CVS Posts Higher Quarterly Profit

CVS Health Corp. CVS 1.69% said its profit and sales rose for the latest quarter, partly driven by gains from the rollout of Covid-19 vaccines in the U.S. while it saw broader revenue growth in other segments.

The pharmacy and insurance company on Tuesday said revenue in the segment that fulfills medication prescriptions and sells general products climbed 2.3% to $23.27 billion, boosted by higher Covid-19 testing and vaccinations. Partly offsetting the gains was lower front-store revenue, which saw an acceleration of demand in March 2020 as consumers prepared for the coronavirus pandemic, and a weak cough, cold and flu season, CVS said.

The company posted revenue of $69.1 billion, up 3.5% from a year earlier and ahead of the FactSet consensus of $68.36 billion. Same-store sales, or those at retail pharmacy stores that had been operating for more than one year, increased 0.4%.

Shares rose about 3% in premarket trading.

CVS, along with rival Walgreens Boots Alliance Inc., supermarket chain Kroger Co. and Walmart Inc. have been offering vaccines at their locations. More than 40% of all U.S. adults have been fully vaccinated, according to Centers for Disease Control and Prevention data, and the daily number of new Covid-19 cases have been declining. Governors across the U.S. are now rolling back restrictions implemented during the pandemic.

Net income totaled $2.22 billion for the first quarter, up from $2 billion in the same period last year. Adjusted earnings were $2.04 a share, ahead of Wall Street estimates.

Revenue in the pharmacy-services segment, which provides pharmacy-benefit management services to employers, health plans, government employee groups and government-sponsored programs, rose 3.8% to $36.32 billion.

Revenue in the healthcare benefits segment, which offers insured and self-insured medical, pharmacy, dental and behavioral health products and services, rose 6.7% to $20.48 billion, driven by growth in the government services business, the company said.

For 2021, CVS said it sees earnings of $6.24 to $6.36 a share, or $7.56 to $7.68 a share on an adjusted basis. It previously expected earnings of $6.06 to $6.22 a share, or $7.39 to $7.55 a share on an adjusted basis.

CVS is expected to provide more details on its vaccine distribution on its conference call at 8 a.m. ET.

As more U.S. adults get their Covid-19 vaccines, a variety of side effects are emerging. WSJ’s Daniela Hernandez speaks with an infectious disease specialist on what is common, what isn’t and when to seek medical attention. Photo: Associated Press

Write to Dave Sebastian at dave.sebastian@wsj.com

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