CVS Health Corporation (CVS): Business Model Canvas [Dec-2025 Updated]

You're looking to truly understand how CVS Health Corporation makes its money, and honestly, mapping out their integrated behemoth-insurance through Aetna, pharmacy benefits via Caremark, and care delivery-is the only way to see the full picture. This isn't just a pharmacy chain anymore; it's a healthcare ecosystem aiming for a projected $397 billion in 2025 revenue by connecting nearly 27 million members to care. Dive into the nine building blocks below to see exactly how they connect their 9,000 retail spots to their PBM claims engine.

CVS Health Corporation (CVS) - Canvas Business Model: Key Partnerships

The Key Partnerships block for CVS Health Corporation as of late 2025 centers on leveraging scale and integration across its PBM, insurer, and retail segments through strategic alliances with drug makers, technology firms, and healthcare providers.

Pharmaceutical manufacturers for drug supply and rebates

CVS Caremark negotiates with pharmaceutical manufacturers to secure favorable drug pricing and rebates, which are then passed on to clients. For instance, in agreements renewed effective January 1, 2025, through December 31, 2027, with organizations like the Health Action Council, CVS Health commits to passing through 100% of rebates with minimum guarantees. This negotiation power is central to the PBM model. Separately, the company is navigating regulatory shifts, such as the HHS 340B rebate pilot, which requires participation from some 14,600 safety-net providers. To influence the legislative landscape affecting this core business, CVS Health spent $2.15 million on federal lobbying in Q3 2025.

Novo Nordisk for GLP-1 drug access and affordability

A landmark partnership was established with Novo Nordisk, effective July 1, 2025, making Wegovy the preferred GLP-1 medicine on CVS Caremark's largest commercial template formularies. This strategic move aims to manage costs for clients, as CVS Caremark passes along more than 99% of all rebates. The deal also benefits cash-paying customers, as Novo Nordisk selected CVS Pharmacy to sell Wegovy for $499/month, less than half its list price, at its more than 9,000 locations.

Here are key figures related to this specific partnership and recent financial context:

Metric	Value/Detail
Wegovy Preferred Status Start Date	July 1, 2025
Cash Price for Self-Pay Customers	$499/month
CVS Caremark Rebate Pass-Through Rate	More than 99%
CVS Health Q1 2025 Total Revenues	$94.6 billion
Revised Full-Year 2025 Adjusted EPS Guidance	$6.00 to $6.20

Independent pharmacies in the Caremark PBM network

CVS Caremark maintains a broad network to ensure member access, which includes a significant component of independent pharmacies. This supports local access and the overall pharmacy ecosystem. The company is focused on ensuring that members have easy access to local options.

• Percentage of national PBM network pharmacies that are independent: almost 43%.
• Percentage of Caremark plan members with convenient local pharmacy access: 98%.
• Historical plan to include up to 10,000 independent community pharmacies in a performance-based network.

Technology and data analytics vendors for digital health platforms

CVS Health is making substantial investments in technology partnerships to build an open, interoperable digital health platform, addressing system fragmentation. This commitment involves significant capital allocation and collaboration with major technology players.

The company has committed to investing $20 billion in technology over the next decade for this platform. As part of this push, CVS Health joined the CMS Health Tech Ecosystem initiative, alongside over 60 other companies, including Amazon, Apple, and Google. Furthermore, Aetna, a CVS subsidiary, launched Aetna Care Paths for personalized recommendations. In January 2025, the legacy CVS Pharmacy app was replaced with a new solution featuring an AI-powered search.

Hospitals and provider groups for Aetna's integrated care networks

Aetna is actively deepening its partnerships with provider groups, particularly through care collaboration programs aimed at improving outcomes for its members. The focus is on high-risk transition points in care delivery.

The Aetna Clinical Collaboration (ACC) program embeds Aetna nurses within partner hospitals to support Medicare Advantage members during discharge. Aetna serves approximately 4 million members over 65. The program is projected to reduce year-over-year 30-day readmissions and average hospital stays by 5% once fully implemented. The company expects to have this program in place at 10 hospitals by the end of 2025. This initiative targets the fact that nearly 20% of Medicare enrollees are readmitted within 30 days.

Aetna is also simplifying payer-provider interactions by bundling prior authorizations. As of November 2025, for certain procedures like knee arthroplasty, the associated medication prior authorization is automatically approved upon medical approval.

CVS Health Corporation (CVS) - Canvas Business Model: Key Activities

You're looking at the core engine room of CVS Health Corporation (CVS) as of late 2025, focusing only on the sheer operational scale of what they actually do every day.

Pharmacy Benefit Management (PBM) for over 2 billion adjusted claims annually

The Health Services segment, which houses CVS Caremark, is a massive claims processor. While the total 30-day equivalent claims processed for 2024 was reported at 1.9 billion, down from 2.3 billion in 2023 due to client transitions, the operational scale remains immense. CVS Pharmacy and Consumer Wellness segment filled 438.1 million prescriptions on a 30-day equivalent basis for the three months ended June 30, 2025. The company is pushing its CostVantage model, with all commercial prescriptions dispensed through CVS Pharmacy processed under it effective January 1, 2025. Retail prescription market share grew to 28.9% in the third quarter of CY2025.

Key PBM/Pharmacy Metrics:

• Retail prescription market share (Q3 2025): 28.9%
• Prescriptions filled (Q2 2025, 30-day equivalent): 438.1 million
• Total PBM 30-day equivalent claims processed (2024): 1.9 billion
• CVS Caremark members (as of March-end 2025): almost 88 million

Health insurance underwriting and claims processing (Aetna)

The Aetna side of the business is focused on managing risk for its members, with a strong emphasis on Medicare Advantage quality ratings. As of June 30, 2025, CVS Health had 26.7 million members in its Aetna health insurance plans. The Medical Benefit Ratio (MBR) for the first six months of 2025 was 88.6%, an improvement from 90% in the prior year period. The company projects the full-year 2025 MBR to be approximately 91%. A significant activity is maintaining high quality scores, with over 81 percent of Medicare Advantage members in plans rated 4 stars or higher for 2026, based on October 2025 CMS ratings.

Aetna Health Insurance Snapshot (as of late 2025):

Metric	Value	Period/Context
Total Medical Membership	26.7 million	As of June 30, 2025
Medical Benefit Ratio (MBR)	89.9%	Q2 2025
Medical Benefit Ratio (MBR)	88.6%	First Six Months of 2025
Projected Full-Year MBR	~91%	FY 2025 Estimate
MA Members in 4+ Star Plans (2026 Rating)	Over 81%	As of October 2025

They are actively managing the exit from the individual exchange business, effective with the 2026 benefit year, with about 1 million people in those plans across 17 states as of Q2 2025.

Retail pharmacy operations and prescription fulfillment

CVS Health operates a vast physical footprint, though it is optimizing this. As of June 30, 2025, the Company had approximately 9,000 retail pharmacy locations. The focus is on operational excellence, which helped same-store prescription volumes increase 6.4% in the second quarter of 2025 compared to the prior year. Same-store sales for the enterprise rose 14.3% year-on-year in Q3 CY2025. The company completed a three-year plan to close 900 stores in December 2024 as part of its omnichannel strategy. Some new pharmacy-only formats, averaging under 5,000 square feet, are being introduced to streamline operations.

• Retail Pharmacy Locations (as of June 30, 2025): Approx. 9,000
• Same Store Prescription Volume Growth (Q2 2025): 6.4%
• Total Company Locations (Q3 2025 end): 8,970

Primary care delivery through Oak Street Health and MinuteClinic

This activity involves direct patient care, primarily through the Oak Street Health acquisition, which cost $10.6 billion in 2023. Oak Street Health serves approximately 350,000 patients across over 230 centers in 27 states. The company is adjusting its strategy, planning to close 16 underperforming Oak Street locations in 2026 due to elevated medical costs, but still plans to operate 230 sites. CVS Health also maintains over 1,000 walk-in and primary care medical clinics overall as of June 30, 2025. Oak Street's at-risk membership increased 31% from the same period last year.

Developing biosimilars via the Cordavis subsidiary

Cordavis, established in August 2023, is CVS Health's subsidiary focused on commercializing and/or co-producing biosimilars. This effort is aimed at bringing competition to the specialty pharmaceutical market. Cordavis partnered with Sandoz to bring Hyrimoz (adalimumab-adaz) to market, with a list price expected to be more than 80% less than Humira's WAC. The global biologics market size was projected to approach nearly $1.5 trillion by 2027. Biosimilars are projected to yield $133 billion in savings to the U.S. health care system in the coming years, according to estimates cited by CVS Health.

Cordavis Biosimilar Focus:

• Biosimilar for Humira launched in Q1 2024
• Targeted list price discount for Hyrimoz: >80% vs. Humira
• Cordavis established: August 2023

Finance: draft 13-week cash view by Friday.

CVS Health Corporation (CVS) - Canvas Business Model: Key Resources

You're looking at the core assets that make CVS Health Corporation run, the stuff that can't easily be replicated overnight. These aren't just line items on a balance sheet; they are the engines driving the integrated health strategy as of late 2025.

The foundation of CVS Health Corporation's operational strength is its integrated data platform. This system is designed to connect the dots across pharmacy benefits management (CVS Caremark), the insurance arm (Aetna), and the physical care delivery points, which is essential for managing population health and risk effectively.

The scale of the insurance business is a massive resource. Aetna's medical membership base provides the necessary volume to manage risk and negotiate contracts. As of the first quarter of 2025, the medical membership stood at approximately 27.1 million members. This is supported by the pharmacy benefits manager (PBM) side, which serves about 87 million plan members as of September 30, 2025.

The physical footprint remains a critical access point, even with digital shifts. CVS Health Corporation maintains a network of approximately 9,000 retail pharmacy locations as of September 30, 2025. Honestly, this physical density means nearly 85% of Americans live within 10 miles of a CVS Pharmacy. This network is complemented by more than 1,000 walk-in and primary care medical clinics.

The infrastructure supporting prescription fulfillment is vast, covering both retail and remote channels. This includes the established mail-order and specialty pharmacy infrastructure, which is a key driver for the Health Services segment, which saw an 8% year-over-year revenue increase in its last reported quarter.

Finally, the brand itself is a significant intangible asset. CVS Health Corporation serves an estimated more than 185 million individuals across its various offerings. Trust is a measurable part of that equity; for instance, 77% of U.S. adults report trusting their local pharmacist.

Here's a quick look at the sheer scale of these operational resources as reported in late 2025:

Key Resource Metric	Value (as of late 2025)
Approximate Retail Pharmacy Locations	9,000
Aetna Medical Membership (Q1 2025)	27.1 million members
Total Individuals Served	185 million
PBM Plan Members (Sept 30, 2025)	87 million
Walk-in & Primary Care Clinics	More than 1,000
2024 U.S. Economic Impact	Over $474 Billion

You should also note the supporting human capital and financial impact that these physical and digital assets generate:

• Employees: 300,000+ employees.
• Supported Jobs: Supports 1.3 million jobs nationwide.
• Tax Contribution: Generated $58.6 billion in local, state, and federal taxes in 2024.
• Community Investment: $239 million invested in community initiatives in 2024.

If onboarding takes 14+ days for new digital services, churn risk rises, so the integration speed of that data platform is defintely a near-term operational focus.

Finance: draft 13-week cash view by Friday.

CVS Health Corporation (CVS) - Canvas Business Model: Value Propositions

Lowering the total cost of care through integrated services

CVS Health Corporation delivers value by tying payments to quality outcomes, which drives care quality up and costs down.

• Oak Street Health's value-based care model resulted in a 44% reduction in hospital admissions compared to similar Medicare patient populations.
• Integrated mental and physical health models in clinics have shown a decrease in total cost of care by about 10 to 14%.

Transparent drug pricing models like CVS CostVantage and TrueCost

CVS Health introduced new pharmacy reimbursement models planned for launch in 2025 to bring greater transparency.

• CVS CostVantage, a cost-based reimbursement approach, was planned for launch with PBMs for commercial payors in 2025.
• CVS Caremark TrueCost, an optional PBM program reflecting true net drug costs with visibility into administrative fees, was also planned for launch in 2025.
• The pharmacy segment posted a top-line growth of 12.5% and Adjusted Operating Income (AOI) growth of 7.6%, partly fueled by the CostVantage reimbursement model.

Convenient, local access to pharmacy and primary care services

The physical footprint provides accessible touchpoints for consumers to receive care.

• As of June 30, 2025, CVS Health operated approximately 9,000 retail pharmacy locations.
• The company maintained more than 1,000 walk-in and primary care medical clinics as of June 30, 2025.
• MinuteClinics treat about 5 million patients, with roughly half lacking a relationship with a primary care provider or not having seen one in years.
• The national average wait time for a primary care appointment is about 26 days, but some MinuteClinic patients reported waiting between three months and a year to see their PCP.
• Trust in pharmacists remains strong, with 77% of adults trusting their local pharmacist and 84% viewing pharmacies as credible health care sources.
• 80% of patients prefer face-to-face pharmacy care.

Comprehensive health insurance plans (Medicare, Medicaid, Commercial)

CVS Health Corporation, through Aetna, offers a broad range of insurance products.

Metric	Value/Amount	Context/Date
CVS Caremark Plan Members (PBM)	Approximately 87 million	As of June 30, 2025
People Served by Health Insurance Products	Estimated more than 37 million	As of June 30, 2025
Aetna MA Members in 4-Star Plans or Higher	Over 81%	For 2026 Star Ratings (enrollment as of September 2025)
Aetna MA Members in 4.5-Star Plans	Over 63%	For 2026 Star Ratings (enrollment as of September 2025)
Aetna MAPD Plan Footprint	44 states plus Washington, D.C.	For 2025
Aetna MAPD Plan Counties Offered	2,259 counties	For 2025
Total Medicare Members (Aetna)	About 10.5 million	Including 4.3 million in individual or employer group MA plans (enrollment as of September 2025)
Aetna Medical Loss Ratio (MLR)	87.3% (Q1 2025) vs. 90.4% (Q1 2024)	First Quarter 2025

Management of complex, high-cost conditions like GLP-1 usage

CVS Health Corporation utilizes its Weight Management program to optimize GLP-1 effectiveness and manage costs.

• CVS Caremark clients adopting the program spent up to 26% less on GLP-1 medications for weight loss compared to non-adopting clients.
• 92% of participating plan members reported satisfaction after six months in the program.
• As of February 1, 2025, the program was available to more than 3.5 million CVS Caremark plan members.
• Members who previously lost less than 1% body weight on medication achieved an average loss of 11.7% after enrollment-a 13x improvement.
• Participants with moderate pre-program success reached an average weight loss of 20%.
• Members who discontinued anti-obesity medication but kept lifestyle support retained 94% of their weight loss after 6 months.

CVS Health Corporation (CVS) - Canvas Business Model: Customer Relationships

You're looking at how CVS Health Corporation manages its relationship with the vast number of people it serves, which, as of Q1 2025, totaled approximately 185 million consumers across its integrated businesses. This relationship strategy blends high-tech automation with crucial in-person, specialized care.

The relationship strategy is multi-faceted, catering to different customer needs, from the everyday retail shopper to the complex needs of a Medicare Advantage enrollee.

Automated digital self-service via the all-in-one mobile app

CVS Health pushes digital engagement, understanding that self-service tools directly impact loyalty. Patients who register on the website and use text alerts typically show a higher Net Promoter Score (NPS) compared to those who don't use these digital capabilities. Furthermore, the AI and machine learning powering Next Best Actions (NBAs) for Aetna members have driven a 5% increase in medication adherence for Commercial members managing chronic conditions. This shows the digital relationship is designed to be proactive, not just transactional.

Personalized, high-touch care at Oak Street Health centers

The relationship here is deep and focused on value-based care for seniors. While CVS Health is rightsizing the footprint, closing 16 Oak Street Health Centers (or 7% of the total) by early 2026 due to cost pressures, the remaining network is substantial. Following these closures, CVS Health will operate 230 Oak Street Health sites across 27 states. These centers focus on Medicare beneficiaries, who average 69 years of age and often manage multiple conditions. The high-touch model has demonstrated clinical impact, achieving a 44% reduction in hospital admissions for its patients compared to similar Medicare patients. The acquisition itself cost more than $10 billion two years prior.

Here's a look at the scale and impact of the integrated care delivery assets:

Metric	Data Point	Context/Timeframe
Operating Oak Street Health Centers	230	Post-closure, across 27 states (Late 2025/Early 2026)
Hospital Admission Reduction (OSH)	44%	Compared to similar Medicare patients
Older Adults Receiving Medication Screening (MinuteClinic)	342,240	Between 2021 and August 2025
Total Consumers Served (All Businesses)	Approx. 185 million	Q1 2025

Pharmacist-patient consultations and medication reviews in-store

The retail pharmacy remains a core relationship touchpoint. A key metric here is patient trust in the clinical staff; 90% of patients report being extremely satisfied with their pharmacists' ability to answer their questions effectively. This satisfaction is a primary driver of the Net Promoter Score (NPS). Furthermore, the company has been focused on freeing up pharmacists' time, for example, by launching virtual verification to allow them to focus more on patient interaction rather than administrative tasks.

Dedicated account management for PBM and Aetna corporate clients

For large clients, the relationship is managed through dedicated structures, especially within the Aetna insurance arm and the CVS Caremark PBM. As of June 30, 2025, Aetna medical membership stood at 26.7 million members. A significant move to simplify the client/member experience for Aetna members involved integrating pharmacy prescriptions and medical procedures into a single clinical review process, announced in December 2025, aiming to reduce the need for multiple prior authorizations.

Empathetic support for complex claims and benefit navigation

Navigating benefits is critical for member retention. Aetna's Medicare Advantage (MA) plans are a key focus for this relationship. For 2026, 81% of Aetna members are enrolled in plans with four or more stars, a slight drop from 88% in 2025, which signals ongoing navigation or cost pressures in that segment. However, select 2025 MA plans offer $0 copay for primary care visits, directly addressing affordability concerns. Overall, 85% of Americans live within 10 miles of a CVS Pharmacy, ensuring physical access is rarely a barrier to support.

• 85% of Americans live within 10 miles of a CVS Pharmacy.
• Aetna MA Star Rating for 2026: 81% of members in 4+ star plans.
• Aetna MA Star Rating for 2025: 88% of members in 4+ star plans.
• Select Aetna 2025 plans offer $0 copay for primary care visits.

CVS Health Corporation (CVS) - Canvas Business Model: Channels

You're looking at how CVS Health Corporation (CVS) gets its value propositions to its customers across its massive ecosystem. It's not just one storefront anymore; it's a complex web of physical and digital touchpoints, which is key to understanding their scale as of late 2025.

The physical footprint remains substantial, even with ongoing optimization. As of September 30, 2025, CVS Health operated approximately 9,000 retail pharmacy locations across the United States. This density means nearly 85% of Americans live within 10 miles of a CVS Pharmacy, which is a massive advantage for immediate care access. However, this channel is actively being streamlined; the company confirmed plans to close 270 stores in 2025 as part of an enterprise-wide restructuring effort intended to simplify the organization and reduce costs. Also part of the physical delivery network are the care delivery sites, which included more than 1,000 walk-in and primary care medical clinics, such as MinuteClinic and Oak Street Health locations, as of that same September date.

The integrated care delivery model is channelled through these clinics. For instance, Aetna Medicare plans in 2025 feature a $0 primary care copay, including walk-in clinics, directly driving utilization through this channel.

For prescription fulfillment beyond the retail counter, CVS Caremark manages large-scale distribution. This includes mail-order and specialty pharmacy services. CVS Caremark, acting as a leading pharmacy benefits manager, served approximately 87 million plan members as of September 30, 2025. Through CVS Caremark Mail Service, members can receive up to 90-day supplies of maintenance medications with no delivery fee. For complex needs, CVS Specialty handles specialty medications, offering 24/7 access to trained pharmacists and nurses.

Digital channels are a major focus for deepening customer connection. CVS Health now serves more than 47 million unique digital customers. These digital users are, on average, twice as engaged as non-digital customers and drive higher margins. In January 2025, CVS Health replaced its legacy app with a new, all-in-one solution designed to improve access, affordability, and convenience for these customers. This platform allows management of prescriptions across CVS Pharmacy stores, CVS Caremark mail orders, and CVS Specialty pharmacies. Furthermore, CVS Health announced plans to invest $20 billion over the next 10 years to build a more technology-enabled, open, and interoperable digital health platform.

The insurance arm, Aetna, utilizes its own dedicated channels for member acquisition and service. Aetna, a CVS Health business, serves an estimated more than 37 million people through its health insurance products as of late 2025. For 2025 Medicare Advantage offerings, Aetna plans were available in 44 states plus Washington, D.C., covering 2,259 counties. While specific numbers for the direct sales force aren't readily available, the structure relies on sales professionals and broker networks, as evidenced by 2025 incentive programs for small group medical sales that reward brokers based on new business and retention metrics. Aetna Medicare serves about 10.5 million Medicare members nationwide in 2025.

Here's a quick look at the scale across these primary access points:

Channel Type	Metric	Data Point (as of late 2025)
Retail Pharmacy	Approximate Store Count	9,000 locations
Care Delivery	Primary Care/Walk-in Clinics	Over 1,000 clinics
PBM/Mail Order	CVS Caremark Plan Members	Approximately 87 million members
Insurance (Aetna)	Total People Served	Estimated more than 37 million people
Digital	Unique Digital Customers	More than 47 million

The digital strategy is designed to connect these disparate services. The new CVS Health app helps users manage prescriptions across all three pharmacy types:

• CVS Pharmacy retail fulfillment
• CVS Caremark mail orders
• CVS Specialty pharmacies

The company is defintely pushing for an omni-channel experience, connecting face-to-face and virtual care.

CVS Health Corporation (CVS) - Canvas Business Model: Customer Segments

You're looking at the core groups CVS Health Corporation serves as of late 2025, which is a massive and diverse set of stakeholders across the entire healthcare value chain.

Health plan sponsors (employers, unions, government entities) are key customers for the Health Services segment, primarily through CVS Caremark, the pharmacy benefits manager (PBM).

• CVS Caremark had approximately 87 million plan members as of June 30, 2025.
• The PBM membership reached almost 88 million as of March-end 2025.
• The Health Care Benefits segment saw revenue increase 8% in Q1 2025.
• The Medical Loss Ratio (MLR) for the health plans decreased to 92.8% in the three months ended September 30, 2025.

Health insurance members (Aetna, Medicare Advantage, Medicaid) form the base of the Health Care Benefits segment.

• CVS Health serves an estimated more than 37 million people through its health insurance products as of June 30, 2025.
• Aetna served about 10.5 million Medicare members nationwide as of October 1, 2024.
• Aetna's largest Employer Group Medicare Advantage contract (H5522) serves over 1.3 million members.
• Aetna's Individual Medicare Advantage contract (H5521) serves 1.1 million members across 33 states.
• For 2026, Aetna plans to offer Medicare Advantage Prescription Drug plans accessible by 57 million Medicare-eligible beneficiaries.
• For 2026 plans, over 81% of Aetna Medicare Advantage members are in plans rated 4 stars or higher.
• Over 63% of Aetna Medicare Advantage members are in a 4.5-star plan for 2026.

Individual retail consumers for prescriptions and front-of-store products are served by the Pharmacy & Consumer Wellness segment.

Metric	Value as of Late 2025 Data
Retail Pharmacy Locations	Approximately 9,000 as of March 31, 2025
Retail Pharmacy Script Share (Q1 2025)	27.6%
Q1 2025 Prescriptions Filled (30-day basis)	435.5 million
Q1 2025 Same Store Prescription Volume Growth	6.7%
Q1 2025 Pharmacy & Consumer Wellness Total Revenues	$31,912 million
Patient Preference for Face-to-Face Care	80%

Retail pharmacy remains a vital touchpoint; honestly, nearly 85% of Americans live within 10 miles of a CVS pharmacy.

Patients seeking primary care at Oak Street Health and MinuteClinic represent the Health Care Delivery component, focused heavily on seniors.

• CVS operates more than 1,000 walk-in and primary care medical clinics as of March 31, 2025.
• Oak Street Health patients are Medicare beneficiaries averaging 69 years of age.
• Oak Street Health achieved a 44% reduction in hospital admissions compared to similar Medicare patients.
• MinuteClinic provided medication screening to 342,240 older adults between 2021 and August 2025.
• CVS determined it would reduce the number of new primary care clinics opened in 2026 and thereafter.
• The company incurred a $5.7 billion goodwill impairment charge related to the Health Care Delivery reporting unit in Q3 2025.

Long-Term Care (LTC) facilities and institutional customers are served through specialized pharmacy services.

• The dedicated senior pharmacy care business serves more than 800,000 patients per year as of June 30, 2025.
• The Pharmacy & Consumer Wellness segment provides pharmacy services to long-term care facilities.

Overall, CVS Health's operations support 1.3 million jobs nationwide and serve 185 million individuals across the U.S.. Finance: draft Q4 2025 segment revenue projections by next Tuesday.

CVS Health Corporation (CVS) - Canvas Business Model: Cost Structure

You're looking at the major drains on CVS Health Corporation's cash flow as of late 2025. Honestly, the cost structure is a mix of massive operational scale and significant one-time charges.

Cost of Revenue and Pharmacy Pressures

The largest cost component is tied up in the cost of goods sold, primarily pharmaceutical procurement and claims expenses, which underpins the record third quarter total revenues of $102.9 billion. Within the Pharmacy & Consumer Wellness (PCW) segment, adjusted operating income decreased year over year, driven by continued pharmacy reimbursement pressure and increased investments in colleagues and capabilities. Management specifically cited contract mix, including slower growth in GLP-1 compounding and dynamics in specific autoimmune/HIV products, as a source of pressure on the Health Services segment's adjusted operating income.

Medical Benefit Ratio (MBR) Management for Aetna

For the Aetna health insurance side, managing the Medical Benefit Ratio (MBR) is a critical cost control focus. For the three months ended September 30, 2025, the MBR decreased to 92.8%, an improvement from 95.2% in the prior year period. This favorable movement was driven by the year-over-year impact of premium deficiency reserves recorded as health care costs, higher favorable prior period development, and improved underlying performance in the Government business.

Store Operations and Employee Costs

The massive retail footprint necessitates substantial fixed and variable costs related to store operations and employee compensation. CVS Health Corporation operates over 9,000 stores primarily in the US. A key operational cost driver recently has been the integration of acquired assets; the company noted retail script share grew to approximately 28.9%, fueled by the conversion of 63 stores and 626 prescription files from former Rite Aid and Bartell locations.

Capital Expenditures for Growth and Maintenance

Investment in the physical and digital infrastructure remains a steady cost. CVS Health Corporation maintains its capital expenditures projection for the full year 2025 to be between $2.9 billion and $3.1 billion. Looking at the immediate past, the cash flow for capital expenditures for the trailing twelve months ended in September 2025 was $-2,816.00 Mil. Here's a quick look at the projected and recent CapEx figures:

Metric	Amount (USD)
Projected Full-Year 2025 CapEx Range	$2.9 billion to $3.1 billion
Trailing Twelve Months (TTM) CapEx (As of Sep. 2025)	$-2,816.00 Million
Q3 2025 Quarterly CapEx	$-698 Million

Integration and Restructuring Charges

Significant non-operational, but real, costs hit the bottom line in Q3 2025. The company incurred a $5.7 billion goodwill impairment charge related to the Health Care Delivery reporting unit. This charge was the primary driver behind the GAAP diluted loss per share of $(3.13) for the quarter. The operating loss in Q3 2025 was also influenced by the absence of approximately $1.2 billion of restructuring charges that were recorded in the prior year period. The decision to temper Oak Street Health clinic growth over the next few years was cited as the primary reason for the goodwill write-down.

• Goodwill Impairment Charge (Q3 2025): $5.7 billion
• Restructuring Charges Absent (Q3 2025 vs. PY): Approximately $1.2 billion offset
• Impact on GAAP EPS (Q3 2025): $(3.13) loss per share

Finance: draft 13-week cash view by Friday.

CVS Health Corporation (CVS) - Canvas Business Model: Revenue Streams

You're looking at the core ways CVS Health Corporation brings in cash as of late 2025. It's a complex mix, reflecting their three main operating segments. Honestly, the numbers show a heavy reliance on the flow of prescriptions and managing insurance risk.

The total revenue for the third quarter of 2025 hit a record high of $102.9 billion, which was up 7.8% compared to the prior year quarter. This top-line performance is the sum of the three major business units, each with its own distinct revenue mechanism.

Here is a breakdown of the key revenue components based on the third quarter of 2025 performance:

Revenue Stream Category	Q3 2025 Reported Amount (Billions USD)	Primary Driver/Context
Health Services revenue	$49.3 billion	Pharmacy Benefit Management (PBM) services and provider services like Oak Street Health. Segment revenue grew over 11% year-over-year.
Pharmacy & Consumer Wellness revenue	$36.2 billion	Retail pharmacy sales, prescription volume, and consumer product sales. Revenue increased nearly 12% versus the prior year quarter.
Health Care Benefits revenue	$36.0 billion	Insurance premiums, primarily from the Aetna subsidiary. Growth was driven by increases in the Government business, largely due to the impact of the Inflation Reduction Act (IRA) on Medicare Part D.
Total Consolidated Revenue (for context)	$102.9 billion	Sum of all operating segments for Q3 2025.

The revenue from the Health Services segment, which includes CVS Caremark, is generated through several avenues tied to managing drug benefits and care delivery. You should note the strategic shift in how dispensing revenue is recognized.

• Pharmacy Benefit Manager (PBM) services revenue, driven by contract wins totaling nearly $6.0 billion in the selling season.
• Provider services revenue from the Health Care Delivery unit, which includes Oak Street Health assets.
• The segment saw a decrease in adjusted operating income of 7.0% due to continued pharmacy client price improvements.

For the Pharmacy & Consumer Wellness segment, the revenue model is shifting to provide more predictable income streams for the retail pharmacies. This is a big deal for the company's near-term stability.

Pharmacy dispensing fees and markups are now governed by the CostVantage model for commercial payers, which CVS Health successfully converted contracts to for 2025. This means reimbursement is based on:

• The actual cost of the drug.
• A defined markup on that cost.
• An additional pharmacist fee for handling and dispensing the medication.

The company plans to transition several government services programs to this cost-based pricing model in 2026. Retail script share rose to 28.9%.

Investment income from cash reserves and float is a secondary, but important, component, particularly for the Health Care Benefits segment. While specific Q3 2025 figures aren't immediately available, we know that in the prior year, an increase in net investment income helped offset utilization and acuity pressures in the Health Care Benefits segment. This income is generated from managing the large cash balances and insurance float held by the Aetna business.

The full-year 2025 total revenue guidance was raised to at least $397 billion.

Finance: draft 13-week cash view by Friday.