Cigna’s first-quarter results surpassed Wall Street’s revenue and non-GAAP profit expectations, with management highlighting strong performance from the company’s specialty pharmacy and pharmacy benefit services platforms. CEO David Cordani attributed momentum to the combined strengths of the EverNorth and Cigna Healthcare businesses, noting in particular the expansion of high-touch specialty services and broader adoption of biosimilar drugs. Cordani emphasized, “We delivered this performance in a dynamic environment with forces of change going beyond tariffs and trade, significant geopolitical, and evolving social impacts.” Management also pointed to disciplined capital deployment, including the completion of the Medicare business divestiture, as a contributor to the quarter’s results.
Is now the time to buy CI? Find out in our full research report (it’s free).
Cigna (CI) Q1 CY2025 Highlights:
- Revenue: $65.5 billion vs analyst estimates of $60.42 billion (14.4% year-on-year growth, 8.4% beat)
- Adjusted EPS: $6.74 vs analyst estimates of $6.35 (6.2% beat)
- Adjusted EBITDA: $2.81 billion vs analyst estimates of $2.86 billion (4.3% margin, 1.7% miss)
- Operating Margin: 3%, in line with the same quarter last year
- Customers: 16.36 million, down from 17.5 million in the previous quarter
- Market Capitalization: $84.42 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Cigna’s Q1 Earnings Call
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Lisa Gill (JP Morgan): asked about Cigna’s ability to negotiate better pricing for GLP-1 drugs and the impact of broader employer coverage. President and COO Brian Evanko explained that competition among manufacturers should improve affordability over time, while coverage levels remain stable but could increase as prices fall.
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A.J. Rice (UBS): inquired about the impact of economic uncertainty on client behavior and retention in pharmacy benefit management. Evanko noted strong retention rates and said affordability remains a top focus for employers, especially given specialty drug cost trends.
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Justin Lake (Wolfe Research): sought clarification on the stop-loss segment’s margin recovery and customer feedback. Management confirmed that the profitability improvement plan is on track, with renewed pricing being gradually implemented and retention remaining steady.
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Charles Rhyee (TD Cowen): asked about regulatory risks related to pharmacy benefit manager ownership and transparency. CEO David Cordani stressed the importance of maintaining flexibility and innovation, emphasizing that recent biosimilar launches and clinical programs rely on integrated capabilities.
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Ann Hynes (Mizuho Securities): questioned ongoing capital deployment priorities and the need for further acquisitions. Cordani reiterated that the focus remains on supporting organic growth, selective bolt-on M&A, and returning excess capital to shareholders, with no immediate need for new capabilities.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will monitor (1) the adoption rates of new biosimilars and specialty drugs, (2) progress on the rollout and uptake of clinical support programs such as inReachRx and InGuide, and (3) regulatory developments affecting pharmacy benefit management and drug pricing. Additionally, we will track customer growth in Cigna Healthcare’s select segment and the company’s ability to maintain disciplined capital allocation.
Cigna currently trades at $330, down from $334.82 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).
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