Cigna Group (NYSE:CI) executives highlighted double-digit revenue growth in 2025, a modestly higher 2026 earnings outlook, and a major regulatory development during the company’s fourth-quarter 2025 earnings call. Management also discussed continued investment to support a new “rebate-free” pharmacy benefit model, trends in medical costs, and expectations for membership and cash flow in 2026.
2025 results and special items
Investor Relations SVP Ralph Giacobbe said the company recorded after-tax special item charges of $483 million, or $1.82 per share, in the fourth quarter, with details provided in the company’s quarterly financial supplement.
Cordani noted several portfolio actions and investments, including an expansion of specialty capabilities in part through an investment in Shields Health Solutions, and said the company completed the sale of Cigna Healthcare’s Medicare business earlier in 2025.
FTC settlement and PBM reform legislation
Cordani spent part of his prepared remarks addressing a “global settlement” with the Federal Trade Commission that was announced the day before the call. He characterized the settlement as a comprehensive resolution of FTC matters related to the pharmacy benefits business, including the industry-wide insulin lawsuit and ongoing investigations.
According to Cordani, the settlement calls for $7 billion in out-of-pocket cost relief over the next 10 years for the company’s customer and patient base, delivered via lower insulin prices and reduced costs for brand-name medications at the pharmacy counter. He also said the settlement would increase transparency for customers and clients and strengthen relationships with community pharmacists.
Management tied the settlement to the company’s evolving pharmacy benefit approach. Cordani said the company was positioned to execute the terms because of a new pharmacy benefit model developed in early 2025 and announced in the third quarter of 2025. He also referenced “additional clarity” from federal PBM reform legislation that passed earlier in the week.
Evernorth and Cigna Healthcare performance
President and COO Brian Evanko said results reflected contributions from three business platforms: specialty and care services within Evernorth, pharmacy benefit services within Evernorth, and Cigna Healthcare.
- Specialty and care services: Evanko said the business delivered 14% adjusted revenue growth and that specialty scripts were up 13% year-over-year in 2025, supported by biosimilar shifts and patient support through Accredo.
- Pharmacy benefit services: Evanko pointed to continued performance and described GLP-1-related initiatives, including EnReachRx (a new patient support model for pharmacies dispensing GLP-1 drugs) and an expansion of the Patient Assurance Program to include GLP-1 medicines to cap member out-of-pocket costs.
- Cigna Healthcare: Evanko said results were slightly ahead of expectations, citing disciplined pricing and affordability efforts such as encouraging use of generics and biosimilars, optimizing sites of care, and improving administrative processes.
Chief Financial Officer Ann Dennison said both Evernorth and Cigna Healthcare achieved pre-tax adjusted earnings at or above the outlook provided a year earlier. For full-year 2025, she reported adjusted after-tax earnings of $8 billion and reiterated adjusted revenues of $275 billion.
Dennison reported fourth-quarter Evernorth revenue of $63.1 billion and pre-tax adjusted earnings of $2.2 billion, with specialty and care services generating $26.7 billion in revenue (up 14%) and $1.0 billion in adjusted earnings. Evernorth’s pharmacy benefit services business delivered $36.3 billion in revenue and $1.2 billion in adjusted earnings, which Dennison said reflected the impact of strategic investments, including initiatives to enhance patient experience.
For Cigna Healthcare, Dennison said fourth-quarter adjusted revenue was $11.2 billion with pre-tax adjusted earnings of $734 million. She said adjusted earnings modestly exceeded expectations as favorable net investment income more than offset modestly higher medical costs. Dennison quantified the higher medical costs as about 60 basis points of medical care ratio, or roughly $50 million, without notable impact to any single part of the portfolio.
New pharmacy benefit model: margins, adoption, and revenue recognition
During Q&A, executives repeatedly said they expect the profit profile of the pharmacy benefit services business to remain broadly similar as the company transitions to a rebate-free, no-spread, fee-based model.
Responding to JPMorgan’s Lisa Gill, Cordani said the company believes the pharmacy benefit services margin profile will remain “similar,” and therefore the underlying “growth algorithm” would remain intact. He also said the settlement would move Ascent GPO capabilities to the United States and estimated an outside impact to the company’s effective tax rate of up to 1% over time “if unmitigated,” describing it as manageable against the company’s long-term earnings growth algorithm.
Evanko said adoption expectations were unchanged from prior commentary: the company’s Cigna Healthcare fully insured book will adopt the new model in 2027, and the company expects at least 50% of Evernorth business to adopt it by year-end 2028. He added that under the new model, compensation would primarily come from an administrative fee (per member or per script, delinked from drug price) and fees tied to clinical programs and innovations, with the company expecting to take risk on that second component.
On accounting, Evanko said the company does not currently expect changes in pharmacy benefit services revenue recognition as the transition progresses, and he said management does not expect a change in the “denominator and the margin profile.”
2026 outlook: earnings, MCR, membership, and cash flow
For 2026, Dennison guided to approximately $280 billion in consolidated adjusted revenues and adjusted income from operations of at least $30.25 per share. She said first-quarter EPS is expected to be slightly above 25% of full-year guidance.
By segment, Dennison projected:
- Evernorth: at least $6.9 billion in adjusted earnings, with investment spending to build infrastructure for the rebate-free model commencing in 2026 and more back-half weighted.
- Cigna Healthcare: at least $4.5 billion in adjusted earnings, with a 2026 medical care ratio (MCR) expected in the range of 83.7% to 84.7%. She said first-quarter 2026 MCR is expected to be below 81% due to typical seasonality.
Dennison also said the company expects about 18.1 million total medical customers at year-end 2026, with growth in middle, select, and international markets offset by lower membership in national accounts and the individual exchange business. In response to Wells Fargo’s Stephen Baxter, Evanko said the company expects fewer than 300,000 individual exchange customers by the end of 2026 as it prioritizes margin over growth.
On capital and cash flow, Dennison said the company delivered $9.6 billion in 2025 cash flow from operations and returned capital through $3.6 billion of share repurchases (11.9 million shares) and $1.6 billion in dividends. For 2026, she guided to about $9 billion in cash flow from operations, approximately $1.3 billion in capital expenditures, and about $1.6 billion in dividends reflecting an increased quarterly dividend of $1.56 per share. She also said the company expects weighted average shares outstanding of 261 million to 265 million and will continue progressing toward a long-term debt-to-capitalization ratio of about 40%.
In closing remarks, Cordani reiterated confidence in delivering at least $30.25 in adjusted EPS in 2026 and said the company remains focused on making it easier for customers to access affordable care.
About Cigna Group (NYSE:CI)
Cigna Group (NYSE: CI) is a global health services company that offers a broad portfolio of healthcare products and insurance solutions for individuals, employers, and governments. Its core businesses include medical and behavioral health plans, dental and vision coverage, pharmacy benefit management, and supplemental health products. Cigna serves a mix of commercial, Medicare, and Medicaid customers and provides workplace benefits such as group health plans and disability and life benefits for employers.
In addition to traditional insurance products, Cigna operates health services and care-delivery platforms designed to manage costs and improve outcomes.
