CVS Health Corporation reported net income of $2.995 billion for the second quarter of 2026, nearly three times the $1.013 billion reported in the same period last year, as its Aetna health insurance business continued to recover from the medical cost pressures that weighed on results through 2024 and 2025.
Total revenues for the three months ended June 30, 2026 rose 7.3% to $106.1 billion, up from $98.9 billion a year earlier, with growth recorded across all three operating segments. Diluted earnings per share reached $2.31, up from $0.80 in the prior-year quarter.
The improvement was driven largely by the Health Care Benefits segment, which includes Aetna. The segment's medical benefit ratio fell to 87.4% from 89.9% a year earlier. That marks a significant shift from the third quarter of 2024, before current chief executive David Joyner took over, when Aetna's medical loss ratio topped 95%, driven largely by higher costs among Medicare Advantage members. Segment revenues rose 3.5% to $37.5 billion, and adjusted operating income more than doubled to $2.426 billion.
CVS raised its full-year 2026 outlook, now projecting total revenues of at least $414 billion, up from at least $405 billion previously. Adjusted earnings per share guidance was lifted to $7.90 to $8.10, from $7.30 to $7.50.
"We uniquely enable what our customers want the most: simple, connected and convenient access to affordable, quality healthcare, where, when, and how they want it," said David Joyner, CVS Health chairman and chief executive.
The Health Services segment, which includes pharmacy benefit manager Caremark, posted revenues of $51.8 billion, up 11.5%. The Pharmacy & Consumer Wellness segment posted revenues of $33.8 billion, aided by continued integration of Rite Aid pharmacy assets.
CVS also expanded its use of artificial intelligence across operations, including Aetna's second-generation Claims Assist Manager platform, which the company said has cut processing time by more than 20% for complex claims requiring manual review.
CVS's own exit from the individual ACA exchange business this year is part of a broader industry retreat. As of July 30, 2026, seven carriers had announced they would exit ACA marketplaces for plan year 2027, while total ACA enrollment had already declined 5% to 23.1 million in 2026 following the expiration of enhanced premium tax credits, with the remaining risk pool skewing older and sicker.
When one of the country's largest health insurers walks away from ACA business while expanding its Medicare Advantage footprint, that is a signal about where the company sees profitable growth concentrating over the next one to two years.
Separately, CMS has finalized changes to the Medicare Advantage Star Ratings system that eliminate several measures insurers had disputed, a shift expected to direct an additional $18.5 billion to Medicare Advantage and Part D plan sponsors over the next decade. Insurers such as Humana, which had specifically challenged call center metrics, are positioned to benefit from more favorable scores as the new methodology phases in.
For brokers and benefits consultants placing individual or small-group health coverage, this divergence has a direct practical consequence heading into the next open enrollment period. Clients relying on ACA marketplace coverage should be prepared for a shrinking, less competitive carrier field as more national insurers follow CVS's lead in scaling back exchange participation, likely accompanied by higher premiums as the remaining risk pool skews older and sicker. At the same time, clients approaching Medicare eligibility are worth steering toward Medicare Advantage conversations earlier than usual, given the scale of capital and product investment carriers are now directing toward that line relative to individual exchange business.
CVS's improved medical benefit ratio and raised guidance suggest the worst of the Medicare Advantage cost spiral may be easing for larger, well-capitalized carriers.
That recovery, combined with the company's decision to retreat from the individual exchange market, points to a broader industry pattern: carriers appear to be concentrating capital and product investment in Medicare Advantage, where costs are proving more manageable, while pulling back from the ACA marketplace, where the risk pool continues to deteriorate.
Whether that divergence holds through 2027 will likely depend on how CMS's Star Ratings changes and continued ACA enrollment declines play out over the next several renewal cycles.
