Financial Data and Key Metrics Changes - The company reported total revenue of $67.2 billion for the second quarter of 2025, with adjusted earnings per share (EPS) growing to $7.2, reflecting a sustained growth trajectory over the past three, five, and ten years with a compounded adjusted EPS growth of 10% to 14% [10][31][34] - The net after-tax special item charges amounted to $171 million, or $0.64 per share, impacting the overall financial results [6][31] Business Line Data and Key Metrics Changes - Cigna Healthcare's second quarter revenues were $10.8 billion, with pretax adjusted earnings of $1.1 billion and a medical care ratio of 83.2%, indicating stable performance despite elevated medical costs [33][20] - Evernorth's revenues grew to $57.8 billion, with pretax adjusted earnings reaching $1.7 billion, slightly ahead of expectations, driven by strong performance in specialty and care services [32][31] - Specialty and Care Services revenue increased by 13% to $25.9 billion, with adjusted earnings rising by 12% year-over-year, showcasing robust growth in specialty pharmacy and biosimilar adoption [32][24] Market Data and Key Metrics Changes - The individual exchange business faced pressures, leading to a strategic decision to prioritize margin over growth, resulting in a reduction of customers from nearly 1 million in 2023 to fewer than 400,000 in 2025 [62][61] - The specialty pharmacy market is projected to grow at high single digits annually, with Cigna expecting long-term average annual income growth of 8% to 11% across its specialty portfolio [26][24] Company Strategy and Development Direction - The company aims to build a more sustainable healthcare model by delivering innovative solutions that improve access and affordability for customers [8][10] - Cigna's strategy includes leveraging a diverse portfolio of businesses to capture value and drive growth, particularly through its Evernorth platform, which encompasses specialty care and pharmacy benefit services [14][18] - The company is focused on enhancing customer experience through technology, such as the introduction of an AI-powered virtual assistant [12][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the dynamic operating environment, characterized by elevated medical costs and regulatory activity, while reaffirming guidance for full-year 2025 adjusted EPS of at least $29.6 [8][34] - The leadership expressed confidence in the company's ability to navigate challenges and deliver sustainable growth, emphasizing the importance of public-private partnerships in addressing healthcare affordability [13][56] Other Important Information - The company continues to experience strong client retention and has secured multiyear renewals with major clients, indicating robust demand for its services [22][29] - Cigna's operating cash flow was impacted by working capital timing, but strong cash flow generation is anticipated in the second half of the year [35][36] Q&A Session Summary Question: Insights on commercial market positioning and pressures - Management highlighted the growing significance of pharmacy services in the overall medical cost equation, noting that pharmacy services now represent mid-20s percentage of total costs, with expectations for further growth [40][41] Question: 2026 selling season and legislative impacts - The company is tracking strong retention rates for its pharmacy benefit services and is focused on affordability and personalization in its offerings, while navigating legislative dynamics [48][50][54] Question: Update on individual exchange business and pricing strategies - Management confirmed a strategic shift to prioritize margin over growth in the individual exchange market, with expectations for further price increases in 2026 [62][63] Question: Impact of hospital billing and coding on commercial trends - Management acknowledged the sophistication in hospital billing and coding, noting it has not had an outsized impact on the stop-loss portfolio, which continues to perform in line with expectations [68][75]

Financial Data and Key Metrics Changes - The company reported total revenue of $67.2 billion for the second quarter of 2025, with adjusted earnings per share increasing to $7.2, reflecting a sustained growth trajectory of 10% to 14% compounded adjusted EPS over the last decade [9][31][32] - Net after-tax special item charges amounted to $171 million, or $0.64 per share, impacting the overall financial results [5] Business Line Data and Key Metrics Changes - Cigna Healthcare's second quarter revenues were $10.8 billion, with pretax adjusted earnings of $1.1 billion and a medical care ratio of 83.2%, indicating stable performance despite elevated medical costs [33][34] - Evernorth's revenues grew to $57.8 billion, with pretax adjusted earnings reaching $1.7 billion, slightly exceeding expectations [32] - Specialty and Care Services within Evernorth saw a revenue increase of 13% to $25.9 billion, with adjusted earnings rising 12% year-over-year [32][24] Market Data and Key Metrics Changes - The specialty pharmacy market is projected to grow at high single digits annually, with Cigna Group expecting long-term average annual income growth of 8% to 11% across its specialty portfolio [26] - The individual exchange enrollment has increased nearly 50% over the past two years, although Cigna's customer base in this segment has decreased significantly due to a strategic focus on margin over growth [66] Company Strategy and Development Direction - The company aims to deliver innovative solutions to improve access and affordability in healthcare, focusing on a sustainable healthcare model [7][10] - Cigna Group emphasizes public-private partnerships to enhance responsiveness to stakeholder needs and has introduced an AI-powered virtual assistant to improve customer experience [12][13] - The company is strategically positioned with a diverse portfolio of businesses, allowing for multiple pathways for growth and adaptability in a dynamic market [14][15] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the dynamic operating environment, characterized by elevated regulatory activity and challenges in health status, affordability, and access [10][11] - The company reaffirms its guidance for full-year 2025 adjusted earnings per share of at least $29.6, indicating confidence in its operational execution and market positioning [31][35] Other Important Information - The company has strategically chosen not to engage in Medicaid or Medicare, opting instead to serve these customers through its Evernorth services portfolio [20] - Cigna Group's operating cash flow was impacted by working capital timing, but strong cash flow generation is anticipated in the second half of the year [36] Q&A Session Summary Question: Insights on innovative products and commercial market positioning - Management highlighted the growing significance of pharmacy services in the overall medical cost equation, noting that pharmacy services now represent mid-20s percentage of total costs, with expectations for further growth [41][42] Question: 2026 selling season and pharmacy benefit renewals - The company anticipates strong retention rates for its pharmacy benefit services and continues to focus on affordability and personalization in its offerings [50][52] Question: Update on individual exchange business and risk adjustment accruals - Management confirmed a strategic choice to prioritize margin over growth in the individual exchange market, resulting in a significant reduction in customer base but improved financial performance [66][68] Question: Impact of hospital billing and coding on commercial trends - Management acknowledged the sophistication in hospital billing and coding, noting that while it impacts the employer book, it does not have an outsized effect on the stop-loss portfolio [72][80] Question: Market dynamics and competitive pricing environment - The pricing environment is characterized as firm, with expectations for price increases in 2026 that exceed those achieved in 2025, reflecting ongoing elevated cost trends [93]

Company Performance - Cigna reported quarterly earnings of $7.2 per share, exceeding the Zacks Consensus Estimate of $7.14 per share, and up from $6.72 per share a year ago, representing an earnings surprise of +0.84% [1] - The company posted revenues of $67.13 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 7.09%, compared to revenues of $60.47 billion in the same quarter last year [2] - Over the last four quarters, Cigna has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2] Stock Outlook - Cigna shares have increased approximately 7.9% since the beginning of the year, while the S&P 500 has gained 8.2% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for investors [4] - The current consensus EPS estimate for the coming quarter is $7.93 on revenues of $64.08 billion, and for the current fiscal year, it is $29.68 on revenues of $258.19 billion [7] Industry Context - The Medical - HMOs industry, to which Cigna belongs, is currently ranked in the bottom 5% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Cigna's stock performance [5][6]

Core Insights - Cigna Group reported a second quarter profit of $1.5 billion, driven by strong performance in its Evernorth health service business despite rising costs in its employer health benefits segment [2][3] - Total revenues for the second quarter of 2025 increased by 11% to $67.2 billion compared to the previous year [3] - Adjusted income from operations rose by 1% year-over-year, reflecting growth in Evernorth Health Services and improvements in Corporate, although offset by higher stop loss medical costs [4] Financial Performance - Net income for the second quarter was $1.5 billion, or $5.71 per share, compared to $5.45 per share in the same quarter of 2024 [3] - Cigna's medical cost ratio increased to 83.2% in the second quarter from 82.3% in the prior year, influenced by higher stop loss medical costs [7][6] Business Segments - The Evernorth health services business, which includes a major pharmacy benefit management company, saw growth in existing client relationships and strong specialty pharmacy growth [8] - Total pharmacy customers increased by 3% from December 31, 2024, reaching 121.9 million due to new sales and expanded relationships [8] Strategic Outlook - Cigna reaffirmed its 2025 outlook for adjusted income from operations of "at least $29.60 per share," emphasizing the importance of adapting to the evolving needs of patients and clients [8] - The company noted that its medical cost issues differ from those of competitors, who have faced challenges primarily in government-subsidized health insurance sectors [5]

INVESTOR RELATIONS CONTACT: Ralph Giacobbe 860-787-7968 Ralph.Giacobbe@TheCignaGroup.com MEDIA CONTACT: Justine Sessions 860-810-6523 Justine.Sessions@Evernorth.com The Cigna Group Reports Strong Second Quarter 2025 Results, Reaffirms 2025 Adjusted EPS Outlook Exhibit 99.1 Press Release BLOOMFIELD, CT, July 31, 2025 – Global health company The Cigna Group (NYSE: CI) today reported strong second quarter 2025 results, reflecting continued growth and solid performance across its diverse portfolio of businesses ...

Core Insights - The Cigna Group reported strong second quarter 2025 results, with total revenues increasing by 11% to $67.2 billion compared to the same period in 2024, driven by growth in Evernorth Health Services and specialty pharmacy [4][7][19] - Shareholders' net income for the second quarter 2025 was $1.5 billion, or $5.71 per share, reflecting a slight increase from $1.5 billion, or $5.45 per share, in the second quarter of 2024 [2][4][7] - Adjusted income from operations for the second quarter 2025 was $1.9 billion, or $7.20 per share, compared to $1.9 billion, or $6.72 per share, in the same quarter of 2024 [3][4][7] Financial Performance - Total revenues for the second quarter 2025 were $67.2 billion, an increase of 11% from $60.5 billion in the second quarter 2024 [4][7] - Adjusted revenues for the second quarter 2025 were $67.1 billion, up from $60.5 billion in the second quarter 2024 [4][7] - Shareholders' net income for the first half of 2025 totaled $2.9 billion, with a per-share value of $10.55 [4][7] Customer Relationships - Total customer relationships as of June 30, 2025, were 182.2 million, reflecting a 2% increase from December 31, 2024, excluding the impact of the HCSC transaction [9][5] - Total pharmacy customers increased by 3% to 121.9 million as of June 30, 2025, due to new sales and expanded relationships [9][5] - Total medical customers decreased by 6% to 18.0 million, primarily due to the HCSC transaction, but remained consistent when excluding this impact [9][5] Segment Performance - Evernorth Health Services reported adjusted revenues of $57.8 billion for the second quarter 2025, a 17% increase from the same quarter in 2024 [13][19] - Cigna Healthcare's adjusted revenues decreased by 18% to $10.8 billion, primarily due to the HCSC transaction; however, excluding this impact, revenues would have increased by 7% [15][19] - The adjusted income from operations for Evernorth Health Services increased by 5% to $1.7 billion, while Cigna Healthcare's adjusted income from operations decreased by 9% to $1.1 billion [19][15] Outlook - The Cigna Group reaffirms its 2025 outlook for adjusted income from operations of at least $29.60 per share [20][21] - The company anticipates continued growth driven by its diverse portfolio and strategic initiatives [20][21]

Core Insights - The Cigna Group is expected to report second-quarter 2025 results on July 31, 2025, with earnings estimated at $7.14 per share and revenues of $62.69 billion, reflecting a year-over-year increase of 6.3% in earnings and 3.7% in revenues [1][2][7] Financial Performance Estimates - The full-year 2025 revenue estimate for Cigna is $258.19 billion, indicating a 4.5% year-over-year growth, while the EPS consensus for 2025 is $29.68, signaling an 8.6% increase year-over-year [3] - Cigna has beaten earnings estimates in three of the last four quarters, with an average surprise of negative 0.3% [3] Earnings Prediction Model - The current model does not predict an earnings beat for Cigna, with an Earnings ESP of -0.54% and a Zacks Rank of 3 (Hold) [4] Revenue Breakdown - Evernorth revenues are projected to grow by 9.9%, while Cigna Healthcare revenues are expected to decline by 18.3% [7] - Pharmacy revenues are estimated to improve by 9%, and fees and other revenues are expected to grow by 11% year-over-year [8] - The overall Evernorth Health Services segment is projected to generate $54.4 billion in revenues, reflecting a 9.9% growth from the prior year [8] Customer and Investment Income Trends - The total medical customers for Cigna are estimated at 17.9 million, down from 19 million a year ago [10] - The consensus estimate for net investment income suggests a significant decline of 31.5% year-over-year [10] Margin and Cost Pressures - The medical care ratio is expected to rise to 83.15%, indicating margin pressure due to elevated medical costs and other expenses [11]

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Group 1: Company Overview - Cigna (CI) is a medical stock headquartered in Bloomfield, with a price change of 9.52% so far this year [3] - The company currently pays a dividend of $1.51 per share, resulting in a dividend yield of 2%, which is higher than the Medical - HMOs industry's yield of 0.77% and the S&P 500's yield of 1.55% [3] Group 2: Dividend Performance - Cigna's annualized dividend of $6.04 has increased by 7.9% from the previous year [4] - Over the last 5 years, Cigna has raised its dividend 5 times, achieving an average annual increase of 81.54% [4] - The current payout ratio is 22%, indicating that Cigna pays out 22% of its trailing 12-month EPS as dividends [4] Group 3: Earnings Growth and Future Outlook - For the fiscal year, Cigna expects solid earnings growth, with the Zacks Consensus Estimate for 2025 at $29.68 per share, reflecting a year-over-year growth rate of 8.60% [5] - Future dividend growth will depend on earnings growth and the payout ratio [4] Group 4: Investment Considerations - Cigna is considered a compelling investment opportunity due to its strong dividend play and current Zacks Rank of 3 (Hold) [6] - Income investors should be aware that high-yielding stocks may struggle during periods of rising interest rates [6]

Core Insights - The Cigna Group has experienced significant stock volatility recently, indicating a challenging market environment for the company [1] Company Analysis - The company has been under scrutiny, with analysts focusing on its financial performance and market position [1] - The analysis emphasizes a disciplined approach to understanding the company's fundamentals rather than following market narratives [1] Market Context - The broader market conditions have contributed to the fluctuations in Cigna's stock price, reflecting investor sentiment and economic factors [1]