Elevance Health Q4 Revenue Jumps 10% While Adjusted Gain Dips to $400M
Elevance Health reported Q4 2025 revenue of $49.3 billion, up 10% year-over-year, but Q4 adjusted operating gain fell to $0.4 billion with benefit expense ratio rising 110 basis points to 93.5%. Full-year revenue rose 13% to $197.6 billion, Carelon revenue jumped 33% to $71.7 billion, and the company repurchased 1.4 million shares for $471 million.
1. Q4 2025 Operating Revenue and Earnings Performance
Elevance Health delivered fourth quarter operating revenue of $49.3 billion, up 10% year-over-year driven by higher premium yields, contributions from recent acquisitions and Medicare Advantage membership growth. Operating gain was $0.3 billion compared to $0.7 billion in Q4 2024, while adjusted operating gain declined to $0.4 billion from $0.8 billion. The adjusted operating margin narrowed to 0.8% from 1.9% a year earlier, reflecting elevated medical cost trends in Affordable Care Act plans and increased Medicare Part D seasonality from Inflation Reduction Act provisions.
2. Segment Highlights and Membership Trends
In the Health Benefits segment, Q4 revenue rose 11% to $41.8 billion, but the segment reported an adjusted operating loss of $0.2 billion versus a gain of $0.2 billion in the prior year quarter. Medical membership reached 45.2 million, down 1% year-over-year due to Medicaid attrition. Carelon’s operating revenue climbed 27% to $18.7 billion, driven by CarelonRx product growth, expanded risk-based solutions and the CareBridge acquisition; adjusted operating gain held steady at $0.6 billion with margin pressure from investment in scale and technology.
3. Cash Flow, Capital Return and Balance Sheet Discipline
Full-year 2025 operating cash flow was $4.3 billion, equivalent to approximately 0.8 times GAAP net income. Parent company cash and investments totaled $2.6 billion at year-end. During Q4, the company repurchased 1.4 million shares for $471 million and paid $377 million in dividends at $1.71 per share. Approximately $6.7 billion of share repurchase authorization remains, underscoring ongoing commitment to disciplined capital deployment.
4. 2026 Outlook and Profit Forecast
For fiscal 2026, Elevance Health projects adjusted EPS growth below consensus expectations as it anticipates continued elevated medical cost trends. The company cited plans for pricing discipline and targeted investments to improve affordability and navigate regulatory changes, while aiming to return to at least 12% adjusted EPS growth by 2027. The board declared a quarterly dividend of $1.72 per share, payable in March to shareholders of record as of mid-March 2026.