ACCENDRA HEALTH INC/VA/ (ACH)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Sale of Products & Healthcare Services Business

On February 28, 2025, we announced that we were actively engaged in discussions regarding the anticipated sale of our Products & Healthcare Services (P&HS) business. On October 7, 2025, we entered into an Equity Purchase Agreement (the Purchase Agreement) by and among the Company, Dominion Healthcare Acquisition Corporation, a Delaware corporation (the Purchaser), and Dominion Healthcare Holdings, L.P., a Delaware limited partnership (Purchaser Parent), to sell the P&HS business, for an aggregate of $375 million in cash, subject to certain adjustments for cash, indebtedness, net working capital and transaction expenses. On December 31, 2025, we completed the sale of the P&HS business pursuant to the Purchase Agreement. We retained a 5% equity interest in the P&HS business, which is reflected in other assets, net on our condensed consolidated balance sheets.

In accordance with GAAP, the financial position and results of operations of the P&HS business are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented. With the exception of Note 2, the Notes to Condensed Consolidated Financial Statements reflect the continuing operations of Accendra Health, Inc. unless otherwise noted. See Note 2 in the Notes to Condensed Consolidated Financial Statements for additional information regarding discontinued operations.

Overview

Accendra Health, Inc., along with its subsidiaries, (collectively, the Company, we, us, or our) is a leading nationwide provider of products, technology, and services that supports health beyond the hospital for millions of people each year. As discussed within Note 1 in the Notes to Condensed Consolidated Financial Statements, our business activities comprise a single operating and reporting segment.

Loss from continuing operations per common share was $(1.16) for the three months ended June 30, 2026 as compared to $(1.09) for the three months ended June 30, 2025. Our financial results for the three months ended June 30, 2026 as compared to the prior year were impacted by a decrease in net revenue of $69 million, an increase in exit and realignment charges, net of $23 million, a $17 million loss on modification and extinguishment of debt, and an increase in acquisition-related charges and intangible amortization of $15 million, partially offset by prior year expenses that did not recur in the current year period, including the transaction breakage fee of $80 million and transaction financing fees, net of $18 million, and lower selling, general, and administrative expenses (SG&A) of $24 million.

Loss from continuing operations per common share was $(1.25) for the six months ended June 30, 2026 as compared to $(1.14) for the six months ended June 30, 2025. Our financial results for the six months ended June 30, 2026 as compared to prior year were impacted by a decrease in net revenue of $115 million, an increase in acquisition-related charges and intangible amortization of $21 million, and a $17 million loss on modification and extinguishment of debt, partially offset by prior year expenses that did not recur in the current year period, including the transaction breakage fee of $80 million and transaction financing fees, net of $18 million, lower SG&A of $31 million and lower exit and realignment charges, net of $14 million.

Refer to “Results of Operations” for further detail of quantitative and qualitative drivers of our results.

Balance Sheet Optimization Transaction

In June 2026, we exchanged and/or extended a substantial portion of our debt (the Balance Sheet Optimization Transaction). In exchange (the Exchange Offers) for our outstanding 4.500% Senior Notes due 2029 (the 2029 Notes) and 6.625% Senior Notes due 2030 (the 2030 Notes, and together with the 2029 Notes, the Unsecured Notes), we offered (i) newly issued 9.000% Senior Secured First Lien Notes due 2032 (the 2032 Notes) to holders that participated in the new money issuance of the First Lien Notes and (ii) newly issued 9.750% Senior Secured Second Lien Notes due 2033 (the 2033 Notes, and together with the 2032 Notes, the Secured Notes).

In connection with the Exchange Offers for the 2029 Notes, we offered $326 million in aggregate principal amount of the newly issued 2032 Notes for cash. The Secured Notes were issued and guaranteed on a senior secured basis by the Company’s existing and future wholly owned domestic subsidiaries (including each subsidiary guarantor of

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the Unsecured Notes), subject to certain exceptions. The 2032 Notes were used to extinguish the $326 million in outstanding principal on the Term Loan A.

At the expiration of the Exchange Offers, $478 million in aggregate principal amount of 2029 Notes were tendered and $548 million in aggregate principal amount of 2030 Notes were tendered and cancelled, representing approximately 99.9% and 99.2% of the principal outstanding. Following such cancellation, and as of June 30, 2026, $0.3 million in aggregate principal amount of the 2029 Notes and $4.2 million in aggregate principal amount of the 2030 Notes remain outstanding. The Unsecured Notes are effectively subordinated to any of our secured indebtedness, including the Secured Notes and outstanding indebtedness under our credit agreements. The Exchange Offers of the Unsecured Notes for Secured Notes have been accounted for as a modification of debt in accordance with ASC 470, Debt.

The 2032 Notes will mature in June 2032 and have $539 million of principal outstanding excluding unamortized deferred financing costs as of June 30, 2026. The 2033 Notes will mature in June 2033 and have $698 million of principal outstanding excluding unamortized deferred financing costs as of June 30, 2026.

The completion of the Balance Sheet Optimization Transaction resulted in a loss on modification and extinguishment of debt of $17 million, including $16 million debt modification third party fees and $0.8 million in recognition of previously deferred debt issuance costs.

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Contract Termination with a Commercial Payor and Equipment Sales

A commercial Payor, with which we had multiple separately managed contracts, has terminated certain of our contracts with them. This termination resulted in minimal impacts to our operating income for the year ended December 31, 2025, as the transitions of agreements and services started late in the fourth quarter of 2025. Such transitions of agreements and services were completed throughout the first half of 2026. The terminated portion of this relationship reflected $37 million, or 3%, of our net revenue, including nearly all of our capitation revenue, for the six months ended June 30, 2026. There was no related revenue for the three months ended June 30, 2026.

In connection with this contract termination, we sold $2.9 million and $85 million of patient service equipment during the three and six months ended June 30, 2026, which resulted in a $0.6 million loss and a $(51) million gain on sales of patient service equipment within exit and realignment charges, net on our condensed consolidated statements of operations. The proceeds from the sales are reflected within the proceeds from sale of patient service equipment line item within the investing activities section of our condensed consolidated statements of cash flows.

Results of Operations

The following discussion and analysis describes results of operations and material changes in the financial condition of the Company since December 31, 2025. Trends of a material nature are discussed to the extent known and considered relevant. This discussion should be read in conjunction with the consolidated financial statements, related notes thereto, and management’s discussion and analysis of financial condition and results of operations included in our Annual Report on Form 10-K for the year ended December 31, 2025.

Net revenue.

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The decrease in net revenue for the three and six months ended June 30, 2026 was primarily driven by an $81 million and $123 million decrease in revenue from the terminated commercial Payor contracts described above, which drove declines in several product categories, including sleep therapy and home respiratory therapy. For the three months ended June 30, 2026, excluding the impact of the commercial Payor contract termination, notable drivers of net revenue growth by product category included Diabetes of $7.8 million, Sleep therapy of $7.7 million, Ostomy of $3.8 million and Urology of $2.6 million, partially offset by declines in Home respiratory therapy of $6.1 million and Wound care of $3.2 million. For the six months ended June 30, 2026, excluding the impact of the commercial Payor contract termination, notable drivers of net revenue growth by product category included Diabetes of $6.2 million, Sleep therapy of $14 million, Ostomy of $

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Sale of Products & Healthcare Services Business

On February 28, 2025, we announced that we were actively engaged in discussions regarding the potential sale of our Products & Healthcare Services business. On October 7, 2025, we entered into an Equity Purchase Agreement (the Purchase Agreement) by and among the Company, Dominion Healthcare Acquisition Corporation, a Delaware

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corporation (the Purchaser), and Dominion Healthcare Holdings, L.P., a Delaware limited partnership (Purchaser Parent) to sell the P&HS business, for an aggregate of $375 million in cash, subject to certain adjustments for cash, indebtedness, net working capital and transaction expenses. On December 31, 2025, we completed the sale of the P&HS business pursuant to the Purchase Agreement. We retained a 5% equity interest in the P&HS business.

In accordance with GAAP, the financial position and results of operations of the P&HS business are presented as discontinued operations and, as such, have been excluded from continuing operations for all periods presented. With the exception of Note 3, the Notes to Consolidated Financial Statements reflect the continuing operations of Accendra Health, Inc. unless otherwise noted. See Note 3 in the Notes to Consolidated Financial Statements for additional information regarding discontinued operations.

Overview

Accendra Health, Inc. (f/k/a Owens & Minor, Inc.) and subsidiaries (Accendra Health, we, us, our or the Company) is a leading nationwide provider of products, technology, and services that supports health beyond the hospital for millions of people each year. As discussed later within Note 1 to Consolidated Financial Statements, our business activities comprise a single operating and reporting segment.

Net (loss) per share from continuing operations was $(1.34) for the year ended December 31, 2025 as compared to net (loss) per share from continuing operations of $(4.57) for the year ended December 31, 2024. Our financial results for the year ended December 31, 2025 as compared to the prior year were favorably impacted by the following: (1) no goodwill impairment charges for the year ended December 31, 2025 as compared to charges incurred for the year ended December 31, 2024 of $307 million, or a $3.97 negative impact per share (see Notes 1 and 5 in the Notes to Consolidated Financial Statements); (2) revenue growth of $82 million; (3) a reduction in exit and realignment charges of $28 million; (4) the remeasurement of an uncertain tax position for the year ended December 31, 2024, including interest which resulted in a $19 million, or a $0.24 negative income tax charge per share (see Note 12 in the Notes to Consolidated Financial Statements); that did not reoccur and (5) a $15 million reduction in selling, general and administrative expense. These impacts were partially offset by (1) an $80 million transaction breakage fee incurred in connection with the termination of the Rotech acquisition; (2) an increase in cost of net revenue of $73 million; (3) an increase in intangible amortization of $33 million; and (4) $18 million in transaction fees during the year ended December 31, 2025.

Net (loss) per share from continuing operations was $(4.57) for the year ended December 31, 2024 as compared to net income per share from continuing operations of $0.12 for the year ended December 31, 2023. Our financial results for the year ended December 31, 2024 as compared to the prior year were unfavorably impacted by the following: (1) a goodwill impairment charge incurred for the year ended December 31, 2024 of $307 million, or a $3.97 negative impact per share; (2) an $81 million increase in selling, general, and administrative expenses including legal settlements of $17 million related primarily to compensation and wage and hour disputes; (3) a $64 million increase in cost of net revenue; and (4) a $39 million increase in exit and realignment costs. These unfavorable impacts were partially offset by (1) a $128 million increase in net revenue; (2) a decrease in intangible amortization of $18 million; and (3) a $9.2 million decrease in interest expense, net.

Refer to “Results of Operations” for further detail of quantitative and qualitative drivers of our results.

Termination of Acquisition of Rotech

As previously disclosed, on July 22, 2024, we entered into an Agreement and Plan of Merger (the Merger Agreement) pursuant to which we agreed to acquire Rotech Healthcare Holdings Inc. (Rotech) subject to the terms and conditions within the Merger Agreement. On June 3, 2025, the Company, Rotech and Merger Sub mutually agreed to terminate the Merger Agreement and entered into a mutual termination agreement (the Termination Agreement). In accordance with the terms of the Termination Agreement, on June 5, 2025, we made a cash payment to Rotech of $80 million.

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Contract Termination with a Commercial Payor

A commercial Payor, with which we have multiple separately managed contracts, has terminated, or is in the process of terminating, certain of our contracts with them. This termination resulted in minimal impacts to our operating income for the year ended December 31, 2025, as the transitions of agreements and services started late in the fourth quarter of 2025. While such transitions of agreements and services are expected to continue throughout the first half of 2026, the specific timing of when these contracts will wind down is highly dependent on the Payor’s successor provider’s ability to successfully transition customers among other factors. The terminated contracts reflected $322 million or 12% of our net revenue, including $231 million of capitation revenue, which represents nearly all of our capitation revenue, for the year ended December 31, 2025.

Results of Operations

Our Management’s Discussion and Analysis of Financial Condition and Results of Operations within this Annual Report on Form 10-K discusses 2025, 2024 and 2023 items and year-to-year comparisons between 2025, 2024 and 2023.

2025 compared to 2024 and 2024 compared to 2023

Net revenue.

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The increase in our net revenue for the year ended December 31, 2025 was driven primarily by sales growth in several product categories, including sleep therapy, ostomy, and urology. The growth in these categories includes the benefits from certain successful sales activities including our Sleep Journey Initiative. This increase was partially offset by $11 million of benefits in the last half of 2024 associated with two settlement benefits related to two multi-year claims reprocessing matters.

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The increase in our net revenue for the year ended December 31, 2024 was driven primarily by sales growth in several product categories, including sleep therapy, diabetes, and wound care. The growth in these categories includes the benefits from certain successful sales activities including our Sleep Journey Initiative.

Cost of net revenue.

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The increase in cost of net revenue reflects the increased cost associated with sales growth of 3.1% and manufacturer price increases, as compared to prior year.

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