 11/07/2025 15:03
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Forward-Looking Statements
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. Forwarding-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 2024 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.
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 2024 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.
References to common stock, warrants to purchase common stock, options to purchase common stock, restricted stock units, performance stock units, share date, per share data and conversion rates with respect to convertible notes and related information have been retroactively adjusted to reflect the effect of the Reverse Stock Split for all periods presented.
Company Overview
Claritev is a leading provider of data-driven cost management solutions that deliver transparency and promote fairness, quality and affordability to the healthcare industry. Through our proprietary data and technology platform, we provide out-of-network cost management, payment and revenue integrity, data and decision science, business-to-business healthcare payments and other services to the payors of healthcare, which are primarily health insurers and their administrative-services-only platforms, self-insured employers, federal and state government-sponsored health plans and other health plan sponsors (typically through their health plan administrators), and, indirectly, the plan members who are the consumers of healthcare services.
Although the end beneficiary of our services are employers and other plan sponsors and their health plan members, our direct customers are typically payors, including payors providing administrative services only, and third-party administrators ("TPAs"), who go to market with our services to those end customers. We offer these payors a single interface to our services, which are used in combination or individually to reduce the medical cost burden on their health plan customers, by lowering the per-unit cost of medical services incurred, managing the utilization of medical services, and increasing the likelihood that the services are reimbursed without error and accepted by the provider. We are a technology-enabled service provider and transaction processor and do not deliver health-care services, provide or manage healthcare services, provide care or care management, or adjudicate or pay claims.
The Company, primarily through its operating subsidiary, Claritev, Inc., offers its solutions nationally through a range of service lines, which include:
•Analytics-Based Servicesreduce medical cost through data-driven algorithms and insights that detect claims over-charges and either negotiate or recommend fair reimbursement for out-of-network medical costs using a variety of data sources and pricing algorithms. Our Analytics-Based Services claim pricing services are generally priced based on a percentage of savings achieved. Also included in this category are services that enable lower cost health plans that feature reference-based pricing either in conjunction with or in place of a provider network. These services are generally priced at a bundled per-employee-per-moth ("PEPM") rate;
•Network-Based Servicesreduce medical cost by providing access to contracted discounts with healthcare providers with whom payors do not have a contractual relationship, through our expansive network of over 1.4 million healthcare providers, which forms one of the largest independent preferred provider organizations in the United States. Our Network-Based Services are priced based on either a percentage of savings achieved or at a per employee/member per month fee. This service category also includes customized network development and management services for payors seeking to expand their network footprint using outsourced services. These services are generally priced on a per provider contract or other project-based price;
•Payment and Revenue Integrity Servicesreduce medical cost through data, technology, and clinical expertise deployed to identify and remove improper and unnecessary charges before or after claims are paid, or to identify and help restore premium dollars underpaid by CMS for government health plans caused by discrepancies with enrollment-related data. Payment and Revenue Integrity Services are generally priced based on a percentage of savings achieved; and
•Data and Decision Science Servicesreduce medical costs through a next generation suite of solutions that apply modern methods of data science to produce descriptive, predictive, and prescriptive analytics that enable customers to optimize decision-making about plan design and network configurations and to support decision-making to improve clinical outcomes, plan performance, and competitive positioning. We formed this new service category in the second quarter of 2023 and accelerated its development through the acquisition of BST. Data and Decisions Science Services are generally priced based on a subscription, licensing, or per-member-per month basis.
Additionally, in 2023 the Company entered into a partnership agreement with ECHO Health, Inc., which through a joint marketing and services agreement adds payment processing of healthcare provider claims as well as payments made to other service providers.
During the nine months ended September 30, 2025, the Company advanced its long-term growth strategy by initiating its first international market expansion into the Middle East and North Africa ("MENA") region through a strategic partnership with Claims Care Revenue Cycle Management LLC ("Claims Care"), a division of Burjeel Holdings. Through this partnership, we will collaborate on a comprehensive product roadmap to deliver state-of-the-art revenue cycle management solutions, tailored to the needs of the MENA market. The relationship will involve the transition of certain of Claritev's offshore business processes to Claims Care, in an effort to foster deeper operational synergies and market alignment.
We believe our solutions provide a strong value proposition to payors, their health plan customers and healthcare consumers, as well as to providers. Overall, our service offerings aim to reduce healthcare costs in a manner that is orderly, efficient, and fair to all parties. In addition, because in most instances the fee for our services is linked to the savings we identify, our revenue model is aligned with the interests of our customers. For the nine months ended September 30, 2025 and September 30, 2024 and for the year ended December 31, 2024, our comprehensive services identified approximately $18.6 billion, $18.3 billion, and $24.7 billion in potential medical cost savings, respectively.
Reverse Stock Split
On September 20, 2024, the Company effected a one-for-forty (1-for-40) reverse stock split of its Class A common stock.
References to common stock, warrants to purchase common stock, options to purchase common stock, restricted stock units, performance stock units, share data, per share data and conversion rates with respect to convertible notes and related information contained in the condensed consolidated financial statements have been retroactively adjusted to reflect the effect of the Reverse Stock Split for all periods presented.
Factors Affecting Our Results of Operations
Medical Cost Savings
Our business and revenues are driven by the ability to lower medical costs through claim savings for our customers. The volume of medical charges associated with those claims is a primary driver of our ability to generate claim savings.
The following table presents the medical charges processed and the potential savings identified across our products and revenue streams, including PEPM and percentage of savings ("PSAV"), for the periods presented (in millions):
| Three Months Ended September 30, | Change | Nine Months Ended September 30, | Change | ||||||||||||||||||||||||||||||||
| 2025 | 2024 | % | 2025 | 2024 | |||||||||||||||||||||||||||||||
| Commercial Health Plans | |||||||||||||||||||||||||||||||||||
| Medical charges processed | $ | 21,646 | $ | 20,515 | 5.5% | $63,665 | $58,661 | 8.5% | |||||||||||||||||||||||||||
| Potential medical cost savings | $ | 5,662 | $ | 6,010 | (5.8)% | $17,345 | $17,238 | 0.6% | |||||||||||||||||||||||||||
| Potential savings as a % of charges | 26.2 | % | 29.3 | % | 27.2 | % | 29.4 | % | |||||||||||||||||||||||||||
| Payment & Revenue Integrity, Property & Casualty, and Other | |||||||||||||||||||||||||||||||||||
| Medical charges processed | $ | 24,291 | $ | 24,186 | 0.4% | $69,001 | $72,821 | (5.2)% | |||||||||||||||||||||||||||
| Potential medical cost savings | $ | 467 | $ | 348 | 34.2% | $1,301 | $1,029 | 26.4% | |||||||||||||||||||||||||||
| Potential savings as a % of charges | 1.9 | % | 1.4 | % | 1.9 | % | 1.4 | % | |||||||||||||||||||||||||||
| Total | |||||||||||||||||||||||||||||||||||
| Medical charges processed | $ | 45,937 | $ | 44,701 | 2.8% | $132,666 | $131,482 | 0.9% | |||||||||||||||||||||||||||
| Potential medical cost savings | $ | 6,129 | $ | 6,358 | (3.6)% | $18,646 | $18,267 | 2.1% | |||||||||||||||||||||||||||
| Potential savings as a % of charges | 13.3 | % | 14.2 | % | 14.1 | % | 13.9 | % | |||||||||||||||||||||||||||
Medical charges processed represent the aggregate dollar amount of claims processed by our cost management and payment and revenue integrity solutions in the period presented. The dollar amount of the claim for the purposes of this calculation is the dollar amount of the claim prior to any reductions that may be made as a result of the claim being processed by our solutions.
Potential medical cost savings represent the aggregate amount of potential savings in dollars identified by our cost management and payment and revenue integrity solutions in the period presented. Since certain of our fees are based on the amount of savings achieved by our customers, and our customers are the final adjudicator of the claims and may choose not to reduce claims or reduce claims by only a portion of the potential savings identified, potential medical cost savings may not directly correlate with the amount of fees earned in connection with the processing of such claims.
Components of Results of Operations
There have been no material changes during the three months ended September 30, 2025 to the components of results of operations as disclosed in Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's 2024Annual Report on Form 10-K.
Non-GAAP Financial Measures
We use EBITDA, Adjusted EBITDA, and adjusted earnings per share ("Adjusted EPS") to evaluate our financial performance. EBITDA, Adjusted EBITDA, and Adjusted EPS are financial measures that are not presented in accordance with GAAP. We believe the presentation of these non-GAAP financial measures provides useful information to investors in assessing our financial condition and results of operations across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our financial operating results of our core business.
These measurements of financial performance have important limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Additionally, they may not be comparable to other similarly titled measures of other companies. Some of these limitations are:
•such measures do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
•such measures do not reflect changes in, or cash requirements for, our working capital needs;
•such measures do not reflect the significant interest expense, or cash requirements necessary to service interest or principal payments on our debt;
•such measures do not reflect any cash requirements for any future replacement of depreciated assets;
•such measures do not reflect the impact of stock-based compensation upon our results of operations;
•such measures do not reflect our income tax (benefit) expense or the cash requirements to pay our income taxes;
•such measures do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and
•other companies in our industry may calculate these measures differently from how we do, limiting their usefulness as a comparative measure.
In evaluating EBITDA, Adjusted EBITDA, and Adjusted EPS, you should be aware that in the future we may incur expenses similar to those eliminated in the presentation.
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 net loss 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 disposal of assets, including right-of-use assets, integration expenses, gain (loss) on change in fair value of Private Placement Warrants and Unvested Founder Shares, transaction related expenses, transformation costs, (gain) loss on debt extinguishment, (gain) loss on investments, loss on impairment of goodwill and intangible assets, and stock-based compensation. 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.
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 net loss adjusted for amortization of intangible assets, stock-based compensation, transaction related expenses, (gain) loss on debt extinguishment, (gain) loss on investments, other expense, gain on change in fair value of Private Placement Warrants and Unvested Founder Shares, loss on impairment of goodwill and intangible assets, and tax effect of adjustments to arrive at Adjusted net income divided by our basic weighted average number of shares outstanding.
The following table presents a reconciliation of net loss to EBITDA and Adjusted EBITDA for the periods presented (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net loss | $ | (69,753) | $ | (391,450) | $ | (203,712) | $ | (1,507,866) | |||||||||||||||
| Adjustments: | |||||||||||||||||||||||
| Interest expense | 101,232 | 81,792 | 292,614 | 245,119 | |||||||||||||||||||
| Interest income | (471) | (1,245) | (1,282) | (2,722) | |||||||||||||||||||
| Benefit for income taxes | (23,608) | (27,220) | (62,449) | (76,715) | |||||||||||||||||||
| Depreciation | 25,968 | 22,572 | 75,775 | 65,372 | |||||||||||||||||||
| Amortization of intangible assets | 85,971 | 85,971 | 257,913 | 257,913 | |||||||||||||||||||
| Non-income taxes | 581 | 515 | 1,697 | 1,623 | |||||||||||||||||||
| EBITDA | $ | 119,920 | $ | (229,065) | $ | 360,556 | $ | (1,017,276) | |||||||||||||||
| Adjustments: | |||||||||||||||||||||||
|
Other expenses, net(1)
|
6,451 | 1,517 | 15,905 | 2,584 | |||||||||||||||||||
| Loss on disposal of assets, including right-of-use assets | 1,902 | - | 7,378 | - | |||||||||||||||||||
| Integration expenses | 66 | 850 | 579 | 1,994 | |||||||||||||||||||
| Change in fair value of Private Placement Warrants and Unvested Founder Shares | - | (87) | - | (476) | |||||||||||||||||||
|
Transformation costs(2)
|
13,883 | - | 29,536 | - | |||||||||||||||||||
| Transaction costs - Refinancing Transaction | - | - | 7,879 | - | |||||||||||||||||||
| Loss (gain) on extinguishment of debt | - | - | 670 | (5,913) | |||||||||||||||||||
| Loss on sale of equity investments | 2,667 | - | 2,667 | - | |||||||||||||||||||
| Loss on impairment of goodwill and intangible assets | - | 361,612 | - | 1,434,363 | |||||||||||||||||||
| Stock-based compensation, including cRSUs | 10,243 | 6,818 | 26,059 | 19,829 | |||||||||||||||||||
| Adjusted EBITDA | $ | 155,132 | $ | 141,645 | $ | 451,229 | $ | 435,105 | |||||||||||||||
(1)"Other expenses, net" represents miscellaneous non-recurring expenses, impairment of other assets, non-integration related severance costs, legal expenses associated with the multi-district litigation, and start-up costs related to international expansion.
(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.
The following table presents a reconciliation of net loss to Adjusted EPS for the periods presented (in thousands, except share and per share amounts):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net loss | $ | (69,753) | $ | (391,450) | $ | (203,712) | $ | (1,507,866) | |||||||||||||||
| Adjustments: | |||||||||||||||||||||||
| Amortization of intangible assets | 85,971 | 85,971 | 257,913 | 257,913 | |||||||||||||||||||
|
Other expenses, net (1)
|
6,451 | 1,517 | 15,905 | 2,584 | |||||||||||||||||||
| Integration expenses | 66 | 850 | 579 | 1,994 | |||||||||||||||||||
| Loss on disposal of assets, including right-of-use assets | 1,902 | - | 7,378 | - | |||||||||||||||||||
| Transaction costs - Refinancing Transaction | - | - | 7,879 | - | |||||||||||||||||||
| Change in fair value of Private Placement Warrants and Unvested Founder Shares | - | (87) | - | (476) | |||||||||||||||||||
|
Transformation costs(2)
|
13,883 | - | 29,536 | - | |||||||||||||||||||
| Loss (Gain) on extinguishment of debt | - | - | 670 | (5,913) | |||||||||||||||||||
| Loss on sale of equity investments | 2,667 | - | 2,667 | - | |||||||||||||||||||
| Stock-based compensation, including cRSUs | 10,243 | 6,818 | 26,059 | 19,829 | |||||||||||||||||||
| Loss on impairment of goodwill and intangible assets | - | 361,612 | - | 1,434,363 | |||||||||||||||||||
| Estimated tax effect of adjustments | (27,094) | (29,724) | (77,080) | (87,925) | |||||||||||||||||||
| Adjusted net income | $ | 24,336 | $ | 35,507 | $ | 67,794 | $ | 114,503 | |||||||||||||||
|
Weighted average shares outstanding - basic and diluted(3)
|
16,480,703 | 16,143,520 | 16,403,821 | 16,139,523 | |||||||||||||||||||
| Net loss per share - basic and diluted | $ | (4.23) | $ | (24.25) | $ | (12.42) | $ | (93.43) | |||||||||||||||
| Adjusted EPS | $ | 1.48 | $ | 2.20 | $ | 4.13 | $ | 7.09 | |||||||||||||||
(1)"Other expenses, net" represents miscellaneous non-recurring expenses, impairment of other assets, non-integration related severance costs, legal expenses associated with the multi-district litigation, and start-up costs related to international expansion.
(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.
(3)Shares, common stock and additional paid-in capital have been retroactively adjusted for all periods presented to reflect the one-for-forty (1-for-40) reverse stock split that became effective on September 20, 2024. See Note 1, General Information and Basis of Accountingof the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report for additional information.
Factors Affecting the Comparability of our Results of Operations
As a result of a number of factors, our historical results of operations may not be comparable to our results of operations in future periods and may not be directly comparable from period to period. Set forth below is a brief discussion of the key factors impacting the comparability of our results of operations.
Refinancing Transaction
As part of the Refinancing Transactions, we have incurred transaction expenses of approximately $71.8 million, of which $7.9 million have been expensed as incurred for nine months ended September 30, 2025, and are included in Transaction costs - Refinancing Transaction in the accompanying condensed consolidated statements of operations and comprehensive loss.
Debt Repurchase and Cancellation
During the nine months ended September 30, 2024, the Company repurchased and cancelled $21.1 million of the Senior Convertible PIK Notes, resulting in the recognition of a gain on debt extinguishment of $5.9 million, representing the difference between the purchase price including associated fees and the net carrying amount of the extinguished debt.
Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024
The following table provides the results of operations for the periods indicated (in thousands):
| Three Months Ended September 30, | Change | Nine Months Ended September 30, | Change | ||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| Revenues | |||||||||||||||||||||||||||||||||||||||||||||||
| Network-Based Services | $ | 52,910 | $ | 46,153 | $ | 6,757 | 14.6 | % | $ | 153,925 | $ | 138,031 | $ | 15,894 | 11.5 | % | |||||||||||||||||||||||||||||||
| Analytics-Based Services | 164,401 | 157,704 | 6,697 | 4.2 | % | 474,797 | 477,693 | (2,896) | (0.6) | % | |||||||||||||||||||||||||||||||||||||
| Payment and Revenue Integrity Services | 28,648 | 26,638 | 2,010 | 7.5 | % | 90,137 | 82,755 | 7,382 | 8.9 | % | |||||||||||||||||||||||||||||||||||||
| Total Revenues | 245,959 | 230,495 | 15,464 | 6.7 | % | 718,859 | 698,479 | 20,380 | 2.9 | % | |||||||||||||||||||||||||||||||||||||
| Costs of services (exclusive of depreciation and amortization of intangible assets shown below) | |||||||||||||||||||||||||||||||||||||||||||||||
| Costs of services (exclusive of depreciation and amortization of intangible assets shown below) | 62,060 | 60,825 | 1,235 | 2.0 | % | 183,319 | 182,271 | 1,048 | 0.6 | % | |||||||||||||||||||||||||||||||||||||
| General and administrative expenses | 61,893 | 37,725 | 24,168 | 64.1 | % | 165,465 | 107,133 | 58,332 | 54.4 | % | |||||||||||||||||||||||||||||||||||||
| Depreciation expense | 25,968 | 22,572 | 3,396 | 15.0 | % | 75,775 | 65,372 | 10,403 | 15.9 | % | |||||||||||||||||||||||||||||||||||||
| Amortization of intangible assets | 85,971 | 85,971 | - | 0.0 | % | 257,913 | 257,913 | - | 0.0 | % | |||||||||||||||||||||||||||||||||||||
| Loss on impairment of goodwill and intangible assets | - | 361,612 | (361,612) | (100.0) | % | - | 1,434,363 | (1,434,363) | (100.0) | % | |||||||||||||||||||||||||||||||||||||
| Operating income (loss) | 10,067 | (338,210) | 348,277 | 103.0 | % | 36,387 | (1,348,573) | 1,384,960 | 102.7 | % | |||||||||||||||||||||||||||||||||||||
| Interest expense | 101,232 | 81,792 | 19,440 | 23.8 | % | 292,614 | 245,119 | 47,495 | 19.4 | % | |||||||||||||||||||||||||||||||||||||
| Interest income | (471) | (1,245) | 774 | 62.2 | % | (1,282) | (2,722) | 1,440 | 52.9 | % | |||||||||||||||||||||||||||||||||||||
| Transaction costs - Refinancing Transaction | - | - | - | NM | 7,879 | - | 7,879 | 100.0 | % | ||||||||||||||||||||||||||||||||||||||
| Loss (gain) on extinguishment of debt | - | - | - | NM | 670 | (5,913) | 6,583 | 111.3 | % | ||||||||||||||||||||||||||||||||||||||
| Loss on sale of equity investments | 2,667 | - | 2,667 | NM | 2,667 | - | 2,667 | 100.0 | % | ||||||||||||||||||||||||||||||||||||||
| Gain on change in fair value of Private Placement Warrants and Unvested Founder Shares | - | (87) | 87 | (100.0) | % | - | (476) | 476 | (100.0) | % | |||||||||||||||||||||||||||||||||||||
| Net loss before taxes | (93,361) | (418,670) | 325,309 | 77.7 | % | (266,161) | (1,584,581) | 1,318,420 | 83.2 | % | |||||||||||||||||||||||||||||||||||||
| Benefit for income taxes | (23,608) | (27,220) | 3,612 | 13.3 | % | (62,449) | (76,715) | 14,266 | 18.6 | % | |||||||||||||||||||||||||||||||||||||
| Net loss | $ | (69,753) | $ | (391,450) | $ | 321,697 | 82.2 | % | $ | (203,712) | $ | (1,507,866) | $ | 1,304,154 | 86.5 | % | |||||||||||||||||||||||||||||||
_____________________
NM = Not meaningful
Revenues
Revenues increased by $15.5 million, or 6.7%, for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. This increase in revenues was due to the increase in Network-Based Services of $6.8 million and Analytics-Based Services revenues of 6.7 million.
Revenues increased by $20.4 million, or 2.9%, for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. This increase in revenues was due to the increase in Network-Based Services of $15.9 million and Payment and Revenue Integrity Services Revenues of $7.4 million during this time period partially offset by the decrease in Analytics-Based Services revenues of $2.9 million.
Network-Based Services revenues increased by $6.8 million, or 14.6%, in the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The increase was primarily due to an increase in the Property and Casualty service line.
Network-Based Services revenues increased by $15.9 million, or 11.5%, in the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. The increase was primarily due to an increase in the Property and Casualty service line.
Analytics-Based Services revenues increased by $6.7 million, or 4.2%, for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. This increase in revenue was primarily due to an increase in the Data iSight ("DIS") and Financial Negotiation ("FNX") services and partially offset by customer and program attrition.
Analytics-Based Services revenues decreased by $2.9 million, or 0.6%, for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. This decrease in revenue was primarily due to a decrease in Surprise Bill Services of $15.8 million, primarily related to customer and program attrition partially offset by increases in DIS and FNX services.
Payment and Revenue Integrity Services revenues increased by $2.0 million, or 7.5%, for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. This increase was primarily due to increases in our Clinical Review and Payment Accuracy service lines of $4.0 million partially offset by decreases in our Revenue Integrity service line of $2.3 million.
Payment and Revenue Integrity Services revenues increased by $7.4 million, or 8.9%, for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. This increase was primarily due to increases in our Clinical Review and Payment Accuracy service lines of $11.9 million partially offset by decreases in our Revenue Integrity service line of $2.4 million.
Costs of Services (exclusive of depreciation and amortization of intangible assets) (in thousands):
| Three Months Ended September 30, | Change | Nine Months Ended September 30, | Change | ||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| Personnel expenses excluding stock-based compensation | $ | 47,618 | $ | 48,983 | $ | (1,365) | (2.8) | % | $ | 141,581 | $ | 148,470 | $ | (6,889) | (4.6) | % | |||||||||||||||||||||||||||||||
| Stock-based compensation (including cRSUs) | 2,800 | 1,940 | 860 | 44.3 | % | 7,095 | 5,994 | 1,101 | 18.4 | % | |||||||||||||||||||||||||||||||||||||
| Personnel expenses including stock-based compensation | 50,418 | 50,923 | (505) | (1.0) | % | 148,676 | 154,464 | (5,788) | (3.7) | % | |||||||||||||||||||||||||||||||||||||
| Access and bill review fees | 5,028 | 5,772 | (744) | (12.9) | % | 17,249 | 15,343 | 1,906 | 12.4 | % | |||||||||||||||||||||||||||||||||||||
| Other cost of services expenses | 6,614 | 4,130 | 2,484 | 60.1 | % | 17,394 | 12,464 | 4,930 | 39.6 | % | |||||||||||||||||||||||||||||||||||||
| Total costs of services | $ | 62,060 | $ | 60,825 | $ | 1,235 | 2.0 | % | $ | 183,319 | $ | 182,271 | $ | 1,048 | 0.6 | % | |||||||||||||||||||||||||||||||
Costs of services were stable for the three and nine months ended September 30, 2025 as compared to the three and nine months ended September 30, 2024.
General and Administrative Expenses (in thousands):
| Three Months Ended September 30, | Change | Nine Months Ended September 30, | Change | ||||||||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | ||||||||||||||||||||||||||||||||||||||||
| Personnel expenses excluding stock-based compensation | $ | 20,246 | $ | 16,209 | $ | 4,037 | 24.9 | % | $ | 55,014 | $ | 45,023 | $ | 9,991 | 22.2 | % | |||||||||||||||||||||||||||||||
| Stock-based compensation (including cRSUs) | 7,443 | 4,879 | 2,564 | 52.6 | % | 18,964 | 13,835 | 5,129 | 37.1 | % | |||||||||||||||||||||||||||||||||||||
| Other general and administrative expenses | 34,204 | 16,637 | 17,567 | 105.6 | % | 91,487 | 48,275 | 43,212 | 89.5 | % | |||||||||||||||||||||||||||||||||||||
| Total general and administrative expenses | $ | 61,893 | $ | 37,725 | $ | 24,168 | 64.1 | % | $ | 165,465 | $ | 107,133 | $ | 58,332 | 54.4 | % | |||||||||||||||||||||||||||||||
The increase in general and administrative expenses of $24.2 million for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024 was primarily due to $13.9 million of transformation costs, increase in personnel expenses of $4.0 million, increased stock compensation of $2.6 million, and $1.9 million of losses on disposal of assets (including right-of-use assets).
The increase in general and administrative expenses of $58.3 million for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024 was primarily due to $29.5 million of transformation costs, increase in
personnel expenses of $10.0 million, $7.4 million of losses on disposal of assets (including right-of-use assets), and increased stock compensation of $5.1 million.
Depreciation Expense
The increases in depreciation expenses of $3.4 million, or 15.0%, and $10.4 million, or 15.9% for the three and nine months ended September 30, 2025 as compared to the three and nine months ended September 30, 2024, were due to purchases of property and equipment, including internally generated capitalized software, partially offset by assets that were written off or became fully depreciated in the period.
Loss on Impairment of Goodwill and Intangible Assets
For the three and nine months ended September 30, 2024, in connection with quantitative impairment testing performed on our goodwill and indefinite-lived intangibles, we recorded a loss on impairment of goodwill and indefinite-lived intangibles of $361.6 million and $1,434.4 million, respectively. For the three and nine months ended September 30, 2025, no such loss was recorded.
Interest Expense
The increase in interest expense of $19.4 million and $47.5 million for the three and nine months ended September 30, 2025 as compared to the three and nine months ended September 30, 2024 was primarily due the non-cash interest recognized on the New Notes and the increase in average indebtedness outstanding during the periods.
Our annualized weighted average cash interest rate increased by 0.16% across our total debt in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. As of September 30, 2025 and September 30, 2024, our total debt had an annualized weighted average cash interest rate of 6.95% and 6.79%, respectively. As of December 31, 2024, our total debt had a weighted average cash interest rate of 6.68%.
Interest Income
The decreases in interest income of $0.8 million and $1.4 million for the three and nine months ended September 30, 2025, as compared to the three and nine months ended September 30, 2024 were primarily due to less interest earned on interest bearing bank accounts resulting from lower average invested cash and cash equivalents balances.
Loss (gain) on extinguishment of debt
During the nine months ended September 30, 2025, in connection with the Refinancing Transactions, the Company recognized a loss on extinguishment of debt of $0.7 million for unamortized deferred costs relating to the Existing Revolving Credit Commitments.
During the nine months ended September 30, 2024, the Company repurchased and cancelled $21.1 million of the Senior Convertible PIK Notes, resulting in the recognition of a gain on debt extinguishment of $5.9 million, representing the difference between the reacquisition price of the debt and the net carrying amount of the extinguished debt.
Benefit for income taxes
Net loss before income taxes for the three months ended September 30, 2025 of $93.4 million generated a benefit for income taxes of $23.6 million. Net loss before income taxes for the three months ended September 30, 2024 of $418.7 million generated a benefit for income taxes of $27.2 million.
Net loss before income taxes for the nine months ended September 30, 2025 of $266.2 million generated a benefit for income taxes of $62.4 million. Net loss before income taxes for the nine months ended September 30, 2024 of $1,584.6 million generated a benefit for income taxes of $76.7 million.
The effective tax rate for the nine months ended September 30, 2025 differed from the statutory rate primarily due to stock compensation expense, limitations on executive compensation and state taxes. The effective tax rate for the nine months ended September 30, 2024 differed from the statutory rate primarily due to stock compensation expense, limitations on executive compensation, non-deductible goodwill impairment, and state taxes.
Liquidity and Capital Resources
As of September 30, 2025, we had cash and cash equivalents of $50.6 million, which includes restricted cash of $11.5 million. As of September 30, 2025, we had $273.6 million of loan availability under the revolving credit facility. As of September 30, 2025, we had five letters of credit totaling $6.4 million of utilization against the revolving credit facility. Four letters of credit are used to satisfy real estate lease agreements for four of our offices in lieu of security deposits in the amount of $4.4 million and $3.2 million as of September 30, 2025 and December 31, 2024, respectively. The Company also has an irrevocable letter of credit to satisfy the obligations of a subsidiary in the amount of $2.0 million as of September 30, 2025 and $6.1 million as of December 31, 2024.
Our primary sources of liquidity are internally generated funds combined with our borrowing capacity under our 2025 Revolving Credit Facility. We believe these sources will provide sufficient liquidity for us to meet our working capital, and capital expenditure and other cash requirements for the next twelve months. We may from time to time at our sole discretion purchase, redeem or retire our long-term debt, through tender offers, in privately negotiated or open market transactions or otherwise. We plan to finance our capital expenditures with cash from operations. Furthermore, our future liquidity and future ability to fund capital expenditures, working capital, and debt requirements are also dependent upon our future financial performance, which is subject to many economic, commercial, financial and other factors that are beyond our control, including the ability of financial institutions to meet their lending obligations to us. If those factors significantly change, our business may not be able to generate sufficient cash flow from operations or future borrowings may not be available to meet our liquidity needs. We anticipate that to the extent we require additional liquidity as a result of these factors or in order to execute our strategy, it would be financed either by borrowings under our senior secured credit facilities, by other indebtedness, additional equity financings, or a combination of the foregoing. We may be unable to obtain any such additional financing on reasonable terms or at all.
Prior to January 30, 2025, our senior secured credit facilities consisted of (a) initial aggregate principal of $1,325.0 million ($1,281.9 million at December 31, 2024) term loan facility maturing on September 1, 2028 and (b) MPH's $450.0 million senior secured revolving credit facility maturing on August 24, 2026, and after January 30, 2025, consist of MPH's senior secured credit facilities which consist of (a) $325.0 million of New First-Out First Lien Term Loans, (b) $1,143.9 million of New Second-Out First Lien Term Loans, and (c) the 2025 Revolving Credit Facility (the "senior secured credit facilities").
Cash Flow Summary
The following table is derived from our condensed consolidated statements of cash flows (in thousands):
| Nine Months Ended September 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Net cash flows provided by (used in): | |||||||||||
| Operating activities | $ | 51,038 | $ | 141,029 | |||||||
| Investing activities | (86,359) | (87,689) | |||||||||
| Financing activities | 56,294 | (37,666) | |||||||||
For the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024
Cash Flows from Operating Activities
Cash flows from operating activities decreased by $90.0 million, primarily due to lower earnings once adjusted for non-cash items of $3.5 million, and unfavorable changes in working capital. Changes in our working capital requirements primarily reflect the timing of payment of $71.8 million of the transaction expenses related to the Refinancing Transaction, the majority of which were paid during the nine months ended September 30, 2025, and the timing of collection on Trade accounts receivables, net.
Cash Flows from Investing Activities
Net cash used in investing activities decreased by $1.3 million, as compared to the prior-year period, primarily due to higher proceeds from the sale of investments, partially offset by investments in technologies to support our transformation initiatives.
Cash Flows from Financing Activities
Net cash provided by financing activities increased $94.0 million as compared to the prior-year period, primarily due the net borrowing of $70.0 million on our 2025 Revolving Credit Facility to fund the transaction costs related to the Refinancing Transaction versus the repurchase of PIK Notes of $14.9 million and treasury stock of $10.4 million in the prior period.
Term Loans and Revolvers
In connection with the Refinancing Transaction, on January 30, 2025, MPH issued senior secured credit facilities composed of $325.0 million of New First-Out First Lien Term Loans and $1,143.9 million of New Second-Out First Lien Term Loans and entered into a $350.0 million senior secured revolving credit facility.
Interest on the New First-Out First Lien Term Loans is calculated, at MPH's option, as (a) Term SOFR (or 0.50%, if higher) plus 3.75% or (b)(x) the highest rate of (1) the prime rate, (2) the federal funds effective rate plus 0.50%, (3) Term SOFR for an interest period of one month plus 1.00%, and (4) 1.50% plus (y) 2.75%. Interest on the New Second-Out First Lien Term Loans is calculated, at MPH's option, as (a) Term SOFR (or 0.50%, if higher) plus the applicable SOFR adjustment plus 4.60% or (b)(x) the highest rate of (1) the prime rate, (2) the federal funds effective rate plus 0.50%, (3) Term SOFR for an
interest period of one month plus the applicable SOFR adjustment plus 1.00%, and (4) 1.50% plus (y) 3.60%. Interest on the 2025 Revolving Credit Loans is calculated, at MPH's option, as (a) Term SOFR (or 0.00%, if higher) plus 3.75% or (b)(x) the highest rate of (1) the prime rate, (2) the federal funds effective rate plus 0.50%, (3) Term SOFR for an interest period of one month plus 1.00% and (4) 1.00% plus (y) 2.75%.
The New First Lien Term Loans mature on December 31, 2030 and the 2025 Revolving Credit Facility matures on December 31, 2029.
We are obligated to pay a commitment fee on the average daily unused amount of our 2025 Revolving Credit Facility. The fee can range from an annual rate of 0.25% to 0.50% based on our consolidated first out, first lien debt to consolidated EBITDA ratio, as defined in the New First Lien Credit Agreement.
Interest Rate Swap Agreements
The Company is exposed to interest rate risk on its floating rate debt. On September 12, 2023, the Company entered into three interest rate swap agreements with a total notional value of $800 million to effectively convert a portion of its floating rate debt to a fixed-rate basis of 4.59% as a weighted-average across the three swaps. The interest rate swap agreements are effective August 31, 2023 and mature on August 31, 2026. The principal objective of these contracts is to reduce the volatility of the cash flows in interest payments associated with the Company's floating rate debt, thus reducing the impact of interest rate changes on future interest payment cash flows. The Company's interest rate swaps are highly effective at offsetting the changes in cash outflows and therefore designated as cash flow hedging instruments. The Refinancing Transaction did not have an impact on these interest swap agreements.
Senior Notes
Senior Convertible PIK Notes
On October 8, 2020, the Company issued $1,300.0 million in aggregate principal amount of Senior Convertible PIK Notes. The Senior Convertible PIK Notes were issued with a 2.5% discount with a maturity date of October 15, 2027.
The Senior Convertible PIK Notes are convertible into shares of Class A common stock based on a $520.00 conversion price, subject to customary anti-dilution adjustments. The Senior Convertible PIK Notes are guaranteed by Polaris Intermediate Corp. ("Polaris Intermediate"). The interest rate on the Senior Convertible PIK Notes is fixed at 6% in cash and 7% in kind and is payable semi-annually on April 15 and October 15 of each year.
5.750% Notes
On October 29, 2020, the Company issued $1,300.0 million in aggregate principal amount of the 5.750% Notes. The 5.750% Notes are guaranteed on a senior unsecured basis jointly and severally by the Company and its subsidiaries (subject to certain exceptions and, as of January 30, 2025, excluding the Released Guarantors (as defined below)) and have a maturation date of November 1, 2028. The 5.750% Notes were issued at par. The interest rate on the 5.750% Notes is fixed at 5.750% and is payable semi-annually on May 1 and November 1 of each year.
As used herein, references to "Released Guarantors" are to (i) Benefits Science LLC, (ii) BST Acquisition Corp., (iii) American Lifecare Holdings, Inc., (iv) American Lifecare, Inc., (v) Statewide Independent PPO Inc., (vi) Private Healthcare Systems, Inc., (vii) HSTechnology Solutions, Inc., (viii) HST Acquisition Corp., (ix) Launchpoint Ventures, LLC, (x) DHP Acquisition Corp. and (xi) Data & Decision Science LLC.
5.50% Notes
On August 24, 2021 MPH issued $1,050.0 million in aggregate principal amount of 5.50% Notes with a maturation date of September 1, 2028. The interest rate on the 5.50% Notes is fixed at 5.50% and is payable semi-annually on March 1 and September 1 of each year. As a result of the Refinancing Transaction, all of the collateral securing the 5.50% Notes was released. Accordingly, the 5.50% Notes are guaranteed on a senior unsecured basis jointly and severally by the Company and its subsidiaries (subject to certain exceptions) and, as of January 30, 2025, excluding the Released Guarantors.
Note Repurchases
In the nine months ended September 30, 2024, the Company repurchased and cancelled $21.1 million of the Senior Convertible PIK Notes, resulting in the recognition of a gain on debt extinguishment of $5.9 million.
In connection with the Exchange Offers, on January 30, 2025, $1,044.2 million, $974.5 million, and $1,253.5 million of the 5.50% Notes, the 5.750% Senior Notes, and the Senior Convertible PIK Notes, respectively, were cancelled. Accordingly, following completion of the Exchange Offers, $5.8 million, $5.3 million, and $420.0 thousand of the 5.50% Notes, the 5.750% Senior Notes, and the Senior Convertible PIK Notes, respectively, remain outstanding.
New Notes
On January 30, 2025, MPH issued $600.2 million in aggregate principal amount of New Second-Out First Lien A Notes with a maturation date of December 31, 2030. The New Second-Out First Lien A Notes bear interest at a rate per annum equal to 6.50% paid in cash plus 5.00% paid in PIK interest, and interest is payable semi-annually on January 30 and July 30 of each year, which commenced on July 30, 2025.Upon the occurrence of specific kinds of changes of control events, the holders of New Second-Out First Lien A Notes will have the right to cause MPH, to repurchase some or all of the New Second-Out First Lien A Notes at 101.0% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the date of purchase. The New Second-Out First Lien A Notes are guaranteed and secured as described below under Guarantees and Security.
On January 30, 2025, MPH issued $763.1 million in aggregate principal amount of New Second-Out First Lien B Notes with a maturation date of December 31, 2030. The New Second-Out First Lien B Notes bear interest at a rate per annum equal to 5.75% in cash, and interest is payable semi-annually on January 30 and July 30 of each year, which commenced on July 30, 2025. Upon the occurrence of specific kinds of changes of control events, the holders of New Second-Out First Lien B Notes will have the right to cause MPH, to repurchase some or all of the New Second-Out First Lien B Notes at 101.0% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the date of purchase. The New Second-Out First Lien B Notes are guaranteed and secured as described below under Guarantees and Security.
On January 30, 2025, MPH issued $752.5 million in aggregate principal amount of New Third-Out First Lien A Notes with a maturation date of March 31, 2031. The New Third-Out First Lien A Notes bear interest at a rate per annum equal to 6.00% paid in cash plus 0.75% paid in PIK interest, and interest is payable semi-annually on January 30 and July 30 of each year, which commenced on July 30, 2025. On the maturity date, MPH is required to repay the outstanding principal amount of the New Third-Out First Lien A Notes at a price equal to 107.0% of the principal amount thereof. Upon the occurrence of specific kinds of changes of control events, the holders of New Third-Out First Lien A Notes will have the right to cause Claritev or MPH, as applicable, to repurchase some or all of the applicable series of New Third-Out First Lien A Notes at 107.0% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the date of purchase. The New Third-Out First Lien A Notes are guaranteed and secured as described below under Guarantees and Security.
On January 30, 2025, the Company issued $969.4 million in aggregate principal amount of New Third-Out First Lien B Notes with a maturation date of March 31, 2031. The New Third-Out First Lien B Notes bear interest at a rate per annum equal to 6.00% paid in cash plus 0.75% paid in PIK interest, and interest is payable semi-annually on January 30 and July 30 of each year, which commenced on July 30, 2025. On the maturity date, the Company is required to repay the outstanding principal amount of the New Third-Out First Lien B Notes at a price equal to 107.0% of the principal amount thereof. Upon the occurrence of specific kinds of changes of control events, the holders of New Third-Out First Lien B Notes will have the right to cause Claritev or MPH, as applicable, to repurchase some or all of the applicable series of New Third-Out First Lien B Notes at 107.0% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the date of purchase. The New Third-Out First Lien B Notes are guaranteed and secured as described below under Guarantees and Security.
The New Second-Out First Lien A Notes, the New Second-Out First Lien B Notes, the New Third-Out First Lien A Notes, and the New Third-Out First Lien B Notes are referred to collectively as the "New Notes."
Debt Covenants and Events of Default
We are subject to certain affirmative and negative debt covenants under the debt agreements governing our indebtedness that limit our and/or certain of our subsidiaries' ability to engage in specific types of transactions. These covenants limit our and/or certain of our subsidiaries' ability to, among other things:
•incur additional indebtedness or issue disqualified or preferred stock;
•pay certain dividends or make certain distributions on capital stock or repurchase or redeem capital stock;
•make certain loans, investments or other restricted payments;
•transfer or sell certain assets;
•incur certain liens;
•place restrictions on the ability of its subsidiaries to pay dividends or make other payments to us;
•guarantee indebtedness or incur other contingent obligations;
•prepay junior debt and make certain investments;
•consummate any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or dispose of all or substantially all of its business units, assets or other properties; and
•engage in transactions with our affiliates.
Term Loan B, 5.50% Notes, 5.750% Notes, New First-Out First Lien Term Loans, New Second-Out First Lien Term Loans, and the New Notes have speculative grade ratings. The Senior Convertible PIK Notes are unrated.
The financial covenant under the 2025 Revolving Credit Facility is such that, if, as of the last day of any fiscal quarter of MPH (commencing with the fiscal quarter ended March 31, 2025), the aggregate amount of loans under the 2025 Revolving Credit Facility, letters of credit issued under the 2025 Revolving Credit Facility (to the extent not cash collateralized or backstopped or, in the aggregate, in excess of $15.0 million) and swingline loans are outstanding and/or issued in an aggregate amount greater than 40.0% of the total commitments in respect of the 2025 Revolving Credit Facility at such time, the 2025 Revolving Credit Facility will require MPH to maintain a consolidated first out first lien debt to consolidated EBITDA ratio not to exceed 2.50 to 1.00.
As of September 30, 2025 and December 31, 2024 we were in compliance with all of the debt covenants.
The debt agreements governing our senior secured indebtedness contain customary events of default, subject to grace periods and exceptions, which include, among others, payment defaults, cross-defaults to certain material indebtedness, certain events of bankruptcy, material judgments, failure of a guarantee on the liens on material collateral to remain in effect, in the case of the debt agreements governing the senior secured credit facilities, any change of control. Upon the occurrence of an event of default under such debt agreements, the lenders and holders of such debt will be permitted to accelerate the loans and terminate the commitments, as applicable, thereunder and exercise other specified remedies available to the lenders and holders thereunder.
As a result of the Refinancing Transaction, (i) the Company and MPH entered into the amendment to the Existing First Lien Credit Agreement (the "Credit Agreement Amendment") and supplemental indentures with respect to the 5.50% Notes, the 5.750% Notes and the Senior Convertible PIK Notes, which had the effect of eliminating substantially all of the covenants and events of defaults in the Existing First Lien Credit Agreement and in the indentures governing such notes.
See the footnotes to the EBITDA and Adjusted EBITDA reconciliation table provided above under Non-GAAP Financial Measuresfor material differences between the financial information of Claritev and MPH.
Guarantees and Security
All obligations under the debt agreements governing the 2025 Revolving Credit Facility, the New First Lien Term Loans, and the New Notes issued by MPH are unconditionally guaranteed by the Company, MPH Acquisition, Polaris Intermediate, Polaris Parent LLC ("Polaris Parent"), and each existing and subsequently acquired or organized direct or indirect wholly owned U.S. organized subsidiary of MPH (subject to certain exceptions). All obligations under the New Notes issued by Claritev are unconditionally guaranteed by MPH, MPH Acquisition, Polaris Intermediate, Polaris Parent, and each existing and subsequently acquired or organized direct or indirect wholly owned U.S. organized subsidiary of MPH (subject to certain exceptions). All such obligations, and the guarantees of such obligations, are secured, subject to permitted liens and other exceptions, by a first priority lien shared between the senior secured credit facilities and the New Notes on substantially all of the tangible and intangible property of the Company, MPH Acquisition, Polaris Intermediate, Polaris Parent, MPH and the subsidiary guarantors, and a pledge of all of the capital stock of each of their respective subsidiaries (subject to certain exceptions).
Critical Accounting Policies and Estimates
The preparation of condensed consolidated financial statements and related disclosures in conformity with GAAP and the Company's discussion and analysis of its financial condition and operating results, require the Company's management to make judgments, assumptions, and estimates, which we believe are reasonable and prudent based on the available facts and circumstances. These judgments, assumptions and estimates affect the amounts reported. There have been no material changes to the Company's critical accounting policies and estimates described in Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2024 Annual Report on Form 10-K.
Customer Concentration
Two clients individually accounted for 28% and 16% of revenues for the year ended December 31, 2024. Three clients individually accounted for 28%, 11% and 10% of revenue for the nine months ended September 30, 2025. The loss of the business of one or more of our larger customers could have a material adverse effect on our results of operations. For further discussion on our customer concentration, please refer to Part I, Item 1A. "Risk Factors" in our 2024 Annual Report on Form 10-K.
Recent Accounting Pronouncements
See Note 1, General Information and Basis of Accountingof the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for additional information.
Quantitative and Qualitative Disclosure About Market Risk
See Item 3. "Quantitative and Qualitative Disclosure about Market Risk" below.
Internal Controls Over Financial Reporting
For further information on the Company's internal controls over financial reporting see Item 4. "Controls and Procedures".
Claritev Corporation published this content on November 07, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on November 07, 2025 at 21:03 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]