CVS Health (CVS) earnings Q2 2020

CVS Health on Wednesday reported that it beat expectations for earnings and revenue in the fiscal second quarter.

Shares of the company were up about 4{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} in premarket trading.

Here’s what the company reported for the quarter ended June 30 compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

• Earnings per share: $2.64 adjusted, vs. $1.93 expected
• Revenue: $65.3 billion vs. $64.23 billion expected

The drugstore chain reported fiscal second-quarter net income of $2.98 billion, or $2.26 per share, up from $1.94 billion, or $1.49 per share, a year earlier.

Excluding items, CVS earned $2.64 per share, higher than the $1.93 cents per share expected by analysts surveyed by Refinitiv.

Revenue rose 3{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} to $65.3 billion, from $63.43 billion a year prior. It also outpaced the $64.23 billion expected by analysts.

CVS raised its outlook for the year. It expects earnings of $5.59 to $5.72 per share. After adjustments, it said it expects to earn between $7.14 and $7.27 per share, up from a prior forecast of $7.04 to $7.17 per share. 

At the drugstore chain, front of the store revenue and prescription volume dropped during the quarter as many customers stayed at home during shelter-in-place orders.

Front store revenues dropped 4.6{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} in the three month period, compared with a year prior.Prescriptions filled dropped by 1.1{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} on a 30-day equivalent basis for the quarter, compared with a year ago, as fewer customers went to the doctor and thus got fewer new prescriptions.

However, the company — which is also in the health benefits business — also got a boost from people’s changing medical habits. Its operating income increased by more than 40{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} compared with the quarter a year prior, as people deferred elective procedures and discretionary use of their health-care benefits.

Read the complete earnings release here.