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What changed in ACCENDRA HEALTH INC/VA/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ACCENDRA HEALTH INC/VA/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+319 added−463 removedSource: 10-K (2026-02-20) vs 10-K (2025-02-28)

Top changes in ACCENDRA HEALTH INC/VA/'s 2025 10-K

319 paragraphs added · 463 removed · 205 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

62 edited+13 added−84 removed59 unchanged
Biggest changeFor Patient Direct, we have developed internal expertise to manage the unique reimbursement requirements of certain Payors and continue to negotiate simplifications in the claims submission process in an effort to reduce subsequent denials and shorten related collection periods. Our general practice is to collect co-payments from the patient or applicable secondary Payor.
Biggest changeMedicare contracts may be subject to a Competitive Bidding Process (CBP) for durable medical equipment, prosthetics, orthotics and supplies (DMEPOS), as further described in the Regulation section. 3 Table of Contents Collections and Accounts Receivable Accendra Health has internal expertise to manage the unique reimbursement requirements of certain Payors and continue to negotiate simplifications in the claims submission process in an effort to reduce subsequent denials and shorten related collection periods.
This includes oversight by the FDA, the Centers for Medicare and Medicaid Services, the Drug Enforcement Agency, the Department of Transportation, the Environmental Protection Agency (EPA), the Department of Homeland Security (DHS), the Occupational Safety and Health Administration, the Department of Labor, the Equal Employment Opportunity Commission, and state boards of pharmacy, or similar state licensing boards and regulatory agencies and other federal and state regulatory authorities.
This includes oversight by the FDA, the Centers for Medicare and Medicaid Services, the Drug Enforcement Administration, the Department of Transportation, the Environmental Protection Agency (EPA), the Department of Homeland Security (DHS), the Occupational Safety and Health Administration, the Department of Labor, the Equal Employment Opportunity Commission, and state boards of pharmacy, or similar state licensing boards and regulatory agencies and other federal and state regulatory authorities.
On December 18, 2020, prior to the completion of the Apria Acquisition on the Apria Acquisition Date, a federal judge approved a civil and administrative settlement between Apria and the U.S. and certain state Medicaid programs, in a complaint filed by three relators under the qui tam provisions of the FCA, 31 U.S.C. § 3729 et seq., as well as comparable state false claims laws, in connection with the rental of non-invasive ventilation products (NIVs).
On December 18, 2020, prior to the Acquisition of Apria on the Apria Acquisition Date, a federal judge approved a civil and administrative settlement between Apria and the U.S. and certain state Medicaid programs, in a complaint filed by three relators under the qui tam provisions of the FCA, 31 U.S.C. § 3729 et seq., as well as comparable state false claims laws, in connection with the rental of non-invasive ventilation products (NIVs).
Additionally, certain states may require certain of our teammates to complete training programs, undergo background checks, and maintain state certification. In addition, various federal and state authorities and clinical practice boards regulate the licensure of our clinical specialists, working either directly as employees or on a per diem or contractual basis, and in our facilities.
Additionally, certain states may require certain of our teammates to complete training programs, undergo background checks, and maintain state certification. In addition, various federal and state authorities and clinical practice boards regulate the licensure of our clinical specialists, working either directly as teammates or on a per diem or contractual basis, and in our facilities.
In the U.S., the Federal Food, Drug, and Cosmetic Act (FFDCA), Food and Drug Administration (FDA) regulations and other federal and state statutes and regulations govern, among other things, medical device design and development, preclinical and clinical testing, premarket clearance or approval, registration and listing, manufacturing, labeling, storage, advertising and promotion, sales and distribution and post-market surveillance.
In the U.S., the Federal Food, Drug, and Cosmetic Act (FFDCA), Food and Drug Administration (FDA) regulations and other federal and state statutes and regulations govern, among other things, medical device design and development, preclinical and clinical testing, premarket clearance or approval, registration and listing, labeling, storage, advertising and promotion, sales and distribution and post-market surveillance.
We periodically review and adjust, if needed, our teammates’ total compensation (including salaries, annual cash incentive compensation, other cash and equity incentives, and benefits) to ensure that our offerings are competitive within the industry and consistent with our performance. We have also implemented enterprise-wide talent development and succession planning programs designed to identify future and/or replacement candidates for key positions.
We periodically review and adjust, if needed, our teammates’ total compensation (including salaries, annual cash incentive compensation, other cash and equity incentives, and benefits) to ensure that our offerings are competitive within the industry and consistent with our performance. We have enterprise-wide talent development and succession planning programs designed to identify future and/or replacement candidates for key positions.
Of particular importance, each of which may be amended and updated from time to time, are: ● The federal Anti-Kickback statute and similar state equivalents prohibits providers and others from directly or indirectly soliciting, receiving, offering or paying any remuneration with the intent of generating referrals or orders for services or items covered by a federal healthcare program.
Of particular importance, each of which may be amended and updated from time to time, are: ● The federal Anti-Kickback statute and similar state equivalents prohibit providers and others from directly or indirectly soliciting, receiving, offering or paying any remuneration with the intent of generating referrals or orders for services or items covered by a federal healthcare program.
Some of the MHMDA’s provisions went into effect in July 2023 and in March 2024. The Florida Legislature passed an update to the Florida Electronic Health Records Exchange Act that prohibits health care providers that use certified health record technologies from storing electronic health records outside the United States, its territories, or Canada.
Some of the MHMDA’s provisions went into effect in July 2023 and in March 2024. The Florida Legislature passed an update to the Florida Electronic Health Records Exchange Act, effective since 2023, that prohibits health care providers that use certified health record technologies from storing electronic health records outside the United States, its territories, or Canada.
Failure to refund amounts received as a result of a prohibited referral on a timely basis may constitute a false or fraudulent claim and may result in civil penalties and additional penalties under the federal False Claims Act (FCA); ● The FCA and similar state laws provide, in part, that the federal government may bring a lawsuit against any person whom it believes has knowingly presented, or caused to be presented, a false or fraudulent request for payment from the federal government, or who has made a false statement or used a false record to get a claim approved.
Failure to refund amounts received as a result of a prohibited referral on a timely basis may constitute a false or fraudulent claim and may result in civil penalties and additional penalties under the federal False Claims Act (FCA); 7 Table of Contents ● The FCA and similar state laws provide, in part, that the federal government may bring a lawsuit against any person whom it believes has knowingly presented, or caused to be presented, a false or fraudulent request for payment from the federal government, or who has made a false statement or used a false record to get a claim approved.
The FDA and DOJ actively investigates allegations of off-label promotion in order to enforce regulations prohibiting these types of activities. The FDA routinely issues informal and more formal communications such as untitled letters or warning letters interpreting its authority over these matters.
The FDA and DOJ actively investigate allegations of off-label promotion in order to enforce regulations prohibiting these types of activities. The FDA routinely issues informal and more formal communications such as untitled letters or warning letters interpreting its authority over these matters.
Our values reflect our commitment to our customers and our teammates, as well as the environment and the communities where we live and work. Our values embody “IDEAL” behavior — Integrity, Development, Excellence, Accountability and Listening. All teammates are expected to reflect these values in all they do each and every day.
Our values reflect our commitment to our customers, our teammates and the environment and the communities where we live and work. Our values embody “IDEAL” behavior — Integrity, Development, Excellence, Accountability and Listening. All teammates are expected to reflect these values in all they do each and every day.
However, there can be no guarantee that these releases or newly-discovered information, more stringent enforcement of or changes in environmental requirements, or our inability to enforce available indemnification agreements will not result in significant costs. In addition, governments in the U.S. and abroad are considering new or expanded laws to address climate change.
However, there can be no guarantee that these releases or newly-discovered information, more stringent enforcement of or changes in environmental requirements, or our inability to enforce available indemnification agreements will not result in significant costs. In addition, federal and state governments in the U.S. are considering new or expanded laws to address climate change.
It is possible that healthcare companies will continue to experience a shift in Payor mix away from fee-for-service Payors, resulting in an increase in the percentage of revenues attributable to reimbursement based upon value-based principles and quality-driven managed care programs, and general industry trends that include pressures to control healthcare costs.
It is possible that healthcare companies will continue to experience a shift in Payor mix away from fee-for-service Payors, resulting in an increase in the percentage of revenues attributable to reimbursement based upon value-based principles and quality-driven managed care programs, and general industry trends that include pressures to control 9 Table of Contents healthcare costs.
Patient Direct Reimbursement To participate in and qualify for reimbursement under governmental reimbursement programs such as Medicare and Medicaid, we must comply with extensive conditions of participation imposed by federal and state authorities as well as third-parties administering such governmental reimbursement programs.
Reimbursement To participate in and qualify for reimbursement under governmental reimbursement programs such as Medicare and Medicaid, we must comply with extensive conditions of participation imposed by federal and state authorities as well as third-parties administering such governmental reimbursement programs.
Key programs focus on teammate safety, leadership development, health and wellness, work-life balance, talent management, and teammate engagement. We believe that teammate engagement is integral to our Life Takes Care purpose, vision, strategy and business success.
Key programs focus on teammate safety, leadership development, health and wellness, work-life balance, talent management, and teammate engagement. We believe that teammate engagement is integral to our Bringing Care to Life purpose, vision, strategy and business success.
Among other things, 12 Table of Contents the CIA requires Apria to impose certain oversight obligations on Apria’s board of directors; provide certain management certifications; continue or implement, as applicable, certain compliance training and education; and engage an Independent Review Organization to perform certain reviews. The CIA also includes certain reporting, certification, record retention, and notification requirements.
Among other things, the CIA requires Apria to impose certain oversight obligations on Apria’s board of directors; provide certain management certifications; continue or implement, as applicable, certain compliance training and education; and engage an Independent Review Organization to perform certain reviews. The CIA also includes certain reporting, certification, record retention, and notification requirements.
The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (collectively, ACA), the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), the Deficit Reduction Act of 2005 (DRA) and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), each contain provisions that have directly impacted reimbursement for the products we provide.
The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (collectively, ACA), the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), the Deficit Reduction Act of 2005 (DRA) and the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), each contains provisions that have directly impacted reimbursement for the products and services we provide.
For instance, the California Consumer Privacy Act (CCPA) became effective on January 1, 2020. The CCPA gives California residents expanded rights to direct the use of their personal information. The CCPA 8 Table of Contents provides for civil penalties for violations, as well as a private right of action for data breaches that may result in data breach litigation.
For instance, the California Consumer Privacy Act (CCPA) became effective on January 1, 2020. The CCPA gives California residents expanded rights to direct the use of their personal information. The CCPA provides for civil penalties for violations, as well as a private right of action for data breaches that may result in data breach litigation.
Even after obtaining the requisite approvals, products may still be the subject of regulatory action if new facts concerning their safety and efficacy come to light. Healthcare regulation is subject to change and can have a considerable impact on the marketing 9 Table of Contents of products and services that we offer.
Even after obtaining the requisite approvals, products may still be the subject of regulatory action if new facts concerning their safety and efficacy come to light. Healthcare regulation is subject to change and can have a considerable impact on the marketing of products and services that we offer.
Demand for many of the existing and new medical devices and supplies dispensed to our customers is, and will continue to be, affected by the extent to which government healthcare programs and private health insurers reimburse us and our customers for their members’/beneficiaries’ medical expenses in the jurisdictions where we do business.
Demand for many of the existing and new medical devices and supplies we provide to patients is, and will continue to be, affected by the extent to which government healthcare programs and private health insurers reimburse us and our customers for their members’/beneficiaries’ medical expenses in the jurisdictions where we do business.
Human Capital Resources Teammate Overview Our teammates are at the heart of everything that we do. Through their creativity, talent and hard work, our teammates allow us to offer exceptional products and services, and they provide the force that propels our mission to empower our customers to advance healthcare.
Human Capital Resources Teammate Overview Our teammates are at the heart of everything that we do. Through their creativity, talent and hard work, our teammates allow us to offer exceptional products and services, and they provide the force that propels our mission to 10 Table of Contents empower our customers to advance healthcare.
Based on available information, we do not believe that any known compliance obligations, releases or investigations under environmental laws or regulations will have a material adverse effect on our business, financial condition, results of operations and cash flows.
Based on available information, we do not believe that any known compliance 6 Table of Contents obligations, releases or investigations under environmental laws or regulations will have a material adverse effect on our business, financial condition, results of operations and cash flows.
Additionally, Patient Direct supplies a wide range of other home medical equipment, patient care product lines including ostomy, wound care (including negative pressure wound therapy), urology, incontinence and other products and services to help improve the quality of life for patients with home care needs.
Additionally, we supply a wide range of other home medical equipment, patient care product lines including ostomy, wound care (including negative pressure wound therapy), urology, incontinence and other products and services to help improve the quality of life for patients with home care needs.
The segment offers a comprehensive range of products and services for in-home care and delivery across diabetes treatment, home respiratory therapy (including home oxygen and non-invasive ventilation services), and obstructive sleep apnea treatment (including continuous positive airway pressure (CPAP) and bi-level positive airway pressure devices, and patient support services).
We offer a comprehensive range of products and services for in-home care and delivery across diabetes treatment, home respiratory therapy (including home oxygen and non-invasive ventilation services), and obstructive sleep apnea treatment (including continuous positive airway pressure (CPAP) and bi-level positive airway pressure devices, and patient support services).
The federal government has taken the position, and some courts have held, that providers who allegedly have violated other statutes, such as the Stark Law, have thereby submitted false claims under the 11 Table of Contents FCA.
The federal government has taken the position, and some courts have held, that providers who allegedly have violated other statutes, such as the Stark Law, have thereby submitted false claims under the FCA.
In many cases, these laws are more restrictive than, and not preempted by, the HIPAA and HITECH rules and requirements, and may be subject to varying interpretation by courts and government agencies, creating complex compliance issues for us and potentially exposing us to additional expenses, adverse publicity and liability. We are also subject to privacy laws outside the U.S.
In many cases, these laws are more restrictive than, and not preempted by, the HIPAA and HITECH rules and requirements, and may be subject to varying interpretation by courts and government agencies, creating complex compliance issues for us and potentially exposing us to additional expenses, adverse publicity and liability.
We also believe that our teammates are the face of Owens & Minor, and we expect every teammate to model our values and commitment to ethical business practices as set forth in our Code of Honor. We believe that our efforts to create an environment that is conducive to our values and teammate success have been rewarded.
We also believe that our teammates are the face of Accendra Health, and we expect every teammate to model our values and commitment to ethical business practices as set forth in our Code of Honor. We believe that our efforts to create an environment that is conducive to our values and teammate success have been successful.
Licensing Certain of our businesses are subject to federal, state, local and foreign laws and regulations relating to the licensure of our facilities, healthcare specialists working for or engaged by us, and certain medical products, and requirements vary amongst jurisdictions.
Licensing Our home healthcare services operations are subject to federal, state, and local laws and regulations relating to the licensure of our facilities, healthcare specialists working for or engaged by us, and medical products, and requirements vary amongst jurisdictions.
Cumulatively, in previous competition rounds of the DMEPOS CBP in effect between 2011 and 2018, we were offered contracts for a substantial majority of the product categories for which we submitted bids. Competitive bidding contracts are expected to be re-bid at least every three years.
Cumulatively, in previous competition rounds of the DMEPOS CBP in effect between 2011 and 2018, our business (including the Apria operations acquired in March 2022) were offered contracts for a substantial majority of the product categories for which we submitted bids. Competitive bidding contracts are expected to be re-bid at least every three years.
Patient Direct is one of the industry’s highest-quality providers of home healthcare equipment, medical supplies and related services, while maintaining a commitment to being a low-cost operator.
We are one of the industry’s highest-quality providers of home healthcare equipment, medical supplies and related services, while maintaining a commitment to being a low-cost operator.
See “Products & Healthcare Services-Global Privacy Regulation.” Further, federal and state consumer laws are being applied increasingly by the Federal Trade Commission (FTC) and state enforcement authorities, to regulate the collection, use and disclosure of personal information or PHI, and to ensure that businesses and organizations maintaining personal information about individuals implement appropriate data safeguards.
Further, federal and state consumer laws are being applied increasingly by the Federal Trade Commission (FTC) and state enforcement authorities, to regulate the collection, use and disclosure of personal information or PHI, and to ensure that businesses and organizations maintaining personal information about individuals implement appropriate data safeguards.
Certain of our teammates in our Patient Direct segment are authorized and/or licensed under various federal, state and local requirements, which cover a variety of topics including standards regarding the provision of medical or care services, clinical records, infection control and care plans.
Certain of our teammates are authorized and/or licensed under various federal, state and local requirements, which cover a variety of topics including standards regarding the provision of medical or care services, clinical records, 5 Table of Contents infection control and care plans.
Our Patient Direct segment provides delivery of disposable medical supplies and equipment rented and sold directly to patients and home health agencies, for which payments are received from managed care plans, the U.S. federal government under the Medicare program, state governments under their respective Medicaid or similar programs, private insurers, home health agencies, and directly from patients.
Our Customers We provide equipment and disposable medical supplies rented and sold directly to patients and home health agencies, for which payments are received from managed care plans, the U.S. federal government under the Medicare program, state governments under their respective Medicaid or similar programs, private insurers, home health agencies, and directly from patients.
These laws and regulations frequently change and have become increasingly stringent over time. Non-compliance with these laws and regulations may result in significant fines or penalties or limitations on our operations or claims for remediation costs, as well as alleged personal injury or property damages.
Non-compliance with these laws and regulations may result in significant fines or penalties or limitations on our operations or claims for remediation costs, as well as alleged personal injury or property damages.
Apria also agreed with the California Department of Insurance to pay $500,000 to resolve claims asserted by the relators under the California Insurance Frauds Prevention Act, Cal. Ins. Code § 1871 et seq.
Apria also agreed with the 8 Table of Contents California Department of Insurance to pay $0.5 million to resolve claims asserted by the relators under the California Insurance Frauds Prevention Act, Cal. Ins. Code § 1871 et seq.
We seek to attract and retain top talent for these critical roles by offering competitive base and incentive compensation packages (and in certain instances share-based compensation and retention incentives), attractive benefits, and opportunities for advancement and rewarding careers.
We depend on our key personnel to successfully operate our business, including our executive officers and senior corporate management. We seek to attract and retain top talent for these critical roles by offering competitive base and incentive compensation packages (and in certain instances share-based compensation and retention incentives), attractive benefits, and opportunities for advancement and rewarding careers.
Failure of our business associates to comply with HIPAA requirements can adversely impact our business. Numerous other federal and state laws that protect the confidentiality, privacy, availability, integrity and security of PHI and healthcare related data also apply to us.
Numerous other federal and state laws that protect the confidentiality, privacy, availability, integrity and security of PHI and healthcare related data also apply to us.
General Regulation Privacy Numerous federal and state laws and regulations, including the Health Insurance Portability and Accountability Act (HIPAA), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (HITECH), govern the collection, dissemination, security, use and confidentiality of Protected Health Information (PHI).
Future legislative and regulatory changes could have a material adverse effect on our financial condition, results of operations and cash flows. ​ General Regulation Privacy Numerous federal and state laws and regulations, including the Health Insurance Portability and Accountability Act (HIPAA), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (HITECH), govern the collection, dissemination, security, use and confidentiality of Protected Health Information (PHI).
While we cannot predict the outcome of the DMEPOS CBP on our business in the future nor the Medicare payment rates that will be in effect in future years, the program may materially adversely affect our financial condition, results of operations and cash flows. 14 Table of Contents State Medicaid programs implement reimbursement policies for the products and services we provide which can vary from state to state.
While we cannot predict the outcome of the DMEPOS CBP on our business in the future nor the Medicare payment rates that will be in effect in future years, the program may materially adversely affect our financial condition, results of operations and cash flows.
We make these filings available free of charge through the SEC Filings link in the Investor Relations content section on our website located at www.owens-minor.com as soon as reasonably practicable after they are filed with or furnished to the SEC. Information included on our website is not incorporated by reference into this Annual Report on Form 10-K.
We make these filings available free of charge through the SEC Filings link in the Investor Relations content section on our website located at www.accendrahealth.com as soon as reasonably practicable after they are filed with or furnished to 11 Table of Contents the SEC.
Consumer protection laws require us to publish statements that describe how we handle personal information and choices individuals may have about the way we handle their personal information. If we publish information that is considered untrue, it may be subject to government claims of unfair or deceptive trade practices, which could lead to significant liabilities and consequences.
If we publish information that is considered untrue, it may be subject to government claims of unfair or deceptive trade practices, which could lead to significant liabilities and consequences.
These laws prohibit price fixing, market allocation, bid-rigging, concerted refusal to deal, market monopolization, price discrimination, tying arrangements, certain acquisitions of competitors and other practices that have, or may have, an adverse effect on competition. Violations of federal or state antitrust laws can result in various sanctions, including criminal and civil penalties.
Antitrust Laws The federal government and most states have enacted antitrust or competition laws that prohibit certain types of conduct deemed to be anti-competitive. These laws prohibit price fixing, market allocation, bid-rigging, concerted refusal to deal, market monopolization, price discrimination, tying arrangements, certain acquisitions of competitors and other practices that have, or may have, an adverse effect on competition.
New or expanded climate-related laws could impose substantial costs on us. Until the timing and extent of climate-related laws are clarified, we cannot predict their potential effect on our capital expenditures or our results of operations.
Compliance with climate-related laws may be further complicated by disparate regulatory approaches in various jurisdictions. New or expanded climate-related laws could impose substantial costs on us. Until the timing and extent of climate-related laws are clarified, we cannot predict their potential effect on our financial condition, results of operations and cash flows.
The description of our business should be read in conjunction with the consolidated financial statements and supplementary data included in this Form 10-K. Founded in 1882, Owens & Minor was incorporated in 1926 and has operated continuously from its Richmond, Virginia headquarters.
We are headquartered in Richmond, Virginia. The description of our business should be read in conjunction with the consolidated financial statements and supplementary data included in this Form 10-K.
We compete against national providers and numerous regional and local providers that deliver products and services to patients’ homes, including AdaptHealth Corp., Lincare, Inogen, Viemed Healthcare, Inc. Rotech is also present in the home healthcare industry.
We compete against national providers and numerous regional and local providers that deliver products and services to patients’ homes, including AdaptHealth Corp., Lincare, Inogen, Viemed Healthcare, Inc., Quipt Home Medical, Cardinal Health and Rotech. In addition, pharmacy benefit managers, such as CVS Health Corporation, compete with us in the home healthcare market.
We cannot predict whether states may consider adopting reimbursement reductions or whether any such changes could have a material adverse effect on our business.
State Medicaid programs implement reimbursement policies for the products and services we provide which can vary from state to state. We cannot predict whether states may consider adopting reimbursement reductions or whether any such changes could have a material adverse effect on our business.
This Code of Honor (including any amendments to or waivers of a provision thereof) and our Corporate Governance Guidelines are available on our website at www.owens-minor.com.
Additionally, we have adopted a written Code of Honor that applies to all of our directors, officers and teammates, including our principal executive officer and senior financial officers. This Code of Honor (including any amendments to or waivers of a provision thereof) and our Corporate Governance Guidelines are available on our website at www.accendrahealth.com.
We believe we are in compliance with such federal and state laws, but courts or regulatory authorities may reach a determination in the future that could adversely affect our operations.
In addition, the DOJ has been pursuing criminal antitrust enforcement actions for conduct of parties that the DOJ is alleging to be fixing wages or limiting worker mobility. We believe we are in compliance with such federal and state laws, but courts or regulatory authorities may reach a determination in the future that could adversely affect our operations.
In response to an audit or inquiry, we are obligated to procure and submit the underlying medical records retained by various clinical providers, medical facilities and prescribers, which may be challenging.
Federal and state agencies and health insurance carriers often conduct audits and request customer records and other documents to support claims submitted for payment of services rendered to customers. In response to an audit or inquiry, we are obligated to procure and submit the underlying medical records retained by various clinical providers, medical facilities and prescribers, which may be challenging.
Additionally, the FTC and many state attorneys general are interpreting existing federal and state consumer protection laws to impose evolving standards for the online collection, use, dissemination and security of PHI and other personal information. Courts may also adopt the standards for fair information practices promulgated by the FTC, which concern consumer notice, choice, security, and access.
The ban also applies to patient information stored through a third-party or subcontracted computing facility or cloud computing service. Additionally, the FTC and many state attorneys general are interpreting existing federal and state consumer protection laws to impose evolving standards for the online collection, use, dissemination and security of PHI and other personal information.
Patient Direct Our Patient Direct segment provides delivery of disposable medical supplies sold directly to patients and home health agencies and is a leading provider of integrated home healthcare equipment and related services in the U.S.
We have retained a 5% equity interest in the P&HS business. ​ Product Offering and Services We provide delivery of products, including disposable medical supplies sold directly to patients and home health agencies and are a leading provider of integrated home healthcare equipment and related services in the U.S.
We cannot predict the future of federal, state, local and foreign regulation or legislation, or possible changes in national healthcare policies. Future legislative and regulatory changes could have a material adverse effect on our financial condition, results of operations and cash flows.
We cannot predict the future of federal, state and local regulation or legislation, or possible changes in national healthcare policies.
We actively manage our accounts receivable to minimize credit risk, days sales outstanding (DSO) and accounts receivable carrying costs. Our ability to accurately invoice and ship product to customers enhances our collection results and affects our DSO performance. As we diversify our customer portfolio, the change in business mix also affects our DSO.
Our general practice is to collect co-payments from the patient or applicable secondary Payor. We actively manage our accounts receivable to minimize credit risk, days sales outstanding (DSO) and accounts receivable carrying costs. We have ongoing initiatives to improve our collections. Our ability to accurately invoice and ship product to customers enhances our collection results and affects our DSO performance.
Such laws, including recent California legislation, may include limitations on greenhouse gas emissions, 10 Table of Contents mandates that companies implement processes to monitor and disclose climate-related matters, additional taxes or offset charges on specified energy sources, and other requirements. Compliance with climate-related laws may be further complicated by disparate regulatory approaches in various jurisdictions.
Such laws, including California’s SB-253 (Climate Corporate Data Accountability Act) and SB-261 (Climate-Related Financial Risk Act), may include limitations on greenhouse gas emissions, mandates that companies implement processes to monitor and disclose climate-related matters, additional taxes or offset charges on specified energy sources, and other requirements.
As part of the provision of, and billing for, healthcare equipment and services, our Patient Direct segment is required to collect and maintain PHI and as such, are subject to HIPAA as a covered entity. HIPAA also applies to business associates of covered entities, which are individuals and entities that provide services for or on behalf of those covered entities.
As part of the provision of, and billing for, healthcare equipment and 4 Table of Contents services, we are required to collect and maintain PHI and as such, are subject to HIPAA as a covered entity.
We use these channels as well as social media and blogs to communicate with our teammates and the public about our Company, our services and other developments. It is possible that the information we post on social media and blogs could be deemed to be material information.
We announce material financial information to our investors using our Investor Relations website, including SEC filings, press releases, public conference calls and webcasts. We use these channels as well as social media and blogs to communicate with our teammates and the public about our Company, our services and other developments.
In the event of a breach of the CIA, Apria could become liable for payment of certain stipulated penalties or could be excluded from participation in federal healthcare programs. Federal and state agencies and health insurance carriers often conduct audits and request customer records and other documents to support claims submitted for payment of services rendered to customers.
In the event of a breach of the CIA, Apria could become liable for payment of certain stipulated penalties or could be excluded from participation in federal healthcare programs. We expect final closure of the CIA to occur in 2026.
Therefore, we encourage investors, the media, and others interested in our Company to review the information we post on the social media channels and blogs listed on our Investor Relations website. Additionally, we have adopted a written Code of Honor that applies to all of our directors, officers and teammates, including our principal executive officer and senior financial officers.
It is possible that the information we post on social media and blogs could be deemed to be material information. Therefore, we encourage investors, the media, and others interested in our Company to review the information we post on the social media channels and blogs listed on our Investor Relations website.
An example of the continued prioritization by the DOJ on corporate and healthcare matters is evidenced by the September 2022 release of the Monaco Guidelines, which reflect enhancements to long-standing DOJ guidelines on corporate accountability. Dealing with investigations can be time- and resource-consuming and can divert management’s attention from the business.
The DOJ’s continued prioritization of corporate and healthcare enforcement is evidenced by both the September 2022 release of the Monaco Guidelines, which reflect enhancements to long-standing DOJ guidelines on corporate accountability, and the record-breaking enforcement results in recent years.
At the end of 2024, we employed approximately 13,500 full-time and part-time teammates in the U.S. and 9,700 teammates outside of the U.S (OUS). None of our U.S. teammates are represented by a labor union or subject to a collective bargaining agreement (CBA), but certain OUS teammates are represented and covered by labor agreements.
At the end of 2025, following the sale of our Products & Healthcare Services segment (the “P&HS Sale”), we employed over 6,500 full-time and part-time teammates. None of our teammates are represented by a labor union or subject to a collective bargaining agreement (CBA). Throughout our operations, we continue to have positive relationships with our teammates.
Antitrust enforcement in the healthcare sector is currently a priority of the FTC and the Department of Justice (DOJ). In addition, the DOJ has been pursuing criminal antitrust enforcement actions for conduct of parties that the DOJ is alleging to be fixing wages or limiting worker mobility.
Violations of federal or state antitrust laws can result in various sanctions, including criminal and civil penalties. Antitrust enforcement in the healthcare sector is currently a priority of the FTC and the Department of Justice (DOJ).
To successfully compete, we must demonstrate that our products offer higher quality, more innovative features or better value versus other products. In our Patient Direct segment, we compete with many healthcare companies across a variety of channels to provide medical supplies and related services for in-home care.
As we diversify our customer portfolio, the change in business mix also affects our DSO. Competition The industry in which we operate is highly competitive. We compete with many healthcare companies across a variety of channels to provide medical supplies and related services for in-home care.
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Business General Owens & Minor, Inc., along with its subsidiaries (we, us, our or the Company), a Fortune 500 company headquartered in Richmond, Virginia, is a global healthcare solutions company that incorporates product manufacturing, distribution support and innovative technology services to deliver significant and sustained value across the breadth of the industry – from acute care to patients in their home.
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Item 1. Business General 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.
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We report our business under two segments: Products & Healthcare Services and Patient Direct, which are described in further detail below.
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We connect patients, providers, and insurers, delivering innovative solutions that help promote better health outcomes and improve quality of life for people living with chronic, complex, and acute health conditions. Together, our trusted brands, Apria and Byram Healthcare, bring nearly 90 years of combined experience in promoting health beyond the hospital in communities across the country.
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Our teammates serve healthcare industry customers in approximately 80 countries, by providing quality products and helping to reduce total costs across the healthcare supply chain by optimizing point-of-care performance, freeing up capital and clinical resources and managing contracts to optimize financial performance.
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Sale of 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 corporation (the Purchaser), and Dominion Healthcare Holdings, L.P., a Delaware limited partnership (Purchaser Parent) to sell the Products & Healthcare Services (P&HS) business, for an aggregate of $375 million in cash, subject to certain adjustments for cash, indebtedness, net working capital and transaction expenses.
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Through organic growth and acquisitions over many years, we significantly expanded and strengthened our company, achieving international scale in the healthcare market. Today, we have production, distribution, storage, customer service and sales facilities located across the United States (U.S.), Canada, Asia, Australia, Europe and Latin America.
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On December 31, 2025, we completed the sale of the P&HS business pursuant to the Purchase Agreement.
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Potential Sale of Products & Healthcare Services Segment On February 28, 2025, we announced that we are actively engaged in discussions regarding the potential sale of our Products & Healthcare Services segment. There is no set timetable for the potential sale and there can be no assurance that we will complete a transaction.
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We use technology in areas such as web portals/electronic ordering, electronic claims submission and electronic funds transfer with managed care organizations to more efficiently process business transactions. This use of technology can improve the initial patient admission process, expedite claims processing and reduce the administrative costs associated with this activity for both us and our providers and Payors.
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Expected Acquisition of Rotech On July 22, 2024, we entered into an Agreement and Plan of Merger to acquire Rotech Healthcare Holdings Inc., (Rotech) for $1.36 billion in cash. Given anticipated tax benefits of approximately $40 million from the transaction, the net purchase price is approximately $1.32 billion.
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Trademarks We have trademarks in the U.S. that are used to designate or identify our Company. We operate under registered trademarks Accendra Health, Apria, Byram Healthcare and Lofta.
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Rotech is a national leader in providing home medical equipment in the U.S. The definitive agreement contains certain termination rights for the Company and Rotech. In the event that we terminate the contract, we will be required to pay Rotech a termination fee of $70 million.
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Regulation Our business is subject to federal and state laws and regulations over our operations, including the reimbursement of our products and services under various government programs that are designed to prevent fraud and abuse. We are subject to state laws governing pharmacies, nursing services, medical equipment suppliers and certain types of home health activities.
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The transaction is subject to customary closing conditions, including expiration or termination of the applicable waiting period under the Hart Scott Rodino Act, and is expected to close in the first half of 2025. We have fully committed financing in place and expect to use a combination of cash and incremental borrowings to fund the purchase price.
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Our teammates are subject to state laws and regulations governing certain professional licensure, including for respiratory therapy, pharmacy and nursing. Compliance with laws and regulations is costly and materially affects our business. We believe we are in material compliance with all statutes and regulations applicable to our operations.
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We expect Rotech to be included in our Patient Direct segment subsequent to the acquisition close date. Acquisition of Apria On March 29, 2022 (Apria Acquisition Date), we completed the acquisition of 100% of Apria, Inc.
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HIPAA also applies to business associates of covered entities, which are individuals and entities that provide services for or on behalf of those covered entities. Failure of our business associates to comply with HIPAA requirements can adversely impact our business.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeGeneral Risk Factors ● Our continued success is substantially dependent on positive perceptions of our reputation. ● We are subject to risks related to public health crises, future outbreaks of health crises or other adverse public health developments. ● The market price for our common stock and debt have been, and may continue to be, highly volatile. ● Our global operations increase the extent of our exposure to the economic, political, currency, regulatory and other risks of international operations. ● We may be adversely affected by global climate change or by legal, regulatory or market responses to such change. ​ 19 Table of Contents Operational Risks ​ We have concentration in and dependence on certain healthcare provider customers, Group Purchasing Organizations, and Payors. ​ In 2024, although no single customer accounted for 5% of our consolidated net revenue, our top ten customers in the U.S. represented approximately 23% of our consolidated net revenue.
Biggest changeDistrict Court for Eastern District of Virginia as the exclusive forum for certain litigation, which could limit our stockholders’ ability to obtain favorable judicial forum. ​ Risks Related to Our Debt ● We may not be able to refinance, extend or repay our substantial indebtedness. ● We may not be able to generate sufficient cash to service debt and other obligations. ● Our credit facilities and existing notes have restrictive covenants that could limit financial flexibility. ● Our variable rate indebtedness subjects us to interest rate risk. ● We may continue to incur additional substantial indebtedness in the future. ​ General Risk Factors ● Our continued success is substantially dependent on positive perceptions of our reputation. ● We are subject to risks related to public health crises and future outbreaks. ● The market price for our common stock and debt have been and may continue to be volatile. ● We may be adversely affected by global climate change or legal, regulatory or market responses to such change. ​ Operational Risks ​ We have concentration in and dependence on certain Payors. ​ During the year ended December 31, 2025, our two largest commercial Payors represented approximately 23% and 14% of our net revenue, derived from multiple separately managed contracts.
Our failure to achieve and maintain regulatory compliance at our medical gas facilities could result in enforcement action, including warning letters, fines, product recalls or seizures, temporary or permanent injunctions, or suspensions in operations at one or more locations, as well as civil or criminal penalties, all of which could materially harm our business, financial condition, results of operations, cash flows, capital resources, and liquidity. ​ The medical gas products we manufacture and distribute and certain other products we distribute are subject to extensive regulation by the FDA and other federal and state governing authorities.
Our failure to achieve and maintain regulatory compliance at our medical gas facilities could result in enforcement action, including warning letters, fines, product recalls or seizures, temporary or permanent injunctions, or suspensions in operations at one or more locations, as well as civil or criminal penalties, all of which could materially harm our business, financial condition, results of operations, cash flows, capital resources, and liquidity. ​ The medical gas products we distribute and certain other products we distribute are subject to extensive regulation by the FDA and other federal and state governing authorities.
Even an isolated incident, or the aggregate effect of individually insignificant incidents, can erode trust and confidence, particularly if they result in adverse publicity, governmental investigations or litigation, and as a result, could tarnish our brand and lead to adverse effects on our business, results of operations, financial condition and cash flows. ​ We are subject to risks related to public health crises, future outbreaks of health crises or other adverse public health developments. ​ As a global healthcare solutions company, we could be impacted by public health crises, pandemic or contagious diseases.
Even an isolated incident, or the aggregate effect of individually insignificant incidents, can erode trust and confidence, particularly if they result in adverse publicity, governmental investigations or litigation, and as a result, could tarnish our brand and lead to adverse effects on our business, results of operations, financial condition and cash flows. ​ We are subject to risks related to public health crises, future outbreaks of health crises or other adverse public health developments. ​ As a healthcare solutions company, we could be impacted by public health crises, pandemic or contagious diseases.
Despite physical, technical, and administrative security measures by us and our external service providers and consultants, our technology systems and operations have in the past and may be in the future subject to cyberattacks from sources beyond our control. In recent years, cyberattacks in our industry have increased and become more sophisticated.
Despite physical, technical, and administrative security measures by us and our external service providers and consultants, our technology systems and operations have been subject to cyberattacks in the past and may be subject to cyberattacks in the future from sources beyond our control. In recent years, cyberattacks in our industry have increased and become more sophisticated.
District Court for the Eastern District of Virginia lacks subject matter jurisdiction, another state or federal court located within the Commonwealth of Virginia) will be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a duty owed to the Company by any director or officer or other employee of the Company or the Company’s shareholders, (iii) any action asserting a claim against the Company or any director or officer or other employee of the Company arising pursuant to any provision of the Virginia Stock Corporation Act, our articles of incorporation or our amended and restated bylaws (as applicable) or (iv) any action asserting a claim against the Company or any director or officer or other employee of the Company governed by the internal affairs doctrine.
District Court for the Eastern District of Virginia, (or, if such court lacks subject matter jurisdiction, another state or federal court located within the Commonwealth of Virginia) will be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a duty owed to the Company by any director or officer or other employee of the Company or the Company’s shareholders, (iii) any action asserting a claim against the Company or any director or officer or other employee of the Company arising pursuant to any provision of the Virginia Stock Corporation Act, our articles of incorporation or our amended and restated bylaws (as applicable) or (iv) any action asserting a claim against the Company or any director or officer or other employee of the Company governed by the internal affairs doctrine.
Such ratings are used by some investors to inform their investment and voting decisions, and thus unfavorable ESG ratings may have a negative impact on our reputation, stock and debt prices and access to and costs of capital. ​ Our amended and restated bylaws designates the U.S.
Such ratings are used by some investors to inform their investment and voting decisions, and thus unfavorable ESG ratings may have a negative impact on our reputation, stock and debt prices and access to and costs of capital. ​ Our amended and restated bylaws designate the U.S.
In addition, in certain markets, competitors may have other products and services that are or perceived to be superior to our own. ​ It is also possible that major changes in available technology, Payor benefit or coverage policies related to those changes, or the preferences of customers, patients and referral sources, may cause our current product offerings to become less competitive or obsolete, and it will be necessary for us to adapt to those changes.
In addition, in certain markets, competitors may have other products and services that are or perceived to be superior to our own. 19 Table of Contents ​ It is also possible that major changes in available technology, Payor benefit or coverage policies related to those changes, or the preferences of customers, patients and referral sources, may cause our current product offerings to become less competitive or obsolete, and it will be necessary for us to adapt to those changes.
If new debt is added to our current debt levels, the related risks that we and our subsidiaries now face to service debt levels and the risks associated with failure to adequately service our debt could intensify. ​ General Risk Factors ​ Our continued success is substantially dependent on positive perceptions of our reputation. ​ One of the reasons customers choose to do business with us and teammates choose us as a place of employment is the reputation that we have built over many years.
If new debt is added to our current debt levels, the related risks that we and our subsidiaries now face to service debt levels and the risks associated with failure to adequately service our debt could intensify. ​ ​ 27 Table of Contents General Risk Factors ​ Our continued success is substantially dependent on positive perceptions of our reputation. ​ One of the reasons customers choose to do business with us and teammates choose us as a place of employment is the reputation that we have built over many years.
Our management’s attention may be diverted by these attempts, and we may need to use funds in litigation to protect our proprietary rights against any infringement, misappropriation or other violation. ​ 31 Table of Contents We may become subject to litigation, investigations, claims and other legal proceedings brought by regulatory agencies, third parties, or individuals. ​ Our commercial success depends in part on avoiding infringement, misappropriation or other violations of the intellectual property and proprietary rights of third parties.
Our management’s attention may be diverted by these attempts, and we may need to use funds in litigation to protect our proprietary rights against any infringement, misappropriation or other violation. ​ We may become subject to litigation, investigations, claims and other legal proceedings brought by regulatory agencies, third parties, or individuals. ​ Our commercial success depends in part on avoiding infringement, misappropriation or other violations of the intellectual property and proprietary rights of third parties.
We may be unable to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. ​ If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital or restructure or refinance our indebtedness.
We may be unable to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. 26 Table of Contents ​ If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital or restructure or refinance our indebtedness.
Regulatory considerations surrounding AI in healthcare are still developing and many 28 Table of Contents regulatory agencies including the FDA are developing and implementing requirements related to the functionality, safety, efficacy, and privacy of AI and machine learning technologies.
Regulatory considerations surrounding AI in healthcare are still developing and many regulatory agencies including the FDA are 21 Table of Contents developing and implementing requirements related to the functionality, safety, efficacy, and privacy of AI and machine learning technologies.
If we are unable to successfully establish new referral sources and maintain strong relationships with our current referral sources, if there is an actual or perceived decrease in the quality of service and care levels we provide, or if efforts to increase the skill level and effectiveness of our sales force fail, our revenues may decline.
If we are unable to 14 Table of Contents successfully establish new referral sources and maintain strong relationships with our current referral sources, if there is an actual or perceived decrease in the quality of service and care levels we provide, or if efforts to increase the skill level and effectiveness of our sales force fail, our revenues may decline.
There can be no assurance that a company’s products or services will be considered cost-effective or that adequate third-party reimbursement will be available to enable a company to maintain price levels sufficient to realize profitability.
There can be no assurance that our products or services will be considered cost-effective or that adequate third-party reimbursement will be available to enable a company to maintain price levels sufficient to realize profitability.
We may not 34 Table of Contents be able to consummate those dispositions or to obtain the proceeds that we could realize from them, and these proceeds may not be adequate to meet any debt service obligations then due. ​ If we are unable to service our debt obligations from cash flows, we may need to refinance all or a portion of our debt obligations prior to maturity.
We may not be able to consummate those dispositions or to obtain the proceeds that we could realize from them, and these proceeds may not be adequate to meet any debt service obligations then due. ​ If we are unable to service our debt obligations from cash flows, we may need to refinance all or a portion of our debt obligations prior to maturity.
We could also be affected by risks that we currently are not aware of or that we currently do not consider material to our business. ​ The following is a summary of the risk factors that we currently believe could materially and adversely affect our business, financial condition, results of operations and cash flows and are not all of the risks that we face.
We could also be affected by risks that we currently are not aware of or that we currently do not consider material to our business. ​ 12 Table of Contents The following is a summary of the risk factors that we currently believe could materially and adversely affect our business, financial condition, results of operations and cash flows and are not all of the risks that we face.
We do not oversee or actively monitor cybersecurity risks related to our external service providers and we rely on these providers to inform us of risks, breaches or cyberattacks. Cyberattacks 21 Table of Contents include actual or attempted unauthorized access, tampering, malware insertion, ransomware attacks, or other system integrity events.
We do not oversee or actively monitor cybersecurity risks related to our external service providers and we rely on these providers to inform us of risks, breaches or cyberattacks. Cyberattacks include actual or attempted unauthorized access, tampering, malware insertion, ransomware attacks, or other system integrity events.
These changes have included an increased reliance on managed care; consolidation of competitors, suppliers and customers; a shift in healthcare provider venues from acute care settings to clinics, physician offices and home care; and the development of larger, more sophisticated purchasing groups.
These changes 20 Table of Contents have included an increased reliance on managed care; consolidation of competitors, suppliers and customers; a shift in healthcare provider venues from acute care settings to clinics, physician offices and home care; and the development of larger, more sophisticated purchasing groups.
The FDA and state authorities conduct periodic, unannounced inspections at medical gas facilities to assess compliance with the cGMP and other regulations. We expend significant time, money, and resources in an effort to achieve substantial compliance with the cGMP regulations and other federal and state law requirements at 30 Table of Contents each of our medical gas facilities.
The FDA and state authorities conduct periodic, unannounced inspections at medical gas facilities to assess compliance with the cGMP and other regulations. We expend significant time, money, and resources in an effort to achieve substantial compliance with the cGMP regulations and other federal and state law requirements at each of our medical gas facilities.
For instance, we expect threat actors may use more advanced tools and techniques, such as artificial intelligence (AI), that are designed to circumvent security controls. As a result, the risk of a cyberattack on our systems has increased.
For instance, we expect threat actors may use more advanced tools and techniques, such as artificial intelligence (AI), that are designed to circumvent security controls. As a 15 Table of Contents result, the risk of a cyberattack on our systems has increased.
Significant price increases, or disruptions in the ability to obtain such equipment and supplies from existing suppliers, such as the disruptions that were associated with the Philips Respironics recall as described in Management’s Discussion and Analysis of Financial Condition and Results of Operations, may reduce our income and could force us to use alternative suppliers.
Significant price increases, or disruptions in the ability to obtain such equipment and supplies from existing suppliers, such as the disruptions that were associated with the Philips Respironics recall as described in Management’s Discussion and Analysis of Financial Condition and Results of Operations, which primarily affected our 2024 results, may reduce our income and could force us to use alternative suppliers.
If a significant accident or event occurs, it could adversely affect our business, financial position, results of operations, and cash flows.
If a significant accident or event occurs, it could adversely affect our business, financial condition, results of operations, and cash flows.
Failure to comply with applicable regulatory requirements could result in administrative enforcement action by the FDA or state agencies, which may include any of the following: adverse publicity; warning or untitled letters; fines; injunctions; consent decrees; civil money penalties; recalls; termination of distribution or seizure of our products; operating restrictions or partial suspension or total shutdown of production; delays in the introduction of products into the market; withdrawals or suspensions of current medical gas certifications or drug approvals, resulting in prohibitions on sales of our products; and criminal prosecution.
We may not be successful in receiving certification in the future. ​ Failure to comply with applicable regulatory requirements could result in administrative enforcement action by the FDA or state agencies, which may include any of the following: adverse publicity; warning or untitled letters; fines; injunctions; consent decrees; civil money penalties; recalls; termination of distribution or seizure of our products; operating restrictions or partial suspension or total shutdown of production; delays in the introduction of products into the market; withdrawals or suspensions of current medical gas certifications or drug approvals, resulting in prohibitions on sales of our products; and criminal prosecution.
Such change in demand may result in further inventory valuation adjustments. Poor economic conditions also could lead our suppliers to offer less favorable terms of purchase to distributors, which would negatively affect our profitability.
Such change in demand may result in further inventory valuation adjustments. Poor economic conditions also could lead our suppliers to offer less favorable terms, which would negatively affect our profitability.
A shift towards customers with lower prices, or from higher gross margin products to lower gross margin products, would reduce our gross profits.
A shift towards customers with lower compensation, or from higher gross margin products to lower gross margin products, would reduce our gross profits.
In addition, some stakeholders may disagree with our goals and initiatives. Further, organizations that provide information to investors on corporate governance and related matters have developed ratings processes for evaluating companies on ESG matters.
In addition, some stakeholders may disagree with our goals and initiatives. Further, organizations that provide information to 25 Table of Contents investors on corporate governance and related matters have developed ratings processes for evaluating companies on ESG matters.
Additionally, we have incurred, and may incur additional costs associated with defending EtO emissions litigation. We have taken and will continue to take measures to comply with all applicable emissions regulations and to reduce emissions.
Additionally, we have incurred, and may incur additional costs associated with defending EtO emissions litigation. We have taken measures to comply with all applicable emissions regulations and to reduce emissions.
Both advocates and opponents to certain ESG initiatives are increasingly resorting to a range of activism forms, 33 Table of Contents including media campaigns and litigation, to advance their perspectives.
Both advocates and opponents to certain ESG initiatives are increasingly resorting to a range of activism forms, including media campaigns and litigation, to advance their perspectives.
Although we believe our assumptions and estimates are reasonable and appropriate, any significant adverse changes in one or a combination of key assumptions, including, but not limited to, a further decrease in our market capitalization, an increase in the discount rate, a failure to meet our business plans or expected earnings and cash flows, unanticipated events and circumstances such as the loss of a contract with a significant customer, changes in assumptions about the duration and magnitude of increased supply chain expense, commodities costs or inflationary pressures and our planned efforts to mitigate such impacts, disruptions in the supply chain, estimated demand and selling prices for personal protective equipment (PPE) or other products, a decrease in the terminal growth rate, increases in tax rates (including potential tax reform) or a significant change in industry or economic trends, may affect the accuracy or validity of such estimates and may result in goodwill impairment.
Although we believe our assumptions and estimates are reasonable and appropriate, any significant adverse changes in one or a combination of key assumptions, including, but not limited to, a further decrease in our market capitalization, an increase in the discount rate, a failure to meet our business plans or expected earnings and cash flows, unanticipated events and circumstances such as the loss of a contract with a significant Payor, changes in assumptions about the duration and magnitude of increased supply chain expense, commodities costs or inflationary pressures and our planned efforts to mitigate such impacts, disruptions in the supply chain, a decrease in the terminal growth rate, increases in tax rates (including potential tax reform) or a significant change in industry or economic trends, may affect the accuracy or validity of such estimates and may result in goodwill impairment.
There is also a risk that we may not adequately implement sustainable processes and procedures to maintain regulatory compliance and to address future regulatory agency findings, should they occur.
There is also a risk that we may not adequately implement sustainable processes and procedures to maintain regulatory compliance and to address future regulatory agency 23 Table of Contents findings, should they occur.
Although we intend to take actions to reduce any adverse effects, these uncertainties could cause customers, suppliers and others that deal with us to seek to change existing business relationships. In addition, teammate retention could be negatively impacted. If key teammates 22 Table of Contents depart because of concerns relating to the uncertainty, our business could be harmed.
Although we have taken actions to reduce any adverse effects, these uncertainties could cause customers, suppliers and others that deal with us to seek to change existing business relationships. In addition, teammate retention could be negatively impacted. If key teammates depart because of concerns relating to the uncertainty, our business could be harmed.
The clarity and completeness of each patient medical file, some of which is the work product of physicians not employed by us, is essential to successfully challenging any payment denials. ​ Certain of our operations engage in Ethylene Oxide (EtO) sterilization of medical products either directly or indirectly through third-parties.
The clarity and completeness of each patient medical file, some of which is the work product of physicians not employed by us, is essential to successfully challenging any payment denials. ​ Certain of our former operations under the P&HS business engaged in Ethylene Oxide (EtO) sterilization of medical products either directly or indirectly through third-parties.
We cannot provide any assurances that we will be able to raise the necessary amount of capital to repay this obligation or that we will be able to extend the maturity dates or otherwise refinance this obligation.
We cannot provide any assurances that we will be able to raise the necessary amount of capital to repay these obligations or that we will be able to extend the maturity dates or otherwise refinance these obligations.
We may experience sudden loss of key personnel due to a variety of causes, including illness, and must adequately plan for succession of key executive roles. Teammates might not successfully transition into new roles.
We may experience sudden loss of key personnel due to a variety of causes, including competitive recruitment, retirement, illness, death, or disability, and must adequately plan for succession of key executive roles. Teammates might not successfully transition into new roles.
As a 24 Table of Contents result of an interim impairment test performed during the three months ended December 31, 2024, we recorded a goodwill impairment charge in our Apria reporting unit of $307 million. No impairment charges to goodwill were recorded in 2023 or 2022.
As a result of an interim impairment test performed during the three months ended December 31, 2024, we recorded a goodwill impairment charge in our Apria reporting unit of $307 million. No impairment charges to goodwill were recorded in continuing operations 2025 or 2023.
We may need to raise capital in order to repay the 2029 Notes and 2030 Notes. As of December 31, 2024, we owed $479 million and $552 million in principal under our 2029 Notes and 2030 Notes, respectively.
The 2029 Notes and 2030 Notes become due and payable in March 2029 and April 2030. We may need to raise capital in order to repay our indebtedness. As of December 31, 2025, we owed $479 million and $552 million in principal under our 2029 Notes and 2030 Notes, respectively.
Upon a default, our lenders would have the right to exercise its rights and remedies to collect, which would include foreclosing on our assets.
Upon a default, our lenders would have the right to exercise its rights and remedies to collect, which would include foreclosing on our assets. Accordingly, a default would have a material adverse effect on our business and financial condition.
A variety of factors may have a significant impact on the market price of our common stock and debt, including, but not limited to: the publication of earnings estimates or other research reports and speculation in the press or investment community; changes in our financial projections or our failure to meet these projections; changes in our industry and competitors; changes in government or legislation; government debt and/or budget crises; changes in our Board or management; our financial condition, results of operations and cash flows and prospects; activism by any single large shareholder or combination of shareholders; lawsuits threatened or filed against us; any future issuances of our common stock, which may include primary offerings for cash, stock splits, issuances in connection with business acquisitions, issuances of restricted stock/units and the grant or exercise of stock options from time to time; the trading volume of our common stock and debt; general market and economic conditions; any future outbreaks or reemergence of the COVID-19 36 Table of Contents pandemic, and any future pandemics; the threat or outbreak of war, terrorism or public unrest (including, without limitation, the war in the Ukraine and a wider European conflict, renewed conflict between Israel and Hamas and the surrounding region, or any other global conflict); and the other factors discussed in this Item 1A.
We may experience additional impacts which are not currently known. ​ The market price for our common stock and debt have been, and may continue to be, highly volatile. ​ A variety of factors may have a significant impact on the market price of our common stock and debt, including, but not limited to: the publication of earnings estimates or other research reports and speculation in the press or investment community; changes in our financial projections or our failure to meet these projections; changes in our industry and competitors; changes in government or legislation; government debt and/or budget crises; changes in our Board or management; our financial condition, results of operations and cash flows and prospects; activism by any single large shareholder or combination of shareholders; lawsuits threatened or filed against us; any future issuances of our common stock, which may include primary offerings for cash, stock splits, issuances in connection with business acquisitions, issuances of restricted stock/units and the grant or exercise of stock options from time to time; the trading volume of our common stock and debt; general market and economic conditions; any future outbreaks, and any future pandemics; the threat or outbreak of war, terrorism or public unrest (including, without limitation, geopolitical conflicts, including the war in Ukraine, conflicts in the Middle East, or tensions involving other regions); and the other factors discussed in this Item 1A.
Risk Factors ​ Index to Risk Factors ​ ​ ​ Section ​ Page Operational Risks ​ 20 Industry and Economic Risks ​ 25 Litigation and Regulatory Risks ​ 28 Risks Related to Our Debt ​ 34 General Risk Factors ​ 36 ​ Forward-Looking Statements and Risk Factors Summary ​ This report contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.
Risk Factors ​ Index to Risk Factors ​ ​ ​ Section ​ Page Operational Risks ​ 14 Risks Related to the Sale of our Products & Healthcare Services business ​ 18 Industry and Economic Risks ​ 19 Litigation and Regulatory Risks ​ 21 Risks Related to Our Debt ​ 26 General Risk Factors ​ 28 ​ Forward-Looking Statements and Risk Factors Summary ​ This report contains certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.
If we cannot obtain the patient service equipment and supplies we currently use, or alternatives at similar or favorable prices, our ability to provide such products may be severely impacted, which could have an adverse effect on our business, financial condition, results of operations, cash flows, capital resources and liquidity. ​ Our operations depend on the proper functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure. ​ We and our external service providers use and rely on information systems to perform our business operations including receiving, processing, analyzing, and managing data in distributing thousands of products to customers from numerous distribution centers.
If we cannot obtain the patient service equipment and supplies we currently use, or alternatives at similar or favorable prices, our ability to provide such products may be severely impacted, which could have an adverse effect on our business, financial condition, results of operations, cash flows, capital resources and liquidity. ​ Our operations depend on the proper functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure. ​ Our business depends on the proper functioning and availability of computer systems and networks to meet operational needs.
Uncertainty about the effects of current and future economic and political conditions on us, our customers, suppliers and partners makes it difficult for us to forecast operating results and to make decisions about future investments.
Uncertainty about the effects of current and future economic and political conditions on us, our customers, suppliers and partners makes it difficult for us to forecast operating results and to make decisions about future investments. Inflation has and may continue to materially impact the costs to source materials or produce and distribute products to customers.
In addition, our interpretation of reporting frameworks or standards may differ from those of others and such frameworks or standards may change over time, any of which could result in significant revisions to our goals or reported progress in achieving such goals.
In addition, our interpretation of reporting frameworks or standards may differ from those of others and such frameworks or standards may change over time, any of which could result in significant revisions to our goals or reported progress in achieving such goals. ​ There are efforts by some stakeholders and regulators to reduce companies’ efforts on certain ESG-related matters.
Further, we could be liable for damages and fines as a result of legislative or regulatory action or litigation, which could have a material adverse effect on our financial condition, results of operations, cash flows, capital resources and liquidity.
Further, we could be liable for damages and fines as a result of legislative or regulatory action or litigation, which could have a material adverse effect on our financial condition, results of operations, cash flows, capital resources and liquidity. 22 Table of Contents Accordingly, our arrangements and business practices may be the subject of government scrutiny or be found to violate applicable laws.
If interest rates were to increase, our debt service obligations on our variable rate indebtedness would increase even though the amount borrowed remained the same, and our earnings and cash flows will correspondingly decrease. ​ ​ ​ 35 Table of Contents Despite current indebtedness levels, we will incur substantially more debt to complete the Rotech Acquisition. ​ We and our subsidiaries will incur substantial additional indebtedness in the future in order to complete the Rotech Acquisition, which could significantly increase our leverage.
If interest rates were to increase, our debt service obligations on our variable rate indebtedness would increase even though the amount borrowed remained the same, and our earnings and cash flows will correspondingly decrease. ​ Despite current indebtedness levels, we may continue to incur indebtedness in the future, and the amount of that additional indebtedness may be substantial, which could further exacerbate the risks described herein. ​ We may incur substantial additional indebtedness in the future.
The Federal Reserve and other Central Banks raised interest rates during 2023 and 2024 and could do so again in the future. The present conditions and state of U.S. and global economies make it difficult to predict whether and/or when and to what extent a recession has occurred or will occur in the near future.
The present conditions and state of U.S. and global economies make it difficult to predict whether and/or when and to what extent a recession has occurred or will occur in the near future.
Accordingly, a default would have a material adverse effect on our business and financial condition. ​ Our credit facilities and our existing notes have restrictive covenants that could limit our financial flexibility. ​ Our Credit Agreement and Revolver, as well as the indentures that govern our existing senior notes, contain financial and other restrictive covenants that limit our ability to engage in activities that may not be in our long-term best interests.
We may not be able to refinance any of our indebtedness on commercially reasonable terms or at all. ​ Our credit facilities and our existing notes have restrictive covenants that could limit our financial flexibility. ​ Our Credit Agreement and Revolver, as well as the indentures that govern our existing senior notes, contain financial and other restrictive covenants that limit our ability to engage in activities that may not be in our long-term best interests.
The forum selection clause in our amended and restated bylaws may have the effect of discouraging lawsuits against us or our directors and officers and may limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us. ​ Risks Related to Our Debt ​ We may not be able to generate sufficient cash to service our debt and other obligations. ​ As of December 31, 2024, on a consolidated basis we had $1.9 billion of aggregate principal amount of indebtedness, excluding deferred financing costs and third party fees, $419 million of undrawn availability under our revolving credit facility, as well as other contractual obligations due beyond the next twelve months.
We may not be able to generate sufficient cash to service our debt and other obligations. ​ As of December 31, 2025, on a consolidated basis we had $2.1 billion of aggregate principal amount of indebtedness, excluding deferred financing costs and third party fees, $217 million of undrawn availability under our revolving credit facility, as well as other contractual obligations due beyond the next twelve months.
Violations of federal (such as HIPAA), state or foreign laws (such as the EU GDPR or U.K. GDPR) concerning privacy and data protection could subject us to civil or criminal penalties, breach of contract claims, costs for remediation and harm to our reputation.
Violations of federal (such as HIPAA) and state laws concerning privacy and data protection could subject us to civil or criminal penalties, breach of contract claims, costs for remediation and harm to our reputation. AI, particularly generative AI, is an emerging technology subject to a complex and evolving regulatory landscape at both the federal and state level.
If we are unable to obtain these approvals in a timely fashion, or if after approval for marketing, a product is later shown to be ineffective or to have unacceptable side effects not discovered during testing, we may experience significant adverse effects, which in turn, could negatively affect our business. ​ Among the U.S. healthcare related laws that we are subject to include the federal Anti-kickback Statute, the federal Ethics in Patient Referrals Act, the Stark Law, the FCA the federal Civil Monetary Penalties Law, the criminal healthcare fraud provisions of the federal Health Insurance Portability and Accountability Act of 1996, federal laws and regulations that prohibit providers from billing and receiving payment from Medicare and Medicaid for services unless the services are medically necessary, adequately and accurately documents, and billed using codes that accurately reflect the type and level of services rendered, and similar state laws relating to fraud, waste and abuse.
Any failure to comply with these laws and regulations or any failure to maintain the necessary permits, licenses or approvals, or to comply with the required standards, could disrupt our operations and/or adversely affect our results of operations, financial condition and cash flows. ​ Among the U.S. healthcare related laws that we are subject to include the federal Anti-Kickback Statute, the federal Ethics in Patient Referrals Act, the Stark Law, the FCA the federal Civil Monetary Penalties Law, the criminal healthcare fraud provisions of the federal Health Insurance Portability and Accountability Act of 1996, federal laws and regulations that prohibit providers from billing and receiving payment from Medicare and Medicaid for services unless the services are medically necessary, adequately and accurately documents, and billed using codes that accurately reflect the type and level of services rendered, and similar state laws relating to fraud, waste and abuse.
A future cybersecurity incident could involve a material data breach or other material impact to the operations of our technology systems, or the third party service providers on which we rely, which could result in failure of our systems to operate properly for an extended period of time, litigation or regulatory action, loss of customers or revenue, and increased expense, any of which might have a material adverse impact on our business operations, reputation, our growth and strategic initiatives, results of operations, financial condition and cash flows. ​ An interruption in the ability of our business to manufacture products or the proper functioning of critical facilities and distribution networks may have a material adverse effect on our business and operations. ​ We manufacture our products in facilities in the U.S., Mexico, Honduras, Thailand and Ireland.
A future cybersecurity incident could involve a material data breach or other material impact to the operations of our technology systems, or the third party service providers on which we rely, which could result in failure of our systems to operate properly for an extended period of time, litigation or regulatory action, loss of customers or revenue, and increased expense, any of which might have a material adverse impact on our business operations, reputation, our growth and strategic initiatives, results of operations, financial condition and cash flows. ​ The recent termination of certain contracts commercial Payor could negatively impact our financial condition, results of operations, cash flows, capital resources and liquidity. ​ A commercial Payor, with which we have multiple separately managed contracts, has terminated, or is in the process of terminating, as applicable certain of our contracts with them .
Our inability to procure certain equipment and supplies, including as a result of failure to maintain and renew certain agreements and access arrangements, could have a materially adverse effect on our results of operations and cash flows. We often use suppliers selectively for quality and cost reasons.
Further, some of our supply agreements contain pricing scales that depend on meeting certain order volumes. Our inability to procure certain equipment and supplies, including as a result of failure to maintain and renew certain agreements and access arrangements, could have a materially adverse effect on our results of operations and cash flows.
Changes in the mix of our customers, products and services provided and payment methodologies could have a material adverse effect on our business, financial condition, results of operations, cash flows, capital resources and liquidity. ​ Our business is dependent on certain significant suppliers. ​ In our Products & Healthcare Services segment in the U.S., we distribute products from approximately 1,000 suppliers and are dependent on these suppliers for the continuing supply of products.
Changes in the mix of our customers, products and services provided and payment methodologies could have a material adverse effect on our business, financial condition, results of operations, cash flows, capital resources and liquidity. ​ Our business is dependent on certain significant suppliers. ​ We currently rely on a relatively small number of suppliers to provide us with the majority of our patient service equipment and supplies for our home healthcare business.
While we experienced growth in sales volumes for certain of our products (such as PPE) during the COVID-19 pandemic, as well as improved productivity and manufacturing output, we may not experience the same result following any other public health crisis. ​ Further, actions by the U.S. government or other foreign governments in response to any such public health developments could adversely affect our business and operations, such as closure of one or more facilities for an unknown period of time. ​ We may incur additional costs to ensure we met the needs of our customers and protect our workforce or to implement operational changes in response to any future pandemics.
For example, the COVID-19 pandemic disrupted capital markets, supply chains for equipment and medical supplies, and our services. ​ Further, actions by the U.S. federal, state or local governments in response to any such public health developments could adversely affect our business and operations, such as closure of one or more facilities for an unknown period of time. ​ We may incur additional costs to ensure we meet the needs of our customers and protect our workforce or to implement operational changes in response to any future pandemics.
We have applied for, and received, designated gas certifications for our medical gas products. We may not be successful in receiving certification in the future.
We have applied for, and received, designated gas certifications for our medical gas products.
These and other possible 26 Table of Contents consequences of financial and economic decline could have a material adverse effect on our business, results of operations, financial condition and cash flows. ​ The U.S. and certain larger global economies experienced inflation rates above Central Bank targets during 2024.
These and other possible consequences of financial and economic decline could have a material adverse effect on our business, results of operations, financial condition and cash flows. ​ The U.S. and global economies experienced elevated inflation rates significantly above Central Bank targets from 2021 through 2023, with inflation moderating but remaining above target levels through 2025.The Federal Reserve and other Central Banks raised interest rates during 2023 and 2024 and could do so again in the future.
These and similar regulatory requirements, which may differ across jurisdictions, are likely to result in increased costs and complexities of compliance in order to collect, measure and report on the relevant climate-related information. Our supply chain will likely be subject to these same transitional risks and may pass along any related cost increases to us.
For example, in 2024 the state of California enacted a series of laws that will require reporting of greenhouse gas emissions and climate risks. These and similar regulatory requirements, which may differ across jurisdictions, are likely to result in increased costs and complexities of compliance in order to collect, measure and report on the relevant climate-related information.
Investor perceptions about the terms or benefits of the Rotech Acquisition could have a negative impact on the trading prices of our common stock and debt. ​ Our inability to adequately integrate acquisitions could have a material adverse effect on our operations. ​ In connection with our growth strategy, we from time to time acquire other businesses, that we believe will expand or complement our existing businesses and operations.
In addition, employee union organizing activities have occurred in the past and may occur in the future, and the adverse impact of unionization and organizing activities on our costs and operating results could be substantial. ​ 16 Table of Contents Our inability to adequately integrate acquisitions could have a material adverse effect on our operations. ​ In connection with our growth strategy, we from time to time acquire other businesses, that we believe will expand or complement our existing businesses and operations.
From time to time, legislative and regulatory initiatives are proposed, including but not limited to proposals to repeal last-in, first-out (LIFO) treatment of inventory in the U.S. or changes in tax accounting methods for inventory, import tariffs and taxes, or other tax items.
From time to time, legislative and regulatory initiatives are proposed, including but not limited to proposals for changes in tax accounting methods for inventory, import tariffs and taxes, including the pass through impact from certain indirect suppliers, or other tax items. Changes in tax laws and regulations could adversely affect our tax positions, tax rate or cash payments for taxes.
These and other supply chain issues can increase our costs, disrupt or reduce our production, delay our product shipments, prevent us from meeting customer demand, damage our customer relationships, and could materially adversely affect our business operations, results of operations, financial condition and cash flows. ​ Uncertainty about current and future economic conditions and other adverse changes in general political conditions may adversely affect demand for our products and services and collectability of our accounts receivable. ​ Poor or deteriorating economic and political conditions in the U.S. and the other countries in which we conduct business could adversely affect the demand for healthcare services and consequently, the demand for our products and services.
Such unanticipated changes could cause us to incur increased capital expenditures and change strategies and could have a material adverse effect on our business, results of operations, financial condition and cash flows. ​ Uncertainty about current and future economic conditions and other adverse changes in general political conditions may adversely affect demand for our products and services and collectability of our accounts receivable. ​ Poor or deteriorating economic and political conditions in the U.S could adversely affect the demand for healthcare services and consequently, the demand for our products and services.
The governmental authorities can, in some cases, delay or stop the proposed transaction from proceeding. These laws may make certain jurisdictions less suitable for investments into healthcare businesses and may result in creased compliance costs, introduce delays to investment and divestment transactions, alter transaction terms and structures and ultimately impact the returns of such investments.
These laws may make certain jurisdictions less suitable for investments into healthcare businesses and may result increased compliance costs, introduce delays to investment and divestment transactions, alter transaction terms and structures and ultimately impact the returns of such investments. ​ Our failure to comply with regulatory requirements or receive regulatory clearances or approvals for our medical gas facilities, products or operations could adversely affect our business. ​ We have a number of medical gas facilities in several states.
We expect the healthcare industry to continue to change significantly and these potential changes, which may include a reduction in government support of healthcare services, adverse changes in legislation or regulations, and further reductions in healthcare reimbursement practices, could have a material adverse effect on our business, results of operations, financial condition and cash flows. ​ Our profitability and cash flows may vary based on the impacts of rising inflationary pressures. ​ Inflation has and may continue to materially impact the costs to source materials or produce and distribute finished goods to customers.
We expect the healthcare industry to continue to change significantly and these potential changes, which may include a reduction in government support of healthcare services, adverse changes in legislation or regulations, and further reductions in healthcare reimbursement practices, could have a material adverse effect on our business, results of operations, financial condition and cash flows. ​ Litigation & Regulatory Risks ​ We are subject to stringent regulatory and licensing requirements, and we have been, are and in the future could become the subject of federal and state investigations and compliance reviews. ​ We are required to comply with extensive and complex laws and regulations at the federal, state and local government levels in the U.S.
In addition, our involvement in these matters and any related adverse rulings may result in increased costs and expenses, significant costs in defending such claims, even if groundless, reputational damage, cause us from time to time to significantly increase our legal expenses and/or modify our pay practices, all of which would likely have an adverse impact on our financial performance and profitability. ​ We may incur product liability losses, litigation liability, product recalls, safety alerts or regulatory action associated with the provision of healthcare services, and the products that we source, assemble, manufacture and sell which can be costly and disruptive to our business. ​ There is an inherent risk of liability in the provision of the services we provide and the design, assembly, manufacture and marketing of the medical products of the types we sell.
In addition, our 24 Table of Contents involvement in these matters and any related adverse rulings may result in increased costs and expenses, significant costs in defending such claims, even if groundless, reputational damage, cause us from time to time to significantly increase our legal expenses and/or modify our pay practices, all of which would likely have an adverse impact on our financial performance and profitability. ​ We could be subject to adverse changes in the tax laws or challenges to our tax positions. ​ We operate throughout the U.S., and we are subject to the tax laws and regulations of the U.S. federal, state and local governments.
Failure to comply with these laws also could subject us to civil and criminal penalties that could adversely affect our business, results of operations, financial condition and cash flows. ​ Our Patient Direct segment is a Medicare-certified supplier and participates in state Medicaid programs.
Such sanctions and damages could adversely affect our results of operations, financial condition and cash flows. ​ We are a Medicare-certified supplier and participates in state Medicaid programs.
We, along with our customers and suppliers, are subject to extensive federal and state regulations relating to healthcare as well as the policies and practices of the private healthcare insurance industry. In recent years, there have been a number of government and private initiatives to reduce healthcare costs and government spending.
In recent years, there have been a number of government and private initiatives to reduce healthcare costs and government spending.
These evolving regulatory requirements These events and impacts could materially adversely affect our business operations and our financial position, results of operations and cash flows. ​ ​
Our supply chain will likely be subject to these same transitional risks and may pass along any related cost increases to us. These events and impacts could materially adversely affect our business operations and our financial position, results of operations and cash flows. ​
Additionally, there is uncertainty that we will be able to pass elevated costs onto customers in an effort to offset inflationary pressures, or that such increases may outpace the compensating inflation-based increase in Medicare payment rates or any other rate increases we may receive. ​ 27 Table of Contents Litigation & Regulatory Risks ​ We are subject to stringent regulatory and licensing requirements, and we have been, are and could become the subject of federal and state investigations and compliance reviews. ​ We are required to comply with extensive and complex laws and regulations at the federal, state and local government levels in the U.S. and other countries where we operate.
Additionally, there is uncertainty that we will be able to pass elevated costs onto customers in an effort to offset inflationary pressures, or that such increases may outpace the compensating inflation-based increase in Medicare payment rates, or any other rate increases we may receive. ​ Any significant downturn in the health of the general economy, or any recession, depression or other sustained adverse market event, including inflationary pressures, could have an adverse effect on our revenues and financial performance, resulting in impairment of assets. ​ Changing conditions in the U.S. healthcare industry may impact our results of operations and cash flows. ​ We, along with our customers and suppliers, are subject to extensive federal and state regulations relating to healthcare as well as the policies and practices of the private healthcare insurance industry.
A successful claim in excess of, or not covered by, our insurance policies could have a material adverse effect on our business, financial condition, results of operations, cash flows, capital resources and liquidity.
We may be more vulnerable to changing market conditions, which could have a material adverse effect on our business, results of operations, financial condition and cash flows.
From time to time, we also enter into certain exclusive arrangements with suppliers for the provision of patient service equipment and supplies. Further, some of our supply agreements contain pricing scales that depend on meeting certain order volumes.
During the year ended December 31, 2025, our three largest suppliers contributed 16%, 14% and 11% of our purchases collectively accounting for approximately 40%. From time to time, we also enter into certain exclusive arrangements with suppliers for the provision of patient service equipment and supplies.
Moreover, we may be obligated to perform under such capitation arrangements even if the contractual reimbursement rates are insufficient to cover our costs based on actual levels of utilization. ​ Our ability to attract and retain talented and qualified teammates is critical to our success and competitiveness. ​ The success of our business depends on our ability to attract, engage, develop and retain qualified and experienced teammates, including key executives.
This CMS determination could adversely affect our business, results of operations, and financial condition. ​ Our ability to attract and retain talented and qualified teammates is critical to our success and competitiveness. ​ The success of our business depends on our ability to attract, engage, develop and retain qualified and experienced teammates, including key executives.
We may be required to record a material charge to earnings in our consolidated financial statements during the period in which any impairment of our goodwill is determined, which charge could adversely affect our results of operations. ​ Industry and Economic Risks ​ We face increasing competition, accelerating pricing pressure and changes in technology. ​ The medical/surgical supply distribution industry in which our Products & Healthcare Services segment operates is highly competitive and characterized by pricing and margin pressure for our business.
We may be required to record a material charge to earnings in our consolidated financial statements during the period in which any impairment of our goodwill is determined, which charge could adversely affect our results of operations. ​ 17 Table of Contents Risks Related to the Sale of our Products & Healthcare Services Business ​ We have sold our P&HS business , and there may be negative impacts on our financial condition, results of operations, cash flows, capital resources and liquidity. ​ On December 31, 2025, we completed the P&HS Sale after which we are a significantly smaller, less diversified company with a single segment.
We may not be able to refinance any of our indebtedness on commercially reasonable terms or at all. ​ We may not be able to refinance, extend or repay our substantial indebtedness which would have a material adverse effect on our financial condition. ​ Our 2029 Notes and 2030 Notes become due and payable in March 2029 and April 2030.
The forum selection clause in our amended and restated bylaws may have the effect of discouraging lawsuits against us or our directors and officers and may limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us. ​ Risks Related to Our Debt ​ We may not be able to refinance, extend or repay our substantial indebtedness which would have a material adverse effect on our financial condition. ​ The Term Loan A will mature in March 2027 and the Term Loan B will mature in March 2029.
Instead, we attempt to work closely with hospitals and physicians to accept discharges and referrals of their patients who require our services. Therefore, the success of our Patient Direct segment is significantly dependent on referrals from hospital and physician sources.
Therefore, our success is significantly dependent on referrals from hospital and physician sources.
This process is ongoing and there are a number of risks and uncertainties including the failure to complete any transaction. This could cause disruptions and create uncertainty surrounding our business and affect our relationships with our customers, suppliers and teammates.
See Note 3 “discontinued operations” in the Notes to Consolidated Financial Statements for additional information. ​ Furthermore, the sale process could cause disruptions and create uncertainty surrounding our business and affect our relationships with our customers, suppliers and teammates.
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We undertake no obligation to update or revise any forward-looking statements, except as required by law. ​ Operational Risks ● We have concentration in and dependence on certain healthcare provider customers, Group Purchasing Organizations, and Payors. ● Our failure to establish and maintain relationships with hospital and physician referral sources may cause our revenue to decline. 17 Table of Contents ● Possible changes in customer and product mix could have a material adverse effect on our business, financial condition, results of operations, cash flows, capital resources, and liquidity. ● Our business is dependent on certain significant suppliers. ● Our operations depend on the proper financial functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure. ● An interruption in the ability of our business to manufacture products or the proper functioning of critical facilities and distribution networks may have a material adverse effect on our business and operations. ● Our capitation arrangements may prove unprofitable if actual utilization rates exceed our assumptions. ● Our ability to attract and retain talented and qualified teammates is critical to our success and competitiveness. ● We cannot assure you that the potential sale of the Products & Healthcare Services segment will be completed; and there may be negative impacts on our business, financial results, and operations. ● We cannot assure you that the proposed acquisition of Rotech (Rotech Acquisition) will be completed. ● We may fail to realize the anticipated benefits of the Rotech Acquisition or those benefits may take longer to realize than expected.
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We undertake no obligation to update or revise any forward-looking statements, except as required by law. ​ Operational Risks ● Our concentration in and dependence on certain Payors. ● Our failure to maintain our relationships with hospital and physician referral sources may cause revenue decline. ● Changes in customer and product mix could materially adversely affect our financial condition and results of operations. ● Our business dependence on certain significant suppliers. ● Our operations depend on proper functioning of information systems; and a cyberattack or systems breach could adversely affect business. ● The recent termination of our contracts with a large commercial payor could negatively impact our financial condition and liquidity. ● A CMS determination reducing reimbursement qualification for non-invasive ventilation products could negatively impact our financial results. ● Our ability to attract and retain talented teammates is critical to our success. ● Our inability to adequately integrate acquisitions could materially adversely affect operations. ● The storage, transportation and provision of compressed and liquid oxygen carries inherent risk of rupture or accidents. ● Our goodwill may become further impaired, requiring significant charge to earnings. ​ Risks Related to the Sale of our Products & Healthcare Services Business ● The sale of the P&HS business may negatively impact our financial condition, results of operations, cash flows, capital resources and liquidity. ● We are required to provide transitional services which may divert the management’s attention and harm our business. ● We are dependent on the successful execution of transitional services by third party. ● Certain of our contracts were transferred or may need to be transferred or replaced and the failure to obtain replacements could increase our expenses. ● The sale of P&HS assets could negatively impact business, and the retained liabilities could adversely affect our financial results. ​ Industry and Economic Risks ● We face increasing competition, accelerating pricing pressure and changes in technology. ● Uncertainty about economic conditions and adverse political changes may affect demand for our products, services and our accounts receivable collectability. ● Changing conditions in the U.S. healthcare industry may impact the results of our operations and cash flows. ​ Litigation & Regulatory Risks ● We are subject to stringent regulatory and licensing requirements; and potential federal and state investigations and compliance reviews. ● We must obtain regulatory clearance prior to consummating certain healthcare transactions. 13 Table of Contents ● Our failure to comply with regulatory requirements or receive clearances or approvals for our medical gas facilities could adversely affect our business. ● Our business may be adversely affected if we are unable to establish, maintain, protect and enforce intellectual property rights. ● We may become subject to litigation, investigations, claims and legal proceedings. ● We could be subject to adverse tax law changes, challenges to tax positions and audits resulting in additional payments. ● Our ESG-related aspirations, goals and disclosures expose us to risks including reputational and stock price risks. ● Our amended bylaws designate U.S.
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We may also encounter significant difficulties in integrating the Rotech business into our operations. ● We and the Rotech business will be subject to business uncertainties while the Rotech Acquisition is pending that could adversely affect our business and the Rotech business. ● The pendency of the Rotech Acquisition could adversely affect our business, financial results, and operations. ● Our inability to adequately integrate acquisitions could have a material adverse effect on our operations. ● Our operations involve the storage, transportation and provision of compressed and liquid oxygen, which carries an inherent risk of rupture or other accidents with the potential to cause substantial loss. ● Our goodwill may become further impaired, which would require us to record a significant charge to earnings in accordance with generally accepted accounting principles.
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Revenue reimbursed under arrangements with Medicare and state Medicaid programs was approximately 19% of our net revenue for the year ended December 31, 2025. 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 .
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Industry and Economic Risks ● We face increasing competition, accelerating pricing pressure and changes in technology. ● An inability to obtain key components, raw materials or manufactured products from third parties in a timely and cost-effective manner, or a material disruption in our supply chain, may have a material adverse effect on our business. ● Uncertainty about current and future economic conditions and other adverse changes in general political conditions may adversely affect demand for our products and services and collectability of our accounts receivable. ● Our Products & Healthcare Services segment is exposed to price fluctuations of key commodities, which may negatively impact our results of operations and cash flows. ● Changing conditions in the U.S. healthcare industry may impact our results of operations and cash flows. ● Our profitability and cash flows may vary based on the impacts of rising inflationary pressures.
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The terminated agreements 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.
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Litigation & Regulatory Risks ● We are subject to stringent regulatory and licensing requirements, and we have been, are and could become the subject of federal and state investigations and compliance reviews. ● We must obtain clearance or approval from appropriate regulatory authorities prior to consummating transactions of certain healthcare related businesses. 18 Table of Contents ● We must obtain clearance or approval from the appropriate regulatory authorities prior to introducing a new product or modification to an existing product.
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Refer to the risk factor titled, “The recent contract termination from a large commercial Payor could negatively impact our financial condition, results of operations, cash flows, capital resources and liquidity risk” below for additional information.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur policies require teammates, contractors, service providers and suppliers who become aware of a cybersecurity incident or the individual’s supervisor to immediately report the cybersecurity incident to the appropriate reporting channels, which include the CISO.
Biggest changeThe CISO is responsible for developing and managing the overall strategy, leading the response to cybersecurity incidents and reporting to the Board. ​ Our policies require teammates, contractors, service providers and suppliers who become aware of a cybersecurity incident to immediately report it to their supervisor or the CISO through the appropriate reporting channels.
Our information security program is integrated within our larger enterprise risk management program and includes, but is not limited to: • Following the methodology of Identify, Protect, Detect, Respond, and Recover; • Mandatory annual cybersecurity awareness training for all teammates accessing our network; • Monthly Company-wide phishing prevention and awareness exercises; • Identification and remediation of information security risks and vulnerabilities in our information technology systems, including regular scanning of both internal and externally facing systems and annual third-party penetration testing; • Implementation of security technologies intended to identify and assist in containing and remediating malware risks; • Active monitoring of logs and events for our network perimeter and internal systems; • Due diligence of information security maintained by third-party vendors that handle our data; • Partnering with the Cybersecurity and Infrastructure Security Agency (CISA), DHS, and the Federal Bureau of Investigation, to leverage their provided sensitive or confidential threat intel and with CISA for weekly vulnerability scans of our key public-facing servers; • Maintaining a cyber insurance policy that provides coverage for security breach recovery and response; and • Engagement of third party consultants to assess the health of our cybersecurity program.
Our information security program is integrated within our larger enterprise risk management program and includes, but is not limited to: • Following the methodology of Identify, Protect, Detect, Respond, and Recover; • Mandatory annual cybersecurity awareness training for all teammates accessing our network; • Monthly Company-wide phishing prevention and awareness exercises; • Identification and remediation of information security risks and vulnerabilities in our information technology systems, including regular scanning of both internal and externally facing systems and annual third-party penetration testing; • Implementation of security technologies intended to identify and assist in containing and remediating malware risks; 29 Table of Contents • Active monitoring of logs and events for our network perimeter and internal systems; • Due diligence of information security maintained by third-party vendors that handle our data; • Partnering with the Cybersecurity and Infrastructure Security Agency (CISA), DHS, and the Federal Bureau of Investigation, to leverage their provided sensitive or confidential threat intel and with CISA for weekly vulnerability scans of our key public-facing servers; • Maintaining a cyber insurance policy that provides coverage for security breach recovery and response; and • Engagement of third party consultants to assess the health of our cybersecurity program.
We maintain a Cybersecurity Incident Response Plan (CIRP) to assist in promptly responding to, resolving, and recovering from cybersecurity incidents. The CIRP includes guidelines for assessing, identifying, managing, reporting, including disclosure of material breaches with the SEC, and remediating cybersecurity incidents.
We maintain a Cybersecurity Incident Response Plan (CIRP) to assist in promptly responding to, resolving and recovering from cybersecurity incidents. The CIRP includes guidelines for assessing, identifying, managing, reporting and remediating cyber incidents, including protocols for disclosure of material breaches with the SEC.
“Risk Factors” for the Risk Factor entitled “ Our operations depend on the proper functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure .” ​
“Risk Factors” for the Risk Factor entitled “ Our operations depend on the proper functioning of information systems, and our business or results of operations could be adversely affected if we experience a cyberattack or other systems breach or failure .” ​ Governance Our Cybersecurity program is managed by our Chief Information Security Officer (CISO).
Following a cybersecurity incident, external subject matter experts, including legal counsel are consulted to reduce the risk of further compromise to our information and to ensure proper reporting and documentation. The Audit Committee would be informed promptly of material cybersecurity incidents in the event that they arise.
Following a cybersecurity incident, we consult external subject matter experts, including legal counsel, to reduce the risk of further compromise to our information and to ensure proper reporting and documentation.
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Item 1C. Cybersecurity Our Cybersecurity program is managed by our Chief Information Security Officer (CISO). The CISO is responsible for developing and managing the overall strategy, leading the response to cybersecurity incidents and reporting to the Board.
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Item 1C. Cybersecurity Risk Management and Strategy Our cybersecurity risk management processes are integrated within our enterprise risk management framework. We conduct periodic cybersecurity risk assessments to identify, evaluate and prioritize threats and vulnerabilities across our information technology environment and business operations.
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The Audit Committee of the Board monitors our information security programs, including our cybersecurity risk management program, and receives updates quarterly, or more frequently as determined appropriate, from management on our cybersecurity program and systems protection. Our CISO has over twenty-five years of experience in cybersecurity and holds active Certified Information Systems Security Professional and Certified Information Security Manager certifications.
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These assessments consider the evolving threat landscape, vulnerabilities in our systems and those of our third-party service providers and potential impacts to our business. Identified risks are evaluated based on likelihood and potential business impact, and we implement controls and mitigation measures aligned with business priorities.
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If a material cybersecurity incident were to occur, it could have a material effect on our business strategy, results of operations and financial condition . For more information see Item 1A.
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Material cybersecurity incidents are escalated to our disclosure committee and senior management for materiality assessment, and the Audit Committee is informed promptly of material cybersecurity incidents in the event that they arise. For more information see Item 1A.
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Our CISO works collaboratively with senior management, including the Chief Financial Officer, General Counsel, and other business leaders. The CISO has eighteen years of experience in cybersecurity.
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The Audit Committee of the Board has primary responsibility for oversight of our cybersecurity risk management program.
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The Audit Committee receives updates from management at least quarterly, or more frequently as appropriate, on our cybersecurity program including the threat environment, program initiatives and investments, cyber insurance coverage, significant incidents or risks, and key metrics. ​ To date, we have not experienced any cybersecurity incidents that have materially affected, or are reasonably likely to materially affect, out business strategy, results of operations, or financial condition. ​

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeIn addition, we lease space on a temporary basis from time to time to meet our inventory storage needs. 38 Table of Contents As of December 31, 2024, our Patient Direct segment had over 300 locations to serve patients that are capable of reaching over 90% of the U.S. population, centers of excellence aligned with specific mail order product categories, as well as regional distribution and repair centers, customer service and billing centers, a national pharmacy and a biomedical center for the repair, maintenance and distribution of patient service equipment.
Biggest changeProperties As of December 31, 2025, following the P&HS Sale, we had over 250 locations to serve patients across the U.S., centers of excellence aligned with specific mail order product categories, as well as regional distribution and repair centers, customer service and billing centers, a national pharmacy and a biomedical center for the repair, maintenance and distribution of patient service equipment.
We believe that, if necessary, we could find facilities to replace these leased premises without suffering a material adverse effect on our business. For information on material lease commitments see Note 6, “Leases”, in the Notes to Consolidated Financial Statements.
We believe that, if necessary, we could find facilities to replace these leased premises without suffering a material adverse effect on our business. For information on material lease commitments see Note 6, “Leases”, in the Notes to Consolidated Financial Statements. 30 Table of Contents
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Item 2. Properties As of December 31, 2024, our Products & Healthcare Services segment operated facilities located throughout the world that handle production, assembly, research, quality assurance testing, distribution, packaging, and sales of our products, as well as office and warehouse space. We also leased customer service centers as well as small offices for sales personnel across the U.S.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe are party to various legal claims that are ordinary and incidental to our business, including ones related to commercial disputes, employment, workers’ compensation, regulatory, cybersecurity, environmental tort, product liability, and other matters. We maintain insurance coverage for cybersecurity, employment, product liability, workers’ compensation and other personal injury litigation matters, subject to policy limits, applicable deductibles and insurer solvency.
Biggest changeWe are party to various legal claims that are ordinary and incidental to our business, including ones related to commercial disputes, employment, workers’ compensation, product liability, regulatory and other matters. We maintain insurance coverage for cybersecurity, employment, product liability, workers’ compensation and other personal injury litigation matters, subject to policy limits, applicable deductibles and insurer solvency.
Item 3. Legal Proceedings Certain legal proceedings in which we are involved are discussed in Note 15, “Commitments, Contingent Liabilities, and Legal Proceedings”, in Notes to Consolidated Financial Statements in this Annual Report.
Item 3. Legal Proceedings Certain legal proceedings in which we are involved are discussed in Note 15, “Commitments, Contingent Liabilities, and Legal Proceedings”, in the Notes to Consolidated Financial Statements in this Annual Report.
From time to time, we establish estimated liabilities based upon periodic assessment of the potential outcomes of pending matters. Based on current knowledge and the advice of counsel, we believe that the liability recorded on the consolidated balance sheet as of December 31, 2024 for currently pending matters considered probable of loss, is sufficient.
From time to time, we establish estimated liabilities based upon periodic assessment of the potential outcomes of pending matters. Based on current knowledge and the advice of counsel, we believe that the liability recorded on the consolidated balance sheet as of December 31, 2025 for currently pending matters considered probable of loss, is sufficient.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeLeon worked for Universal Corporation and The Brinks Company for 18 years where he served as Vice President and Treasurer. ​ Andrew G. Long (59) Executive Vice President & Chief Executive Officer of Products & Healthcare Services Segment Executive Vice President & Chief Executive Officer of Products & Healthcare Services Segment since October 2022. Previously Mr.
Biggest changeLeon worked for Universal Corporation and The Brinks Company for 18 years where he served as Vice President and Treasurer. ​ Perry Bernocchi (67) Executive Vice President & Chief Operating Officer Mr.
Prior to that, he was President, Customer Channels at Thermo Fisher from July 2008 to January 2014 and President, Research Market from November 2006 to July 2008. Earlier in his career, Mr. Pesicka held various Vice President-level roles in Thermo Fischer Scientific’s finance department, serving as Chief Financial Officer of numerous divisions. Prior to Thermo Fisher Scientific, Mr.
Prior to that, he was President, Customer Channels at Thermo Fisher from July 2008 to January 2014 and President, Research Market from November 2006 to July 2008. Earlier in his career, Mr. Pesicka held various Vice President-level roles in Thermo Fisher Scientific’s finance department, serving as Chief Financial Officer of numerous divisions. Prior to Thermo Fisher Scientific, Mr.
Bernocchi worked for Caremark/Coram from 1982 to 2000 in various roles of increasing responsibility in operations and general management within Coram Resource Network and as Senior Vice President of Operations. Heath Galloway (48) Executive Vice President, General Counsel & Corporate Secretary Executive Vice President, General Counsel & Corporate Secretary since May 2023.
Bernocchi worked for Caremark/Coram from 1982 to 2000 in various roles of increasing responsibility in operations and general management within Coram Resource Network and as Senior Vice President of Operations. Heath Galloway (49) Executive Vice President, General Counsel & Corporate Secretary Mr.
Pesicka spent eight years with TRW, Inc. in its finance department and three years with PricewaterhouseCoopers as an auditor. Jonathan A. Leon (58) Executive Vice President, Chief Financial Officer Executive Vice President and Chief Financial Officer of Owens & Minor since September 2024 and served as interim Chief Financial Officer since June 2024. Previously Mr.
Pesicka spent eight years with TRW, Inc. in its finance department and three years with PricewaterhouseCoopers as an auditor. Jonathan A. Leon (59) Executive Vice President, Chief Financial Officer Mr. Leon has served as Executive Vice President and Chief Financial Officer of Accendra Health since September 2024 and has served as interim Chief Financial Officer since June 2024. Previously Mr.
Item 4. Mine Safety Disclosures Not applicable. Information about our Executive Officers Edward A. Pesicka (57) President, Chief Executive Officer & Director President and Chief Executive Officer since joining Owens & Minor in March 2019. Mr. Pesicka was also appointed to the Board of Directors at the time he joined the Company. Previously Mr.
Item 4. Mine Safety Disclosures Not applicable. Information about our Executive Officers Edward A. Pesicka (58) President, Chief Executive Officer & Director Mr. Pesicka has served as President and Chief Executive Officer since joining Accendra Health in March 2019. Mr. Pesicka was also appointed to the Board of Directors at the time he joined the Company. Previously Mr.
Leon served as Senior Vice President, Corporate Treasurer of the Company since May 2018. Prior to that, Mr. Leon served as Vice President, Treasurer, after joining Owens & Minor 39 Table of Contents in January 2017. Before joining Owens & Minor, Mr.
Leon served as Senior Vice President, Corporate Treasurer of the Company since May 2018. Prior to that, Mr. Leon served as Vice President, Treasurer, after joining Accendra Health in January 2017. Before joining Accendra Health, Mr.
Perry Bernocchi (66) Executive Vice President & Chief Executive Officer of Patient Direct Segment Executive Vice President & Chief Executive Officer of Patient Direct Segment since March 2023. Prior to that, Mr. Bernocchi served as President & Chief Executive Officer of the Company’s Byram Healthcare division, a position he held since 2009. Mr.
Bernocchi has served as Executive Vice President and Chief Operating Officer since January 2025 and was previously Executive Vice President and Chief Executive Officer, Patient Direct since March 2023. Prior to that, Mr. Bernocchi served as President & Chief Executive Officer of the Company’s Byram Healthcare division, a position he 31 Table of Contents held since 2009. Mr.
Removed
Long served as Chief Financial Officer of Owens & Minor since joining the Company in November 2019. Prior to that, Mr. Long served as the Chief Executive Officer and as a board member of Insys Therapeutics, Inc. (Insys) , from April 2019 to November 8, 2019. Insys filed for Chapter 11 bankruptcy protection in June 2019. Prior to that, Mr.
Added
Galloway joined Accendra Health in February 2013, serving as Assistant General Counsel until April 2016 and Associate General Counsel until May 2023, when he was appointed as Executive Vice President, General Counsel & Corporate Secretary. In this role, Mr. Galloway oversees the Accendra legal and government relations teams and has responsibility for corporate governance, M&A, dispute resolution, and legal compliance.
Removed
Long served as the Chief Financial Officer of Insys from August 2017. Prior to joining Insys, Mr. Long served as Senior Vice President of Global Finance at Patheon, a pharmaceutical company, from 2015 to 2017. Prior to working at Patheon, Mr. Long served as Vice President of Finance for multiple divisions at Thermo Fisher Scientific from 2006 until 2015.
Added
In January 2026, Mr. Galloway also assumed oversight responsibility for the Company’s human resources function. Before joining Accendra, Mr. Galloway spent nine years in private practice and was a partner at Williams Mullen, a full-service law firm based in Richmond, Virginia. Mr.
Removed
Prior to that, from April 2016 to May 2023, Mr. Galloway served as Associate General Counsel. Prior to that, Mr. Galloway served as Assistant General Counsel after joining Owens & Minor in February 2013. Prior to joining Owens & Minor, Mr. Galloway worked at Williams Mullen for nine years.
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Galloway received his Bachelor of Arts and Juris Doctorate degrees from Washington & Lee University. ​ 32 Table of Contents Part II
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Jennifer Stone (54) Executive Vice President & Chief Human Resources Officer Executive Vice President & Chief Human Resources Officer of Owens & Minor since June 2024. Prior to that, Ms. Stone served as Vice President, Human Resources, Medical Surgical Portfolio at Medtronic, a global medical device company. Prior to Medtronic, Ms.
Removed
Stone also spent more than 20 years at Target Corporation, a retail company, in various roles of increasing responsibility, including most recently as Head of Talent Management. Snehashiah Sarkar (50) Executive Vice President & Chief Information Officer Executive Vice President & Chief Information Officer of Owens & Minor since May 2024. Mr.
Removed
Sarkar joined the Company in 2022 as Senior Vice President & Chief Information Officer. Before joining Owens & Minor, Mr. Sarkar worked for Varian, a Siemens Healthineers Company, as Senior Vice President, Head of Business Transformation Office, and Chief Information Officer. Be fore that, Mr.
Removed
Sarkar spent 13 years with Varian Medical Systems in various leadership roles. 40 Table of Contents Michael W. Lowry (63) Senior Vice President, Corporate Controller & Chief Accounting Officer Senior Vice President, Corporate Controller & Chief Accounting Officer since June 2018. Prior to that, from May 2016 to June 2018, Mr.
Removed
Lowry was Senior Vice President, Corporate Controller and Vice President, Corporate Controller beginning in 2013. Prior to that, from 2009 to 2013 Mr. Lowry was the Vice President, Treasurer. Mr. Lowry joined Owens & Minor in 1988. ​ 41 Table of Contents Part II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThis graph assumes that the value of the investment in the common stock and each index was $100 on December 31, 2019, and that all dividends were reinvested. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Base Period Years Ended Company Name / Index ​ 12/2019 ​ 12/2020 12/2021 12/2022 12/2023 12/2024 Owens & Minor, Inc. ​ $ 100.00 ​ $ 523.82 ​ $ 842.59 ​ $ 378.29 ​ $ 373.29 ​ $ 253.16 S&P 500 Index ​ 100.00 ​ 118.39 ​ 152.34 ​ 124.73 ​ 157.48 ​ 196.85 Russell 3000 Medical Equipment and Services Sector ​ 100.00 ​ 125.94 ​ 152.09 ​ 118.27 ​ 124.16 ​ 132.03 ​ On February 26, 2025, the Owens & Minor Board of Directors authorized a share repurchase program of up to $100 million over the next 24 months.
Biggest changeThis graph assumes that the value of the investment in the common stock and each index was $100 on December 31, 2020, and that all dividends were reinvested. ​ 33 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Base Period ​ ​ ​ Years Ended Company Name / Index ​ 12/2020 ​ 12/2021 ​ ​ ​ 12/2022 ​ ​ ​ 12/2023 ​ ​ ​ 12/2024 ​ ​ ​ 12/2025 Accendra Health, Inc. ​ $ 100.00 ​ $ 160.85 ​ $ 72.22 ​ $ 71.26 ​ $ 48.33 ​ $ 10.35 Russell 2000 Index ​ 100.00 ​ 114.78 ​ ​ 91.30 ​ ​ 106.71 ​ ​ 119.00 ​ ​ 134.23 Russell 3000 Medical Equipment and Services Sector ​ 100.00 ​ 120.76 ​ 93.91 ​ 98.59 ​ 104.83 ​ 110.56 ​ On February 26, 2025, our Board of Directors authorized a share repurchase program of up to $100 million and expires in February 2027.
Because many of our shares of common stock are held by brokers and other institutions on behalf of stockholders, the common shareholders of record do not reflect the total number of stockholders. 5-Year Total Shareholder Return The following performance graph compares the performance of our common stock to the Standard & Poor’s Composite-500 Index (S&P 500 Index), the Russell 3000 Medical Equipment and Services Sector Index, an index that includes more than 100 companies in the medical equipment and services industry.
Because many of our shares of common stock are held by brokers and other institutions on behalf of stockholders, the common shareholders of record do not reflect the total number of stockholders. 5-Year Total Shareholder Return The following performance graph compares the performance of our common stock to the Russell 2000 Index and the Russell 3000 Medical Equipment and Services Sector Index, an index that includes more than 100 companies in the medical equipment and services industry.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Owens & Minor, Inc.’s common stock trades on the New York Stock Exchange under the symbol OMI. As of January 31, 2025, there were 2,082 common shareholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities Accendra Health, Inc.’s common stock trades on the New York Stock Exchange under the symbol ACH (formerly OMI). As of January 31, 2026, there were 1,772 common shareholders of record.
Under the program, Owens & Minor may repurchase shares of common stock on a discretionary basis from time to time through open market repurchases, privately negotiated transactions and 10b5-1 trading plans. ​ 42 Table of Contents ​
The program expires in February 2027. Under the program, we may repurchase shares of common stock on a discretionary basis from time to time through open market repurchases, privately negotiated transactions and 10b5-1 trading plans.
Added
Under the program, we may repurchase shares of common stock on a discretionary basis from time to time through open market repurchases, privately negotiated transactions and 10b5-1 trading plans. ​ The following table summarizes share repurchase activity for the year ended December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (in thousands, except per share data) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Period ​ Total Number of Shares Purchased ​ ​ Average Price Paid Per Share ​ Total Number of Shares Purchased as Part of Publicly Announced Program (1) ​ ​ Approximate Dollar Value of Shares That May Yet be Purchased Under the Program (2) February 26-February 28, 2025 ​ — ​ $ — ​ — ​ $ 100,000 March 1-March 31, 2025 ​ 173 ​ $ 8.66 ​ 173 ​ $ 98,500 April 1-April 30, 2025 ​ 653 ​ $ 7.87 ​ 653 ​ $ 93,360 May 1-May 31, 2025 ​ — ​ $ — ​ — ​ $ 93,360 June 1-June 30, 2025 ​ — ​ $ — ​ — ​ $ 93,360 July 1-July 31, 2025 ​ — ​ $ — ​ — ​ $ 93,360 August 1-August 31, 2025 ​ — ​ $ — ​ — ​ $ 93,360 September 1-September 30, 2025 ​ — ​ $ — ​ — ​ $ 93,360 October 1-October 31, 2025 ​ — ​ $ — ​ — ​ $ 93,360 November 1-November 30, 2025 ​ 1,129 ​ $ 3.10 ​ 1,129 ​ $ 89,860 December 1-December 31, 2025 ​ — ​ $ — ​ — ​ $ 89,860 Total (3) ​ 1,955 ​ ​ ​ ​ 1,955 ​ ​ ​ ​ ​ (1) On February 26, 2025, our Board of Directors authorized a share repurchase program of up to $100 million.
Added
(2) During the period from February 26, 2025 (the date the share repurchase program was authorized) through December 31, 2025, we repurchased shares in open-market transactions and retired approximately 2.0 million shares of our common stock for an aggregate of $10 million, or a weighted average price per share of $5.19.
Added
(3) Represents the period from February 26, 2025 (the date the share repurchase program was authorized) through December 31, 2025. ​ ​

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe following table summarizes our consolidated statements of cash flows for the year ended December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ December 31, (Dollars in thousands) 2024 2023 Net cash provided by (used for): ​ ​ Operating activities $ 161,495 ​ $ 740,710 Investing activities (116,533) ​ (137,254) Financing activities (267,603) ​ (417,330) Effect of exchange rate changes (901) ​ 613 Net (decrease) increase in cash, cash equivalents and restricted cash $ (223,542) ​ $ 186,739 ​ Cash provided by operating activities for the year ended December 31, 2024 reflected positive cash generated by a net loss after the effects of reconciling non-cash adjustments.
Biggest changeThe following table summarizes our consolidated statements of cash flows for the year ended December 31, 2025, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ December 31, (Dollars in thousands) ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Net cash provided by (used for): ​ ​ ​ ​ ​ ​ Operating activities from continuing operations ​ $ 154,496 ​ $ 143,686 ​ $ 336,458 Operating activities from discontinued operations ​ ​ (256,286) ​ ​ 17,809 ​ ​ 404,252 Operating activities ​ ​ (101,790) ​ ​ 161,495 ​ ​ 740,710 Investing activities from continuing operations ​ ​ 198,993 ​ (98,036) ​ (107,893) Investing activities from discontinued operations ​ ​ (54,570) ​ (18,497) ​ (29,361) Investing activities ​ 144,423 ​ (116,533) ​ (137,254) Financing activities from continuing operations ​ ​ 190,205 ​ (250,023) ​ (411,056) Financing activities from discontinued operations ​ ​ (2,127) ​ (17,580) ​ (6,274) Financing activities ​ 188,078 ​ (267,603) ​ (417,330) Effect of exchange rate changes ​ 1,896 ​ (901) ​ 613 Net increase (decrease) in cash, cash equivalents and restricted cash ​ $ 232,607 ​ $ (223,542) ​ $ 186,739 ​ Cash used for operating activities for the year ended December 31, 2025 reflected a net loss including the impact of the $80 million termination fee of the Rotech acquisition, $18 million in transaction financing fees, net for the Rotech acquisition financing, $22 million in legal settlement payments for two litigation matters, and favorable changes in working capital, including a $122 million reduction in continuing operations accounts receivable driven by a $120 million increase in accounts receivable that had been sold and removed from our consolidated balance sheets.
The Revolving Credit Agreement, the Credit Agreement, the Receivables Sale Program, the 2029 Unsecured Notes, and the 2030 Unsecured Notes contain cross-default provisions which could result in the acceleration of payments due in the event of default of any of the related agreements.
The Revolving Credit Agreement, the Credit Agreement, the Amended Receivables Sale Program, the 2029 Unsecured Notes, and the 2030 Unsecured Notes contain cross-default provisions which could result in the acceleration of payments due in the event of default of any of the related agreements.
Due to the uncertainty of forecasting variable interest rate payments, interest payment amounts on our variable rate debt are excluded from the contractual obligations disclosed in this section. See Note 6, “Leases”, Note 8, “Debt”, Note 10, “Retirement Plans”, Note 12, “Income Taxes”, and Note 15, “Commitments, Contingent Liabilities, and Legal Proceedings” in the Notes to Consolidated Financial Statements.
Due to the uncertainty of forecasting variable interest rate payments, interest payment amounts on our variable rate debt are excluded from the contractual obligations disclosed in this section. See Note 6, “Leases”, Note 8, “Debt”, Note 10, “Retirement Plan”, Note 12, “Income Taxes”, and Note 15, “Commitments, Contingent Liabilities, and Legal Proceedings” in the Notes to Consolidated Financial Statements.
The terms of the applicable credit agreements also require us to maintain ratios for leverage and interest coverage, including on a pro forma basis in the event of an acquisition or divestiture. We were in compliance with our debt covenants at December 31, 2024.
The terms of the applicable credit agreements also require us to maintain ratios for leverage and interest coverage, including on a pro forma basis in the event of an acquisition or divestiture. We were in compliance with our debt covenants at December 31, 2025.
Our estimates are generally based on historical experience and various other assumptions that are judged to be reasonable in light of the relevant facts and circumstances. Because of the uncertainty inherent in such estimates, actual results may differ. We believe our critical accounting estimates include accounting for goodwill valuation, revenue recognition, and inventory valuation. Goodwill.
Our estimates are generally based on historical experience and various other assumptions that are judged to be reasonable in light of the relevant facts and circumstances. Because of the uncertainty inherent in such estimates, actual results may differ. We believe our critical accounting estimates include accounting for revenue recognition. Revenue Recognition.
DSO in 2024 reflected the impact of the reduction in accounts receivable, net due to sales of accounts receivable under the Receivables Sale Program . Excluding the impact of the Receivables Sale Program, DSO would have been 25.7 as of December 31, 2024.
DSO in 2024 reflected the impact of the reduction in accounts receivable, net due to sales of accounts receivable under the Receivables Sale Program. Excluding the impact of the Receivables Sale Program, DSO would have been 30.7 as of December 31, 2024.
The majority of these factors are related to financial market changes inclusive of a decline in Owens & Minor’s stock price and rising interest rates.
The majority of these factors are related to financial market changes inclusive of a decline in our stock price and rising interest rates.
Additionally, as of December 31, 2024, material cash requirements, including known contractual and other obligations, due beyond the next twelve months were primarily comprised of $1.8 billion in principal debt payments excluding finance leases, $225 million in fixed interest payments on our outstanding senior notes, $347 million in operating leases and $28 million in U.S. retirement plan benefits, based on the same assumptions used to measure our year-end benefit obligation .
Additionally, as of December 31, 2025, material cash requirements, including known contractual and other obligations, due beyond the next twelve months were primarily comprised of $2.1 billion in principal debt payments, $167 million in fixed interest payments on our outstanding senior notes, $83 million in operating leases and $28 million in U.S. retirement plan benefits, based on the same assumptions used to measure our year-end benefit obligation .
Cash used for financing activities in 2023 included repayments of debt of $321 million including $170 million of unscheduled and $15 million of scheduled principal payments on our Term Loan A and Term Loan B, $135 million of cash to repurchase $144 million aggregate principal of the 2024 Notes, the 4.500% senior unsecured notes due in 2029 (2029 Unsecured Notes) and the 6.625% senior notes due in 2030 (the 2030 Unsecured Notes) .
Cash used for financing activities in 2023 included repayments of debt of $321 million, and $170 million of unscheduled and $15 million of scheduled repayments on term loans, $135 million of cash to repurchase $144 million aggregate principal of the 2024 Notes, the 4.500% senior unsecured notes due in 2029 (2029 Unsecured Notes) and the 6.625% senior notes due in 2030 (the 2030 Unsecured Notes).
Our primary sources of liquidity include cash and cash equivalents, our Receivables Sale Program, our Revolving Credit Agreement and our Receivables Purchase Agreement (RPA).
Our primary sources of liquidity include cash and cash equivalents, our Amended Receivables Sale Program and our Revolving Credit Agreement.
At December 31, 2024, and December 31, 2023, our Revolving Credit Agreement was undrawn, and we had letters of credit, which reduce revolver availability, of $31 million and $27 million, leaving $419 million and $423 million available for borrowing.
December 31, 2024, our Revolving Credit Agreement was undrawn. At December 31, 2025 and December 31, 2024, we had letters of credit, which reduce revolver availability, of $30 million and $31 million, leaving $217 million and $419 million available for borrowing.
On October 18, 2024, O&M Funding and Owens & Minor Medical, LLC., each a wholly-owned subsidiary of the Company, entered into a Receivables Purchase Agreement (the Receivables Sale Program) with persons from time to time, as Purchasers, PNC Bank, National Association, as Administrative Agent, and PNC Capital Markets LLC, as Structuring Agent, pursuant to which accounts receivable with an aggregate outstanding amount not to exceed $450 million are sold, on a limited-recourse basis, to the Purchasers in exchange for cash.
On October 18, 2024, we entered into a Receivables Purchase Agreement (the Receivables Sale Program) with persons from time to time, as Purchasers, PNC Bank, National Association, as Administrative Agent, and PNC Capital Markets LLC, as Structuring Agent, pursuant to which accounts receivable with an aggregate outstanding amount not to exceed $450 million are sold, on a limited-recourse basis, to the Purchasers in exchange for cash.
DSO in 2024 reflected the impact of the reduction in accounts receivable, net due to sales of accounts receivable under the Receivables Sale Program. Excluding the impact of the Receivables Sale Program, DSO would have been 25.7 as of December 31, 2024.
DSO in 2025 reflected the impact of the reduction in accounts receivable, net due to sales of accounts receivable under the Amended Receivables Sale Program. Excluding the impact of the Amended Receivables Sale Program, DSO would have been 29.8 as of December 31, 2025.
We had no borrowings under our revolving credit facility on a net basis for 2024 and the activity under our amended Receivables Financing Agreement netted to no impact to our outstanding borrowings.
We had no borrowings under our Revolving Credit Facility for 2024 and the activity under our amended Receivables Financing Agreement netted to no impact on our outstanding borrowings. We had no borrowings under our revolving credit facility on a net basis for 2023 and made net repayments of $96 million under our amended Receivables Financing Agreement. ​ Capital resources.
As of December 31, 2024, other material cash requirements, including known contractual and other obligations, in the next twelve months were primarily comprised of $40 million in principal debt payments, $123 million in operating leases, $58 million in fixed interest payments on our outstanding senior notes, and $43 million associated with the NOPA matter, which includes $12 million of interest accrued on the matter through December 31, 2024.
Contractual Obligations As of December 31, 2025, other material cash requirements, including known contractual and other obligations and excluding anticipated voluntary prepayments of debt, in the next twelve months were primarily comprised of $49 million in operating leases, $58 million in fixed interest payments on our outstanding senior notes, and $35 million associated with the NOPA matter, which includes $11 million of interest accrued on the matter through December 31, 2025.
Income taxes. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) 2024 2023 ​ $ % Income tax provision (benefit) $ 5,329 $ (13,425) $ 18,754 139.7 % Effective tax rate ​ (1.5) % ​ 24.5 % ​ ​ ​ ​ ​ ​ 48 Table of Contents The change in the effective tax rate for the year ended December 31, 2024 compared to 2023 resulted primarily from the pre-tax goodwill impairment charge of $307 million ($305 million net of tax) , related to the Apria reporting unit and a one-time income tax charge of $19 million, or a $0.24 negative impact per share, related to a recent decision associated with Notices of Proposed Adjustments (NOPA) that we received in 2020 and 2021.
Income taxes. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) ​ 2025 ​ ​ ​ 2024 ​ $ ​ ​ ​ % Income tax provision $ 729 $ 20,850 $ (20,121) (96.5) % Effective tax rate ​ (0.7) % ​ (6.3) % ​ ​ ​ ​ ​ ​ The change in the effective tax rate for the year ended December 31, 2025 compared to 2024 resulted primarily from the pre-tax goodwill impairment charge of $307 million ($305 million net of tax) related to Apria and a one-time income tax charge of $19 million, or a $0.24 negative impact per share, related to a recent decision associated with Notices of Proposed Adjustments (NOPA) that we received in 2020 and 2021.
Cash used for financing activities in 2024 included repayments of debt of $244 million, including the $171 million paid to redeem the outstanding principal of the 4.375% senior notes due in 2024 (the 2024 Notes), unscheduled principal payments of $45 million on the Term Loan A facility (Term Loan A) and scheduled principal payments of $28 million on our Term Loan A and Term Loan B facility (Term Loan B).
Cash used for financing activities in 2024 included repayments of debt of $244 million, including $171 million paid to redeem the 4.375% senior notes that were due in December 2024, and $45 million of unscheduled and $28 million of scheduled repayments on term loans.
Total accounts receivable sold under the Receivables Sale Program and net cash proceeds were $168 million during the year ended December 31, 2024. We collected $98 million of the sold accounts receivable for the year ended December 31, 2024.
Total accounts receivable sold under the Receivables Sale Program and net cash proceeds were $325 million related to continuing operations during the year ended December 31, 2025. We collected $330 million of the sold accounts receivable related to continuing operations for the year ended December 31, 2025.
We have $837 million in outstanding term loans under a term loan credit agreement (the Credit Agreement). The interest rate on our Revolving Credit Agreement is based on a spread over a benchmark rate (as described in the Revolving Credit Agreement). The Revolving Credit Agreement matures in March 2027.
The interest rate on our Revolving Credit Agreement is based on a spread over a benchmark rate (as described in the Revolving Credit Agreement). The Revolving Credit Agreement matures in March 2027.
We determine the transaction price based on contractually agreed-upon amounts or rates, adjusted for estimates of variable consideration including but not limited to rebates, discounts, performance guarantees, and implicit price concessions.
Due to the nature of our industry and the reimbursement environment in which we operate, revenue recognition requires significant estimates and judgments. We determine the transaction price based on contractually agreed-upon amounts or rates, adjusted for estimates of variable consideration including but not limited to rebates, discounts, performance guarantees, and implicit price concessions.
Additionally, anticipated changes in pricing of a capitated contract also contributed to this charge. ​ Acquisition-related charges were $22 million for the year ended December 31, 2024 as compared to $18 million for the year ended December, 31, 2023.
Additionally, anticipated changes in pricing of a capitated contract also contributed to this charge. ​ Acquisition-related charges were $22 million for the year ended December 31, 2024 related to the terminated acquisition of Rotech, which consisted primarily of legal and professional fees.
We estimate a hypothetical increase (decrease) in DSO of one day would result in a decrease (increase) in our cash balances, an increase (decrease) in borrowings against our Revolving Credit Agreement, or a combination thereof of approximately $29 million.
We estimate a hypothetical increase (decrease) in DSO of one day would result in a decrease (increase) in our cash balances, an increase (decrease) in borrowings against our Revolving Credit Agreement, or a combination thereof of approximately $7.7 million. The majority of our cash and cash equivalents are held in cash depository accounts with major banks in the U.S.
Interest expense, net. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) 2024 2023 $ % Interest expense, net $ 143,804 ​ $ 157,915 ​ $ (14,111) ​ (8.9) % Effective interest rate 7.09 % 6.96 % ​ ​ ​ The decrease in interest expense was primarily due to lower average outstanding borrowings of $227 million, partially offset by an increase in the effective interest rate of 13 basis points.
Other expense, net for the year ended December 31, 2024 also includes a $1.1 million loss on extinguishment of debt. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) ​ 2024 ​ ​ ​ 2023 ​ ​ ​ $ ​ ​ ​ % Interest expense, net ​ $ 107,566 ​ $ 116,769 ​ $ (9,203) ​ (7.9) % Effective interest rate ​ ​ 7.09 % ​ 6.96 % ​ ​ ​ ​ ​ Other expense, net ​ $ 4,589 ​ $ 1,197 ​ $ 3,392 ​ 283.4 % ​ The decrease in interest expense was primarily due to lower average outstanding borrowings of $227 million, partially offset by an increase in the effective interest rate of 13 basis points.
Under the program, Owens & Minor may repurchase shares of common stock on a discretionary basis from time to time through open market repurchases, privately negotiated transactions and 10b5-1 trading plans. ​ We believe cash generated by operating activities, including available cash proceeds from the Receivables Sale Program, available financing sources, and borrowings under the Revolving Credit Agreement, as well as cash on hand, will be sufficient to fund our working capital needs, capital expenditures, long-term strategic growth, payments under long-term debt and lease arrangements, debt repurchases, share repurchases and other cash requirements.
During the year ended December 31, 2025 we repurchased in open-market transactions and retired 2.0 million shares of our common stock for an aggregate of $10 million, or a weighted average price per share of $5.19. ​ We believe cash generated by operating activities, including available cash proceeds from the Amended Receivables Sale Program, available financing sources, and borrowings under the Revolving Credit Agreement, as well as cash on hand, will be sufficient to fund our working capital needs, capital expenditures, long-term strategic growth, payments under long-term debt and lease arrangements, debt repurchases, share repurchases and other cash requirements.
If actual amounts of consideration ultimately received differ from the Company’s estimates, the Company adjusts these estimates, which would affect net revenue in the period such adjustments become known. Inventory.
If actual amounts of consideration ultimately received differ from the Company’s estimates, the Company adjusts these estimates, which would affect net revenue in the period such adjustments become known. 46 Table of Contents Recent Accounting Pronouncements For a discussion of recent accounting pronouncements, see Note 1 in the Notes to Consolidated Financial Statements.
The interest rate on the Term Loan B is based on either the Term SOFR or the Base Rate plus an Applicable Rate. The Term Loan A matures in March 2027 and the Term Loan B matures in March 2029.
The interest rate on the Term Loan B is based on either the Term SOFR or the Base Rate plus an Applicable Rate. The Term Loan A matures in March 2027 and the Term Loan B matures in March 2029. 44 Table of Contents At December 31, 2025 we had $204 million in outstanding borrowings on our Revolving Credit Agreement.
(2) Based on year end merchandise inventories and cost of goods sold for the fourth quarter ended December 31, 2024, 2023 and 2022.
(2) Based on year end inventories and cost of net revenue for the fourth quarter ended December 31, 2025 and 2024. ​ 42 Table of Contents Liquidity and capital expenditures.
Our financial results for the year ended December 31, 2024 as compared to the prior year were impacted by the following: (1) a goodwill impairment charge of $307 million related to our Apria reporting unit, or a $3.97 negative impact per share (see Notes 1 and 5 in the Notes to Consolidated Financial Statements); (2) the remeasurement of an uncertain tax position, 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); (3) legal settlements of $17 million related primarily to compensation and wage and hour disputes and (4) incremental exit and realignment charges of $11 millio n primarily related to our 2023-2024 Operating Model Realignment Program and information technology (IT) strategic initiatives and (5) the decline in Products & Healthcare Services segment operating income, as described below.
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.
Cash used for investing activities in 2023 included capital expenditures of $208 million for patient service equipment and our strategic and operational efficiency initiatives, partially offset by $72 million in proceeds primarily related to the sale of patient service equipment.
Cash used for investing activities in 2024 also included $45 million of discontinued operations capital expenditures and $34 million in proceeds from the sale of our former corporate headquarters. ​ 43 Table of Contents Cash used for investing activities in 2023 included continuing operations capital expenditures of $179 million primarily for patient service equipment, and our strategic and operational efficiency initiatives associated with other fixed assets and capitalized software, partially offset by $72 million in proceeds from the sale of patient service equipment.
Cash used for investing activities in 2024 included capital expenditures of $228 million for patient service equipment and our strategic and operational efficiency initiatives, partially offset by $103 million in proceeds related to the sale and disposal of property and equipment, which included sales of patient service equipment and $34 million in gross proceeds related to the sale of our corporate headquarters, and $18 million included in the ‘Other, net’ line item for a settlement with Philips for returned equipment as described in the ‘Philips Respironics Recall’ section above.
Cash used for investing activities in 2025 also included $55 million of discontinued operations capital expenditures. ​ Cash used for investing activities in 2024 included continuing operations capital expenditures of $183 million primarily for patient service equipment, other fixed assets and capitalized software, partially offset by $70 million in proceeds from the sale of patient service equipment and $18 million included in the ‘other, net’ line item for settlement with Philips for returned equipment as described in the ‘Philips Respironics Recall’ section above.
DS&A expenses also included a favorable impact from foreign currency translation of $0.9 million for the year ended December 31, 2024 as compared to the prior year. Goodwill impairment charges relates to impairment recognized in the Apria reporting unit during the quarter ended December 31, 2024 relating to a combination of factors occurring in the fourth quarter of 2024.
Goodwill impairment charge for the year ended December 31, 2024 reflected impairment recognized in our former Apria reporting unit during the quarter ended December 31, 2024 relating to a combination of factors occurring in the fourth quarter of 2024.
The Patient Direct segment includes our home healthcare divisions (Byram and Apria). Net (loss) per share was $(4.73) for the year ended December 31, 2024 as compared to net (loss) per share of $(0.54) for the year ended December 31, 2023.
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.
Exit and realignment charges, net were $110 million and $99 million for the years ended December 31, 2024 and 2023.
(3) During the year ended December 31, 2025 exit and realignment charges, net were $18 million.
Other expense, net. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) 2024 2023 $ % Other expense, net $ 4,683 $ 4,837 $ (154) (3.2) % ​ Other expense, net in 2024 and 2023 primarily represented interest cost and net actuarial losses related to our retirement plans.
Other expense, net for the years ended December 31, 2025 and 2024 includes interest cost and net actuarial losses related to our U.S. retirement plan.
Changes in our working capital can vary in the normal course of business based upon the timing of inventory purchases, collections of accounts receivable, and payments to suppliers. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) 2024 2023 $ % Cash and cash equivalents $ 49,382 ​ $ 243,037 ​ $ (193,655) ​ (79.7) % Accounts receivable, net $ 690,241 ​ $ 598,257 ​ $ 91,984 ​ 15.4 % DSO (1) ​ 23.3 ​ ​ 20.5 ​ ​ ​ ​ ​ ​ Merchandise inventories $ 1,131,879 ​ $ 1,110,606 ​ $ 21,273 ​ 1.9 % Inventory days (2) ​ 49.2 ​ ​ 49.0 ​ ​ ​ ​ ​ ​ Accounts payable $ 1,251,964 $ 1,171,882 $ 80,082 6.8 % (1) Based on year end accounts receivable and net revenue for the fourth quarter ended December 31, 2024 and 2023.
Our working capital can vary in the normal course of business based upon the timing of inventory purchases, collections of accounts receivable, and payments to suppliers. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) ​ 2025 ​ ​ ​ 2024 ​ ​ ​ $ ​ ​ ​ % Cash and cash equivalents ​ $ 281,989 ​ $ 27,572 ​ $ 254,417 ​ 922.7 % Accounts receivable ​ $ 95,907 ​ ​ 218,270 ​ $ (122,363) ​ (56.1) % DSO (1) ​ ​ 12.4 ​ ​ 28.9 ​ ​ ​ ​ ​ ​ Inventories ​ $ 74,435 ​ ​ 67,581 ​ $ 6,854 ​ 10.1 % Inventory days (2) ​ ​ 17.8 ​ ​ 17.2 ​ ​ ​ ​ ​ ​ Accounts payable $ 363,565 $ 359,927 $ 3,638 1.0 % (1) Based on year end accounts receivable and net revenue for the fourth quarter ended December 31, 2025 and 2024.
Refer to “Results of Operations” for further detail of quantitative and qualitative drivers of our results. 43 Table of Contents Potential Sale of Products & Healthcare Services Segment On February 28, 2025, we announced that we are actively engaged in discussions regarding the potential sale of our Products & Healthcare Services segment.
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.
The losses on sales of accounts receivable are recorded in other operating expense (income), net in the consolidated statements of operations and were $1.9 million for the year ended December 31, 2024.
The losses on sales of accounts receivable of continuing operations, inclusive of professional fees incurred to establish the agreement, recorded in selling, general, and administrative expenses in the consolidated statements of operations were $2.2 million for the year ended December 31, 2025.
Seasonality Our business is affected by seasonality, which historically has resulted in higher sales volume during our third and fourth quarters, ending September 30 and December 31. Contractual Obligations On July 22, 2024, we entered into an Agreement and Plan of Merger to acquire Rotech for $1.36 billion in cash.
We do not expect Pillar Two to have a material impact on our financial position, results of operations and cash flows. 45 Table of Contents Seasonality Our business is affected by seasonality, which historically has resulted in higher sales volume during our third and fourth quarters, ending September 30 and December 31.
On March 14, 2023, we entered into the RPA, pursuant to which accounts receivable with an aggregate outstanding amount not to exceed $200 million are sold, on a limited-recourse basis, to the Purchaser in exchange for cash.
On December 31, 2025, we entered into an Amended & Restated Receivables Purchase Agreement (the Amended Receivables Sale Program) with persons from time to time party thereto, as Purchasers, PNC Bank, as Administrative Agent, and PNC Capital Markets LLC, as Structuring Agent, pursuant to which accounts receivable with an aggregate outstanding amount not to exceed $150 million are sold, on a limited-recourse basis, to the Purchasers in exchange for cash.
Intangible amortization was $65 million and $84 million for the years ended December 31, 2024 and 2023 and related primarily to intangible assets acquired in the Apria, Halyard, and Byram acquisitions. The decline is related to certain intangible assets being fully amortized. See Note 5 in the Notes to Consolidated Financial Statements.
Acquisition-related charges for the year ended December 31, 2023 were $17 million, consisting of costs related to the acquisition of Apria. Intangible amortization was $40 million and $58 million for the years ended December 31, 2024 and 2023 and related primarily to intangible assets acquired in the Apria and Byram acquisitions.
Cash provided by operating activities was negatively impacted by unfavorable changes in working capital for the year ended December 31, 2024 and was positively impacted by changes in working capital for the year ended December 31, 2023.
Cash provided by operating activities for the year ended December 31, 2024 was also impacted by $18 million of favorable changes in discontinued operations operating cash flow, driven by operating earnings, partially offset by unfavorable changes in working capital. ​ Cash provided by operating activities for the year ended December 31, 2023 reflected earnings from continuing operations, excluding non-cash charges such as depreciation and amortization, as well as favorable changes in working capital.
Acquisition-related charges in 2024 consisted of costs related to the expected acquisition of Rotech, which related primarily to legal and professional fees. Acquisition charges in 2023 consisted primarily of costs related to the Apria Acquisition.
Acquisition-related charges were $22 million for the years ended December 31, 2025 and 2024 related to the terminated acquisition of Rotech, which consisted primarily of legal and professional fees. Intangible amortization was $74 million and $40 million for the years ended December 31, 2025 and 2024 and related primarily to intangible assets acquired in the Apria and Byram acquisitions.
Operating expenses. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) 2024 2023 $ % Distribution, selling and administrative expenses $ 1,909,791 ​ $ 1,813,559 ​ $ 96,232 ​ 5.3 % As a % of net revenue 17.85 % 17.55 % ​ ​ Goodwill impairment charges $ 307,112 ​ $ — ​ $ 307,112 ​ NM ​ Acquisition-related charges and intangible amortization $ 86,543 ​ $ 101,037 ​ $ (14,494) ​ (14.3) % Exit and realignment charges, net $ 110,162 ​ $ 99,127 ​ $ 11,035 ​ 11.1 % Other operating expense (income), net $ 13,316 ​ $ 6,930 ​ $ 6,386 ​ 92.2 % ​ NM – Not meaningful ​ The increase in DS&A expenses was driven primarily by incremental costs to support the $367 million, or 3.6% net revenue growth, along with future revenue growth and an increase of $41 million in teammate benefit costs, partially offset by $18 million in expense savings from our IT strategic initiatives, $7.4 million of personnel cost savings related to 2023 organizational changes, and other productivity gains derived from operating efficiencies.
Exit and realignment charges, net were $47 million for the year ended December 31, 2024 which included professional fees associated with strategic initiatives of $36 million and IT strategic initiatives and other of $11 million. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) ​ 2024 ​ ​ ​ 2023 ​ ​ ​ $ ​ ​ ​ % Selling, general and administrative expenses ​ $ 1,082,344 ​ $ 1,001,656 ​ $ 80,688 ​ 8.1 % As a % of net revenue ​ ​ 40.4% ​ ​ 39.2% ​ ​ ​ ​ ​ Goodwill impairment charge ​ $ 307,112 ​ $ — ​ $ 307,112 ​ NM % Acquisition-related charges and intangible amortization ​ $ 61,848 ​ $ 74,797 ​ $ (12,949) ​ (17.3) % Exit and realignment charges, net ​ $ 46,806 ​ $ 7,336 ​ $ 39,470 ​ 538.0 % NM - Not meaningful ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The increase in SG&A expenses was driven primarily by incremental costs to support the $128 million net revenue growth, along with future revenue growth, an increase in teammate incentive expense, excluding restricted stock, of $13 million.
On February 26, 2025, the Owens & Minor Board of Directors authorized a share repurchase program of up to $100 million over the next 24 months.
On February 26, 2025, our Board of Directors authorized a share repurchase program of up to $100 million over the next two years. Under the program, we may repurchase shares of common stock on a discretionary basis from time to time through open market repurchases, privately negotiated transactions and 10b5-1 trading plans.
Net (loss) per share was not impacted as compared to the prior year by foreign currency translation for the year ended December 31, 2024. Products & Healthcare Services segment operating income was $53 million for the year ended December 31, 2024, compared to $58 million for the year ended December 31, 2023.
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.
Loss (gain) on extinguishment of debt. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) 2024 2023 $ % Loss (gain) on extinguishment of debt ​ $ 1,101 ​ $ (3,518) ​ $ 4,619 ​ 131.3 % ​ Loss on extinguishment of debt for the year ended December 31, 2024 represents the loss associated with early retirement of indebtedness of $45 million for our Term Loan A.
Other expense, net for the years ended December 31, 2024 and 2023 includes a $1.1 million loss on extinguishment of debt and a $3.5 million gain on extinguishment of debt, as well as interest cost and net actuarial losses related to our U.S. retirement plan.
We regularly evaluate market conditions, our liquidity profile and various financing alternatives to enhance our capital structure.
On June 10, 2025 (the Redemption Date), the New Notes were redeemed in full at a price equal to 100% of the aggregate principal amount of the New Notes, plus accrued and unpaid interest to, but excluding the Redemption Date. ​ We regularly evaluate market conditions, our liquidity profile and various financing alternatives to enhance our capital structure.
Removed
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Management’s discussion and analysis of financial condition and results of operations is intended to assist the reader in the understanding and assessment of significant changes and trends related to our results of operations.
Added
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 34 Table of Contents 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.
Removed
The discussion and analysis presented below refers to, and should be read in conjunction with, the consolidated financial statements and accompanying notes included in Item 8 of Part II of this Annual Report on Form 10-K. Overview Owens & Minor, Inc., along with its subsidiaries, is a global healthcare solutions company.
Added
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.
Removed
We report our business under two segments: Products & Healthcare Services and Patient Direct. The Products & Healthcare Services segment includes our U.S. distribution division (Medical Distribution), including outsourced logistics and value-added services, and our Global Products division which manufactures and sources medical surgical products through our production and kitting operations.
Added
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.
Removed
These were partiall y offset by lower acquisition-related charges and intangible amortization of $14 million, lower interest expense of $14 million, and an increase in Patient Direct segment operating income as described below for the year ended December 31, 2024 as compared to the prior year.
Added
(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.
Removed
The decline for the year ended December 31, 2024 as compared to the prior year was primarily due to (1) increased teammate benefit costs of $15 million and (2) competitive pricing pressures, including glove pricing, partially offset by revenue growth of 3.1% and savings derived by our sourcing initiatives of $15 million.
Added
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.
Removed
Patient Direct segment operating income was $260 million for the year ended December 31, 2024, compared to $247 million for the year ended December 31, 2023.
Added
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.
Removed
The increase for the year ended December 31, 2024 as compared to the prior year was primarily due to (1) 5.0% net revenue growth, (2) cost savings from IT strategic initiatives of $16 million, and (3) a benefit of $5.4 million from an agreement with Philips Respironics (Philips) for previously recalled equipment , partially offset by increased teammate benefit costs of $26 million and unfavorable changes in revenue mix.
Added
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.
Removed
Segment operating incomes exclude adjustments noted in Note 16, “Segments”, in the Notes to Consolidated Financial Statements.
Added
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.
Removed
There is no set timetable for the potential sale and there can be no assurance that we will complete a transaction. Expected Acquisition of Rotech On July 22, 2024, we entered into an Agreement and Plan of Merger to acquire Rotech for $1.36 billion in cash.
Added
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).
Removed
Given anticipated tax benefits of approximately $40 million from the transaction, the net purchase price is approximately $1.32 billion. Rotech is a national leader in providing home medical equipment in the US. The definitive agreement contains certain termination rights for the Company and Rotech.
Added
In accordance with the terms of the Termination Agreement, on June 5, 2025, we made a cash payment to Rotech of $80 million. 35 Table of Contents 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.
Removed
In the event that we terminate the contract, we will be required to pay Rotech a termination fee of $70 million. The transaction is subject to customary closing conditions, including expiration or termination of the applicable waiting period under the Hart Scott Rodino Act, and is expected to close in the first half of 2025.
Added
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.
Removed
We have fully committed financing in place and expect to use a combination of cash and incremental borrowings to fund the purchase price.
Added
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.
Removed
Philips Respironics Recall In June 2021, one of Apria’s suppliers, Philips, announced a voluntary recall of its continuous and non-continuous ventilators (certain continuous positive airway pressure (CPAP), bilevel positive airway pressure and ventilator devices) related to polyurethane foam used in those devices, which the U.S.
Added
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.
Removed
Food and Drug Administration (FDA) identified as a Class I recall, the most serious category of recall (the June 2021 Recall). In December 2022, Philips issued a subsequent voluntary recall related to deficiencies in repairs made to certain of the ventilators that had originally been recalled in June 2021 (together with the June 2021 recall, the Recall).
Added
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. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) ​ 2025 ​ ​ ​ 2024 ​ ​ ​ $ ​ ​ ​ % ​ Diabetes ​ $ 783,370 ​ $ 777,483 ​ $ 5,887 ​ 0.8 % Sleep therapy ​ 740,052 ​ 702,950 ​ ​ 37,102 ​ 5.3 % Home respiratory therapy ​ ​ 433,050 ​ ​ 435,954 ​ ​ (2,904) ​ (0.7) % Ostomy ​ ​ 212,838 ​ ​ 195,923 ​ ​ 16,915 ​ 8.6 % Wound care ​ ​ 188,508 ​ ​ 192,407 ​ ​ (3,899) ​ (2.0) % Urology ​ ​ 116,022 ​ ​ 107,121 ​ ​ 8,901 ​ 8.3 % Other ​ ​ 288,192 ​ ​ 268,274 ​ ​ 19,918 ​ 7.4 % Net revenue ​ $ 2,762,032 ​ $ 2,680,112 ​ $ 81,920 ​ 3.1 % ​ 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.
Removed
In April 2024, Philips entered into a consent decree enjoining Philips from making and distributing non-medically necessary CPAP, bilevel positive airway pressure and ventilator devices at any of its Sleep and Respiratory Care Business facilities until the FDA determines that Philips has complied with the remediation and compliance activities set forth in the consent decree.
Added
The growth in these categories includes the benefits from certain successful sales activities including our Sleep Journey Initiative .
Removed
We have incurred significant costs coordinating the Recall. During the second quarter of 2024, we reached an agreement with Philips requiring Philips to pay us for recalled equipment returned to Philips.
Added
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. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended ​ ​ ​ ​ ​ ​ ​ December 31, ​ Change (Dollars in thousands) ​ 2024 ​ ​ ​ 2023 ​ ​ ​ $ ​ ​ ​ % ​ Diabetes ​ $ 777,483 ​ $ 723,318 ​ $ 54,165 ​ 7.5 % Sleep therapy ​ 702,950 ​ 669,784 ​ ​ 33,166 ​ 5.0 % Home respiratory therapy ​ ​ 435,954 ​ ​ 457,675 ​ ​ (21,721) ​ (4.7) % Ostomy ​ ​ 195,923 ​ ​ 177,890 ​ ​ 18,033 ​ 10.1 % Wound care ​ ​ 192,407 ​ ​ 170,949 ​ ​ 21,458 ​ 12.6 % Urology ​ ​ 107,121 ​ ​ 97,985 ​ ​ 9,136 ​ 9.3 % Other ​ ​ 268,274 ​ ​ 254,971 ​ ​ 13,303 ​ 5.2 % Net revenue ​ $ 2,680,112 ​ $ 2,552,572 ​ $ 127,540 ​ 5.0 % 36 Table of Contents ​ 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.
Removed
During the year ended December 31, 2024, we received $18 million from Philips which was recorded in the ‘Other, net’ line item within investing activities of the consolidated statements of cash flows.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−4 removed0 unchanged
Biggest changeExcluding deferred financing costs and third party fees, we had $326 million in borrowings under our Term Loan A, $511 million in borrowings under our Term Loan B, no outstanding borrowings under our Revolving Credit Agreement, $70 million of uncollected accounts receivable under our Receivables Sale Program, and no uncollected accounts receivable under our RPA at December 31, 2024.
Biggest changeExcluding deferred financing costs and third party fees, we had $326 million in borrowings under our Term Loan A, $511 million in borrowings under our Term Loan B, $204 million in outstanding borrowings under our Revolving Credit Agreement and $134 million of uncollected accounts receivable under our Amended Receivables Sale Program at December 31, 2025.
After considering the effects of our interest rate swap agreement (See Note 11 in the Notes to Consolidated Financial Statements), we estimate an increase in interest rates of 100 basis points would result in a potential reduction in future pre-tax earnings of approximately $6.1 million per year based on our borrowings and uncollected accounts receivable sold under our Receivables Sale Program at December 31, 2024.
After considering the effects of our interest rate swap agreement (See Note 11 in the Notes to Consolidated Financial Statements), we estimate an increase in interest rates of 100 basis points would result in a potential reduction in future pre-tax earnings of approximately $9.2 million per year based on our borrowings and uncollected accounts receivable sold under our Amended Receivables Sale Program at December 31, 2025.
We are exposed to market risk from changes in interest rates related to our borrowing under our Revolving Credit Agreement, and related to our participation in the Receivables Sale Program, and RPA.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to market risk from changes in interest rates related to our borrowing under our Revolving Credit Agreement, and related to our participation in the Amended Receivables Sale Program.
Removed
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are subject to price risk for our raw materials, the most significant of which relates to the cost of polypropylene and nitrile used in the manufacturing processes of our Products & Healthcare Services segment.
Removed
Prices of the commodities underlying these raw materials are volatile and have fluctuated significantly in recent years and in the future may contribute to fluctuations in our results of operations. The ability to hedge these commodity prices is limited. In the normal course of business, we are exposed to foreign currency translation and transaction risks.
Removed
Our business transactions outside of the U.S. are denominated in the euro, Malaysian ringgit, Mexican peso, thai baht and 54 Table of Contents other currencies. We may use foreign currency forwards, swaps and options, where possible, to manage our risk related to certain foreign currency fluctuations.
Removed
As of December 31, 2024 and 2023, we held contracts with notional amounts of $43 million and $78 million to exchange the U.S. dollar, euro, thai baht and other currencies. See Note 11 in the Notes to Consolidated Financial Statements.

Other ACH 10-K year-over-year comparisons