“CVS Health Exceeds First Quarter Expectations on Strength of Medicare Business”

CVS Health raised its 2025 forecast above the expectations of Wall Street. The better-than-expected first quarter was partly attributed to improvements in Medicare benefits.

The health care company also received a boost from improved star ratings for its Medicare Advantage plans, which are privately operated variations of the government coverage program.

CVS Health, along with other health insurance providers, has been facing challenges due to escalating costs from their Medicare Advantage clientele. This announcement by the company follows a recent move by rival UnitedHealth, which lowered its 2025 forecast as a response to increased care utilization.

Overall, CVS Health booked adjusted earnings of $2.25 per share as the company’s profit soared 60% to $1.78 billion in the year’s first quarter. Total revenue climbed 7% to $94.59 billion.

Analysts expect earnings of $1.70 per share on $93.66 billion in revenue for the first quarter, according to the data firm FactSet.

For the full year, CVS Health now expects adjusted earnings to range from $6 to $6.20 per share.

The company forecast in February adjusted earnings of $5.75 to $6 per share. Analysts expect $5.92.

CVS Health Corp., based in Woonsocket, Rhode Island, runs one of the nation’s largest drugstore chains and a huge pharmacy benefit management business that operates prescription drug coverage for employers, insurers and other big clients. It also covers 27 million people through its Aetna insurance arm.

The company also said Thursday that it would leave the Affordable Care Act’s individual marketplaces next year. It currently covers about a million people in that market across 17 states.

Company shares jumped 10% to $73.55 before markets opened Thursday.

The stock has already climbed more than 48% so far in 2025 after sinking by deeper than 40% last year. CVS Health’s rough 2024 included several guidance cuts and the resignation of former CEO Karen Lynch.