Q2 2025 Earnings Summary
| Metric | YoY Change | Reason |
|---|---|---|
Total Operating Revenue | 14% increase (from $43,223M to $49,421M) | Revenue growth reflects strong performance across segments. Building on prior period improvements, higher premiums, improved Health Benefits revenue, and robust contributions from the Carelon segments—supported by premium rate increases and strategic acquisitions—have driven overall revenue expansion. |
Health Benefits | 12% increase (from $37,159M to $41,582M) | Growth in this segment is mainly due to higher premium yields and membership expansion. These continues efforts to offset earlier Medicaid attrition with improved enrollment in Medicare Advantage and Individual ACA plans have translated into increased revenue compared to the previous period. |
CarelonRx | 21% increase (from $8,774M to $10,643M) | This increase stems from ongoing acquisitions and improved prescription utilization. Following trends observed in previous periods, the integration of pharmacy services acquisitions and scaling of operational capabilities has boosted revenue growth in this segment. |
Carelon Services | 64% increase (from $4,545M to $7,441M) | A dramatic increase driven by acquisitions and scaling of risk-based solutions. The significant jump builds on past strategic initiatives such as the incorporation of new service lines and integration of CareBridge, reinforcing its strong external growth momentum from earlier periods. |
Corporate & Other | 90% increase (from $122M to $232M) | The near doubling is due to higher affiliated revenues. Continued consolidation and improved performance from affiliated entities, similar to prior period trends, have significantly bolstered this segment. |
Eliminations | Deepened from –$7,377M to –$10,477M | The widening gap results from adjustments for unaffiliated capitated risk arrangements and affiliated eliminations. Although no new explanatory factors were provided, the trend reflects typical accounting adjustments consistent with prior periods. |
Premiums | 17% increase (from $35,416M to $41,271M) | Premium growth is driven by higher yields and robust membership gains in Medicare Advantage and ACA segments. These improvements, which helped offset Medicaid membership decline in previous periods, have continued to drive premium revenue upward. |
Product Revenue | 9% increase (from $5,530M to $6,042M) | Modest growth in product revenue reflects steady integration of recent acquisitions. The connected care strategy integrated with health benefits and Carelon operations has delivered a consistent, though smaller, uplift compared to previous periods. |
Service Fees | 7% decline (from $2,277M to $2,108M) | The slight decline is likely due to dilution from integration challenges and shifts in the underlying service mix. While overall operating performance improved in other segments, the service fee component faced margin pressures that carried over from previous periods. |
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Adjusted EPS | FY 2025 | $34.15 to $34.85 | Approximately $30 | lowered |
Medicaid Margins | FY 2025 | Expected to remain flat year-over-year in FY 2025 | Expected to show year-over-year improvement in the second half of 2025 and remain positive for the full year, though below long-term targets | raised |
ACA Operating Margins | FY 2025 | no prior guidance | Expected to decline year-over-year at a high single-digit percentage rate | no prior guidance |
Medicare Advantage Margins | FY 2025 | no prior guidance | Targeting stable margins for the year, supported by disciplined bidding and stable utilization trends | no prior guidance |
Operating Revenue | FY 2025 | no prior guidance | Reported at $49.4 billion for Q2 2025, reflecting a 14% year-over-year increase | no prior guidance |
Consolidated Benefit Expense Ratio | FY 2025 | no prior guidance | Reported at 88.9% for Q2 2025, an increase of 260 basis points year-over-year | no prior guidance |
Adjusted Operating Expense Ratio | FY 2025 | no prior guidance | Reported at 10% for Q2 2025, improving by 140 basis points year-over-year | no prior guidance |
Medical Membership | FY 2025 | no prior guidance | Ended Q2 2025 with 45.6 million members, down approximately 200,000 sequentially | no prior guidance |
CarillonRx Growth | FY 2025 | no prior guidance | Operating revenue grew by over 20% year-over-year | no prior guidance |
Carillon Services Growth | FY 2025 | no prior guidance | Delivered over 50% growth in revenue and operating gain | no prior guidance |
Seasonality in Earnings | FY 2025 | no prior guidance | A modestly higher portion of earnings is expected in Q3 2025 compared to Q4 2025 | no prior guidance |
Research analysts covering Elevance Health.