CVS Health Revises 2024 Outlook Again

CVS Health has revised its 2024 financial outlook downward for the third time this year, primarily due to challenges in its Aetna insurance business. CEO Karen Lynch has taken direct control of the insurance segment following the departure of Executive Vice President Brian Kane, aiming to address financial and operational issues. The company reported a 39% drop in adjusted operating income from its health benefits division and a 12% decline in its pharmacy sector's adjusted operating income. CVS also plans a $2 billion cost-cutting initiative, incorporating AI and automation, and is nearing the completion of a three-year plan to close 900 stores. Despite these setbacks, CVS reported Q2 revenue of $91.2 billion, slightly below Wall Street expectations, but beat earnings per share estimates. Shares of CVS have declined significantly this year, reflecting the company's ongoing financial struggles.