The Cigna Group (CI) Q3 2024 earnings summary

Executive summary

• Total revenues for Q3 2024 rose 30% year-over-year to $63.7 billion, driven by strong growth in Evernorth Health Services and higher pharmacy revenues.

• Adjusted EPS for Q3 2024 was $7.51, up 11% year-over-year, with adjusted income from operations increasing 5% to $2.1 billion.

• Evernorth Health Services and Cigna Healthcare both contributed to growth, with Evernorth leading through innovation in specialty pharmacy and biosimilars.

• Shareholders' net income for Q3 2024 was $739 million ($2.63 per share), down 48% from Q3 2023, mainly due to a $2.7 billion impairment of VillageMD equity securities.

• The company entered a definitive agreement to sell its Medicare Advantage and related businesses for approximately $3.7 billion, expected to close in Q1 2025.

Financial highlights

• Q3 2024 consolidated revenues reached $63.7 billion (+30% YoY); adjusted EPS was $7.51 (+11% YoY).

• Evernorth Health Services adjusted revenues rose 36% year-over-year to $52.6 billion, with pre-tax adjusted income up 9% to $1.88 billion.

• Cigna Healthcare adjusted revenues increased 3% to $13.2 billion, but pre-tax adjusted income declined 4% to $1.17 billion; medical care ratio was 82.8%.

• Specialty and Care Services revenue rose 23% year-over-year to $23.8 billion, with adjusted earnings of $825 million.

• Year-to-date share repurchases totaled $5.7 billion, including $715 million in October; $5.6 billion repurchase authority remained as of October 30, 2024.

Outlook and guidance

• Reaffirmed full-year 2024 adjusted EPS guidance of at least $28.40.

• Evernorth expected to deliver at least $7 billion in pre-tax adjusted earnings for 2024; Cigna Healthcare at least $4.775 billion.

• 2025 EPS growth projected at a minimum of 10%, with tailwinds from biosimilars, new client wins, and Medicare sale proceeds.

• Cigna Healthcare medical care ratio expected between 81.7% and 82.5% for FY2024.

• No material impact expected from 2025 Medicare Advantage rates on consolidated results.