DGX 10-K & 10-Q changes, risk factors and insider trading

You should carefully consider all of the information set forth in this Report, including the following risk factors, before deciding to invest in any of our securities. The risks below are not the only ones that we face. Additional risks not presently known to us, or that we presently deem immaterial, may also negatively impact us. Our business, consolidated financial condition, revenues, results of operations, profitability, cash flows or reputation ,reputation, or the price of our common stock, could be materially impacted by any of these factors.

The U.S. healthcare system continues to evolve. Significant change is taking place in the healthcare system, including as discussed above under the heading "The Clinical Testing IndustryIndustry.". For example, value-based reimbursement is increasing (e.g., UnitedHealthcare's Preferred Lab Network) and CMS has set goals for value-based reimbursement to be achieved by 2030. Patients are encouraged to take increased interest in and responsibility for, and often are bearing increased responsibility for payment for, their healthcare. Healthcare industry participants are evolving and consolidating. Healthcare services increasingly are being provided by non-traditional providers (e.g., physician assistants), in non-traditional venues (e.g., retail medical clinics, urgent care centers) and using new technologies (e.g., telemedicine, digital pathology). Utilization of the healthcare system is being influenced by several factors and may result in a decline in the demand for diagnostic information services. In addition, we believe that clinical testing market fundamentals are changing. The regulatory environment related to reimbursement rates for clinical laboratory tests under Medicare are in flux and we also believe that health plans and consumers increasingly are focusing on driving better value in laboratory testing services. We expect that the evolution of the healthcare industry will continue, and that industry change is likely to be extensive.

WeIn alsoaddition, believethe diagnostic information services industry is faced with potential changes in government regulations that healthcould plansimpact andpatient consumersaccess increasinglyto are focusing on driving better value in laboratory testing services.healthcare. We expect that the evolution of the healthcare industry will continue, and that industry change is likely to be extensive.

The diagnostic information services industry also is faced with changing technology and new product introductions. Competitors may compete using advanced technology, including technology that enables more convenient or cost-effective testing (e.g., technology enabled by AI). Digital pathology is an example of this. Competitors also may compete on the basis of new service offerings. Competitors also may offer new testing services that can be performed outside of a commercial clinical laboratory, such as point-of-care testing that can be administered by physicians in their offices, complex testing that can be performed by hospitals in their own laboratories, and home testing that can be carried out without requiring the services of outsideproviders providers.like us.

Pursuant to PAMA, reimbursement rates for many clinical laboratory tests provided under Medicare were reduced during 2018 - 2020. Unfortunately, asby arelying resulton oflaboratory a flawed implementation of PAMA, thereported data collectedalone in 2017, CMS did not accuratelyreceive representcomprehensive and representative data needed to set Medicare rates that reflected the laboratorycommercial marketmarket, as required under PAMA. Independent laboratories were overrepresented, and hospitals and physician office laboratories were underrepresented, making the first round of PAMA cuts too extreme.excessive. The first three years of cuts greatly exceeded the original 10-year savings projections. PAMAStarting calls for further revision of the Medicare CLFS for years afterin 2020, based on future surveys of market rates. Congress has delayedrepeatedly cutsacted fiveto timesdelay PAMA implementation by delaying the next round of data reporting (2021 - 20252020-2026) and delayedMedicare 2019 reporting six timescuts (2020 - 20252021-2026). ReimbursementHowever, ratethe reductionstructural fromflaws 2026-28 is capped byof PAMA atstill 15%need annually.to be addressed to mitigate future excessive cuts. Congress reintroduced federalintroduced legislation in 20232025, (the SavingResults Access to Laboratory Services Act),Act, which would reform PAMA and create a true market-based CLFS.

ThereThe is uncertainty surrounding potential changes to the regulatorypolitical environment impacting healthcare regulation in the United States,States particularly as it relatescontinues to healthcarebe regulationuncertain. The services that we offer and relatedour programs,result followingof operations could be adversely affected by legislative, enforcement, regulatory and public policy changes at the outcomefederal or state level, many of the U.S. Presidential election in November 2024, which maywe havecannot aanticipate materialat adversethis effecttime. onThere our business. For example, the incoming administration announced a planned advisory commissioncontinues to reformbe federal government processes and reduce expenditures. Pressurespressures on and uncertainty surrounding the U.S. federal government’s budget, and potential changes in budgetary priorities, which could adversely affect the funding for individual programs, including Medicare and other government programs upon which our business depends. Additionally, changes in legislation and regulations (including those related to taxation, trade and importation), economic and monetary policies, geopolitical matters, among other potential impacts, could adversely impact the global economy and our operating results. The potential impact of any new policies or changes to existing policies that have been or may be implemented as a result of the new administration is currently uncertain.

These laws and regulations may be interpreted or applied by a governmental, prosecutorial, regulatory or judicial authority in a manner that could require us to make changes in our operations, including our pricing and/or billing practices. We may not be able to maintain, renew or secure required permits, licenses or any other regulatory approvals needed to operate our business or commercialize our services. If we fail to comply with applicable laws and regulations, or if we fail to comply with settlement obligations, or if we fail to maintain, renew or obtain necessary permits, licenses and approvals, we could suffer civil and criminal penalties, fines, exclusion from participation in governmental healthcare programs and the loss of various licenses, certificates and authorizations necessary to operate our business, as well as incur additional liabilities from third-party claims. If any of the foregoing were to occur, our reputation could be damaged and important business relationships with third parties could be adversely affected.

The FDA has regulatory responsibility over, among other areas, instruments, software, test systems, collection kits, reagents and other devices used by clinical laboratories to perform diagnostic testing in the United States. The FDA also regulates drugs-of-abuse testing for employers and insurers, testing for blood bank purposes and testing of donors of human cells for purposes such as in vitro fertilization. We offer companion and complementary diagnostic testing servicestests to pharmaceutical companies that are regulated by the FDA. A number of tests we develop internally are offered as LDTs.

For more information, see above under the heading “RegulationRegulation.".

Our international operations (including in Canada) increase our exposure to risks inherent in doing business in non-U.S. markets, which may vary by market and include: intellectual property legal protections and remedies; weak legal systems which may, among other things, affect our ability to enforce contractual rights; trade regulations and procedures and actions affecting approval, production, pricing, supply, reimbursement and marketing of products and services; existing and emerging data privacy regulations affecting the processing and transfer of personal data; new regulations relating to the use of AI; and challenges based on differing languages, cultures and unfamiliar practices. InternationalTariffs, sanctions and other barriers imposed or threatened by the U.S. government, and the responses to those actions from other countries, may result in adverse impacts to the global economic environment, including the global financial and trading markets, which could have a negative impact on our results of operations and financial condition. These actions could also requirenegatively usimpact our supply chain costs or availability of products we need to devote management resources to implementoperate our controlsbusiness. andThe systemsongoing in new markets, and to complyuncertainty with the U.S.current Foreignstate Corruptof Practicesglobal Acttrade andpolicy similarmagnifies anti-corruptionthese laws in non-U.S. jurisdictions.risks.

The diagnostic information services industry is facing rapidly changing technology and innovations in product offerings, including technology that enables more convenient, accessible and cost-effective testing. For example, digital pathology is a technology that we are currently deploying that may change the practice of pathology and our role in it. Competitors also may offer new testing services that can be performed outside of a commercial clinical laboratory, such as point-of-care testing that can be administered by physicians in their offices, complex testing that can be performed by hospitals in their own laboratories, and home testing that can be carried out without requiring the services of outsideproviders providers.like us. Further, diagnostic tests approved or cleared by the FDA for home use are automatically deemed to be “waived” tests under CLIA and may be performed by consumers in their homes; test kit manufacturers could seek to increase sales to patients of such test kits. Additionally, some traditional customers for anatomic pathology services, including specialty physicians that generate biopsies through surgical procedures, such as dermatologists, gastroenterologists, urologists and oncologists, are consolidating, have added in-office histology labs or have retained pathologists to read cases on site. Hospitals also are internalizing clinical laboratory testing, including some non-routine and advanced testing. These technological advances (and the ones yet to come) and the continued internalization of testing services may lead to the need for less frequent testing and/or less use of the testing services we offer.

We have been and expect to continue to use AI technology in our testing services, and we anticipate it will become increasingly important to us over time. This technology, including generative AI, which is in its early stages of broader commercial implementation, presents a number of risks inherent in its use, including risks related to cybersecurity, privacy and data security and use practices.practices and our oversight of how we use AI. Additionally, AI technology can create accuracy issues and other outcomes that could harm our customers and negatively impact our reputation and our business. Further, our competitors may develop new testing services and other products relying on AI more rapidly or more successfully than us, which could hinder our ability to compete effectively and adversely affect our results of operations. Using AI successfully will require significant resources, including having the technical expertise required to develop, test and maintain AI-based testing services.services and continually developing the appropriate governance and oversight of our use of AI. In addition, we anticipate that there will continue to be new regulatory requirements concerning the use of AI, which may aim to regulate, limit, or block the use of AI in our testing and other services or otherwise impose other restrictions that may hinder their usability or effectiveness.

IT systems are used extensively in virtually all aspects of our business, including clinical testing, test reporting, billing, customer service, logistics and management of medical data. Our success depends, in part, on the continued and uninterrupted performance of our IT systems. A failure or delay in our IT systems could impede our ability to serve our customers and patients and protect their confidential data. Despite redundancy and backup measures and precautions that we have implemented, our IT systems may be vulnerable to damage, disruptions and shutdown from a variety of sources, including the age of the technology, telecommunications or network failures, system conversion, standardization or modernization initiatives, human acts and natural disasters. For example, in Februaryconnection 2025,with Project Nova, we committed to a multi-year project ("Project Nova") to modernize our "Order to Cash" business processesprocesses, including the related information technology infrastructure and underlying enabling technologies. We are partnering with Epic, a third-party licensor, to assist in the implementation of Project Nova. These issues can also arise as a result of failures by third parties with whom we do business, including manufacturers and developers of the hardware and software we use, and over which we have limited control. Any disruption or failure of our IT systems, including in connection with Project Nova, could have a material impact on our ability to serve our customers and patients, including negatively affecting our reputation in the marketplace, or otherwise adversely impact our business.

It is important that we continue to strengthen our efficiencyefficiency, including through the use of technology and automation, to promote our competitive position and enable us to mitigate the impact on our profitability of steps taken by government payers and health insurers to reduce the utilization and reimbursement of diagnostic information services, and to partly offset pressures from the currentan inflationary environment, including labor and benefit cost increases, and reimbursement pressures.

In our business, we collect, generate, process or maintain sensitive information, such as patient data and other personal information. We are subject to laws and regulations regarding protecting the security and privacy of certain healthcare and personal information, including: (a) the federal Health Insurance Portability and Accountability Act and the regulations thereunder, which establish (i) a complex regulatory framework including requirements for safeguarding protected health information and (ii) comprehensive federal standards regarding the uses and disclosures of protected health information; (b) state laws (e.g., California) and similar laws in other states; and (c) laws outside the United States, including the European Union's General Data Protection Regulation, Canada’s Personal Information Protection and Electronic Documents Act and provincial health privacy laws, and similar laws in other jurisdictions.

We regularly assess opportunities and risks related to corporate responsibility, which includes sustainability, social and governance matters. As part of this process, we make decisions related to these matters and may set goals and targets related to sustainability and social matters. We have a broad range of stakeholders, including our stockholders, employees, customers, which include government entities, patients and communities we serve, some of whom increasingly focus on corporate responsibility considerations.considerations Inand addition,many somehave different or conflicting expectations with respect to corporate responsibility and related matters. Some of our stockholders, employeesemployees, customers and patients may consider corporate responsibility factors in making investment, employment and service provider decisions. Our ability to achieve the goals we may set related to corporate responsibility matters are subject to numerous risks and uncertainties, many of which are outside of our control. Despite our efforts, we may not achieve our goals on the timetable we set or at all. Additionally, certain of our stakeholders may not be satisfied with our decisions related to corporate responsibility matters, the goals we set, our progress towards these goals or the resulting outcomes. This could lead to negative perceptions of, or loss of support for, our business, difficulty recruiting or attracting new employees and our stock price being negatively impacted.

External actors may develop and deploy viruses, other malicious software programs, ransomware attacks, distributed denial of service attacks or other attempts to harm or obtain unauthorized access to our systems, including through the increased use of AI and other emerging technologies. External actors may also deploy programs targeting our employees which are designed to attack our IT systems or otherwise exploit security vulnerabilities through programs such as electronic spamming, phishing, smishing, spear phishing or similar tactics. As a result of the difficulty in detecting many of these attacks, intrusions and breaches, failures or losses may be repeated or compounded before they are discovered or rectified, which could further increase these costs and consequences. Additionally, new technology that we deploy to automate processes, improve customer service, generate insights from lab and other data and stimulate innovation to improve operational efficiency, including the expanded use of AI, may further expose our IT systems to the risk of cyberattacks and may create the need for rapid modifications to our cybersecurity program. Also, an increasing risk of civil unrest, political tensions, wars or other military conflicts may also impact the cybersecurity threat risk landscape.

Although the Company has implemented robust security measures implemented,measures, which are monitored and routinely tested both by internal resources and external parties, cybersecurity threats and attacks against us continue to evolve and occur and may not be recognized until after an incident. In August 2021, ReproSource, our subsidiary, experienced a data security incident in which an unauthorized party may have accessed or acquired protected health information and personally identifiable information of ReproSource patients (in connection with the incident, ReproSource discovered and contained ransomware). The Company’s other systems were not impacted or compromised by this incident. Although the attacks we have experienced in the past have not materially disrupted, interrupted, damaged or shutdown the Company's IT systems, or materially disrupted the Company's performance of its business, the mitigation or remediation efforts that we have undertaken, and may undertake in the future, require the attention of management and expenditures of resources, which can be significant. There can be no assurance that the Company can anticipate all evolving future attacks, viruses or intrusions, implement adequate preventative measures, or remediate any security vulnerabilities on a timely basis or at all. If our IT systems are successfully attacked, it could result in major and/or prolonged disruption of our business, compromise confidential information, and result in litigation and potential liability for the Company, government investigation, significant damage to our reputation or otherwise adversely affect our business.

In addition, third parties to whom we outsource certain of our services or functions, or with whom we interface, store or process confidential patient and employee data or other confidential information, as well as those third parties’ providers, arehave alsoexperienced and remain subject to the risks outlined above. For example, in June 2019, the Company reported that Retrieval-Masters Creditors Bureau, Inc./American Medical Collection Agency (AMCA), informed the Company that an unauthorized user had access to AMCA’s system. AMCA previously provided debt collection services for the Company and provided debt collection services for a company that provides revenue management services to the Company. AMCA’s affected system included financial, medical and other personal information. The Company’s systems or databases were not involved in this incident. A breach or attack affecting third parties with whom we engage could also harm our business, results of operations and reputation and subject us to liability. Additionally, many of the third-party service providers we rely on use generative AI for a variety of purposes, which increases the risk that our sensitive and proprietary data, and the data of our patients and customers, could be inadvertently or maliciously exposed.

In addition, we believe that our overall relations with our employees are good. However, unfavorable labor environments, unionization activity,activity or(including in non-U.S. markets), a failure to comply with labor or employment laws or reputational considerations triggered by any of the risks described in this Report could result in, among other things, labor unrest, strikes, work stoppages, slowdowns by the affected workers, finesfines, penalties and penalties.a loss of employees. If any of these events were to occur, the Company could experience a disruption of its operations or higher ongoing labor costs, either of which could have a material adverse effect upon the Company's business.

We plan selectively to enhance our business from time to time through business development activities, such as acquisitions, licensing arrangements, investments and alliances.alliances, including joint ventures. However, these plans are subject to the availability of appropriate opportunities and competition from other companies seeking similar opportunities. Moreover, the success of any such effort may be affected by a number of factors, including our ability to properly assess and value the potential business opportunity, andobtain any necessary regulatory clearance (including due to antitrust concerns), integrate the new businesses,businesses and manage the costs related to any such integrationintegration, and to retain key technical, professional or management personnel. The success of our strategic alliances depends not only on our contributions and capabilities, but also on the property, resources, efforts and skills contributed by our strategic partners. Further, disputes may arise with strategic partners, due to conflicting priorities or conflicts of interests.

Acquisitions are not all the same (e.g., asset acquisitions differ from acquisitions of equity interests); different acquisitions offer different risks.risks and require different levels of effort to obtain regulatory clearance. Acquisitions may involve the integration of a separate company that has different systems, processes, policies and cultures. Integration of acquisitions involves a number of risks including the diversion of management's attention to the assimilationintegration of the operations of assets or businesses we have acquired, difficulties in the diligence and integration of operations and systems and the realization of potential operating synergies, or introduction of IT security vulnerabilities not adequately investigated during diligence or managed after acquisition, the integration and retention of the personnel of the acquired businesses and of our existing business, challenges in retaining the customers of the combined businesses, and potential adverse effects on operating results. The process of combiningnegotiating, completing and integrating acquisitions may be disruptive to our businesses (especially as transactions become increasingly complex) and may cause an interruption of, or a loss of momentum in, such businesses as a result of the following difficulties, among others:

•failure to maintain the quality or timeliness of services and profitability that our Company has historically provided;

Our operations may be adversely impacted by the effects of natural disasters such as hurricanes and earthquakes, public health emergencies and pandemics, geopolitical matters,conflicts, hostilities or acts of terrorism and other criminal activities.

We operate facilities primarily across the United States, and consumers frequently visit our facilities in person. The ability of our employees and consumers to access our facilities may be adversely impacted by the effects of extreme weather events and natural disasters, such as hurricanes, earthquakes, tropical storms, floods, fires, or other extreme weather conditions, including major winter storms, droughts and heat waves; public health emergencies and pandemics; geopolitical matters,conflicts, hostilities or acts of terrorism or other activities. Although we maintain a business continuity program to prepare for and respond to such events, because of their unpredictable nature, these events may limit or interrupt our ability to conduct operations. Additionally, such events may interrupt our ability to transport specimens, to receive materials from our suppliers or otherwise to provide our services. These events also may result in a decline in the number of patients who seek clinical testing services or in our employees' ability to perform their job duties.

Inflationary pressures over the last number of years have resulted in increases in the costs of the testing equipment, supplies and other goods and services that we purchase from manufacturers, suppliers and others. Inflationary pressures, along with the competition for labor, have also resulted in a rise of our labor costs, which include the costs of compensation, benefits, and recruiting and training new hires. Our ability to raise the prices and fees we charge for the services we provide is limited. Continuation of the currentAn inflationary environment may adversely impact us.

(c) AUncertain declineand involatile economic conditions, including the impact of an inflationary environment.environment and changes in government policies, including related to trade.

(h) Failure to efficiently integrate acquired businessesbusinesses, integrate our business with our joint ventures, and to manage the costs related to any such integration,integration and implementation requirements, or to retain key technical, professional or management personnel.

(k) Inability to identify, consummate or achieve expected benefits from our acquisitions of other businesses.

(p) ChallengesChallenges, including the associated competitive pressures, with properly managing the developmentdevelopment, implementation, oversight and use of AI.

(r) Development of tests by our competitors or others which we may not be able to license, or usage (or theft) of our technology ortechnology, similar technologies ortechnologies, our trade secrets or other intellectual property by competitors, any of which could negatively affect our competitive position.

(w) Terrorist and other criminal activities, hurricanes, earthquakes or other natural disasters, geopolitical matters,hostilities or other global conflicts, public health emergencies and pandemics, which could affect our customers or suppliers, transportation or systems, or our facilities, and for which insurance may not adequately reimburse us.

(eedd) The other factors that are discussed within “Item 1. Business,” “Item 1A. Risk Factors” and “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report on Form 10-K.

Quest Diagnostics works across the healthcare ecosystem to create a healthier world, one life at a time. Our diagnostic information services ("DIS") business provides diagnostic insights from the results of our laboratory testing to empower people, physicians, and organizations to take action to improve health outcomes. Derived from one of the world's largest databases of de-identifiable clinical lab results, our diagnostic insights reveal new avenues to identify and treat disease, inspire healthy behaviors and improve healthcare management. In the right hands and with the right context, our diagnostic insights can inspire actions that transform lives and create a healthier world. We provide services to a broad range of customers within our primary customer channels - physicians (including those associated with accountable care organizations ("ACOs") and Federally Qualified Health Centers ("FQHCs")), hospitals, and patients and consumers. Our other customers include health plans, employers, new and emerging retail healthcare providers, government agencies, pharmaceutical companies and other commercial clinical laboratories. We offer broad access to clinical testing through a network of laboratories, patient service centers, phlebotomists in physician offices, and our connectivity resources, including call centers and mobile phlebotomists, nurses and other health and wellness professionals. Our large in-house staff of medical and scientific experts, including medical directors, scientific directors, genetic counselors and board-certified geneticists, provide medical and scientific consultation to healthcare providers and patients regarding our tests and test results, and help them best utilize our services to improve outcomes and enhance satisfaction. During 2024,2025, we processed approximately 217244 million test requisitions through our extensive laboratory network.

Acquisition of select testing assets of LencoSpectra Diagnostic Laboratories, Inc. ("Lenco")Laboratories

For further details, see NotesNote 6 to the audited consolidated financial statements.

We are engaged in a multi-year program called Invigorate, which includes structured plans to drive savings and improve productivity across the value chain, including in such areas as patient services, logistics and laboratory operations, revenue services, information technology and procurement. The Invigorate program aims to deliver 3% annual cost savings and productivity improvements to partially offset pressures from the currentan inflationary environment, including labor and benefit cost increases and reimbursement pressures. We are leveraging automation and artificial intelligence to improve productivity and also improve quality across our entire value chain, not just in the laboratory. Other areas of focus include reducing denials and patient concessions, and enhancing the digital experience, and selecting and retaining talent.experience.

Healthcare market participants, including health plans and governments, are focusing on controlling costs, including potentially by reducing reimbursement for healthcare services, changing reimbursement for healthcare services (including but not limited to a shift from fee-for-service to capitation), changing medical coverage policies (e.g., healthcare benefits design), denying coverage for services, requiring preauthorization of laboratory testing, requiring co-pays, introducing laboratory spend management utilities and payment and patient care innovations such as ACOs and patient-centered medical homes. In recent years, there has been an ongoing trend of rising patient responsibility which has resulted in an increase in our reserves for patient price concessions. As health plans and government programs require greater levels of patient cost-sharing, our patient price concessions may continue to be negatively impacted and adversely impact our results of operations. There could be a shift to capitation arrangements where we agree to a predetermined monthly reimbursement rate for each member enrolled in a restricted plan, generally regardless of the number or cost of services provided by us. In 20242025 and 2023,2024, we derived approximately 5%8% and 3%,5%, respectively, of our consolidated net revenues from capitated payment arrangements and in 20242025 and 2023,2024, we derived approximately 11%15% and 9%,11%, respectively, of our testing volume from capitated payment arrangements. The increases from 2023 to 2024 were principally due to LifeLabs, which has revenues generated from various capitated arrangements with the government.

Historically, the Medicare Clinical Laboratory Fee Schedule ("CLFS") and the Medicare Physician Fee Schedule established under Part B of the Medicare program have been subject to change, including each year. Pursuant to theThe Protecting Access to Medicare Act of 2014 ("PAMA"), reimbursement rates for many clinical laboratory testingtests provided under Medicare were reduced fromduring 2018 - 2020. Starting in 2020, Congress has repeatedly acted to delay PAMA callsimplementation forby furtherdelaying revisionthe next round of data reporting (2020-2026) and Medicare cuts (2021-2026). Congress introduced legislation in 2025, the CLFSResults forAct, yearswhich afterwould 2020, based on future surveys of market rates; reimbursement reduction from 2026 - 2028 is capped byreform PAMA at 15% annually. PAMA's next data collection and reportingcreate perioda havetrue beenmarket-based delayed, most recently by federal legislation adopted in 2024, which further delayed the reimbursement rate reductions and reporting requirements until January 1, 2026.CLFS.

Client payers include physicians, hospitals, employers, new and emerging retail healthcare providers, pharmaceutical companies and other commercial clinical laboratories and institutions for which services are performed on a wholesale basis, and are billed based on a negotiated fee schedule. Credit risk and ability to pay are more of a consideration for these payers than healthcare insurers and government payers. Collection of consideration we expect to receive generally occurs within 60 to 90 days of billing.

We perform our annual impairment test during the fourth quarter of the fiscal year. For the year ended December 31, 2024,2025, we performed a qualitative assessment for our DIS and risk assessment services reporting units. Based on the totality of the information available for each reporting unit, we concluded that it was more likely than not that the estimated fair values were greater than the carrying values of the reporting values, and as such, no further analysis was required. As a sensitivity, in conjunction with the most recent quantitative test performed for the year ended December 31, 2023, if the estimated fair values of each of our reporting units decreased by 10%, we would have concluded that our goodwill was not impaired. However, DS revenues for the year ended December 31, 2025 decreased by 3.3% compared to the prior year primarily due to lower revenues associated with our risk assessment services offered to insurers. Therefore, we will continue to closely monitor the risk assessment services reporting unit for potential impairment going forward.

•pre-tax amortization expense of $127 million (recorded in amortization of intangible assets), or $0.84 per diluted share;

•pre-tax net charges of $62 million ($27 million recorded in cost of services and $37 million recorded in selling, general and administrative expenses, partially offset by a $2 million gain recorded in other operating (income) expense, net), or $0.42 per diluted share, primarily associated with workforce reductions and integration costs incurred in connection with further restructuring and integrating our business;

•pre-tax charges of $15 million (recorded in equity in earnings of equity method investees, net of taxes,taxes), or $0.10 per diluted share, representing net losses associated with changes in the carrying value of our strategic investments; and

•pre-tax charges of $6 million ($2 million recorded in cost of services, $2 million recorded in selling, general and administrative expenses and $2 million recorded in other operating (income) expense, net,net), or $0.04 per diluted share, including a loss associated with thean increase in the fair value of the contingent consideration accrual associated with previous acquisitions), or $0.04 per diluted share; partially offset by

•pre-tax gains of $12 million,million (recorded in other incomeincome, (expensenet), net, or $0.08 per diluted share, principally representing a non-recurring gain associated with a foreign exchange forward contract utilized in conjunction with an acquisition, and

•$9 million of excess tax benefits associated with stock-based compensation arrangements,arrangements (recorded in income tax expense,expense), or $0.08 per diluted share.

DISNet revenues for the year ended December 31, 20242025 increased by 7.1%11.8% compared to the prior year. For the year ended December 31, 2024:2025, organic growth was 5.3% compared to the prior year.

•DIS revenues infor the baseyear businessended (includingDecember the31, impact of recent acquisitions)2025 increased by 9.0%12.2% compared to the prior year. For the year ended December 31, 2025:

FirstSecond Quarter Highlights

For further discussion of the year-over-year changes for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, see "Results of Operations" below.

For the threesix months ended MarchJune 31,30, 2026, we incurred $7$11 million of pre-tax charges in connection with restructuring and integration activities, principallyincluding including$9 million of employee separation costs, with the remainder including integration costs. Most of the charges will result in cash expenditures. Additional restructuring and integration charges may be incurred in future periods, including as we identify additional opportunities to achieve further savings and productivity improvements.

Results for the three months ended MarchJune 31,30, 2026 were affected by certain items that on a net basis decreased diluted earnings per share by $0.26$0.28 as follows:

•pre-tax charges of $4$1 million, principally recorded in other operating expense,expense (income), net, or $0.03$0.02 per diluted share, primarily representing a loss associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions; partially offset by

•pre-tax gains of $8$1 million, recorded in equity in earnings of equity method investees, net of taxes, or $0.06$0.01 per diluted share, principallyrepresenting consistinggains associated with changes in the carrying value of aour non-recurringstrategic gain related to a leaseinvestments; and

Net revenues for the three months ended MarchJune 31,30, 2026 increased by 9.2%10.2% compared to the prior year period principally driven by organic revenue growth of 9.0%.10.0%.

DIS revenues for the three months ended MarchJune 31,30, 2026 increased by 9.4%10.3% compared to the prior year period.

For the three months ended MarchJune 31,30, 2026:

•The increase in DIS revenues compared to the prior year period was principally driven by the organic growth of 9.2%.10.1%.

•DIS volume increased by 10.9%13.1% compared to the prior year period principally driven by organic growth of 10.8%,13.0%, of which approximately 7%9% was due to both our new relationship with Corewell Health to provide Collaborative Lab Solutions and increasing our laboratory testing at dialysis clinics owned by Fresenius Medical Care in the United States. Excluding the Corewell Health and Fresenius Medical Care related testing, organic volume increased 3.8%by approximately 4% compared to the prior year period.

•Revenue per requisition decreased by 1.3%2.8% compared to the prior year period primarily driven by the business mix associated with our new relationships with Corewell Health and Fresenius Medical Care, which include a greater proportion of routine tests than most of our clinical testing. Excluding the Corewell Health and Fresenius Medical Care business mix impacts, revenue per requisition increased by approximately 2.5%3% primarily driven by an increase in the number of tests per requisition and favorable test mix.requisition.

DS revenues for the three months ended MarchJune 31,30, 2026 were principally consistent with the prior year period.

For the three months ended MarchJune 31,30, 2026, cost of services increased by $164$198 million compared to the prior year period. The increase was primarily driven by higher compensation costs and, to a lesser extent, higheran increase in supplies expense,expense reflecting higher testing volumes, partially offset by cost savings and productivity improvements from our Invigorate program.

SG&A consistconsists principally of the costs associated with our sales and marketing efforts, billing operations, credit loss expense and general management and administrative support as well as administrative facility costs.

For the three months ended MarchJune 31,30, 2026, SG&A increased by $28$43 million compared to the prior period. The increase was primarily driven by higher compensation costs.

The changes in the value of our deferred compensation obligations isare largely offset by changes in the value of the associated investments, which are recorded in other expense, net. For further details regarding our deferred compensation plans, see Note 17 to the audited consolidated financial statements included in our 2025 Annual Report on Form 10-K.

For both the three and six months ended MarchJune 31,30, 2026, amortization expense was principally consistent with the prior year period.periods.

Other Operating Expense,Expense (Income), Net

Other operating expense,expense (income), net includes miscellaneous income and expense items and other charges related to operating activities.

For both the three and six months ended MarchJune 31,30, 2026 and 2025,2026, other operating expense,expense (income), net primarily represents losses associated with the increase in the fair value of the contingent consideration accrual associated with previous acquisitions.