From CNBC:

CVS Health has reported fourth-quarter revenue and earnings that surpassed expectations, but the company has cut its full-year profit outlook due to rising medical costs. The company now expects adjusted earnings of at least $8.30 per share, down from previous guidance of at least $8.50 per share. This comes as medical costs continue to rise throughout the healthcare and insurance industry.

Despite exceeding Wall Street expectations with earnings per share of $2.12 and revenue of $93.81 billion for the quarter, CVS’s profit shrunk from the previous year. The company reported a net income of $2.05 billion for the fourth quarter, compared to $2.33 billion in the same period a year ago. CVS attributes its reduced profit forecast to high medical costs and the potential implications for 2024.

The health services business segment for CVS was a strong point, generating $49.15 billion in revenue for the fourth quarter, a 12.3% increase compared to the same quarter the previous year. This significant growth was fueled in part by increased sales in specialty pharmacy services, and the recent acquisitions of health-care providers like Signify Health and Oak Street Health.

CVS’s health insurance segment increased to $26.73 billion during the quarter, approximately a 16% rise from the same period in 2022. This includes plans by Aetna for Affordable Care Act, Medicare Advantage, Medicaid, and other health services. However, the insurance segment’s medical benefit ratio increased to 88.5% from 85.8% a year earlier. This is mainly due to increased utilization in Medicare Advantage and other benefits.



Read more: CVS Heath (CVS) Q4 2023 earnings