CVS Health tops Q3 forecasts but absorbs hefty charge for struggling clinic business

Core Insights - CVS Health experienced double-digit sales growth in its drugstores and pharmacy benefits management business, leading to better-than-expected third-quarter results [1] - The company raised its 2025 earnings forecast significantly above Wall Street estimates, despite incurring a nearly $6 billion charge related to its care delivery business [1][8] Sales and Revenue - CVS filled more prescriptions at drugstores, partly due to business from the defunct Rite Aid chain, with a 9% sales increase in its health insurance segment driven by improvements in Medicare and Medicaid coverage [2] - Total revenue grew almost 8% to $102.9 billion, surpassing analysts' expectations of $98.81 billion [6][7] Financial Performance - CVS reported a loss of nearly $4 billion in the third quarter, which included the $5.7 billion goodwill impairment charge for its care delivery business [6][3] - Adjusted earnings were reported at $1.60 per share, exceeding analysts' expectations of $1.37 per share [6][7] Care Delivery Business - The company recorded a $5.7 billion goodwill impairment charge related to its care delivery business, which includes Oak Street Health clinics acquired for approximately $10.6 billion [3] - CVS plans to close 16 underperforming clinics and reduce the number of new clinics it intends to open [3][5] Future Outlook - CVS Health now expects adjusted earnings for the year to range from $6.55 to $6.65 per share, an increase of 25 cents per share from its previous forecast [8]