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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2025


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to x

Commission file number 000-19291

CORVEL CORPORATION

(Exact Name of Registrant as Specified in its Charter)

     Delaware

     33-0282651

     (State or other jurisdiction of
incorporation or organization)

     (I.R.S. Employer
Identification No.)


5128 Apache Plume Road, Suite 400
Fort Worth, TX		76109
(Address of principal executive offices)		(Zip Code)

(817) 390-1416
(Registrant’s telephone number, including area code)

Not Applicable

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Common Stock, Par Value $0.0001 Per Share

     CRVL

     The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☑	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

The number of shares outstanding of the registrant’s Common Stock, $0.0001 par value per share, as of February 2, 2026, was 51,152,437.

CORVEL CORPORATION

QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS


		Page

PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements	3

	Consolidated Balance Sheets – December 31, 2025 (unaudited) and March 31, 2025	3
	Consolidated Income Statements (unaudited) – Three months ended December 31, 2025 and 2024	4
	Consolidated Income Statements (unaudited) – Nine months ended December 31, 2025 and 2024	5
	Consolidated Statements of Stockholders’ Equity (unaudited) – Three and nine months ended December 31, 2025 and 2024	6
	Consolidated Statements of Cash Flows (unaudited) – Nine months ended December 31, 2025 and 2024	7
	Notes to Consolidated Financial Statements	8

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26

Item 4.	Controls and Procedures	26

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	27

Item 1A.	Risk Factors	27

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36

Item 3.	Defaults Upon Senior Securities	36

Item 4.	Mine Safety Disclosures	36

Item 5.	Other Information	36

Item 6.	Exhibits	37

	Signatures	38

Page 2

PART I – FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

CORVEL CORPORATION

Consolidated Balance Sheets


	December 31, 2025			March 31, 2025
	(Unaudited)
Assets
Current Assets
Cash and cash equivalents	$	230,033,000		$	170,584,000
Customer deposits		115,427,000			101,472,000
Accounts receivable, net		102,100,000			104,126,000
Prepaid taxes and expenses		16,363,000			10,507,000
Total current assets		463,923,000			386,689,000
Property and equipment, net		114,122,000			92,052,000
Goodwill		36,814,000			36,814,000
Other intangibles, net		307,000			438,000
Right-of-use asset, net		19,447,000			20,825,000
Deferred tax asset, net		9,749,000			8,704,000
Other assets		423,000			454,000
TOTAL ASSETS	$	644,785,000		$	545,976,000
Liabilities and Stockholders' Equity
Current Liabilities
Accounts and taxes payable	$	29,998,000		$	16,792,000
Accrued liabilities		220,449,000			187,244,000
Total current liabilities		250,447,000			204,036,000
Long-term lease liabilities		18,616,000			19,953,000
Total liabilities		269,063,000			223,989,000
Commitments and contingencies
Stockholders' Equity
Common stock, $.0001 par value: 360,000,000 shares authorized at December 31, 2025 and March 31, 2025; 166,036,690 shares issued (51,143,561 shares outstanding, net of Treasury shares) and 165,836,235 shares issued (51,359,544 shares outstanding, net of Treasury shares) at December 31, 2025 and March 31, 2025, respectively		5,000			5,000
Paid-in capital		260,835,000			250,407,000
Treasury stock (114,893,129 shares at December 31, 2025 and 114,476,691 shares at March 31, 2025)		(867,518,000	)		(831,510,000	)
Retained earnings		982,400,000			903,085,000
Total stockholders' equity		375,722,000			321,987,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	644,785,000		$	545,976,000

See accompanying notes to unaudited consolidated financial statements.

Page 3

CORVEL CORPORATION

Consolidated Income Statements – (Unaudited)


	Three Months Ended
	December 31, 2025		December 31, 2024
REVENUES	$	235,625,000	$	227,973,000
Cost of revenues		180,709,000		175,115,000
Gross profit		54,916,000		52,858,000
General and administrative expenses		22,684,000		22,058,000
Income before income tax provision		32,232,000		30,800,000
Income tax provision		8,058,000		7,029,000
NET INCOME	$	24,174,000	$	23,771,000
Net income per common and common equivalent share
Basic	$	0.47	$	0.46
Diluted	$	0.47	$	0.46
Weighted average common and common equivalent shares
Basic		51,317,000		51,388,000
Diluted		51,582,000		52,038,000

See accompanying notes to unaudited consolidated financial statements.

Page 4

CORVEL CORPORATION

Consolidated Income Statements – (Unaudited)


	Nine Months Ended
	December 31, 2025		December 31, 2024
REVENUES	$	709,979,000	$	664,075,000
Cost of revenues		540,125,000		512,528,000
Gross profit		169,854,000		151,547,000
General and administrative expenses		66,439,000		64,043,000
Income before income tax provision		103,415,000		87,504,000
Income tax provision		24,100,000		18,758,000
NET INCOME	$	79,315,000	$	68,746,000
Net income per common and common equivalent share
Basic	$	1.55	$	1.34
Diluted	$	1.53	$	1.32
Weighted average common and common equivalent shares
Basic		51,328,000		51,384,000
Diluted		51,739,000		51,999,000

See accompanying notes to unaudited consolidated financial statements.

Page 5

CORVEL CORPORATION

Consolidated Statements of Stockholders’ Equity – (Unaudited)


	Three Months Ended December 31, 2025
	Common Shares		Stock Amount		Paid-in- Capital			Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – September 30, 2025		166,000,944	$	5,000	$	258,511,000			(114,707,570	)	$	(853,965,000	)	$	958,226,000	$	362,777,000
Stock issued under stock option plan, net of shares repurchased		35,746		—		962,000			—			—			—		962,000
Stock-based compensation expense		—		—		1,362,000			—			—			—		1,362,000
Purchase of treasury stock		—		—		—			(185,559	)		(13,553,000	)		—		(13,553,000	)
Net income		—		—		—			—			—			24,174,000		24,174,000
Balance – December 31, 2025		166,036,690	$	5,000	$	260,835,000			(114,893,129	)	$	(867,518,000	)	$	982,400,000	$	375,722,000


	Three Months Ended December 31, 2024
	Common Shares		Stock Amount		Paid-in- Capital			Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – September 30, 2024		165,715,800	$	3,000	$	242,894,000			(114,310,320	)	$	(813,020,000	)	$	852,895,000	$	282,772,000
Stock issued under stock option plan, net of shares repurchased		47,403		—		1,978,000			—			—			—		1,978,000
Stock-based compensation expense		—		—		1,823,000			—			—			—		1,823,000
Purchase of treasury stock		—		—		—			(85,710	)		(9,494,000	)		—		(9,494,000	)
Adjusted shares outstanding		—		2,000		(2,000	)		—			—			—		—
Net income		—		—		—			—			—			23,771,000		23,771,000
Balance – December 31, 2024		165,763,203	$	5,000	$	246,693,000			(114,396,030	)	$	(822,514,000	)	$	876,666,000	$	300,850,000


	Nine Months Ended December 31, 2025
	Common Shares		Stock Amount		Paid-in- Capital			Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – March 31, 2025		165,836,235	$	5,000	$	250,407,000			(114,476,691	)	$	(831,510,000	)	$	903,085,000	$	321,987,000
Stock issued under employee stock purchase plan		5,682		—		418,000			—			—			—		418,000
Stock issued under stock option plan, net of shares repurchased		187,162		—		5,049,000			—			—			—		5,049,000
Stock-based compensation expense		—		—		4,177,000			—			—			—		4,177,000
Stock issuance for asset acquisition		7,611		—		784,000			—			—			—		784,000
Purchase of treasury stock		—		—		—			(416,438	)		(36,008,000	)		—		(36,008,000	)
Net income		—		—		—			—			—			79,315,000		79,315,000
Balance – December 31, 2025		166,036,690	$	5,000	$	260,835,000			(114,893,129	)	$	(867,518,000	)	$	982,400,000	$	375,722,000


	Nine Months Ended December 31, 2024
	Common Shares		Stock Amount		Paid-in- Capital			Treasury Shares			Treasury Stock			Retained Earnings		Total Stockholders' Equity
Balance – March 31, 2024		165,486,225	$	3,000	$	233,629,000			(114,099,537	)	$	(793,905,000	)	$	807,920,000	$	247,647,000
Stock issued under employee stock purchase plan		3,306		—		342,000			—			—			—		342,000
Stock issued under stock option plan, net of shares repurchased		273,672		—		8,348,000			—			—			—		8,348,000
Stock-based compensation expense		—		—		4,376,000			—			—			—		4,376,000
Purchase of treasury stock		—		—		—			(296,493	)		(28,609,000	)		—		(28,609,000	)
Adjusted shares outstanding		—		2,000		(2,000	)		—			—			—		—
Net income		—		—		—			—			—			68,746,000		68,746,000
Balance – December 31, 2024		165,763,203	$	5,000	$	246,693,000			(114,396,030	)	$	(822,514,000	)	$	876,666,000	$	300,850,000

See accompanying notes to unaudited consolidated financial statements.

Page 6

CORVEL CORPORATION

Consolidated Statements of Cash Flows – (Unaudited)


	Nine Months Ended
	December 31, 2025			December 31, 2024
Cash Flows from Operating Activities
NET INCOME	$	79,315,000		$	68,746,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		23,499,000			21,935,000
Loss on write down or disposal of property, capitalized software or investment		12,000			112,000
Stock-based compensation expense		4,177,000			4,376,000
Provision for expected credit losses		231,000			1,400,000
Deferred income tax		(1,045,000	)		(1,094,000	)
Changes in operating assets and liabilities
Accounts receivable		1,794,000			(10,470,000	)
Customer deposits		(13,955,000	)		(11,354,000	)
Prepaid taxes and expenses		(5,856,000	)		(3,126,000	)
Other assets		33,000			856,000
Accounts and taxes payable		4,721,000			(1,000	)
Accrued liabilities		33,205,000			32,240,000
Operating leases, net		41,000			774,000
Net cash provided by operating activities		126,172,000			104,394,000
Cash Flows from Investing Activities
Purchase of property and equipment		(36,182,000	)		(27,094,000	)
Net cash used in investing activities		(36,182,000	)		(27,094,000	)
Cash Flows from Financing Activities
Purchase of treasury stock		(36,008,000	)		(28,609,000	)
Proceeds from exercise of common stock options		5,049,000			8,348,000
Proceeds from purchases under employee stock purchase plan		418,000			342,000
Net cash used in financing activities		(30,541,000	)		(19,919,000	)
Increase in cash and cash equivalents		59,449,000			57,381,000
Cash and cash equivalents at beginning of period		170,584,000			105,563,000
Cash and cash equivalents at end of period	$	230,033,000		$	162,944,000
Supplemental Cash Flow Information:
Income taxes paid	$	24,153,000		$	20,787,000
Purchase of software license under finance agreement	$	8,485,000		$	—
Asset acquisition	$	4,500,000		$	—

See accompanying notes to unaudited consolidated financial statements.

Page 7

CORVEL CORPORATION

Notes to Consolidated Financial Statements

December 31, 2025

Note 1 — Summary of Significant Accounting Policies

Basis of Presentation: The unaudited consolidated financial statements include the accounts of CorVel Corporation (the “Company,” “we”, “our”, or “us”) and its consolidated subsidiaries. Significant intercompany accounts and transactions have been eliminated in consolidation.

The unaudited consolidated financial statements herein have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The accompanying interim unaudited consolidated financial statements have been prepared under the presumption that users of the interim financial information have either read or have access to the audited consolidated financial statements for the latest fiscal year ended March 31, 2025. Accordingly, note disclosures which would substantially duplicate the disclosures contained in the March 31, 2025 audited consolidated financial statements have been omitted from these interim unaudited consolidated financial statements.

The Company evaluated all subsequent events and transactions through the date of filing this report.

Certain information and note disclosures normally included in financial statements prepared in accordance with United States generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the three and nine months ended December 31, 2025, are not necessarily indicative of the results that may be expected for the fiscal year ending March 31, 2026 or any other period. For further information, refer to the audited consolidated financial statements and notes thereto for the fiscal year ended March 31, 2025, included in the Company’s Annual Report on Form 10-K filed with the SEC on May 23, 2025 (the “2025 Annual Report”). Two customers accounted for 10% or more of accounts receivable as of December 31, 2025.

Recent Accounting Pronouncements: New accounting pronouncements are issued periodically by the FASB and are adopted by the Company as of the specified effective dates. Unless otherwise disclosed below, the Company believes that recently issued and adopted pronouncements will not have a material impact on the Company’s financial position, results of operations and cash flows or do not apply to the Company’s operations.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which updates the accounting for internal-use software by replacing stage-based rules with a principles-based framework. This shirt permits entities to capitalize costs once management has authorized funding and committed to using the software, and it is probable the project will be complete. Entities may elect to apply the guidance retrospectively, prospectively to software costs incurred after the adoption date or on a modified prospective basis. The update is effective for fiscal years beginning after December 15, 2027 and interim periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, to require disaggregated disclosure of certain income statement expense line items, such as purchases of inventory, employee compensation, and, depreciation and amortization. The new standard is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments should be applied prospectively, but retrospective application is permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, a new accounting standard to enhance the transparency and decision usefulness of income tax disclosures. The new standard is effective for fiscal years beginning after December 15, 2024, with retrospective application permitted. The Company intends to add the additional disclosures required under the new accounting standard.

Note 2 – Revenue Recognition

Revenue from Contracts with Customers

The Company operates in one reportable operating segment: managed care. The Company generates revenue through its patient management and network solutions service lines. Revenue generated from patient management service line is recognized over time as

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services are provided and performance obligations are satisfied. Revenue generated from network solutions service line is recognized when control of the promised services is transferred to the Company’s customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. As the Company completes its performance obligations, which are described in greater detail below, it has an unconditional right to consideration pursuant to the Company’s contracts. Generally, the Company’s accounts receivable are expected to be collected within 30 days, in accordance with the underlying payment terms.

Patient Management Service Line

The patient management service line provides services primarily related to workers’ compensation claims management and case management. This service line also includes additional services such as accident and health claims programs. Each claim referred by the customer is considered an additional optional purchase of claims management services under the agreement with the customer. The transaction price is readily available from the contract and is fixed for each service. Revenue is recognized over time as services are provided and performance obligations are satisfied through efforts expended to research, investigate, evaluate, document, and report the claim and control of these services is transferred to the customer. Revenue is recognized based on historical claim closure rates and claim type by utilizing a portfolio approach based on time elapsed for these claims, which is generally between three and fifteen months. The Company believes this approach reasonably reflects the transfer of the claims management services to its customers.

The Company’s obligation to manage claims and cases under patient management service line contracts range from less than one year to multiple years. The term of these contracts is typically one year; however, many of these contracts contain auto-renewal provisions leading the Company’s customer relationships to span multiple years. Under certain claims management agreements, the Company receives consideration from a customer at contract inception prior to transferring services to the customer, however, the Company would begin performing services immediately. The period between a customer’s payment of consideration and the completion of the promised services is generally less than one year. There is no difference between the amount of promised consideration and the cash selling price of the promised services. The fee is billed upfront by the Company in order to provide customers with simplified and predictable ways of purchasing the Company’s services.

The patient management service line also offers the services of case managers who provide administration services by proactively managing medical treatment for claimants while also facilitating an understanding of, and participation in, their rehabilitation process. Revenue for case management services is recognized over time as the performance obligations are satisfied through the effort expended to manage the medical treatment for claimants and control of these services is transferred to the customer. Case management services are generally billed based on time incurred, are considered variable consideration, and revenue is recognized for the amount in which the Company has the right to invoice for services performed. The Company believes this approach reasonably reflects the transfer of the case management service to the customer.

Network Solutions Service Line

The network solutions service line consists primarily of medical bill review and third-party services. Medical bill review services provide an analysis of medical charges for customers’ claims to identify opportunities for savings. Revenue from medical bill review services is recognized at the point in time when control of the service is transferred to the customer, based upon the transfer of the results of the medical bill review service to the customer as this is the most accurate depiction of the transfer of the service to the customer. Medical bill review revenue is variable, generally based on performance metrics set forth in the underlying contracts. Each period, the Company bases its revenue estimates on a contract-by-contract basis. The Company makes its best estimate using amounts the Company has earned and expects to be collected using historical averages and other factors to project such revenues. Variable consideration is recognized when the Company concludes it is probable that a significant revenue reversal will not occur in future periods.

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Third-party services revenue includes pharmacy, directed care services and other services, and includes amounts received from customers compensating the Company for certain third-party costs associated with providing its integrated network solutions services. The Company is considered the principal in these transactions as it directs the third-party, controls the specified service and pricing, performs program utilization review, directs payment to the provider, assumes the financial risk of loss associated with services rendered, and combines the services provided into an integrated solution, as specified within its customer contracts. The Company has the ability to influence contractual fees with customers and assumes the financial risk of loss in certain contractual obligations. These factors indicate that the Company is the principal and therefore required to recognize gross revenue and operating expense from service-partner fees within its consolidated statements of income.

The following table presents revenues disaggregated by service line for the three and nine months ended December 31, 2025 and 2024:


	Three Months Ended
	December 31, 2025		December 31, 2024
Patient management services	$	146,059,000	$	145,860,000
Network solutions services		89,566,000		82,113,000
Total services	$	235,625,000	$	227,973,000


	Nine Months Ended
	December 31, 2025		December 31, 2024
Patient management services	$	443,622,000	$	432,206,000
Network solutions services		266,357,000		231,869,000
Total services	$	709,979,000	$	664,075,000

Arrangements with Multiple Performance Obligations

The Company offers a suite of services under its patient management and network solutions service lines. Although customers can select from a variety of services, the Company typically has one performance obligation per customer. The Company always provides its customers with an option to contract additional services. The price of each service is separate and distinct to each customer. Pricing is generally consistent for each service irrespective of the other services or quantities requested by the customer.

Contract Balances

Due to the timing of revenue recognition, billings and cash collections, the Company’s consolidated balance sheets include billed accounts receivables, unbilled receivables, and contract liabilities (reported as deferred revenues). Unbilled receivables are due to the Company for services already rendered, except for physical invoicing and the passage of time. Invoicing requirements vary by customer contract, but substantially all unbilled revenues are billed within one year.


	December 31, 2025			March 31, 2025
Billed receivables	$	68,197,000		$	65,323,000
Allowance for expected credit losses		(4,179,000	)		(7,690,000	)
Unbilled receivables		38,082,000			46,493,000
Accounts receivable, net	$	102,100,000		$	104,126,000

When the Company receives consideration from a customer prior to transferring services to the customer under the terms of certain claims management agreements, it records deferred revenues on the consolidated balance sheets, which represents a contract liability.

Certain services, such as claims management, are provided under fixed-fee service agreements and require the Company to manage claims over a contract period, typically for one year with the option for auto renewal, with the fixed fee renewing on the anniversary date of such contract. The Company recognizes deferred revenues as revenues when it performs services and transfers control of the services to the customer and satisfies the performance obligation, which it determines utilizing a portfolio approach. For all fixed fee service agreements, revenues are straight-lined and recognized over the expected service periods by type of claim.

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The table below presents the deferred revenues balance and the significant activity affecting deferred revenues during the nine months ended December 31, 2025:


	Nine Months Ended
	December 31, 2025
Beginning balance at April 1, 2025	$	30,809,000
Additions		59,417,000
Revenue recognized from beginning of period		(27,259,000	)
Revenue recognized from additions		(32,028,000	)
Ending balance at December 31, 2025	$	30,939,000

Remaining Performance Obligations

Remaining performance obligations consist of deferred revenues. As of December 31, 2025, the Company has approximately $30.9 million of remaining performance obligations related to claims and non-claims services for which the price is fixed. The Company expects to recognize approximately 99% of its remaining performance obligations as revenues within the current fiscal year ending March 31, 2026, and expects to recognize the remaining balance as revenue thereafter. See the discussion below regarding the practical expedients elected for the disclosure of remaining performance obligations.

Costs to Obtain a Contract

The Company has an internal sales force compensation program where remuneration is based solely on the revenues recognized in the period and does not represent an incremental cost to the Company, which provides a future benefit expected to be longer than one year and would meet the criteria to be capitalized and presented on the consolidated balance sheets.

Practical Expedients Elected

As a practical expedient, the Company does not adjust the consideration in a contract for the effects of a significant financing component. It expects, at contract inception, that the period between a customer’s payment of consideration and the transfer of promised services to the customer will be one year or less.

For patient management services that are billed on a time-and-expense incurred or per unit basis and for which revenue is recognized over time, the Company recognizes revenue at the amount to which it has the right to invoice for services performed.

The Company does not disclose the value of remaining performance obligations for (i) contracts where revenue is recognized for the amount the Company has the right to invoice for services performed, and (ii) contracts with variable consideration allocated entirely to a single performance obligation.

Note 3 — Stock-Based Compensation and Stock Options

Under the Company’s Restated Omnibus Incentive Plan (formerly the Restated 1988 Executive Stock Option Plan) (the “Omnibus Plan”) as of March 31, 2025, there were 1,185,727 stock options outstanding and 1,775,459 shares available for issuance. Under the Omnibus Plan, shares of common stock were granted to key employees, non-employee directors, and consultants at exercise prices not less than the fair market value of the common stock on the date of grant. Options granted under the Omnibus Plan generally vest as to 25% of the shares one year from the date of grant, and as to the remaining 75% of the shares ratably each month over the following 36 months. The options granted to employees and directors expire at the end of five years and ten years, respectively, from the date of grant. All options granted in the three months ended December 31, 2025 and 2024 were granted with an exercise price equal to the fair value of the Company’s common stock on the grant date and are non-statutory stock options. After August 7, 2025, no further grants may be under the Omnibus Plan.

On August 7, 2025, the Company’s stockholders approved the 2025 Stock Incentive Plan (the “2025 SIP”) replacing the Omnibus Plan, which expires on June 30, 2026. Consistent with the Omnibus Plan, the primary purpose of the 2025 SIP is to continue to attract and retain qualified personnel. The 2025 SIP initially reserves 1,775,459 shares of common stock for issuance to employees, directors, consultants, independent contractors and advisors. The 2025 SIP permits the issuance of stock options, restricted stock, stock appreciation rights, restricted stock units and performance awards.

The Company will not grant any further equity awards under the Omnibus Plan. Outstanding awards under the Omnibus Plan will remain outstanding, unchanged and subject to the terms of the Omnibus Plan and their respective award agreements. Shares subject to awards that are forfeited, expire or are otherwise terminated without shares being issued, or shares withheld to pay the exercise price of

Page 11

an award or to satisfy tax withholding obligations, including shares subject to awards granted under the Omnibus Plan that are outstanding after June 30, 2026, will be returned to the pool of shares available for grant and issuance under the 2025 SIP.

The Company records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model based on the assumptions included in the table below. The risk-free rate is based on the interest rate paid on a U.S. Treasury issue with a term similar to the estimated life of the option. The Company uses historical data, among other factors, to estimate the expected volatility, dividend yield and option life. The Company accounts for forfeitures as they occur, rather than estimating expected forfeitures. No options were granted during the three months ended December 31, 2024. The following assumptions were used to estimate the fair value of stock options granted during the three months ended December 31, 2025, using the Black-Scholes option-pricing model:


		Three Months Ended
		December 31, 2025
Risk-free interest rate		3.69%
Expected volatility		31%
Expected dividend yield		0.00%
Expected weighted average life of option in years		4 years

For the three months ended December 31, 2025 and 2024, the Company recorded stock-based compensation expense of $1,362,000 and $1,823,000, respectively. For the nine months ended December 31, 2025 and 2024, the Company recorded stock-based compensation expense of $4,177,000 and $4,376,000, respectively. The table below shows the amounts recognized in the unaudited consolidated financial statements for stock-based compensation expense for all stock options during the three and nine months ended December 31, 2025 and 2024, respectively.


	Three Months Ended
	December 31, 2025			December 31, 2024
Cost of revenues	$	639,000		$	685,000
General and administrative		723,000			1,138,000
Total cost of stock-based compensation included in income before income tax provision		1,362,000			1,823,000
Amount of income tax benefit recognized		(340,000	)		(416,000	)
Amount charged against net income	$	1,022,000		$	1,407,000
Effect on basic earnings per share	$	(0.02	)	$	(0.03	)
Effect on diluted earnings per share	$	(0.02	)	$	(0.03	)


	Nine Months Ended
	December 31, 2025			December 31, 2024
Cost of revenues	$	1,988,000		$	2,123,000
General and administrative		2,189,000			2,253,000
Total cost of stock-based compensation included in income before income tax provision		4,177,000			4,376,000
Amount of income tax benefit recognized		(974,000	)		(938,000	)
Amount charged against net income	$	3,203,000		$	3,438,000
Effect on basic earnings per share	$	(0.06	)	$	(0.07	)
Effect on diluted earnings per share	$	(0.06	)	$	(0.07	)

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The following table provides summary information for all stock options outstanding and exercisable at December 31, 2025:


Range of Exercise Price	Outstanding Options – Number of Outstanding Options		Outstanding Options – Weighted Average Remaining Contractual Life		Outstanding Options – Weighted Average Exercise Price		Exercisable Options – Number of Exercisable Options		Exercisable Options – Weighted Average Exercise Price
$14.44 to $49.63		320,540		1.63	$	31.32		308,483	$	30.60
$49.64 to $54.54		281,325		2.53		52.43		198,306		52.40
$54.55 to $73.36		341,586		2.93		69.14		149,263		66.79
$73.37 to $110.18		162,320		4.74		103.02		20,097		92.59
Total		1,105,771		2.72	$	58.90		676,149	$	46.83

The following table provides summary information regarding all stock options outstanding at December 31, 2025, and changes during the three months then ended:


	Number of Options			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value as of December 31, 2025
Options outstanding at October 1, 2025		1,071,486		$	56.73
Granted		83,000			75.32
Exercised		(43,467	)		35.52
Cancelled – forfeited		(4,670	)		68.27
Cancelled – expired		(578	)		85.05
Ending outstanding		1,105,771		$	58.90		2.72	$	16,338,984
Ending vested and expected to vest		993,674		$	58.28		2.72	$	15,367,233
Ending exercisable at December 31, 2025		676,149		$	46.83		2.08	$	14,733,744

There were no options granted during the three months ended December 31, 2024. The weighted-average grant-date fair value of stock options granted during the three months ended December 31, 2025 was $21.90.

The stock option grants and stock-based compensation expense reflected above include time-based stock options, which vest based on the satisfaction of time-based service conditions, and performance-based stock options, which vest based on the Company’s achievement of certain pre-determined earnings per share targets that are assessed on a calendar year basis by the Company’s Board of Directors (the “Board”). Performance-based stock options are generally valued in the same manner as the time-based stock options except the Company only recognizes stock-based compensation expense to the extent it is probable the targets will be achieved. The Company recognized stock-based compensation expense for performance-based stock options of $427,000 and $819,000 for the three months ended December 31, 2025 and 2024, respectively, and $1,281,000 and $1,354,000 for the nine months ended December 31, 2025 and 2024, respectively.

Note 4 — Treasury Stock

The Board initially approved the commencement of a stock repurchase program in 1996 (the “stock repurchase program”). In 2022, the Board authorized the repurchase of additional shares under the stock repurchase program, thereby increasing the total number of shares of common stock approved for repurchase under the program to 117,000,000. The stock repurchase program does not obligate the Company to acquire any amount of its common stock and may be suspended or discontinued at any time at its discretion.

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Since the commencement of the stock repurchase program, the Company has used approximately $868 million to repurchase 114,893,129 shares of its common stock, which equals approximately 69% of the shares of common stock that would have been outstanding had there been no repurchases. The average price at which shares have been repurchased under the program is $7.55 per share. These repurchases were funded primarily by the net income of the Company, along with proceeds from the exercise of stock options.

During the three and nine months ended December 31, 2025, the Company repurchased 185,559 shares of its common stock for approximately $13.4 million, excluding tax, at an average price of $72.47 per share and 416,438 shares of its common stock for approximately $36 million at an average price of $86.47 per share, respectively. The Company had 51,143,561 shares of common stock outstanding as of December 31, 2025, net of the 114,893,129 shares of common stock held in treasury.

During the period subsequent to the quarter ended December 31, 2025, the Company repurchased 68,212 shares of its common stock for $4.7 million at an average price of $69.26 per share.

Note 5 — Weighted Average Shares and Net Income Per Share

Net income per common and common equivalent share was computed by dividing net income by the weighted average number of common and common share equivalents outstanding during the period. The following table sets forth the calculations of the basic and diluted weighted average common shares for the three and nine months ended December 31, 2025 and 2024:


	Three Months Ended
	December 31, 2025		December 31, 2024
Net Income	$	24,174,000	$	23,771,000
Basic:
Weighted average common shares outstanding		51,317,000		51,388,000
Net Income per share	$	0.47	$	0.46
Diluted:
Weighted average common shares outstanding		51,317,000		51,388,000
Treasury stock impact of stock options		265,000		650,000
Total common and common equivalent shares		51,582,000		52,038,000
Net Income per share	$	0.47	$	0.46


	Nine Months Ended
	December 31, 2025		December 31, 2024
Net Income	$	79,315,000	$	68,746,000
Basic:
Weighted average common shares outstanding		51,328,000		51,384,000
Net Income per share	$	1.55	$	1.34
Diluted:
Weighted average common shares outstanding		51,328,000		51,384,000
Treasury stock impact of stock options		411,000		615,000
Total common and common equivalent shares		51,739,000		51,999,000
Net Income per share	$	1.53	$	1.32

Note 6 — Contingencies and Legal Proceedings

From time to time, the Company is involved in various legal proceedings, disputes, and other claims arising in the ordinary course of business. Although the results of these matters cannot be predicted with certainty, the Company believes it is not currently a party to any legal proceedings, disputes, or other claims for which a material loss is considered probable and for which the amount (or range) of loss is reasonably estimable. In connection with the Company's acquisition of a privately held technology firm, the Company agreed to issue a maximum of 96,973 shares of common stock to certain of the seller parties contingent on the achievement of agreed upon contractual milestones.

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Note 7 — Accounts and Income Taxes Payable and Accrued Liabilities

The following tables set forth accounts payable, income taxes payable, and accrued liabilities at December 31, 2025 and March 31, 2025:


	December 31, 2025		March 31, 2025
Accounts payable	$	25,872,000	$	15,422,000
Income taxes payable and uncertain tax positions		4,126,000		1,370,000
Total accounts and taxes payable	$	29,998,000	$	16,792,000


	December 31, 2025		March 31, 2025
Payroll, payroll taxes and employee benefits	$	51,858,000	$	30,971,000
Customer deposits		115,427,000		101,472,000
Accrued professional service fees		9,460,000		11,004,000
Self-insurance accruals		3,193,000		3,276,000
Deferred revenue		30,939,000		30,809,000
Operating lease liabilities		7,332,000		8,126,000
Other		2,240,000		1,586,000
Total accrued liabilities	$	220,449,000	$	187,244,000

Note 8 — Leases

The Company determines if an arrangement contains a lease at contract inception. The Company’s current lease agreements have remaining lease terms between one and seven years. The Company recognizes a right-of-use (“ROU”) asset and a lease liability at the lease commencement date. The lease liability is initially measured based on the present value of the unpaid lease payments as of the lease commencement date. Key estimates and judgments used in determining the liability include the (1) discount rate the Company uses to discount the unpaid lease payments to present value, (2) lease term, and (3) lease payments.

Accounting Standard Codification (“ASC”) 842 requires a lessee to discount its unpaid lease payments using the interest rate implicit in the lease or, if that rate cannot be readily determined, its incremental borrowing rate. Generally, the Company cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, the Company generally uses its incremental borrowing rate as the discount rate for the lease. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. Because the Company does not generally borrow on a collateralized basis, it uses quoted interest rates obtained from financial institutions as an input to derive an appropriate incremental borrowing rate, adjusted for the amount of the lease payments, the lease term, and the effect on that rate of designating specific collateral with a value equal to the unpaid lease payments for that lease.

Some of the Company’s lease agreements include options to extend the lease following the initial term. The Company elected the practical expedient of hindsight in determining the option to renew. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheets. The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

For lease agreements entered into or reassessed after the adoption of ASC 842, the Company has elected a practical expedient to account for the lease and non-lease components as a single lease component. Therefore, for those leases, the lease payments used to measure the lease liability include all of the fixed consideration in the contract.

Variable lease payments are recognized upon occurrence of the event, activity, or circumstance in the lease agreement on which those payments are assessed.

Page 15

The components of lease expense are as follows:


	Three Months Ended
	December 31, 2025		December 31, 2024
Operating lease expense	$	2,098,000	$	2,281,000
Finance lease expense		—		20,000
Short-term lease expense		—		5,000
Variable lease expense		66,000		191,000
Total lease expenses	$	2,164,000	$	2,497,000


	Nine Months Ended
	December 31, 2025		December 31, 2024
Operating lease expense	$	6,295,000	$	6,823,000
Finance lease expense		19,000		61,000
Short-term lease expense		—		113,000
Variable lease expense		393,000		479,000
Total lease expenses	$	6,707,000	$	7,476,000

The following table presents the lease related assets and liabilities recorded on the Company’s consolidated balance sheets related to its operating leases at December 31, 2025 and March 31, 2025:


	December 31, 2025			March 31, 2025
Right-of-use asset, net	$	19,447,000		$	20,825,000
Short-term lease liability	$	7,332,000		$	8,126,000
Long-term lease liability		18,616,000			19,953,000
Total lease liabilities	$	25,948,000		$	28,079,000
Weighted average remaining operating lease term	3.89 years			4.01 years
Weighted average remaining finance lease term		—		0.25 years
Weighted average discount rate		5.1	%		4.5	%

Supplemental cash flow information related to operating leases at December 31, 2025 and 2024 was as follows:


	December 31, 2025			December 31, 2024
Cash paid for amounts included in the measurement of operating lease liabilities	$	7,009,000		$	6,559,000
Operating lease liabilities arising from obtaining ROU assets	$	42,364,000		$	40,637,000
Finance lease liabilities arising from obtaining ROU assets	$	—		$	358,000
Reductions to ROU assets resulting from reductions to operating lease liabilities	$	(1,650,000	)	$	(10,210,000	)

As of December 31, 2025, maturities of operating lease liabilities for each of the next five years and thereafter are as follows:



2026	$	2,226,000
2027		8,175,000
2028		7,461,000
2029		5,209,000
2030		3,265,000
Thereafter		2,392,000
Total lease payments		28,728,000
Less interest		(2,780,000	)
Total lease liabilities	$	25,948,000

As of December 31, 2025, the Company has additional operating lease commitments that have not yet commenced of approximately $2.6 million. These leases will commence in 2026 and have lease terms between 7 and 11 years.

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Note 9 — Segment Reporting

The Company operates within one operating segment. The Company’s Chief Operating Decision Maker (“CODM”) is its Chief Executive Officer. The CODM reviews segment financial information presented on a consolidated basis, including revenue, gross profit and operating expenses, and considers budget-to-actual variances for the purposes of making operating decisions, assessing financial performance and allocating resources.

The Company derives its revenues from providing patient management and network solutions services. Patient management services include claims administration, utilization review, medical case management, and vocational rehabilitation. Network solutions services include fee schedule auditing, hospital bill auditing, coordination of independent medical examinations, diagnostic imaging review services and preferred provider referral services. The percentages of revenues attributable to patient management and network solutions services for the three and nine months ended December 31, 2025 and 2024 are listed below.


	Three Months Ended
	December 31, 2025			December 31, 2024
Patient management services		62.0	%		64.0	%
Network solutions services		38.0	%		36.0	%
		100.0	%		100.0	%


	Nine Months Ended
	December 31, 2025			December 31, 2024
Patient management services		62.5	%		65.1	%
Network solutions services		37.5	%		34.9	%
		100.0	%		100.0	%

The Company’s management is structured geographically with regional vice presidents who are responsible for all services provided by and operating results of the Company in their particular region. These regional vice presidents have area and district managers who are also responsible for all services provided by the Company in their given area and district. All revenues are derived from customers within the United States, and all long-lived assets are located in the United States.

Under ASC 280-10, two or more operating segments may be aggregated into a single operating segment for financial reporting purposes if aggregation is consistent with the objective and basic principles of the accounting guidance, if the segments have similar economic characteristics, and if the segments are similar in each of the following areas: (i) the nature of products and services, (ii) the nature of the production processes, (iii) the type or class of customer for their products and services, and (iv) the methods used to distribute their products or provide their services. The Company believes its patient management and network solutions services meet these criteria as they provide similar managed care services to similar customers using similar methods of production and distribution. All of the Company’s regions perform both patient management and network solutions services.

The following table presents the financial information for the Company’s one reportable and operating segment for the three and nine months ended December 31, 2025 and 2024:


	Three Months Ended
	December 31, 2025		December 31, 2024
Revenues	$	235,625,000	$	227,973,000
Less:
Labor expenses		115,150,000		114,009,000
Direct product expenses		53,404,000		49,803,000
Depreciation and amortization expenses		8,068,000		7,498,000
Income tax provision		8,058,000		7,029,000
Occupancy expenses		4,991,000		5,336,000
Other items (1)		21,780,000		20,527,000
Net income	$	24,174,000	$	23,771,000


(1)	Includes other operating costs (such as marketing and maintenance expenses), net gain (loss) on asset sales and disposals and other costs.

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	Nine Months Ended
	December 31, 2025		December 31, 2024
Revenues	$	709,979,000	$	664,075,000
Less:
Labor expenses		342,125,000		333,211,000
Direct product expenses		161,169,000		144,870,000
Depreciation and amortization expenses		23,500,000		21,935,000
Income tax provision		24,100,000		18,758,000
Occupancy expenses		15,194,000		15,980,000
Other items (1)		64,576,000		60,575,000
Net income	$	79,315,000	$	68,746,000


(1)	Includes other operating costs (such as marketing and maintenance expenses), net gain (loss) on asset sales and disposals and other costs.

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

This report may include certain forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including (without limitation) statements with respect to anticipated future operating and financial performance, growth and acquisition opportunities and other similar forecasts and statements of expectation. Words such as “expects,” “anticipates,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “potential,” “continue,” “strive,” “ongoing,” “may,” “will,” “would,” “could,” “should,” as well as variations of these words and similar expressions, are intended to identify these forward-looking statements. Forward-looking statements made by the Company and its management are based on estimates, projections, beliefs and assumptions of management at the time of such statements and are not guarantees of future performance.

The Company disclaims any obligations to update or revise any forward-looking statement based on the occurrence of future events, the receipt of new information or otherwise. Actual future performance, outcomes, and results may differ materially from those expressed in forward-looking statements made by the Company and its management as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation): general industry and economic conditions, including fluctuations in the number of national claims based on the number of injured workers; competition from other managed care companies and third party administrators; the Company’s ability to renew or maintain contracts with its customers on favorable terms or at all; the ability to expand certain areas of the Company’s business; growth in the Company’s sale of third-party administrator (“TPA”) services; shifts in customer demands; increases in operating expenses, including employee wages, benefits and medical inflation; the ability of the Company to produce market-competitive software; cost of capital and capital requirements; the Company’s ability to attract and retain key personnel; the impact of possible cybersecurity incidents on the Company’s business; existing and possible litigation and legal liability in the course of operations and the Company’s ability to resolve such litigation; governmental and public policy changes, including but not limited to legislative and administrative law and rule implementation or change; the impact of recently issued accounting standards on the Company’s consolidated financial statements; the availability of financing in the amounts, at the times, and on the terms necessary to support the Company’s future business; and the other risks identified in Part II, Item 1A of this report, under the heading “Risk Factors.”

Overview

The Company is an independent nationwide provider of medical cost containment and managed care services designed to address the escalating medical costs of workers’ compensation benefits, automobile insurance claims, and group health insurance benefits. The Company’s services are provided to insurance companies, TPAs, governmental entities, and self-administered employers to assist them in managing the medical costs and monitoring the quality of care associated with healthcare claims. In January 2026, the Bureau of Labor Statistics reported that the occupational injury count for 2024 was 2.34 million compared to 2.37 million in 2023, 2.34 million in 2022, 2.24 million in 2021, 2.11 million in 2020, and 2.69 million in 2019. While the injury count has steadily increased since 2019, it has not returned to pre-pandemic levels. Despite fewer claims to administrate in each of 2024, 2023, 2022, 2021 and 2020 as compared to 2019, the Company has been able to overcome the decrease with an increase in market share.

Patient Management Services

In addition to its network solutions services, the Company offers a range of patient management services, which involve working one-on-one with injured employees and their various healthcare professionals, employers and insurance company adjusters. Patient management services include claims management and all services sold to claims management customers, case management, 24/7 nurse triage, utilization management, vocational rehabilitation, and life care planning. The services are designed to monitor the medical necessity and appropriateness of healthcare services provided to workers’ compensation and other healthcare claimants and to expedite return to work. The Company offers these services on a stand-alone basis, or as an integrated component of its medical cost containment services. Patient management services include the processing of claims for self-insured payors with respect to property and casualty insurance.

Network Solutions Services

The Company’s network solutions services are designed to reduce the price paid by its customers for medical services rendered in workers’ compensation cases, automobile insurance policies, and group health insurance policies. The network solutions services offered by the Company include automated medical fee auditing, preferred provider management and reimbursement services, retrospective utilization review, facility claim review, professional review, pharmacy services, directed care services, Medicare solutions, clearinghouse services, independent medical examinations, and inpatient medical bill review. Network solutions services also include revenue from the Company’s directed care network (known as CareIQ), including imaging, physical therapy, durable medical equipment, translation and transportation.

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Organizational Structure

The Company’s management is structured geographically with regional vice presidents who are responsible for all services provided by the Company within his or her particular region and the operating results of the Company in multiple states. In addition, the regional vice presidents oversee area and district managers who are also responsible for all services provided by the Company in their given area and district.

Business Enterprise Segments

The Company operates in one reportable operating segment: managed care. It generates its revenue through its patient management and network solutions services. Both services are available to customers throughout the United States. Accordingly, the Company’s internal financial reporting is segmented geographically and managed on a geographic rather than service line basis, with virtually all of its operating revenue generated within the United States.

Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) 280-10, “Segment Reporting,” establishes standards for the way that public business enterprises report information about operating segments in annual and interim consolidated financial statements. Under FASB ASC 280-10, two or more operating segments may be aggregated into a single operating segment for financial reporting purposes if aggregation is consistent with the objective and basic principles, if the segments have similar economic characteristics, and if the segments are similar in each of the following areas: (i) the nature of products and services; (ii) the nature of the production processes; (iii) the type or class of customer for their products and services; and (iv) the methods used to distribute their products or provide their services. The Company believes its patient management and network solutions services meet these criteria as each provides similar services and products to similar customers using similar methods of production and distribution.

Because we believe we meet each of the criteria set forth above and each of our regions have similar economic characteristics, we aggregate our results of operations in one reportable operating segment: managed care.

Seasonality

While we are not directly impacted by seasonal shifts, we are affected by the change in working days in a given quarter. There are generally fewer working days for our employees to generate revenue in the third fiscal quarter due to employee vacations, inclement weather, and holidays.

Recent Acquisition

During the quarter ended September 30, 2025, the Company acquired a privately held technology firm adding proprietary tools and intellectual property for our enhanced bill review process.

Summary of Quarterly Results

The Company’s revenues increased to $235.6 million in the quarter ended December 31, 2025, from $228.0 million in the quarter ended December 31, 2024, an increase of $7.7 million, or 3%. This increase resulted primarily from an increase in network solutions activity with existing customers.

Cost of revenues increased to $180.7 million in the quarter ended December 31, 2025, from $175.1 million in the quarter ended December 31, 2024, an increase of $5.6 million, or 3%. This increase was primarily due to the increase of 3% in revenue mentioned above.

General and administrative expense increased to $22.7 million in the quarter ended December 31, 2025, from $22.1 million in the quarter ended December 31, 2024, an increase of $0.6 million, or 3%. General and administrative expense in the quarter ended December 31, 2025 consisted of approximately the increase of 3% of revenues. The Company expects the proportion of general and administrative expense in future quarters to be between 9% and 11% of revenues.

Income tax provision increased to $8.1 million in the quarter ended December 31, 2025, from $7.0 million in the quarter ended December 31, 2024, an increase of $1.0 million, or 15%. Income before income tax provision increased to $32.2 million in the quarter ended December 31, 2025, from $30.8 million in the quarter ended December 31, 2024, an increase of $1.4 million, or 5%. The effective tax rate was 25% for the quarter ended December 31, 2025, compared to 22.8% for the quarter ended December 31, 2024.

Diluted weighted average common and common equivalent shares decreased to 51.6 million shares for the quarter ended December 31, 2025 from 52.0 million shares for the quarter ended December 31, 2024, a decrease of 456,000 shares, or 0.9%, due to the weighted impact of shares repurchased partially offset by the weighted impact of options exercised.

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Diluted earnings per share increased to $0.47 per share in the quarter ended December 31, 2025, from $0.46 per share in the quarter ended December 31, 2024, an increase of $0.01 per share, or 2%. The increase in diluted earnings per share was primarily due to an increase in net income.

Results of Operations for the three months ended December 31, 2025 and 2024

The Company generates revenues from providing patient management and network solutions services to payors of workers’ compensation benefits, automobile insurance claims, and group health insurance benefits.

The following table sets forth, for the periods indicated, the dollar amounts, dollar and percent changes, share changes, and the percentage of revenues represented by certain items reflected in the Company’s unaudited consolidated income statements for the three months ended December 31, 2025 and 2024. The Company’s past operating results are not necessarily indicative of future operating results.


	Three Months Ended								Percentage
	December 31, 2025			December 31, 2024			Change		Change
Revenue	$	235,625,000		$	227,973,000		$	7,652,000		3.4	%
Cost of revenues		180,709,000			175,115,000			5,594,000		3.2	%
Gross profit		54,916,000			52,858,000			2,058,000		3.9	%
Gross profit as percentage of revenue		23.3	%		23.2	%
General and administrative expenses		22,684,000			22,058,000			626,000		2.8	%
General and administrative as percentage of revenue		9.6	%		9.7	%
Income before income tax provision		32,232,000			30,800,000			1,432,000		4.6	%
Income before income tax provision as percentage of revenue		13.7	%		13.5

CORVEL CORP 10-Q