Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
CVS Health's FY2025 revenue grew 7.8% to $402.1B, but net income collapsed 61.7% to $1.77B as operating margins were severely compressed, reflecting significant cost pressures and structural challenges across its business segments.
Revenue
$402.07B
+7.85% YoY
EPS (Diluted)
$1.39
-62.02% YoY
Operating Income
$4.66B
-45.28% YoY
Source: SEC XBRL
Cvs Health (CVS) reported FY2025 revenue of $402.07B, up 7.8% year over year. Operating margin was 1.2%, down 1.1 points from 2.3% a year earlier. Operating cash flow was $10.64B, up 16.8% year over year.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 2.58 | 1.87 | Beat +38.0% |
| Mar 2026 | 2.57 | 2.22 | Beat +15.8% |
| Dec 2025This filing | 1.09 | 1.00 | Beat +8.8% |
| Sep 2025 | 1.60 | 1.38 | Beat +15.7% |
Reported EPS of $1.09 versus the $1.00 analyst consensus — a +8.8% beat for Dec 2025.
Compiled by AI from this SEC filing
CVS Health posted $402.1B in revenue for FY2025, up 7.8% from $372.8B in the prior year, demonstrating continued top-line growth. However, this growth failed to translate to the bottom line, as operating income fell 45.3% to $4.66B from $8.52B, signaling that cost inflation and mix shifts are eroding profitability.
Source: 10-K Income Statement
Operating margin contracted sharply from 2.28% to 1.16% year-over-year, a decline of approximately 112 basis points. Net margin fell to just 0.44%, down from approximately 1.24% in the prior year, indicating that cost of revenue and operating expenses are growing faster than revenues.
Source: 10-K Income Statement & Key Ratios
Cost of revenue rose 7.2% to $221.2B, consuming a larger share of revenue and compressing gross profit. The implied gross profit is approximately $180.9B, but operating expenses further eroded this to a thin operating income of $4.66B, suggesting significant SG&A and other cost burdens.
Source: 10-K Income Statement
Despite the sharp decline in net income, operating cash flow improved 16.8% to $10.64B from $9.11B, suggesting that non-cash charges such as D&A ($4.61B) and working capital movements are supporting cash generation. Free cash flow (operating cash flow minus investing outflows) is estimated at approximately $4.77B.
Source: 10-K Cash Flow Statement
CVS halted share repurchases entirely in FY2025 (down from $3.02B in buybacks the prior year), while maintaining dividends at $3.40B, up marginally 0.7%. This capital allocation shift suggests management is prioritizing balance sheet preservation and liquidity over returning capital to shareholders.
Source: 10-K Cash Flow Statement
Compiled by AI from this SEC filing · 3 high, 2 medium, 0 low
Net income declined 61.7% to $1.77B and EPS fell from $3.67 to $1.40, while operating margin compressed to just 1.16%. This dramatic profitability decline raises concerns about CVS's ability to sustain its dividend ($3.40B paid) and service its substantial debt load from earnings alone.
Source: 10-K Income Statement & Key Ratios
CVS's current ratio stands at 0.84, meaning current liabilities of $88.7B exceed current assets of $74.7B. This sub-1.0 current ratio indicates that CVS may face short-term liquidity pressure and could need to refinance or draw on credit facilities to meet near-term obligations.
Source: 10-K Balance Sheet & Key Ratios
Total liabilities of $178.2B against stockholders' equity of $75.2B results in a debt-to-equity ratio of 2.37x. With ROA at only 0.70% and ROE at 2.35%, the company is generating very low returns relative to its asset base and leverage, increasing financial risk in a rising interest rate environment.
Source: 10-K Balance Sheet & Key Ratios
CVS completely suspended its share repurchase program in FY2025, compared to $3.02B in buybacks the prior year, while financing cash outflows surged to -$4.94B from -$1.14B. This suggests management is under pressure to conserve cash, potentially limiting financial flexibility.
Source: 10-K Cash Flow Statement
Cash and equivalents declined modestly to $8.45B from $8.59B, while the company paid $3.40B in dividends. With net income of only $1.77B, dividends are not covered by earnings, meaning CVS is effectively funding its dividend from operating cash flow and potentially debt, which is unsustainable long-term if profitability does not recover.
Source: 10-K Balance Sheet & Cash Flow Statement
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 402.07 $B | 372.81 $B | +7.85% |
Cost of Revenue $B | 221.17 $B | 206.29 $B | +7.21% |
Operating Income $B | 4.66 $B | 8.52 $B | -45.28% |
Net Income $B | 1.77 $B | 4.61 $B | -61.68% |
EPS (Basic) $ | 1.40 $ | 3.67 $ | -61.85% |
EPS (Diluted) $ | 1.39 $ | 3.66 $ | -62.02% |
Answers draw on this SEC filing and the data on this page
CVS Health's Q2 FY2026 operating income surged 97.5% driven by government insurance gains and lapping prior-year litigation costs.
CVS Health delivered a strong Q1 2026 with revenue rising 6.2% YoY to $100.4B and net income surging 65.4% to $2.9B, driven by improved operating leverage and margin expansion.
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