Key Takeaways
- First quarter earnings per share reached $7.79, surpassing analyst expectations of $7.60
- Quarterly revenue climbed 5% annually to $68.5 billion, exceeding the projected $66.3 billion
- The company increased its 2026 full-year EPS forecast to a minimum of $30.35, representing a $0.10 boost
- Shares declined approximately 3% following the earnings announcement, with pharmacy operations cited as a concern
- Leadership transition underway as CEO David Cordani steps down July 1, with COO Brian Evanko assuming the role
Cigna delivered impressive first-quarter results that exceeded analyst projections, yet investors responded by selling off shares. The healthcare giant surpassed both earnings and revenue targets while raising its annual outlook, but the stock still retreated.
Adjusted earnings per share for the quarter reached $7.79, representing growth from the prior year’s $6.74 and exceeding Street expectations of $7.60. Total revenue touched $68.5 billion, marking a 5% year-over-year expansion and beating the $66.3 billion projection.
Management also elevated its 2026 full-year EPS projection to no less than $30.35, marking a $0.10 lift from earlier guidance. This updated midpoint narrowly edges out the analyst consensus figure of $30.33.
Yet despite these positive metrics, shares tumbled roughly 3% to approximately $283 during morning trading.
Adjusted operational income grew 12% to $2.1 billion, up from $1.8 billion in the first quarter of 2025. The improvement stemmed primarily from performance at Cigna Healthcare and Evernorth Health Services divisions.
Cigna Healthcare’s pre-tax adjusted operational income surged 18% to reach $1.5 billion. The division’s medical care ratio enhanced to 79.8%, an improvement from the 82.2% recorded in the comparable quarter last year.
Evernorth delivered adjusted revenues of $58.4 billion, representing a 9% year-over-year increase. Income from Specialty and Care Services operations rose 20% to $1.1 billion.
Pharmacy Benefits Division Raises Red Flags
The pharmacy benefit manager segment emerged as the problematic area. TD Cowen analyst Charles Rhyee characterized it as the “only blemish” in an otherwise strong report, though he acknowledged the weakness was anticipated given similar challenges at UnitedHealth and Elevance Health. He maintained a Buy rating with a $338 target price.
Leerink Partners analyst Whit Mayo maintained a Market Perform stance, noting that results “look fine” but that “not much jumps off the page as particularly surprising.”
Cigna has been restructuring its PBM operations since the fall, transitioning toward a “rebate-free” framework in response to regulatory scrutiny and public backlash regarding drug pricing mechanisms.
CEO Succession Creates Additional Questions
This past February, Cigna’s Express Scripts division became the first among the three dominant PBMs to reach a settlement with the Federal Trade Commission concerning insulin pricing litigation. The company admitted no wrongdoing, and the settlement complemented the rebate-free approach previously disclosed.
Cigna is simultaneously navigating an executive transition. CEO David Cordani is departing on July 1, with COO Brian Evanko set to assume leadership.
The confluence of ongoing business model restructuring, executive succession, and measured analyst responses helps clarify why an earnings beat coupled with raised guidance failed to propel the stock upward.
Cigna’s enhanced medical care ratio and organic expansion in specialty operations represented the most notable bright spots from the quarterly report.
