Common-Size Income Statement
Quarterly Data
CVS Health Corp., common-size consolidated income statement (quarterly data)
Based on: 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-K (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31).
- Revenue Composition Trends
- The proportion of revenue derived from products has generally declined over the periods analyzed, starting at approximately 71% and decreasing notably to around 61% by early 2025. In contrast, premiums as a revenue source have exhibited an increasing trend, rising from roughly 26% to nearly 35% in the same timeframe. Services revenues have remained a minor yet gradually increasing component, growing from under 3% to slightly above 4% towards the end of the period.
- Cost of Revenues and Gross Profit
- Costs related to products sold have shown some volatility but trended downward more recently, falling from approximately 60-62% of revenues to around 54%. Health care costs have increased notably, climbing from near 22% earlier to over 30% in the later periods, suggesting rising expenses in this segment. Collectively, the cost of revenues has increased slightly over time, moving from about 82% to around 85-87% in the latest quarters, which has corresponded with a general decline in gross profit margins, from near 18% down to approximately 13-15%.
- Operating Expenses
- Operating expenses have modestly decreased as a share of revenues, dropping from circa 13% to roughly 11-12% in later quarters. This suggests some operational efficiency improvements or cost controls, despite the challenges in cost of revenue.
- Special Charges and Impairments
- There are intermittent charges impacting operating expenses, including restructuring, opioid litigation, store, and goodwill impairments mainly occurring sporadically after 2021. These charges occasionally had material negative effects, especially the large opioid litigation charge observed in mid-2022 and several restructuring and impairment charges thereafter, affecting profitability in certain quarters.
- Profitability Metrics
- Operating income as a percentage of revenues has fluctuated significantly, with peaks above 7% early on and troughs including a notable loss in the third quarter of 2022. In general, operating income has tended to be volatile but illustrates a downward pressure over time, with values often falling below 4% and rarely exceeding mid single-digit percentages later in the timeline.
- Net income attributable to the company has mirrored this pattern, showing variability with a peak around 4.5% early on, dipping into losses in late 2022, and subsequently remaining in a lower range between approximately 1-2% of revenues in recent quarters.
- Investment and Financing Impacts
- Net investment income remained a small positive contributor, generally under 1% of revenues but with an upward trend toward the latest quarters. Interest expense steadily declined as a proportion of revenues from around 1.1% to about 0.7-0.8%, reflecting potentially reduced borrowing costs or lower debt levels. Occasional gains or losses on early debt extinguishment had minor and irregular effects on income.
- Income Taxes
- The effective tax provision varied, often ranging between about 0.4% and 1.5% of revenues but showing occasional tax benefits in certain quarters. These fluctuations slightly moderated net income outcomes but did not reverse overall trends.
- Overall Summary
- The data indicates a transition in revenue composition toward increased reliance on premiums and a decreasing share from product sales, accompanied by rising healthcare-related costs. Despite some operational cost efficiency gains, gross margins and profitability faced downward pressures, partly due to increased cost burdens and episodic special charges. The company’s income generation has become more moderate and volatile, with net income margins generally lower in the periods analyzed. Investment income and financing costs contributed modestly to the financial results. The financial profile suggests challenges in maintaining margin stability amid evolving revenue sources and cost dynamics.