Elevance Health Reports Second Quarter 2025 Results

• 2Q 2025 operating revenue of $49.4 billion, up 14.3% from 2Q 2024

• 2Q 2025 diluted EPS¹ of $7.72; adjusted diluted EPS² of $8.84

• Revising FY 2025 adjusted diluted EPS guidance to approximately $30.00

• Returned $2.0 billion of capital to shareholders year-to-date

Elevance Health, Inc. (NYSE:ELV) reported second quarter 2025 results.

"In the second quarter, Elevance Health made meaningful progress in delivering an experience that is simple and personal to those we serve, while advancing our efforts to enhance efficiency across the healthcare system. We are updating our outlook to reflect elevated medical cost trends in ACA and slower rate alignment in Medicaid. While the external environment continues to evolve, we are focused on the areas within our control - managing healthcare costs, deploying targeted investments in advanced technology and value-based care delivery, and reinforcing the operational foundation that supports long-term value creation. With the embedded earnings power of our diversified Health Benefits and Carelon businesses, we remain confident in achieving at least 12% average annual growth in adjusted diluted EPS over time."

Gail K. Boudreaux

President and Chief Executive Officer

Given the ongoing and industry-wide impact of elevated cost trends in ACA and Medicaid, Elevance Health now expects 2025 GAAP net income per diluted share to be approximately $24.10 and adjusted net income per diluted share to be approximately $30.00.

Operating revenue was $49.4 billion in the second quarter of 2025, an increase of $6.2 billion, or 14 percent compared to the prior year quarter. This was driven by higher premium yields in our Health Benefits segment, recently closed acquisitions, and growth in our Medicare Advantage membership, partially offset by membership attrition in our Medicaid business.

The benefit expense ratio was 88.9 percent, an increase of 260 basis points year over year, reflecting higher medical cost trend primarily in our Medicaid business and ACA health plans. Days in Claims Payable stood at 43.9 days as of June 30, 2025, when adjusted for our acquisition of CareBridge. This represents a decrease of 0.1 days sequentially on a comparable basis.

The operating expense ratio was 10.1 percent, an improvement of 160 basis points. The adjusted operating expense ratio was 10.0 percent, an improvement of 140 basis points, primarily driven by expense leverage associated with growth in operating revenue and ongoing expense discipline as we prioritize investments to support our long-term strategy.

Cash Flow & Balance Sheet

Operating cash flow was $3.1 billion year-to-date, or 0.8 times GAAP net income, an increase of $0.6 billion year over year. As of June 30, 2025, cash and investments at the parent company totaled approximately $2.2 billion.

During the second quarter of 2025, the Company repurchased 0.9 million shares of its common stock for $379 million, at a weighted average price of $410.05, and paid a quarterly dividend of $1.71 per share, representing a distribution of cash totaling $385 million. As of June 30, 2025, the Company had approximately $8.0 billion of Board approved share repurchase authorization remaining.

Health Benefits is comprised of Individual, Employer Group risk-based, Employer Group fee-based, BlueCard^®, Medicare, Medicaid, and Federal Employee Program businesses.

Health Benefits segment operating revenue was $41.6 billion in the second quarter of 2025, an increase of $4.4 billion, or 12 percent compared to the prior year quarter, driven primarily by higher premium yields, recently closed acquisitions, and growth in our Medicare Advantage membership, partially offset by lower Medicaid membership.

Operating gain totaled $1.6 billion, impacted principally by higher medical cost trend in our Medicaid business and ACA health plans.

Medical membership totaled approximately 45.6 million as of June 30, 2025, a decline of 212 thousand from the first quarter of 2025, driven by lower Medicaid membership and attrition resulting from lower effectuation rates in our Individual ACA business.

Carelon is comprised of CarelonRx and Carelon Services.

Operating revenue for Carelon was $18.1 billion in the second quarter of 2025, an increase of $4.8 billion, or 36 percent compared to the prior year quarter. This was driven by recent acquisitions in home health and pharmacy services, growth in CarelonRx product revenue, and the scaling of innovative risk-based capabilities in Carelon Services.

Operating gain for Carelon totaled $0.9 billion, an increase of $0.2 billion, or 33 percent, primarily driven by improved Carelon Health performance and higher CarelonRx product revenue.

Quarterly Dividend

On July 16, 2025, the Audit Committee of the Company's Board of Directors declared a third quarter 2025 dividend to shareholders of $1.71 per share. The third quarter dividend is payable on September 25, 2025, to shareholders of record at the close of business on September 10, 2025.

About Elevance Health

Elevance Health is a lifetime, trusted health partner whose purpose is to improve the health of humanity. The company supports consumers, families, and communities across the entire healthcare journey – connecting them to the care, support, and resources they need to lead better lives. Elevance Health's companies serve over 109 million consumers through a diverse portfolio of industry-leading medical, pharmacy, behavioral, clinical, home health, and complex care solutions. For more information, please visit www.elevancehealth.com or follow us @ElevanceHealth on X and Elevance Health on LinkedIn.

Conference Call and Webcast

Management will host a conference call and webcast today at 8:30 a.m. Eastern Daylight Time ("EDT") to discuss the company's second quarter results and outlook. The conference call should be accessed at least 15 minutes prior to the start of the call with the following numbers:

The access code for today's conference call is 3972058. There is no access code for the replay. The replay will be available from 11:30 a.m. EDT today, until the end of the day on August 15, 2025. The call will also be available through a live webcast at www.elevancehealth.com under the "Investors" link. A webcast replay will be available following the call.

Basis of Presentation

1. Operating revenue and operating gain/loss are the key measures used by management to evaluate performance in each of its reporting segments, allocate resources, set incentive compensation targets and to forecast future operating performance. Operating gain/loss is calculated as total operating revenue less benefit expense, cost of products sold and operating expense. It does not include net investment income, net gains/losses on financial instruments, interest expense, amortization of other intangible assets, gains/losses on extinguishment of debt or income taxes, as these items are managed in a corporate shared service environment and are not the responsibility of operating segment management. Refer the GAAP reconciliation tables.
2. Operating margin is defined as operating gain divided by operating revenue.

Elevance Health

Earnings Release Financial Schedules and Supplementary Information

Quarter & Year-to-Date Ended June 30, 2025

• Membership and Other Metrics

• Quarterly & Year-to-Date Consolidated Statements of Income

• Condensed Consolidated Balance Sheet

• Condensed Consolidated Statement of Cash Flows

• Supplemental Financial Information - Reportable Segments

• Supplemental Financial Information - Reconciliation of Medical Claims Payable

• Reconciliation of Non-GAAP Financial Measures

REPORTABLE SEGMENTS

Elevance Health has four reportable segments: Health Benefits (comprised of Individual, Employer Group risk-based, Employer Group fee-based, BlueCard^®, Medicare, Medicaid, and Federal Employee Program businesses); CarelonRx; Carelon Services; and Corporate & Other (comprised of businesses that do not individually meet the quantitative thresholds for an operating division as well as corporate expenses not allocated to our other reportable segments).

Elevance Health

GAAP Reconciliation

(Unaudited)

This document references non-GAAP measures, including "Adjusted Shareholders' Net Income," "Adjusted Shareholders' Net Income Per Share," "Adjusted EPS," "Adjusted Operating Gain," "Adjusted Operating Expense" and "Adjusted Operating Expense Ratio," which are non-GAAP measures. These non-GAAP measures are intended to aid investors when comparing Elevance Health's financial results among periods and are not intended to be alternatives to any measure calculated in accordance with GAAP. Reconciliations of these non-GAAP measures to the most directly comparable measures calculated in accordance with GAAP are available below. In addition to these non-GAAP measures, references are made to the measures "Operating Revenue" and "Operating Gain/Loss," "Operating Margin" and "Adjusted EPS". Operating revenue and operating gain/loss are the key measures used by management to evaluate performance in each of its reportable segments, allocate resources, set incentive compensation targets and to forecast future operating performance. Operating gain/loss is calculated as total operating revenue less benefit expense, cost of products sold and operating expense. It does not include net investment income, net gains/losses on financial instruments, interest expense, amortization of other intangible assets and gains/losses on extinguishment of debt or income taxes, as these items are managed in a corporate shared service environment and are not the responsibility of operating segment management. Each of these measures is provided to further aid investors in understanding and analyzing Elevance Health's operating and financial results. A reconciliation of Operating Revenue to Total Revenue is set forth in the Consolidated Statements of Income herein. A reconciliation of the non-GAAP measures to the most directly comparable measures calculated in accordance with GAAP, together with a reconciliation of reportable segments operating gain to income before income tax expense, is provided below. Prior amounts may be grouped differently to conform to the current presentation. Net adjustment items per share may not sum due to rounding. A reconciliation of Operating Revenue to Total Revenue is set forth in the Consolidated Statements of Income herein.

Elevance Health

GAAP Reconciliation

(Unaudited)