Elevance Health (ELV) Q4 2024 earnings summary

Executive summary

• Fourth quarter and full-year 2024 results aligned with guidance, with operating revenue of $45.0B for Q4 and $175.2B for the year, up 6% and 3% year-over-year, respectively.

• Adjusted diluted EPS was $3.84 for Q4 and $33.04 for the year, nearly flat year-over-year and in line with expectations.

• Medicaid cost trends remained elevated but stable; Medicare Advantage saw strong retention and is expected to grow 7%-9% in 2025.

• Commercial business showed robust performance with record retention and over 30% growth in individual exchange business.

• Carelon segment experienced significant internal and external growth, with the CareBridge and Kroger Specialty Pharmacy acquisitions expanding home health and pharmacy capabilities.

Financial highlights

• Membership ended at 45.7M, down 2% year-over-year due to Medicaid redeterminations, but flat sequentially.

• Consolidated benefit expense ratio for Q4 was 92.4%; full-year ratio was 88.5%, up 150 bps year-over-year due to higher Medicaid costs.

• Adjusted operating expense ratio improved to 9.9% in Q4 and 10.6% for the year, down 70 bps year-over-year.

• Operating cash flow for 2024 was $5.8B, about 1.0x net income; days in claims payable was 42.9 days.

• $2.9B in share repurchases for the year, with $1.8B in Q4; $9.3B in repurchase authorization remains.

Outlook and guidance

• 2025 adjusted diluted EPS guidance is $34.15–$34.85; GAAP diluted EPS outlook is $30.40–$31.10.

• Projected year-end 2025 medical membership of 45.75–46.6M, with Medicare Advantage membership expected at 2.2–2.25M.

• Operating revenue expected to grow high single- to low double-digit percent, aided by premium yield increases and acquisitions.

• Consolidated medical loss ratio (MLR) expected around 89.1% ±50 bps, up 60 bps year-over-year, reflecting persistent Medicaid cost trends and business mix.

• Operating cash flow for 2025 anticipated at ~$8B; $2.3B planned for share repurchases.