TLDR
- Elevance Health Q3 revenue jumps 12% to $50.1B on Medicare strength
- Adjusted EPS hits $6.03; strong cash flow backs $3.3B in shareholder returns
- Carelon revenue soars 33%, boosting operating margin and digital growth
- Medicaid declines offset by Medicare gains; total membership stays stable
- Elevance reaffirms 2025 outlook with $30 EPS target and cost control focus
Elevance Health Inc. (ELV) closed higher on October 21, 2025, at $354.07, gaining 1.52%.
Elevance Health Inc., ELV
The company posted third-quarter revenue of $50.1 billion, marking a 12% rise year-over-year. Earnings remained solid, with adjusted diluted EPS reaching $6.03 and GAAP diluted EPS at $5.32.
Q3 Revenue Growth Driven by Medicare and Acquisitions
Elevance Health recorded a $5.4 billion increase in operating revenue, supported by Medicare Advantage growth and strategic acquisitions. The Health Benefits segment saw revenue grow to $42.2 billion, with premium yields and Medicare enrollment driving gains. Medicaid membership continued to decline due to eligibility revisions, slightly offsetting growth.
The benefit expense ratio climbed to 91.3%, up 180 basis points, mainly due to higher costs in Medicare Part D. This was expected following changes linked to the Inflation Reduction Act, which influenced seasonal drug utilization. Despite these pressures, Elevance maintained expense control and strategic investment pacing.
Medical membership stood at 45.4 million, reflecting stability despite ongoing Medicaid challenges. The BlueCard® and Medicaid programs experienced declines, but Medicare gains balanced the mix. The company’s focus remained on value-based care and technology-driven efficiencies.
Carelon Performance Strengthens Operating Margin
Carelon, which includes CarelonRx and Carelon Services, generated $18.3 billion in Q3 revenue, marking a 33% annual increase. This boost came from recent acquisitions in home health and pharmacy, along with scaling risk-based care solutions. CarelonRx product growth and service expansion supported this upward trend.
Operating gain for Carelon reached $0.8 billion, driven by Carelon Services’ strong performance and targeted growth investments. Management continued investing in scalable platforms while maintaining a disciplined cost structure. These efforts reflect the company’s broader strategy to modernize healthcare delivery.
Carelon’s expansion underpinned Elevance’s digital transformation, enhancing member services and access. AI-enabled tools improved the experience and simplified processes across the healthcare journey. These enhancements contributed to sustainable long-term growth across all business units.
Capital Return and Cash Flow Strategy Underpin Confidence
Elevance returned $3.3 billion to shareholders year-to-date through share repurchases and dividends. The company bought back 2.9 million shares during Q3 for $875 million, at an average price of $303.48. It also distributed $381 million in dividends, reinforcing shareholder value creation.
Year-to-date operating cash flow stood at $4.2 billion, reflecting strong fundamentals, despite a $0.9 billion decline linked to legal settlement costs. Cash and investments at the parent level totaled $2.6 billion by the quarter’s end, supporting liquidity. The company held $7.2 billion in remaining share repurchase authorization.
Elevance reaffirmed its full-year 2025 adjusted EPS guidance of approximately $30.00 and benefit expense ratio near 90.0%. The company remains focused on managing controllable factors, supporting employees, and driving scalable care models. With disciplined execution and a diversified portfolio, Elevance continues positioning itself for sustainable growth.
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