At the same time, the company raised its outlook for 2026. One reason for the improved picture is that Aetna, CVS's insurance unit, is showing signs of stabilizing.
But investors focused on something else: executives said during the earnings call that they expect membership in Caremark, the company's pharmacy benefit manager, to shrink.
The results were broad-based. CVS, which operates the largest pharmacy chain in the U.S., said all three of its main businesses - insurance, pharmacy services, and retail pharmacy - beat revenue estimates for the quarter.
The company also said its 2026 revenue outlook now calls for $414 billion or more, compared with a previous forecast of at least $405 billion.
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CVS said in its earnings release that the improved profit forecast was driven mainly by its insurance and retail pharmacy segments. But management stressed that it remains cautious about the rest of the year because medical costs are still elevated and the broader economy may create headwinds.
Investors have been watching Aetna closely because expensive claims in Medicare Advantage plans have hurt several major insurers over the last two years. CVS's latest quarter suggests its turnaround plan is gaining ground. That plan includes cutting $2 billion in costs, closing weaker stores, replacing some leaders, and controlling expenses within Medicare Advantage plans.
CVS's report also rounded out a strong second-quarter earnings season for the health insurance sector.
The stock's slide was tied to Caremark. The market's reaction makes more sense when you consider how important Caremark is to CVS's overall model.
Caremark negotiates drug prices for employers, unions, and health plans. If its membership rolls shrink, CVS may have less bargaining power with drugmakers and less prescription volume flowing through its own pharmacies. That can put pressure on future earnings even when the current quarter looks solid.
Caremark is a key link in the company's vertically integrated strategy. Aetna's insurance plans generate drug claims, Caremark processes those claims and negotiates rebates, and CVS pharmacies fill the resulting prescriptions. A membership decline at Caremark can therefore weaken the entire chain: lower volume makes it harder to hold down costs for clients, and that can eventually affect premiums and store traffic. The raised outlook suggests the company expects those pressures to be manageable, but Wall Street's reaction shows that investors want clearer evidence that Caremark can stabilize.
CVS also announced a collaboration with Eli Lilly on Wednesday. The partnership will make Lilly's obesity injection Zepbound and new weight-loss pill Foundayo available to eligible patients through the CVS Health app.
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