Health insurer Elevance Health Inc. (NYSE:ELV) reported first-quarter adjusted earnings of $12.58 per share, beating the consensus of $10.79.
Elevance Revenue Growth Driven By Premium Yields
The company reported revenues of $49.49 billion, up 1.5% year over year, above the consensus of $48.34 billion.
The growth was driven by higher premium yields in the Health Benefits segment and growth in CarelonRx product revenue, partially offset by anticipated declines in Medicare Advantage, Medicaid, and Employer Group risk membership.
Medical Costs And CMS Accrual Impact Margins
The benefit expense ratio was 86.8%, an increase of 40 basis points, reflecting the expected elevated medical cost trend in Medicaid business, partially offset by improved performance in Medicare.
The operating expense ratio of 12.8% included a $935 million accrual representing the current best estimate of the identified potential exposure related to the CMS notice.
The company also recorded a charge of $129 million related to business optimization as it simplifies and enhances its organizational structure.
Elevance Segment Details
Health Benefits segment operating revenue was $42.5 billion in the quarter, up 2.6%.
Medical membership totaled approximately 45.4 million as of March 31, 2026.
Operating revenue for Carelon was $18 billion, up 7.9%, driven by the scaling of Carelon Services risk-based solutions and CarelonRx product revenue.
Elevance Health Raises 2026 Earnings Guidance
Elevance Health raised its fiscal 2026 adjusted earnings per share to at least $26.75, up from prior guidance of at least $25.50 per share, compared to the Wall Street estimate of $25.83.
In an investor call, Gail Boudreau, President and CEO, said, “We are operating with greater alignment, accountability, and clarity across the enterprise, and that progress is showing up in our results. In the first quarter, our performance exceeded expectations, driven by underlying business strength along with ACA seasonality and non-recurring investment income. While it is still early in the year, the trends we are seeing give us increased confidence in the trajectory of the business.”
Boudreau further added that the outlook remains grounded in prudent, achievable assumptions with clear visibility into the key drivers of performance supported by improving claims experience.
ELV Price Action: Elevance Health shares were up 0.39% at $329.39 at the time of publication on Wednesday, according to Benzinga Pro data.
Image Via Shutterstock
Login to comment