What Cigna Group (CI) Said on Its Q3 Earnings Call

Key Points

• Cigna raised its 2026 adjusted EPS outlook to at least $30.60 after Q3 adjusted revenue of $73.8 billion and adjusted earnings of $7.98 per share, driven by stronger-than-expected Cigna Healthcare results.
• Cigna Healthcare earnings rose 15% year over year, while Evernorth revenue increased 6%; Evernorth’s outlook was maintained at at least $6.9 billion in full-year pre-tax adjusted earnings.
• For 2027, Cigna expects adjusted EPS growth of at least 10% from an approximately $30 run rate, despite pharmacy benefit pressure and an estimated $200 million impact from exiting ACA exchanges. The company reaffirmed its goal of at least $45 adjusted EPS in 2030.

Cigna Group NYSE: CI raised its full-year adjusted earnings outlook after reporting $73.8 billion in adjusted revenue and $2.1 billion in adjusted after-tax earnings for the third quarter of 2026.

The company reported adjusted earnings of $7.98 per share and now expects at least $30.60 per share for the full year. The updated outlook reflects stronger-than-expected performance in Cigna Healthcare, while the company maintained its earnings forecast for its Evernorth Health Services business.

Chief Executive Officer Brian Evanko said medical cost trends remained elevated but were consistent with the company’s expectations and pricing assumptions. He also outlined a mix of growth opportunities and headwinds for 2027, including pressure on pharmacy benefit earnings and the planned exit from the Affordable Care Act exchange market.

Healthcare Results Lift Outlook

Cigna Healthcare reported third-quarter adjusted revenue of $11.7 billion, up 9% from a year earlier, and pre-tax adjusted earnings of $1.2 billion. Earnings grew 15% year over year and exceeded expectations, supported by favorable net investment income and operating efficiencies, Chief Financial Officer Ann Dennison said.

The segment’s medical care ratio was 85%, in line with expectations. Cigna ended the quarter with 18.5 million medical customers, up 2% since the start of the year. Customers in its Select segment, which serves U.S. employers with fewer than 500 employees, increased 5% year to date.

Cigna raised its full-year pre-tax adjusted earnings outlook for Cigna Healthcare to at least $4.6 billion. It narrowed its expected medical care ratio range to 84.2%, plus or minus 25 basis points, while maintaining the previous midpoint.

Evanko said the company’s stop-loss business was performing as planned and that pricing actions had helped restore much of its margin in 2026. Management expects further margin improvement in 2027.

Specialty Growth Offsets Pharmacy Transition

Evernorth’s third-quarter revenue rose 6% to $63.8 billion, while pre-tax adjusted earnings were $1.8 billion. Specialty and Care Services earnings grew 15% to $1.1 billion, helped by specialty pharmacy and distribution performance and adoption of lower-cost drug alternatives.

Dennison said generic versions of the oncology drug Revlimid had reached approximately 90% penetration. She also pointed to adoption of biosimilars for Humira and Stelara. Cigna maintained its expectation for at least $6.9 billion in full-year Evernorth pre-tax adjusted earnings.

Pharmacy Benefit Services posted $765 million in third-quarter pre-tax adjusted earnings. Dennison said results reflected previously discussed renewals and extensions of large client contracts, as well as investment in the transition to the company’s Signature pharmacy benefits model.

Evanko described Signature as a fee-based model without rebates. It is scheduled to be adopted by Cigna Healthcare’s fully insured business on January 1, 2027, with broader adoption across Evernorth expected to ramp in 2028. He said the company was negotiating contracts with pharmaceutical manufacturers and network pharmacies.

The CEO said the 2027 rollout to the fully insured book was not expected to create a headwind because changes in economics were incorporated into pricing. Cigna is tracking toward retention in the high 90% range and at least 2 million new Pharmacy Benefit Services customers in 2027, he added.

2027 Outlook and Cost Savings

Cigna expects adjusted earnings per share to grow at least 10% in 2027 from an estimated 2026 run rate of approximately $30 per share. That starting point reflects an approximately $200 million headwind from the ACA exchange exit, including lost earnings and remaining runoff and stranded overhead costs. Management plans to provide comprehensive 2027 guidance on its fourth-quarter call.

Dennison said Cigna Healthcare adjusted income from operations should grow within its long-term target range of 6% to 9% from reported 2026 results. Specialty and Care Services earnings are expected to grow near the low end of their 8% to 12% range, partly because of a more limited pipeline of new biosimilars and specialty generics.

For Evernorth overall, the company expects earnings to rise by low single digits. Evanko said Pharmacy Benefit Services income is expected to decline by single digits as industry rebate pools compress and fewer employers cover GLP-1 drugs for weight management.

Cigna also reaffirmed its goal of at least $45 in adjusted earnings per share in 2030. Its Accelerate to One modernization initiative is targeting $3 billion in gross annual run-rate savings by that year. Dennison said some savings would be reinvested, while a portion would benefit operating results.

Third-quarter operating cash flow was $2.6 billion, and Cigna repurchased approximately 900,000 shares for about $250 million. Its debt-to-capitalization ratio fell to 41.8% at September 30; the company expects to reach its approximately 40% target by year-end.

About Cigna Group (NYSE:CI)

The Cigna Group is a global health services company that provides health insurance and related services through its Cigna Healthcare and Evernorth Health Services businesses. Cigna Healthcare offers medical, dental, behavioral health and other coverage and services to employers, individuals and government-program members.

Evernorth provides pharmacy benefit management, specialty pharmacy, care delivery and other health services. Its offerings include prescription drug benefits and services for people with complex or chronic conditions.

The company serves customers in the United States and select international markets.

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