Groowe Groowe BETA / Newsroom
⏱ News is delayed by 15 minutes. Sign in for real-time access. Sign in

CVS HEALTH CORPORATION REPORTS STRONG FIRST QUARTER 2026 RESULTS AND RAISES FULL-YEAR 2026 GUIDANCE

prnewswire.com

CVS HEALTH CORPORATION REPORTS STRONG FIRST QUARTER 2026 RESULTS AND RAISES FULL-YEAR 2026 GUIDANCE WOONSOCKET, R.I., May 6, 2026 /PRNewswire/ -- CVS Health Corporation (NYSE: CVS) today announced operating results for the three months ended March 31, 2026.

"CVS Health continues to provide what people want most from health care: a connected, convenient, cost-effective engagement experience across our unique collection of businesses. We build trust every day in communities across the country by providing better access, affordability and care to nearly 185 million people. Our positive performance is driven by strong execution across our enterprise. We will continue to build momentum through delivering on our strategy and a steadfast focus on our purpose - to simplify health care one person, one family and one community at a time."

- David Joyner, CVS Health Chairman and CEO

Three Months Ended

March 31,

Year Ending

December 31,

In billions, except per share amounts

2026

2025

2026 Projected

Total revenues

$ 100.4

$ 94.6

At least $405.0

Diluted earnings per share

$ 2.30

$ 1.41

$6.24-$6.44

Adjusted EPS (2)

$ 2.57

$ 2.25

$7.30-$7.50

Cash flow from operations

$ 4.2

$ 4.6

At least $9.5

First quarter GAAP diluted EPS of $2.30 increased from $1.41 in the prior year. Adjusted EPS of $2.57 increased from $2.25 in the prior year, primarily due to improved adjusted operating income in the Health Care Benefits segment, reflecting continued execution on the Health Care Benefits segment margin recovery plan.

The Company is increasing its full-year 2026 GAAP diluted EPS, Adjusted EPS and cash flow from operations guidance to reflect increases in the Health Care Benefits and Pharmacy & Consumer Wellness segments, while maintaining a cautious view for the remainder of the year in light of continued elevated cost trends and the potential for macro headwinds.

Consolidated first quarter results

Three Months Ended

March 31,

In millions, except per share amounts

2026

2025

Change

Total revenues

$ 100,426

$ 94,588

$ 5,838

Operating income

4,680

3,374

1,306

Adjusted operating income (1)

5,150

4,579

571

Net income

2,957

1,782

1,175

Diluted earnings per share

$ 2.30

$ 1.41

$ 0.89

Adjusted EPS (2)

$ 2.57

$ 2.25

$ 0.32

For the three months ended March 31, 2026 compared to the prior year:

Operational Updates

Health Care Benefits segment

The Health Care Benefits segment offers a full range of insured and self-insured ("ASC") medical, pharmacy, dental and behavioral health products and services. The segment results for the three months ended March 31, 2026 and 2025 were as follows:

Three Months Ended

March 31,

In millions, except percentages

2026

2025

Change

Total revenues

$ 35,971

$ 34,810

$ 1,161

Adjusted operating income (1)

3,041

1,993

1,048

Medical benefit ratio ("MBR") (3)

84.6 %

87.3 %

(2.7) %

Medical membership (4)

26.0

27.1

(1.1)

Health Services segment

The Health Services segment provides a full range of pharmacy benefit management solutions, delivers health care services in its medical clinics, virtually, and in the home, and offers provider enablement solutions. The segment results for the three months ended March 31, 2026 and 2025 were as follows:

Three Months Ended

March 31,

In millions

2026

2025

Change

Total revenues

$ 48,237

$ 43,462

$ 4,775

Adjusted operating income (1)

1,489

1,603

(114)

Pharmacy claims processed (5) (6)

464.7

464.2

0.5

Pharmacy & Consumer Wellness segment

The Pharmacy & Consumer Wellness segment dispenses prescriptions in its retail pharmacies and through its infusion operations, provides ancillary pharmacy services including pharmacy patient care programs and vaccination administration, and sells a wide assortment of health and wellness products and general merchandise. The segment also provides pharmacy fulfillment services to support the Health Services segment's specialty and mail order pharmacy offerings. The segment results for the three months ended March 31, 2026 and 2025 were as follows:

Three Months Ended

March 31,

In millions

2026

2025

Change

Total revenues

$ 31,989

$ 31,912

$ 77

Adjusted operating income (1)

1,197

1,313

(116)

Prescriptions filled (5) (6)

451.2

435.5

15.7

About CVS Health

CVS Health is a leading health solutions company simplifying health care one person, one family and one community at a time. As of March 31, 2026, the Company had approximately 9,000 retail pharmacy locations, more than 1,000 walk-in and primary care medical clinics and a leading pharmacy benefits manager with approximately 88 million plan members. The Company also serves an estimated more than 37 million people through a broad range of health insurance products and related services. The Company's integrated model uses personalized, technology driven services to connect people to simply better health, increasing access to quality care, delivering better outcomes, and lowering overall costs.

Teleconference and Webcast

The Company will be holding a conference call today for investors at 8:00 a.m. (Eastern Time) to discuss its first quarter results. An audio webcast of the call will be broadcast simultaneously for all interested parties through the Investor Relations section of the CVS Health website at http://investors.cvshealth.com. This webcast will be archived and available on the website for a one-year period following the conference call.

Non-GAAP Financial Information

The Company presents both GAAP and non-GAAP financial measures in this press release to assist in the comparison of the Company's past financial performance with its current financial performance. See "Non-GAAP Financial Information" beginning on page 10 and endnotes beginning on page 19 for explanations of non-GAAP financial measures presented in this press release. See pages 12 through 13 and page 18 for reconciliations of each non-GAAP financial measure used in this release to the most directly comparable GAAP financial measure.

Cautionary Statement Concerning Forward-looking Statements

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of CVS Health Corporation. Statements in this press release that are forward-looking include, but are not limited to, the full-year 2026 guidance information, Mr. Joyner's quotation and the information included in the reconciliations and endnotes. By their nature, all forward-looking statements are not guarantees of future performance or results and are subject to risks and uncertainties that are difficult to predict and/or quantify. Actual results may differ materially from those contemplated by the forward-looking statements due to the risks and uncertainties described in our Securities and Exchange Commission ("SEC") filings, including those set forth in the Risk Factors section and under the heading "Cautionary Statement Concerning Forward-Looking Statements" in our most recently filed Annual Report on Form 10-K, our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2026 and our Current Reports on Form 8-K.

You are cautioned not to place undue reliance on CVS Health's forward-looking statements. CVS Health's forward-looking statements are and will be based upon management's then-current views and assumptions regarding future events and operating performance, and are applicable only as of the dates of such statements. CVS Health does not assume any duty to update or revise forward-looking statements, whether as a result of new information, future events, uncertainties or otherwise.

- Tables Follow -

CVS HEALTH CORPORATION

Condensed Consolidated Statements of Operations

(Unaudited)

Three Months Ended

March 31,

In millions, except per share amounts

2026

2025

Revenues:

Products

$ 62,226

$ 57,669

Premiums

33,791

32,820

Services

3,835

3,579

Net investment income

574

520

Total revenues

100,426

94,588

Operating costs:

Cost of products sold

55,444

51,057

Health care costs

29,358

29,135

Operating expenses

10,944

11,022

Total operating costs

95,746

91,214

Operating income

4,680

3,374

Interest expense

(774)

(785)

Other income

32

28

Income before income tax provision

3,938

2,617

Income tax provision

981

835

Net income

2,957

1,782

Net income attributable to noncontrolling interests

(14)

(3)

Net income attributable to CVS Health

$ 2,943

$ 1,779

Net income per share attributable to CVS Health:

Basic

$ 2.31

$ 1.41

Diluted

$ 2.30

$ 1.41

Weighted average shares outstanding:

Basic

1,273

1,261

Diluted

1,279

1,264

CVS HEALTH CORPORATION

Condensed Consolidated Balance Sheets

(Unaudited)

In millions

March 31,

2026

December 31,

2025

Assets:

Cash and cash equivalents

$ 9,542

$ 8,453

Investments

2,260

2,145

Accounts receivable, net

40,992

39,779

Inventories

17,770

19,246

Other current assets

4,253

5,091

Total current assets

74,817

74,714

Long-term investments

32,407

32,669

Property and equipment, net

13,037

13,083

Operating lease right-of-use assets

14,741

14,973

Goodwill

85,478

85,478

Intangible assets, net

25,070

25,508

Other assets

7,424

7,113

Total assets

$ 252,974

$ 253,538

Liabilities:

Accounts payable

$ 16,922

$ 17,641

Pharmacy claims and discounts payable

26,149

26,344

Health care costs payable

15,518

15,399

Accrued expenses and other current liabilities

22,258

22,387

Other insurance liabilities

1,075

1,116

Current portion of operating lease liabilities

1,904

1,737

Current portion of long-term debt

2,580

4,068

Total current liabilities

86,406

88,692

Long-term operating lease liabilities

13,330

13,643

Long-term debt

60,531

60,502

Deferred income taxes

3,771

3,832

Other long-term insurance liabilities

4,592

4,716

Other long-term liabilities

6,707

6,771

Total liabilities

175,337

178,156

Shareholders' equity:

Preferred stock

Common stock and capital surplus

50,679

50,402

Treasury stock

(36,706)

(36,790)

Retained earnings

63,282

61,196

Accumulated other comprehensive income

201

406

Total CVS Health shareholders' equity

77,456

75,214

Noncontrolling interests

181

168

Total shareholders' equity

77,637

75,382

Total liabilities and shareholders' equity

$ 252,974

$ 253,538

CVS HEALTH CORPORATION

Condensed Consolidated Statements of Cash Flows

(Unaudited)

Three Months Ended

March 31,

In millions

2026

2025

Cash flows from operating activities:

Reconciliation of net income to net cash provided by operating activities:

Net income

$ 2,957

$ 1,782

Adjustments required to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

1,115

1,154

Stock-based compensation

266

126

Loss on sale of subsidiary

236

Deferred income taxes and other items

(91)

(169)

Change in operating assets and liabilities

2

1,427

Net cash provided by operating activities

4,249

4,556

Cash flows from investing activities:

Proceeds from sales and maturities of investments

4,159

3,534

Purchases of investments

(4,186)

(3,552)

Purchases of property and equipment

(849)

(743)

Acquisitions

(5)

(20)

Other

7

19

Net cash used in investing activities

(874)

(762)

Cash flows from financing activities:

Commercial paper borrowings (repayments), net

(859)

Repayments of long-term debt

(1,518)

(743)

Dividends paid

(847)

(840)

Proceeds from exercise of stock options

103

144

Payments for taxes related to net share settlement of equity awards

(9)

(11)

Other

(47)

(23)

Net cash used in financing activities

(2,318)

(2,332)

Net increase in cash, cash equivalents and restricted cash

1,057

1,462

Cash, cash equivalents and restricted cash at the beginning of the period

8,712

8,884

Cash, cash equivalents and restricted cash at the end of the period

$ 9,769

$ 10,346

Non-GAAP Financial Information

The Company uses non-GAAP financial measures to analyze underlying business performance and trends. The Company believes that providing these non-GAAP financial measures enhances the Company's and investors' ability to compare the Company's past financial performance with its current and expected future performance. These non-GAAP financial measures, which are included in this press release and which may be referred to on the conference call discussing the Company's first quarter financial results, are provided as supplemental information to the financial measures presented in this press release and discussed on the conference call that are calculated and presented in accordance with GAAP. Non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures determined or calculated in accordance with GAAP. The Company's definitions of its non-GAAP financial measures may not be comparable to similarly titled measures reported by other companies.

Non-GAAP financial measures such as consolidated adjusted operating income, adjusted earnings per share ("EPS") and adjusted income attributable to CVS Health exclude from the relevant GAAP metrics, as applicable: amortization of intangible assets, net realized capital gains or losses and other items, if any, that neither relate to the ordinary course of the Company's business nor reflect the Company's underlying business performance.

For the periods covered in this press release, the following items are excluded from the non-GAAP financial measures described above, as applicable, because the Company believes they neither relate to the ordinary course of the Company's business nor reflect the Company's underlying business performance:

See endnotes (1) and (2) on page 19 for definitions of non-GAAP financial measures. Reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure are presented on pages 12 through 13 and page 18.

Reconciliations of Non-GAAP Financial Measures to the Most Directly Comparable GAAP Financial Measures

Adjusted Operating Income

(Unaudited)

The following are reconciliations of consolidated operating income (GAAP measure) to consolidated adjusted operating income, as well as reconciliations of segment GAAP operating income (loss) to segment adjusted operating income (loss):

Three Months Ended March 31, 2026

In millions

Health Care

Benefits

Health

Services

Pharmacy &

Consumer

Wellness

Corporate/

Other

Consolidated

Totals

Operating income (loss) (GAAP measure)

$ 2,806

$ 1,347

$ 1,134

$ (607)

$ 4,680

Amortization of intangible assets

236

142

63

1

442

Net realized capital (gains) losses

(1)

17

16

Acquisition-related integration costs

12

12

Adjusted operating income (loss) (1)

$ 3,041

$ 1,489

$ 1,197

$ (577)

$ 5,150

Three Months Ended March 31, 2025

In millions

Health

Care

Benefits

Health

Services

Pharmacy &

Consumer

Wellness

Corporate/

Other

Consolidated

Totals

Operating income (loss) (GAAP measure)

$ 1,674

$ 1,227

$ 864

$ (391)

$ 3,374

Amortization of intangible assets

294

144

60

1

499

Net realized capital (gains) losses

21

(15)

15

21

Acquisition-related integration costs

45

45

Legacy litigation charge

387

387

Loss on Accountable Care assets

247

247

Office real estate optimization charges

4

2

6

Adjusted operating income (loss) (1)

$ 1,993

$ 1,603

$ 1,313

$ (330)

$ 4,579

Adjusted Earnings Per Share

(Unaudited)

The following are reconciliations of net income attributable to CVS Health to adjusted income attributable to CVS Health and calculations of GAAP diluted EPS and Adjusted EPS:

Three Months Ended

March 31, 2026

Three Months Ended

March 31, 2025

In millions, except per share amounts

Total

Company

Per

Common

Share

Total

Company

Per

Common

Share

Net income attributable to CVS Health (GAAP measure)

$ 2,943

$ 2.30

$ 1,779

$ 1.41

Amortization of intangible assets

442

0.35

499

0.39

Net realized capital losses

16

0.01

21

0.02

Acquisition-related integration costs

12

0.01

45

0.04

Legacy litigation charge

387

0.30

Loss on Accountable Care assets

247

0.19

Office real estate optimization charges

6

0.01

Tax impact of non-GAAP adjustments

(121)

(0.10)

(140)

(0.11)

Adjusted income attributable to CVS Health (2)

$ 3,292

$ 2.57

$ 2,844

$ 2.25

Weighted average diluted shares outstanding

1,279

1,264

Supplemental Information

(Unaudited)

The following are reconciliations of financial measures of the Company's segments to the consolidated totals:

In millions

Health Care

Benefits

Health

Services

Pharmacy &

Consumer

Wellness

Corporate/

Other

Intersegment

Eliminations (a)

Consolidated

Totals

Three Months Ended

March 31, 2026

Total revenues

$ 35,971

$ 48,237

$ 31,989

$ 126

$ (15,897)

$ 100,426

Adjusted operating income (loss) (1)

3,041

1,489

1,197

(577)

5,150

March 31, 2025

Total revenues

$ 34,810

$ 43,462

$ 31,912

$ 133

$ (15,729)

$ 94,588

Adjusted operating income (loss) (1)

1,993

1,603

1,313

(330)

4,579

_____________________________________________

(a)

Intersegment revenue eliminations relate to intersegment revenue generating activities that occur between the Health Care Benefits segment, the Health Services segment, and/or the Pharmacy & Consumer Wellness segment.

Supplemental Information

(Unaudited)

Health Care Benefits segment

The following table summarizes the Health Care Benefits segment's performance for the respective periods:

Three Months Ended

March 31,

Change

In millions, except percentages and basis points ("bps")

2026

2025

$

%

Revenues:

Premiums

$ 33,792

$ 32,808

$ 984

3.0 %

Services

1,717

1,615

102

6.3 %

Net investment income

462

387

75

19.4 %

Total revenues

35,971

34,810

1,161

3.3 %

Health care costs

28,579

28,637

(58)

(0.2) %

MBR (Health care costs as a % of premium revenues) (3)

84.6 %

87.3 %

(270)

bps

Operating expenses

$ 4,586

$ 4,499

$ 87

1.9 %

Operating expenses as a % of total revenues

12.7 %

12.9 %

Operating income

$ 2,806

$ 1,674

$ 1,132

67.6 %

Operating income as a % of total revenues

7.8 %

4.8 %

Adjusted operating income (1)

$ 3,041

$ 1,993

$ 1,048

52.6 %

Adjusted operating income as a % of total revenues

8.5 %

5.7 %

Premium revenues (by business):

Government

$ 27,783

$ 24,902

$ 2,881

11.6 %

Commercial

6,009

7,906

(1,897)

(24.0) %

The following table summarizes the Health Care Benefits segment's medical membership for the respective periods:

March 31, 2026

December 31, 2025

March 31, 2025

In thousands

Insured

ASC

Total

Insured

ASC

Total

Insured

ASC

Total

Medical membership: (4)

Commercial

2,462

15,872

18,334

3,447

15,350

18,797

3,961

15,250

19,211

Medicare Advantage

4,175

4,175

4,267

4,267

4,220

4,220

Medicare Supplement

1,192

1,192

1,202

1,202

1,253

1,253

Medicaid

1,938

366

2,304

1,952

373

2,325

1,983

412

2,395

Total medical membership

9,767

16,238

26,005

10,868

15,723

26,591

11,417

15,662

27,079

Supplemental membership information:

Medicare Prescription Drug Plan (stand-alone)

3,889

4,041

4,094

The following table summarizes the Health Care Benefits segment's days claims payable for the respective periods:

March 31, 2026

December 31, 2025

March 31, 2025

Days Claims Payable (7)

42.9

38.9

43.2

Supplemental Information

(Unaudited)

Health Services segment

The following table summarizes the Health Services segment's performance for the respective periods:

Three Months Ended

March 31,

Change

In millions, except percentages

2026

2025

$

%

Revenues:

Products

$ 45,726

$ 41,135

$ 4,591

11.2 %

Services

2,511

2,313

198

8.6 %

Net investment income

14

(14)

(100.0) %

Total revenues

48,237

43,462

4,775

11.0 %

Cost of products sold

44,719

40,115

4,604

11.5 %

Health care costs

1,302

1,047

255

24.4 %

Gross profit (8)

2,216

2,300

(84)

(3.7) %

Gross margin (Gross profit as a % of total revenues) (8)

4.6 %

5.3 %

Operating expenses

$ 869

$ 1,073

$ (204)

(19.0) %

Operating expenses as a % of total revenues

1.8 %

2.5 %

Operating income

$ 1,347

$ 1,227

$ 120

9.8 %

Operating income as a % of total revenues

2.8 %

2.8 %

Adjusted operating income (1)

$ 1,489

$ 1,603

$ (114)

(7.1) %

Adjusted operating income as a % of total revenues

3.1 %

3.7 %

Pharmacy claims processed (5) (6)

464.7

464.2

0.5

0.1 %

Supplemental Information

(Unaudited)

Pharmacy & Consumer Wellness segment

The following table summarizes the Pharmacy & Consumer Wellness segment's performance for the respective periods:

Three Months Ended

March 31,

Change

In millions, except percentages

2026

2025

$

%

Revenues:

Products

$ 31,339

$ 31,285

$ 54

0.2 %

Services

650

627

23

3.7 %

Total revenues

31,989

31,912

77

0.2 %

Cost of products sold

25,790

25,804

(14)

(0.1) %

Gross profit (8)

6,199

6,108

91

1.5 %

Gross margin (Gross profit as a % of total revenues) (8)

19.4 %

19.1 %

Operating expenses

$ 5,065

$ 5,244

$ (179)

(3.4) %

Operating expenses as a % of total revenues

15.8 %

16.4 %

Operating income

$ 1,134

$ 864

$ 270

31.3 %

Operating income as a % of total revenues

3.5 %

2.7 %

Adjusted operating income (1)

$ 1,197

$ 1,313

$ (116)

(8.8) %

Adjusted operating income as a % of total revenues

3.7 %

4.1 %

Revenues (by major goods/service lines):

Pharmacy

$ 26,123

$ 26,076

$ 47

0.2 %

Front Store

5,259

5,243

16

0.3 %

Other

607

593

14

2.4 %

Prescriptions filled (5) (6)

451.2

435.5

15.7

3.6 %

Same store sales increase (decrease): (9)

Total

2.8 %

14.2 %

Pharmacy

3.1 %

17.7 %

Front Store

1.2 %

(0.3) %

Prescription volume (6)

6.8 %

6.7 %

Adjusted Earnings Per Share Guidance

(Unaudited)

The following reconciliations of projected net income attributable to CVS Health to projected adjusted income attributable to CVS Health and calculations of projected GAAP diluted EPS and projected Adjusted EPS contain forward-looking information. All forward-looking information involves risks and uncertainties. Actual results may differ materially from those contemplated by the forward-looking information for a number of reasons as described in our SEC filings, including those set forth in the Risk Factors section and under the heading "Cautionary Statement Concerning Forward-Looking Statements" in our most recently filed Annual Report on Form 10-K and our most recently filed Quarterly Report on Form 10-Q. See "Non-GAAP Financial Information" earlier in this press release and endnote (2) later in this press release for more information on how we calculate Adjusted EPS.

Year Ending

December 31, 2026

Low

High

In millions, except per share amounts

Total

Company

Per

Common

Share

Total

Company

Per

Common

Share

Net income attributable to CVS Health (GAAP measure)

$ 8,032

$ 6.24

$ 8,288

$ 6.44

Non-GAAP adjustments:

Amortization of intangible assets

1,730

1.35

1,730

1.35

Net realized capital losses

16

0.01

16

0.01

Acquisition-related integration costs

80

0.06

80

0.06

Tax impact of non-GAAP adjustments

(470)

(0.36)

(470)

(0.36)

Adjusted income attributable to CVS Health (2)

$ 9,388

$ 7.30

$ 9,644

$ 7.50

Weighted average diluted shares outstanding

1,286

1,286

Endnotes

(1) The Company defines adjusted operating income as operating income (GAAP measure) excluding the impact of amortization of intangible assets, net realized capital gains or losses and other items, if any, that neither relate to the ordinary course of the Company's business nor reflect the Company's underlying business performance, such as acquisition-related integration costs, certain legacy litigation charges, losses on Accountable Care assets and office real estate optimization charges. The chief operating decision maker (the "CODM") uses adjusted operating income as its principal measure of segment performance as it enhances the CODM's ability to compare past financial performance with current performance and analyze underlying business performance and trends. The consolidated measure is not determined in accordance with GAAP and should not be considered a substitute for, or superior to, the most directly comparable GAAP measure, consolidated operating income. See "Non-GAAP Financial Information" earlier in this press release for additional information regarding the items excluded from consolidated operating income in determining consolidated adjusted operating income.

(2) GAAP diluted earnings per share and Adjusted EPS, respectively, are calculated by dividing net income attributable to CVS Health and adjusted income attributable to CVS Health by the Company's weighted average diluted shares outstanding. The Company defines adjusted income attributable to CVS Health as net income attributable to CVS Health (GAAP measure) excluding the impact of amortization of intangible assets, net realized capital gains or losses and other items, if any, that neither relate to the ordinary course of the Company's business nor reflect the Company's underlying business performance, such as acquisition-related integration costs, certain legacy litigation charges, losses on Accountable Care assets, office real estate optimization charges, as well as the corresponding income tax benefit or expense related to the items excluded from adjusted income attributable to CVS Health. See "Non-GAAP Financial Information" earlier in this press release for additional information regarding the items excluded from net income attributable to CVS Health in determining adjusted income attributable to CVS Health.

(3) Medical benefit ratio is calculated by dividing the Health Care Benefits segment's health care costs by premium revenues and represents the percentage of premium revenues spent on medical benefits for the segment's insured members. Management uses MBR to assess the underlying business performance and underwriting of its insurance products, understand variances between actual results and expected results and identify trends in period-over-period results. MBR provides management and investors with information useful in assessing the operating results of the Health Care Benefits segment's insured products.

(4) Medical membership represents the number of members covered by the Health Care Benefits segment's insured and ASC medical products and related services at a specified point in time. Management uses this metric to understand variances between actual medical membership and expected amounts as well as trends in period-over-period results. This metric provides management and investors with information useful in understanding the impact of medical membership on the Health Care Benefits segment's total revenues and operating results.

(5) Pharmacy claims processed represents the number of prescription claims processed through the Company's pharmacy benefits manager and dispensed by either its retail network pharmacies or the Company's mail and specialty pharmacies. Prescriptions filled represents the number of prescriptions dispensed through the Pharmacy & Consumer Wellness segment's retail pharmacies and infusion services operations, as well as through the Omnicare long-term care pharmacies prior to their deconsolidation in September 2025. Management uses these metrics to understand variances between actual claims processed and prescriptions dispensed, respectively, and expected amounts as well as trends in period-over-period results. These metrics provide management and investors with information useful in understanding the impact of pharmacy claim volume and prescription volume, respectively, on segment total revenues and operating results.

(6) Includes an adjustment to convert 90-day prescriptions to the equivalent of three 30-day prescriptions. This adjustment reflects the fact that these prescriptions include approximately three times the amount of product days supplied compared to a normal prescription.

(7) Days claims payable is calculated by dividing the Health Care Benefits segment's health care costs payable at the end of each quarter by its average health care costs per day during such quarter. Management and investors use this metric as one of the indicators of the adequacy of the health care costs payable liability at the end of each quarter.

(8) Gross profit is calculated as the segment's total revenues less its cost of products sold, and, for the Health Services segment, health care costs. Gross margin is calculated by dividing the segment's gross profit by its total revenues and represents the percentage of total revenues that remains after incurring direct costs associated with the segment's products sold and services provided. Gross margin provides investors with information that may be useful in assessing the operating results of the Company's Health Services and Pharmacy & Consumer Wellness segments.

(9) Same store sales and prescription volume represent the change in revenues and prescriptions filled in the Company's retail pharmacy stores that have been operating for greater than one year and digital sales initiated online or through mobile applications and fulfilled through the Company's distribution centers, expressed as a percentage that indicates the increase or decrease relative to the comparable prior period. Same store metrics exclude revenues and prescriptions from infusion services operations and long-term care pharmacies. Management uses these metrics to evaluate the performance of existing stores on a comparable basis and to inform future decisions regarding existing stores and new locations. Same-store metrics provide management and investors with information useful in understanding the portion of current revenues and prescriptions resulting from organic growth in existing locations versus the portion resulting from opening new stores.

SOURCE CVS Health