3 Strategic Focus Areas Elevance Health 4Q 2025 Earnings Presentation January 28, 2026 Key Highlights 1 2025 Results Elevance Health fourth quarter operational results consistent with expectations 2 2026 Guidance & 2027 Outlook 2026 adjusted diluted EPS1 guidance of at least $25.50 2027 adjusted diluted EPS1 to grow at least 12%, off our ending 2026 earnings baseline Fourth Quarter & Full Year 2025 Results | Elevance Health | 4Q 2025 | 4Q 2024 | Change | 2025 | 2024 | Change | | --- | --- | --- | --- | --- ...

分组1 - Elevance Health reported quarterly earnings of $3.33 per share, exceeding the Zacks Consensus Estimate of $3.1 per share, but down from $3.84 per share a year ago, representing an earnings surprise of +7.30% [1] - The company posted revenues of $49.31 billion for the quarter ended December 2025, which was 0.45% below the Zacks Consensus Estimate, compared to $44.99 billion in the same quarter last year [2] - Elevance Health has surpassed consensus EPS estimates three times over the last four quarters, while also topping consensus revenue estimates three times in the same period [2] 分组2 - The stock has underperformed the market, losing about 7.9% since the beginning of the year, while the S&P 500 has gained 1.9% [3] - The current consensus EPS estimate for the upcoming quarter is $10.37 on revenues of $50.52 billion, and for the current fiscal year, it is $27.01 on revenues of $205.02 billion [7] - The Zacks Industry Rank indicates that the Medical Services sector is currently in the bottom 26% of over 250 Zacks industries, suggesting potential underperformance compared to higher-ranked industries [8]

Elevance Health stock was set to fall for second consecutive day Wednesday. ...

Core Insights - Elevance Health reported a fourth quarter net income of $547 million, reflecting ongoing challenges with healthcare costs impacting earnings [2][3] - The company is the second-largest health insurer in the U.S., operating under the Anthem brand and managing Medicaid contracts [4] Financial Performance - Net income increased by 31% to $547 million, or $2.47 per share, compared to $418 million, or $1.81 per share, in the previous year [8] - Total revenues rose by 9.5% to $49.7 billion, with operating revenue up 10% to $49.3 billion, driven by higher premium yields and growth in Medicare Advantage membership [9][8] Cost and Expense Ratios - The benefit expense ratio increased to 93.5% in the fourth quarter, up from 91.3% in the third quarter, indicating rising medical costs [6][8] - For the full year, the benefit expense ratio was 90.0%, an increase of 150 basis points year-over-year, attributed to elevated medical cost trends [7] Membership and Market Position - Elevance ended 2025 with 45.2 million health plan members, a 1% decrease from the previous year, primarily due to attrition in the Medicaid segment [9] - The company continues to expand its Carelon health services business, with operating revenue increasing by 27% to $18.7 billion [10] Strategic Focus - The CEO emphasized a commitment to improving affordability and access to healthcare, aiming for at least 12% adjusted earnings per share growth by 2027 through pricing discipline and targeted investments [10]

Financial Performance - Elevance Health reported an adjusted EPS of $3.33 for Q4 2025, exceeding estimates of $3.10, but operating revenue was $49.31 billion, slightly below the estimated $49.81 billion, and medical membership was 45.23 million, short of the estimated 45.36 million [2] - Danaher Corporation achieved total sales of $6.84 billion in Q4 2025, surpassing the estimated $6.79 billion, with an adjusted EPS of $2.23, outperforming the $2.16 estimate [3] - ASML noted a normalization in sales to China, with expectations for China's sales share to decrease to approximately 20% in 2026 from 33% in 2025 due to export restrictions, despite recording record orders in Q4 2025 [5] Guidance and Outlook - Elevance Health's guidance for 2026 adjusted EPS is projected to be at least $25.50, which is below the analyst consensus of $26.99 [2] - Danaher's 2026 adjusted EPS guidance is set between $8.35 and $8.50, aligning with the analyst estimate of $8.46 [3] - ASML raised its 2026 revenue guidance driven by strong global demand for AI-related chips [5] Analyst Ratings and Market Sentiment - Morgan Stanley upgraded RTX to a top pick and raised its price target from $215 to $235, indicating increased analyst optimism regarding the company's future performance [4]

Core Viewpoint - Elevance Health has forecasted that its profit for 2026 will be below Wall Street expectations due to anticipated higher medical costs continuing into the year [1] Group 1: Financial Forecast - The company expects that elevated medical costs will persist, impacting profitability [1] - The profit forecast for 2026 is notably lower than what analysts had anticipated [1]

Market Overview - U.S. stock markets are experiencing a pivotal moment with anticipation surrounding the Federal Reserve's interest rate decision and earnings reports from major technology companies [1] - Premarket trading shows a mixed but generally upward trend, with S&P 500 Futures up 0.3% to 7,028.75 points and Nasdaq 100 Futures up 0.6% to 26,228.75 points, while Dow Jones Futures remain flat at 49,159.0 points [2] Semiconductor Industry - U.S. chip stocks are seeing notable gains, with Nvidia increasing by 1.7%, AMD rising by 1.4%, and Intel climbing 4.6%, reflecting strong investor confidence in AI and advanced computing [3] Major Market Indexes - The S&P 500 Index closed at a record high of 6,978.60 points, a 0.41% increase, driven by strength in chipmakers and AI infrastructure stocks, particularly Micron Technology, which announced a $24 billion investment in Singapore [4] - The Dow Jones Industrial Average closed at 49,003.41 points, down 0.83%, primarily due to weakness in the healthcare sector, with UnitedHealth Group forecasting a revenue decline for 2026 [5] - The Nasdaq Composite Index closed up 0.91% at 23,817.10 points, reaching a 2.75-month high, with nearly 30% year-over-year growth attributed to AI advancements [6] Upcoming Market Events - The Federal Reserve is expected to hold its key interest rate steady within the 3.5%-3.75% target range, following three consecutive rate cuts in late 2025, with a focus on the labor market and consumer spending [7] - Major earnings reports are anticipated from tech giants Meta Platforms and Microsoft, which will provide insights into the technology sector's health and AI investments [13] Company News - Infosys announced a strategic AI-focused collaboration, indicating ongoing investment in AI solutions [14] - Boeing's CEO outlined a turnaround plan after six consecutive annual losses, addressing operational challenges [14] - HSBC is scaling back its M&A and equities businesses in Europe, the UK, and the Americas to focus on Asian operations [14] - JetBlue Airways reported a significant Q4 loss and provided weaker-than-expected revenue guidance, raising concerns about profitability [14] - RTX Corporation delivered higher-than-expected Q4 results, showcasing strong growth across its business segments [14]

Financial Performance - 4Q 2025 operating revenue was $49.3 billion, a 10% increase from the prior year, while FY 2025 revenue reached $197.6 billion, up 13%[6] - 4Q 2025 diluted EPS was $2.47, with adjusted diluted EPS at $3.33; FY 2025 diluted EPS was $25.21, and adjusted diluted EPS was $30.29[6] - Projected FY 2026 GAAP diluted EPS is expected to be at least $22.30, with adjusted diluted EPS projected to be at least $25.50[6] - Total operating revenue rose by 9.6% to $49,311 million for Q4 2025, with a total of $197,584 million for the full year, reflecting a 12.8% increase[39] - Adjusted Operating Gain for 2025 was $7.5 billion, with a guidance of at least $6.8 billion for 2026[61] - GAAP Diluted EPS for 2025 was $25.21, with a forecast of at least $22.30 for 2026[61] Segment Performance - Operating revenue for the Health Benefits segment was $41.8 billion in 4Q 2025, an 11% increase year-over-year, and $167.1 billion for FY 2025, also an 11% increase[17] - Carelon's operating revenue was $18.7 billion in 4Q 2025, a 27% increase compared to the prior year, and $71.7 billion for FY 2025, a 33% increase[24] - Operating revenue for the CarelonRx segment increased by 16.7% to $11,644 million in Q4 2025, with a full-year revenue of $43,400 million, up 20.7%[45] - Total Health Benefits Operating Revenue for the twelve months ended December 31, 2025, was $167,094 million, reflecting an 11.2% increase from $150,275 million in 2024[49] Membership and Enrollment - Medical membership totaled approximately 45.2 million as of December 31, 2025, a decrease of 0.5 million, or 1%, year-over-year[18] - Total medical membership decreased by 1.1% year-over-year to 45,232,000 members as of December 31, 2025[37] - Medicare Advantage membership grew by 7.9% year-over-year to 2,230,000 members, while total Medicare membership increased by 5.2% to 3,112,000[37] - Year-End Medical Enrollment for 2025 was 45,232,000, projected to decrease to between 43,175,000 and 43,875,000 for 2026[63] - Commercial Fee-Based enrollment for 2025 was 27,092,000, expected to increase to between 27,200,000 and 27,500,000 for 2026[63] Expenses and Claims - The benefit expense ratio for 4Q 2025 was 93.5%, an increase of 110 basis points year-over-year, while the full year ratio was 90.0%, up 150 basis points[10] - The benefit expense as a percentage of premiums increased to 93.5% in Q4 2025, compared to 92.4% in Q4 2024[39] - The current year medical claims paid as a percentage of current year net incurred medical claims was 89.5% for 2025, up from 88.5% in 2024[51] - The net medical claims payable at the end of 2025 was $16,781 million, up from $15,567 million at the end of 2024[51] Shareholder Returns - The company returned $4.1 billion of capital to shareholders in 2025, including share repurchases and dividends[6] - The company declared a first quarter 2026 dividend of $1.72 per share, payable on March 25, 2026[27] - For the three months ended December 31, 2025, shareholders' net income increased by 30.9% to $547 million compared to $418 million in the same period of 2024[54] - Adjusted shareholders' earnings per diluted share for the three months ended December 31, 2025, increased by 3.1% to $3.33 compared to $3.23 in 2024[54] - Adjusted shareholders' net income for the twelve months ended December 31, 2025, decreased by 11.6% to $6,804 million from $7,694 million in 2024[54] Assets and Cash Flow - Cash and cash equivalents at the end of the period increased to $9,491 million from $8,288 million year-over-year[41] - Total assets grew to $121,494 million as of December 31, 2025, compared to $116,889 million in 2024[41] - Operating Cash Flow for 2025 was $4.3 billion, with a guidance of at least $5.5 billion for 2026[61] Future Outlook - Full Year 2025 Premium Revenue was $164.6 billion, with a projected mid single digit decline for 2026[61] - Total Operating Revenue for 2025 was $197.6 billion, expected to decline in the low single digits for 2026[61] - Benefit Expense Ratio for 2025 was 90.0%, expected to increase to 90.2% +/- 50 bps for 2026[61] - Adjusted Effective Tax Rate for 2025 was 17.6%, projected to rise to between 22.0% and 24.0% for 2026[61]

Core Insights - Elevance Health reported fourth quarter and full year 2025 results, showing disciplined execution in a dynamic environment and a focus on advancing affordability and healthcare accessibility for members [2][4]. Financial Performance - Operating revenue for Q4 2025 was $49.3 billion, a 10% increase from Q4 2024, while total operating revenue for 2025 reached $197.6 billion, up 13% year-over-year [4][11]. - The operating gain for Q4 2025 was $0.3 billion, with an adjusted operating gain of $0.4 billion, reflecting a decrease compared to the previous year [4][12]. - The benefit expense ratio increased to 93.5% in Q4 2025, up 110 basis points from the prior year, driven by higher medical costs [5][25]. Segment Performance - The Health Benefits segment generated $41.8 billion in operating revenue for Q4 2025, an 11% increase compared to Q4 2024, with a full year revenue of $167.1 billion, also up 11% [10][11]. - Carelon segment reported operating revenue of $18.7 billion in Q4 2025, a significant increase of 27% year-over-year, driven by growth in CarelonRx and Carelon Services [15][29]. Membership Metrics - Medical membership totaled approximately 45.2 million as of December 31, 2025, a decrease of 0.5 million or 1% year-over-year, primarily due to attrition in the Medicaid business [13][22]. Cash Flow and Shareholder Returns - Operating cash flow for 2025 was $4.3 billion, approximately 0.8 times GAAP net income, with cash and investments at the parent company totaling $2.6 billion as of December 31, 2025 [8][26]. - The company repurchased 1.4 million shares for $471 million in Q4 2025 and declared a quarterly dividend of $1.71 per share, totaling $377 million in cash distribution [9][17].

This story was originally published on Healthcare Dive. To receive daily news and insights, subscribe to our free daily Healthcare Dive newsletter. Dive Brief: Elevance became the second major insurer to predict declining revenue in 2026 on Wednesday, as for-profit payers continue to shave off members to try and recover margins. The Indianapolis-based insurer estimated its operating revenue will drop by a low-single digit percentage next year. The guidance comes one day after UnitedHealth forecast an ...