Executive Summary

Q2 2025 delivered strong top-line and membership growth with total revenues at $477.6M (+34% y/y) and MA membership at 106,323 (+32% y/y), while GAAP net loss from continuing operations was $10.6M and Insurance BER rose to 88.4% due to supplemental benefit and Part D utilization .
Guidance was tightened: membership range raised to 104k–108k, Adjusted SG&A improved to $335M–$345M, and Insurance BER increased to 88.5%–89.5%; Adjusted EBITDA ($50M–$70M) and Adjusted Net Income ($50M–$70M) maintained .
Management emphasized sustained adjusted profitability alongside >30% membership/revenue growth and highlighted 2026 tailwinds from moving to a four-star payment year and favorable CMS rate notice dynamics; 97% of members are in wide-network PPO plans .
Key near-term watch items: continued variability from first-year IRA Part D changes, seasonal utilization in H2 (particularly Q4), and cohort mix effects from strong new-member growth; claims-payable days normalized to 32 days in Q2 .
Potential stock catalysts: raised membership guidance, operating leverage via SG&A improvement, visible tech-enabled care (COPD/CHF whitepapers), and 2026 four-star payment year positioning .

What Went Well and What Went Wrong

What Went Well

Sustained growth and operating leverage: Revenues grew 34% y/y to $477.6M and Adjusted SG&A fell to 17.3% of revenues (down ~280 bps y/y), showing leverage despite growth-related variable costs .
Membership and PPO positioning: MA membership reached 106,323 (+32% y/y), with 97% of members in wide-network PPO—management sees competitive advantage in PPO as peers pull back .
Technology-led clinical impact: New COPD and earlier CHF analyses showed associations with fewer hospitalizations/readmissions and improved specialty access, reinforcing Clover Assistant/Counterpart value proposition .

What Went Wrong

Insurance BER pressure: Insurance BER rose to 88.4% (vs. 76.1% in Q2 2024), with elevated supplemental (notably dental) and first-year IRA Part D utilization, prompting guidance increase to 88.5%–89.5% .
Profitability mixed: GAAP net loss from continuing operations was $10.6M; Adjusted EBITDA and Adjusted Net Income declined y/y given utilization pockets (Q2 2025 Adjusted EBITDA $17.1M vs. $36.2M in Q2 2024) .
Modeling uncertainty: Management flagged Part D as a “known unknown” in H2 due to limited historical baseline and industry-wide subsidy adjustments, increasing variability risk into year-end .

Financial Results

Metric	Q2 2024	Q1 2025	Q2 2025
Total Revenues ($USD Millions)	$356.3	$462.3	$477.6
Insurance Revenue ($USD Millions)	$349.9	$456.9	$469.8
GAAP Net (Loss) Income from Continuing Ops ($USD Millions)	$7.2	$(1.3)	$(10.6)
Diluted EPS (Continuing Ops, $USD)	$0.01	—	$(0.02)
Adjusted EBITDA ($USD Millions)	$36.2	$25.8	$17.1
Adjusted Net Income ($USD Millions)	$35.9	$25.3	$16.7
Insurance BER (%)	76.1%	86.1%	88.4%
Adjusted SG&A as % of Total Revenues (%)	20.1%	18.0%	17.3%

Segment performance (Insurance):

Insurance Segment ($USD Thousands)	Q2 2024	Q2 2025
Premiums Earned, net	$349,900	$469,826
Net Medical Claims Incurred	$249,406	$394,212
Salaries and Benefits	$54,508	$60,309
General & Administrative	$43,631	$47,693
Segment Net (Loss) Income	$2,355	$(32,388)

Key KPIs and balance sheet:

KPI	Q2 2024	Q1 2025	Q2 2025
Average MA Membership (members)	80,016	101,959	105,494
Insurance Members (EOQ) (members)	80,261	103,418	106,323
Total Cash, Cash Equivalents & Investments ($USD Millions)	$482.8	$390.8	$389.3
Days in Claims Payable (days)	—	37	32
Members in PPO Plans (%)	—	—	97%

Notes: Non-GAAP definitions and reconciliations for Adjusted EBITDA, Adjusted Net Income, Adjusted SG&A, and Insurance BER are provided in the 8-K appendices .

Discrepancy call-out: The Q2 call transcript references $70M Adjusted EBITDA/Adjusted Net Income for Q2, but Exhibit 99.1 reports $17.1M and $16.7M respectively; we anchor on the 8-K values for accuracy .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Insurance Revenue	FY 2025	$1.800B–$1.875B	$1.800B–$1.875B	Maintained
Adjusted SG&A	FY 2025	$355M–$365M	$335M–$345M	Lowered (improved)
Adjusted SG&A as % of Total Revenues	FY 2025	19%–20%	18%–19%	Lowered (improved)
Adjusted EBITDA	FY 2025	$50M–$70M	$50M–$70M	Maintained
Adjusted Net Income	FY 2025	$50M–$70M	$50M–$70M	Maintained
Average MA Membership	FY 2025	103k–107k	104k–108k	Raised
Insurance BER	FY 2025	87%–88%	88.5%–89.5%	Raised

Drivers and rationale: Raised BER reflects elevated supplemental/Part D utilization and new member mix; SG&A improvement tied to cost initiatives and partner term renegotiations, delivering operating leverage despite growth .

Earnings Call Themes & Trends

Topic	Q4 2024 (Q-2)	Q1 2025 (Q-1)	Q2 2025 (Current)	Trend
AI/Technology (Clover/Counterpart Assistant)	Technology-first model pivotal; plan to invest alongside profitability	Confident in tech adaptability (HEC V28), expanded CA reach; CHF whitepaper	COPD whitepaper; ecosystem alignment with CMS/White House interoperability; scaling CA with data	Expanding evidence base and externalization
Membership & Growth	Strong retention and cohort management; 2025 guidance initiated	+30% membership; growth concentrated in NJ with CA providers	+32% membership; raised FY membership guidance	Accelerating growth; retention strategy
Regulatory/Macro (IRA Part D, CMS rates)	Set stage for 2025; BER improved in 2024	Part C/D utilization tracking as expected; CMS 2026 notice additive	IRA Part D “known unknown” in H2; higher 2026 direct subsidy signals industry costs; 2026 four-star tailwind	Raised BER; 2026 tailwinds
Competitive Landscape (PPO)	—	Peers pulling back on PPO benefits; Clover advantage in wide networks	Expect competitor pullback in PPO; Clover strong in core markets	Clover advantaged in PPO
Operating Leverage/Cost	SG&A improved y/y in 2024; FY profitability improved	Adjusted SG&A down to 18% of revenues; buyback completed	Adjusted SG&A 17.3%; cost initiatives and partner renegotiations	Continued leverage
Regional Strategy (NJ)	—	Majority of OEP growth in NJ; room to expand	NJ pharmacy pilot leveraging CA; strong local partnerships	Deepening NJ presence

Management Commentary

“We delivered meaningful growth alongside sustained adjusted EBITDA profitability in Medicare Advantage… we expect our performance in 2025 will position us very well to accelerate both growth and profitability in 2026, which is a four star payment year” .
“We are generally satisfied with the underlying trends… keeping a particularly close watch on the impacts from the Part D IRA changes this year… we anticipate more variability in our modeling of performance” .
“Adjusted SG&A as a percentage of total revenues improved to 17% this quarter… net of continued strategic investments focused on stars, quality initiatives, home care and Clover Assistant capabilities” .
“We are increasing our Medicare Advantage membership guidance… reconfirming insurance revenue… improving adjusted SG&A guidance… updating our insurance BER guidance to a range of 88.5 to 89.5%” .
“In 2026, we will increase to a four star payment year for our PPO plans, which brings financial tailwinds… and we expect compounding favorable impact from the CMS final rate notice” .

Q&A Highlights

BER/Utilization: Elevated Part D and supplemental (especially dental) utilization drove higher BER; initiatives in place to monitor/manage; industry expects relief in 2026 from subsidy changes .
SG&A Efficiency: Cost initiatives and partner term renegotiations underpin SG&A improvement while supporting growth .
Cohorts/Geography: Cohorts (new/returning) performing in line; BER differences not split by cohort; focus on supplemental monitoring; confidence in NJ core markets .
Competitive Dynamics: Competitors likely to pull back in PPO-wide networks where Clover’s tech-first model performs well; 2026 four-star payment year adds tailwind .
Counterpart/Clinical Evidence: CHF and COPD whitepapers demonstrate CA correlation with improved outcomes; Counterpart pipeline expanding across health systems/payers .

Estimates Context

Wall Street consensus (S&P Global) for Q2 2025 EPS, revenue, and EBITDA was unavailable at time of retrieval; therefore, estimate comparisons are not shown. Values retrieved from S&P Global.*
Implication: Given raised Insurance BER and maintained adjusted profitability guidance, analysts may need to reflect higher medical cost ratios for H2 and a more back-half-weighted utilization profile, with FY profitability anchored by SG&A leverage and cohort maturation .

Key Takeaways for Investors

Growth plus leverage: Revenues +34% y/y to $477.6M and Adjusted SG&A down to 17.3% of revenues indicate operating leverage amidst rapid member growth .
Membership momentum: FY membership guidance raised to 104k–108k; current quarter end members at 106,323; continued intra-year growth expected .
Cost vigilance: Insurance BER increased (88.4% in Q2; FY guide 88.5%–89.5%) due to supplemental and IRA Part D; management monitoring closely through H2 seasonality .
2026 setup: Four-star payment year and favorable CMS rate notice present structural tailwinds; Clover’s 97% PPO mix and CA-enabled model supports competitive positioning .
Claims/process normalization: Days in claims payable improved to 32 days, signaling operational normalization post industry incidents and back-office transitions .
Clinical differentiation: COPD and CHF results support CA’s association with better outcomes (hospitalizations/readmissions), strengthening the tech-enabled narrative .
Trading lens: Near term, watch H2 utilization trends (Q4 seasonality) and Part D variability; medium term, membership retention and cohort maturation plus 2026 tailwinds can support profitability expansion .

Additional Relevant Press Releases (Q2 timeframe)

Russell 3000 Index inclusion enhances investor visibility and potential index flows (effective June 30, 2025) .
NJ community pharmacy pilot (July 9, 2025) underscores local care enablement using CA and pharmacy networks, relevant to supplemental adherence and outcomes themes heading into H2 .

CLOVER HEALTH INVESTMENTS, CORP. /DE (CLOV)·Q2 2025 Earnings Summary