Elevance Health, Inc. Earnings Summary — Q2 FY2026

• Operating revenue grew slightly to $49.8 billion, supported by higher premium yields and CarelonRx growth, despite membership declines in Medicare and Medicaid.
• Shareholders' net income decreased 16.1% year-over-year to $1.46 billion, impacted by higher benefit expenses and targeted workforce investments.
• The benefit expense ratio rose 80 basis points to 89.7%, driven by elevated medical cost trends in Government businesses, primarily Medicare and Medicaid.
• Medical membership decreased by approximately 1.5% year-over-year to 44.9 million, reflecting a known commercial fee-based transition and Medicaid attrition.
• The Carelon segment showed resilience with revenue growth of 6% to $19.2 billion and a 1% increase in operating gain due to specialty pharmacy profitability.
• Management raised FY 2026 adjusted diluted EPS guidance to at least $27.00, expressing confidence in returning to 12% growth in 2027.
• The company demonstrated strong capital return, repurchasing 0.7 million shares for $234 million and paying $373 million in dividends during the quarter.

Management raised full-year 2026 guidance, now expecting GAAP diluted EPS of at least $20.10 and adjusted diluted EPS of at least $27.00. Operating cash flow guidance was also raised to at least $6.0 billion for the full year.

Improving

While net income and margins declined year-over-year due to expected medical cost headwinds, the results exceeded management's prior outlook, leading to a guidance raise and optimistic projections for 2027.

The company is accelerating investments in medical cost management and Carelon's value-based solutions to reinforce a return to at least 12% adjusted EPS growth in 2027 off the 2026 baseline.