Cigna Beats Q2 Expectations, Driven by Strong Evernorth Growth Amid Industry Challenges

Cigna Corporation, a major player in the health insurance and pharmacy benefit management sectors, has reported better-than-expected second-quarter results for 2025, primarily fueled by robust growth in its Evernorth health services division. The company's performance comes against a backdrop of persistent industry-wide challenges, including elevated medical costs and increased regulatory scrutiny of pharmacy benefit managers (PBMs).

Evernorth Leads Revenue Growth

Cigna's Evernorth segment, which includes its PBM business Express Scripts, reported impressive growth figures. Revenue for Evernorth reached $57.8 billion in Q2, marking a 17% increase year-over-year. The unit's adjusted income from operations rose by 5% to $1.7 billion.

Within Evernorth, pharmacy benefit services saw a 20% jump in adjusted revenue, with adjusted income for this division climbing 2% to $833 million. These positive results are particularly noteworthy given the current regulatory environment, where PBMs face intensified scrutiny from both lawmakers and regulators over their role in drug pricing.

Health Insurance Segment Navigates Challenges

While Cigna's health insurance business performed within expectations, it faced headwinds from "persistently elevated medical costs throughout the year," according to COO Brian Evanko. The company's medical loss ratio (MLR) increased to 83.2% in Q2 2025, up from 82.3% in the same period last year, reflecting higher spending on patient care.

The health insurance unit reported adjusted revenue of $10.8 billion, an 18% decrease year-over-year, largely attributed to the divestiture of its Medicare business. Adjusted income from operations in this segment fell 9% to $1.1 billion.

Despite these challenges, Cigna's focus on employer-sponsored health plans and its recent exit from the Medicare market have positioned it favorably compared to competitors more exposed to government-sponsored programs.

Financial Performance and Outlook

Overall, Cigna reported total revenue of $67.2 billion for Q2, an 11% increase from $60.5 billion in the same quarter last year. Net income remained relatively flat year-over-year at $1.5 billion.

The company reaffirmed its full-year outlook, projecting adjusted income from operations of at least $29.60 per share. This guidance suggests confidence in Cigna's ability to navigate the current healthcare landscape effectively.

As the pharmaceutical and healthcare industries continue to evolve, Cigna's performance in the coming quarters will be closely watched by investors and industry analysts alike.