Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

CVS Health Corp., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income	4,586)	8,368)	4,165)	7,898)	7,192)
Depreciation and amortization	4,597)	4,366)	4,247)	4,512)	4,441)
Loss on assets held for sale	—)	349)	2,533)	—)	—)
Store impairments	—)	—)	—)	1,358)	—)
Goodwill impairment	—)	—)	—)	431)	—)
Stock-based compensation	540)	588)	447)	484)	400)
Restructuring charges, impairment of long-lived assets	840)	152)	—)	—)	—)
(Gain) loss on sale of subsidiaries	—)	—)	(475)	—)	(269)
(Gain) loss on early extinguishment of debt	(491)	—)	—)	452)	1,440)
Deferred income taxes	(572)	(676)	(2,075)	(428)	(570)
Other noncash items	(502)	264)	332)	(390)	72)
Accounts receivable, net	(1,301)	(6,260)	(2,971)	(2,703)	(1,510)
Inventories	(102)	1,233)	(1,435)	735)	(973)
Other assets	(38)	(510)	(566)	(3)	364)
Accounts payable and pharmacy claims and discounts payable	2,335)	3,618)	4,260)	2,898)	2,769)
Health care costs payable and other insurance liabilities	2,757)	394)	1,247)	169)	(231)
Other liabilities	(3,542)	1,540)	6,468)	2,852)	2,740)
Change in operating assets and liabilities, net of effects from acquisitions	109)	15)	7,003)	3,948)	3,159)
Adjustments required to reconcile net income to net cash provided by operating activities	4,521)	5,058)	12,012)	10,367)	8,673)
Net cash provided by operating activities	9,107)	13,426)	16,177)	18,265)	15,865)
Proceeds from sales and maturities of investments	10,353)	7,729)	6,729)	7,246)	6,467)
Purchases of investments	(15,191)	(9,043)	(7,746)	(9,963)	(9,639)
Purchases of property and equipment	(2,781)	(3,031)	(2,727)	(2,520)	(2,437)
Proceeds from sale-leaseback transactions	—)	—)	—)	—)	101)
Acquisitions, net of cash and restricted cash acquired	(95)	(16,612)	(139)	(146)	(866)
Proceeds from sale of subsidiaries, net of cash and restricted cash sold	—)	—)	(1,249)	—)	840)
Other	101)	68)	85)	122)	—)
Net cash used in investing activities	(7,613)	(20,889)	(5,047)	(5,261)	(5,534)
Commercial paper borrowings (repayments), net	1,919)	200)	—)	—)	—)
Proceeds from issuance of short-term loan	—)	5,000)	—)	—)	—)
Repayment of short-term loan	—)	(5,000)	—)	—)	—)
Proceeds from issuance of long-term debt	7,913)	10,898)	—)	987)	9,958)
Repayments of long-term debt	(4,773)	(3,166)	(4,211)	(10,254)	(15,631)
Derivative settlements	—)	—)	—)	—)	(7)
Repurchase of common stock	(3,023)	(2,012)	(3,500)	—)	—)
Dividends paid	(3,373)	(3,132)	(2,907)	(2,625)	(2,624)
Proceeds from exercise of stock options	361)	277)	551)	549)	264)
Payments for taxes related to net share settlement of equity awards	(185)	(181)	(370)	(168)	(88)
Other	26)	(201)	(79)	155)	(27)
Net cash provided by (used in) financing activities	(1,135)	2,683)	(10,516)	(11,356)	(8,155)
Net increase (decrease) in cash, cash equivalents and restricted cash	359)	(4,780)	614)	1,648)	2,176)
Cash, cash equivalents and restricted cash at the beginning of the period	8,525)	13,305)	12,691)	11,043)	5,954)
Cash, cash equivalents and restricted cash at the end of the period	8,884)	8,525)	13,305)	12,691)	8,130)

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

A significant downward trend is observed in net cash provided by operating activities, which declined from a peak of $18.27 billion in 2021 to $9.11 billion by the end of 2024. This reduction in operational cash generation occurred despite fluctuations in net income, suggesting that cash conversion efficiency has weakened over the five-year period.

Operating Cash Flow Components: The decline in operating cash flow is closely linked to volatility in working capital. Specifically, accounts receivable experienced a substantial increase in outflows, peaking at $6.26 billion in 2023. Non-cash charges, such as depreciation and amortization, have remained remarkably stable, consistently contributing between $4.2 billion and $4.6 billion annually to the reconciliation of net income to cash flow.
Investing Activities and Strategic Expansion: Investing activities were dominated by a massive capital deployment in 2023, where net cash used in investing reached $20.89 billion. The primary driver was a $16.61 billion net acquisition. Beyond this strategic expansion, purchases of property and equipment have remained steady, fluctuating within a narrow band of $2.4 billion to $3.0 billion per year, indicating a consistent level of maintenance and organic growth investment.
Financing Strategy and Capital Structure: The company shifted its financing approach to support its 2023 acquisition and ongoing obligations. After several years of net debt repayment, long-term debt issuance increased sharply to $10.90 billion in 2023 and $7.91 billion in 2024. This influx of capital offset the heavy investing outflows and supported shareholder distributions. Dividends have shown a consistent upward trajectory, rising from $2.62 billion in 2020 to $3.37 billion in 2024, while share repurchases became a regular feature from 2022 onward, totaling approximately $8.54 billion over three years.
Liquidity and Cash Position: The ending cash, cash equivalents, and restricted cash balance has remained relatively resilient, closing at $8.88 billion in 2024. The volatility in the total cash position was primarily driven by the timing of large-scale acquisitions and the subsequent issuance of debt to maintain liquidity buffers.

In summary, the financial trajectory is characterized by a transition from strong internal cash generation to a period of heavy strategic investment funded by external debt. The combination of declining operating cash flows and increasing dividend obligations suggests a growing reliance on the capital markets to sustain growth and shareholder returns.

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CVS Health Corp. (NYSE:CVS)

Cash Flow Statement