Cigna Q4 Earnings Miss Estimates on Decline in Medical Membership

Core Viewpoint - Cigna Group reported mixed financial results for the fourth quarter of 2024, with adjusted earnings per share (EPS) missing estimates while revenues showed significant growth year over year [1][2]. Financial Performance - Adjusted EPS for Q4 2024 was $6.64, missing the Zacks Consensus Estimate by 15.2$65.7 billion, surpassing the consensus mark by 3.9% [2]. - Total benefits and expenses rose 29% year over year to $63.5 billion, driven by higher pharmacy and medical costs [4]. - Adjusted operating income fell 8$1.8 billion, primarily due to reduced contributions from the Cigna Healthcare unit [4]. Customer Base and Segments - Cigna's medical customer base decreased by 3.2% year over year to 19.15 million, falling short of the consensus estimate [3]. - Evernorth Health Services segment reported adjusted revenues of $53.7 billion, a 33$51.1 billion [5]. - Cigna Healthcare segment's adjusted revenues grew 3% year over year to $13.3 billion but missed the consensus estimate [7]. Cost and Margin Analysis - The adjusted pre-tax margin for operating income deteriorated by 70 basis points year over year to 4$7.6 billion, a decrease of 3.5% from the previous year [9]. - Total assets increased by 2% to $155.9 billion, while total shareholders' equity decreased by 11.2$41 billion [9]. Capital Deployment - Cigna repurchased 20.9 million shares for approximately $7 billion in 2024 and increased its share repurchase authorization to$10.3 billion [12]. - An 8% increase in the quarterly cash dividend was approved, raising it to $1.51 per share [12]. 2025 Outlook - Adjusted revenues for 2025 are projected to be at least$252 billion, indicating a minimum growth of 2% from 2024 [13]. - Adjusted operating income is expected to be a minimum of $7.9 billion, reflecting a growth of at least 2.1$29.50, suggesting a growth of at least 7.9% from 2024 [13].