10-QPeriod: Q1 FY2026

Elevance Health, Inc. Quarterly Report for Q1 Ended Mar 31, 2026

Filed April 22, 2026For Securities:ELV

Summary

Elevance Health, Inc. reported its financial results for the quarter ended March 31, 2026. Total revenues increased by 2.6% year-over-year to $50.18 billion, driven by premium rate increases and growth in CarelonRx product revenues, partially offset by membership attrition. However, shareholders' net income saw a significant decrease of 19.2% to $1.76 billion, resulting in diluted EPS of $8.00, down from $9.61 in the prior year's quarter. This decline was primarily attributed to higher medical and operating costs across business lines, particularly a substantial loss contingency accrual related to Medicare Advantage risk adjustment data, and increased corporate expenses associated with an operating model transformation program. The company experienced a decrease in total medical membership by 0.9%, largely due to Medicaid eligibility redeterminations and declines in Medicare Advantage and FEP programs. Despite these challenges, the company maintained strong operating cash flow, which significantly increased to $4.33 billion, largely due to favorable working capital movements. Elevance Health continued its capital return program through dividends and share repurchases, demonstrating a commitment to shareholder value.

Financial Highlights

50 data points
Beta

Revenue

$50.18B

89.1% Gross Margin

Net Income

$1.76B

3.5% Net Margin

EPS (Diluted)

$8.00

Total Assets

$125.83B

Cash & Equivalents

$9.66B

Free Cash Flow

$4.10B

Financial Statements
Beta
Revenue$50.18B
Cost of Revenue$5.46B
Gross Profit$44.72B
SG&A Expenses$6.33B
Operating Income$2.09B
Net Income$1.76B
EPS (Basic)$8.03
EPS (Diluted)$8.00
Shares Outstanding (Basic)219.80M
Shares Outstanding (Diluted)220.40M

Key Highlights

  • 1Total revenues increased by 2.6% to $50.18 billion, driven by premium increases and CarelonRx growth.
  • 2Shareholders' net income decreased by 19.2% to $1.76 billion, with diluted EPS falling to $8.00.
  • 3Total medical membership declined by 0.9%, primarily due to Medicaid redeterminations and lower Medicare Advantage enrollment.
  • 4Operating cash flow significantly increased by 325.7% to $4.33 billion, driven by favorable working capital changes.
  • 5A significant loss contingency accrual of approximately $935 million was recorded for Medicare Advantage risk adjustment data.
  • 6The company incurred $129 million in costs for its Operating Model Transformation Program in Q1 2026.
  • 7Elevance Health returned $1.12 billion to shareholders through common stock repurchases and paid $376 million in dividends during the quarter.

Frequently Asked Questions

The primary driver for the decrease in shareholders' net income was higher medical and operating costs across various business lines. This included a significant loss contingency accrual of approximately $935 million related to the resubmission of certain Medicare Advantage risk adjustment data, as well as increased corporate expenses associated with the Operating Model Transformation Program. Additionally, decreased operating gain in all lines of business and increased interest expense contributed to the decline.

Total medical membership declined by 0.9%, primarily due to attrition in Medicaid membership resulting from eligibility redeterminations. Decreases were also observed in the Medicare Advantage and Federal Employee Program (FEP®) businesses. These were partially offset by an increase in the Employer Group Fee-Based business.

Elevance Health reported a significant increase in operating cash flow to $4.33 billion, up from $1.02 billion in the prior year's quarter. This increase was primarily driven by favorable working capital impacts. The company also continued to return capital to shareholders through $1.12 billion in common stock repurchases and $376 million in dividends.

The Operating Model Transformation Program is a strategic initiative implemented in Q1 2026 to streamline decision-making, simplify organizational structures, and enhance technology use. The company incurred $129 million in costs during the first quarter of 2026, primarily for personnel-related charges like severance. These costs were recognized as operating expense in the Corporate & Other segment.