NEW YORK (AP) – The rush to fill medicine cabinets and pantries ahead of the rapidly spreading COVID-19 pandemic fueled surging profits at CVS Health during its first quarter.
The outbreak also lifted the health care giant’s insurance business because patients delayed or cancelled elective surgeries and used the health care system less.
Net income jumped 41% to a little more than $2 billion. Earnings excluding one-time items totaled $1.91 per share, easily beating Wall Street per-share projections of $1.63, according to a survey by Zacks Investment Research.
Revenue climbed 8% to $66.76 billion, also topping analysts estimates of $63.13 billion.
CVS Health operates one of the nation’s largest drugstore chains with around 9,900 retail locations. It also runs prescription drug plans for big clients like insurers and employers through a large pharmacy benefit management business, and the company sells health insurance through its Aetna arm.
Total revenue from the company’s biggest business, its pharmacy benefit management arm, climbed 4% to nearly $35 billion. CVS Health sold more specialty drugs and 90-day prescriptions and early refills of some medications rose as people got ready for the pandemic.
The health crisis has forced patients around the country to largely hunker down in their homes and cut down on things like routine trips to the drugstore.
CVS booked an unusually high 8% rise in sales from the front end — or the area outside the pharmacy — of established drugstores as customers stocked up on other health products and merchandise.
The Woonsocket, Rhode Island, company also reaffirmed its annual forecast Wednesday. It expects full-year adjusted earnings to range between $7.04 to $7.17 per share.
Analysts forecast, on average, earnings of $7.02 per share, according to FactSet.
Company shares jumped 4%, or $2.49, to $63.70 before the opening bell.
By AP reporter Tom Murphy
