CVS Q3 tops Street but takes $5.3B charge on struggling health care delivery unit
CVS Health Corp. easily topped Street estimates and raised its earnings outlook despite a big net loss on an goodwill impairment charge related to its health care delivery unit.
The company swung to a net loss of $3.98 billion, or $3.13 per share, for its quarter ended Sept. 30, compared to net income of $87 million in the year-ago period. Excluding the impairment charge, adjusted earnings were $1.60 per share, up from $1.09 last year and topping analysts’ estimates of $1.37.
Total third-quarter revenue rose 7.8% to a record $102.87 billion, easily beating analysts’ estimates of $98.81 billion. Revenue in CVS’s pharmacy and consumer wellness segment increased 11.7%, primarily driven by pharmacy drug mix and increased prescription volume, including incremental volume resulting from the company’s Rite Aid prescription file acquisitions, partially offset by continued pharmacy reimbursement pressure.
Revenue in the company’s health care benefits segment, which includes its Aetna insurance business, rose 9.1% to nearly $36 billion.
In its earnings statement, CVS said its health care delivery reporting unit has continued to experience "challenges which have impacted its ability to grow the business at the rate previously estimated.” The company said it has made several changes to unit’s management team and finalized strategic changes, including plans to reduce the number of primary care clinics it would open in 2026 and beyond. It also will close select Oak Street Health clinics.
CVS raised its 2025 guidance range for adjusted earnings to $6.55 to $6.65 per share, up from $6.30 to $6.40 per share. Cash flow from operations is now expected to be $7.5 billion to $8 billion, compared with its previous outlook of at least $7.5 billion.
"CVS Health uniquely delivers what the people we serve want the most: a connected, simpler experience that improves health and simplifies care," stated David Joyner, CVS Health president and CEO. "Our leadership team has stabilized operations and is focused on businesses and markets where we can succeed. As a result, we are making progress on our journey to be America's most trusted health care company. Our strong enterprise performance demonstrates the continued focus we have on operational and financial improvement across our businesses."
As of Sept. 30, 2025, 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 87 million plan members.
