CVS Health Corp. beat estimates for second-quarter profit and sales, a sign of strength as the drugstore chain cuts staff to reduce costs and focuses on broadening its health-care offerings.
(Bloomberg) — CVS Health Corp. beat estimates for second-quarter profit and sales, a sign of strength as the drugstore chain cuts staff to reduce costs and focuses on broadening its health-care offerings.
Adjusted earnings for the quarter were $2.21 a share, according to a statement Wednesday, beating the $2.10 average estimate of analysts surveyed by Bloomberg. Revenue rose 10% from a year ago to $88.9 billion, also exceeding estimates. The company maintained its annual adjusted profit forecast of $8.50 to 8.70 a share.Â
CVS has been taking steps to move away from its retail roots and expand further into other dimensions of health care, in part with the recent acquisitions of home health-care provider Signify Health Inc. and primary care company Oak Street Health Inc. On Tuesday, the company said it would cut 5,000 jobs from its workforce of 300,000 as part of an initiative to re-prioritize investments around care delivery and technology.
The shares rose 1.4% before US markets opened, after losing 21% this year through Tuesday’s close.
Sales in the pharmacy and consumer wellness segment beat estimates at $28.8 billion in the quarter, while those in the health-services segment, the company’s largest, rose to $46.2 billion, also exceeding Wall Street views..Â
Revenue in the health insurance unit beat estimates at $26.7 billion, a 17% increase from the year earlier. The medical benefit ratio, a measure of how much premium revenue is spent on care, was 86.2%, while analysts had predicted 84.6%.
Â
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.