Financial Analysis

Commitments and Contingencies Guarantees The Company had the following significant guarantee arrangements at December 31, 2025: ASC Claim Funding Accounts - The Company has arrangements with certain banks for the processing of claim payments for its ASC customers. The banks maintain accounts to fund claims of the Companys ASC customers. The customer is responsible for funding the amount paid by the bank each day. In these arrangements, the Company guarantees that the banks will not sustain losses if the responsible ASC customer does not properly fund its account. The Company can limit its exposure to these guarantees by suspending the payment of claims for ASC customers that have not adequately funded the amount paid by the bank. Separate Accounts Assets - Certain Separate Accounts assets associated with the large case pensions business in the Corporate/Other segment represent funds maintained as a contractual requirement to fund specific pension annuities that the Company has guaranteed. Minimum contractual obligations underlying the guaranteed benefits in these Separate Accounts were approximately $807 million and $857 million at December 31, 2025 and 2024, respectively. See Note 1 Significant Accounting Policies for additional information on Separate Accounts. Contract holders assume all investment and mortality risk and are required to maintain Separate Accounts balances at or above a specified level. The level of required funds is a function of the risk underlying the Se …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Borrowings and Credit Agreements The following table is a summary of the Companys borrowings as of December 31, 2025 and 2024: In millions 2025 2024 Short-term debt Commercial paper $ $ 2,119 Long-term debt 4.1% senior notes due March 2025 724 3.875% senior notes due July 2025 2,828 5% senior notes due February 2026 1,500 1,500 2.875% senior notes due June 2026 1,750 1,750 3% senior notes due August 2026 750 750 3.625% senior notes due April 2027 750 750 6.25% senior notes due June 2027 372 372 1.3% senior notes due August 2027 2,250 2,250 4.3% senior notes due March 2028 5,000 5,000 5% senior notes due January 2029 1,000 1,000 5.4% senior notes due June 2029 1,000 1,000 3.25% senior notes due August 2029 1,750 1,750 5.125% senior notes due February 2030 1,500 1,500 3.75% senior notes due April 2030 1,500 1,500 1.75% senior notes due August 2030 1,250 1,250 5.25% senior notes due January 2031 750 750 1.875% senior notes due February 2031 1,250 1,250 5.55% senior notes due June 2031 1,000 1,000 2.125% senior notes due September 2031 1,000 1,000 5% senior notes due September 2032 750 5.25% senior notes due February 2033 1,750 1,750 5.3% senior notes due June 2033 1,250 1,250 5.7% senior notes due June 2034 1,250 1,250 4.875% senior notes due July 2035 652 652 5.45% senior notes due September 2035 1,500 6.625% senior notes due June 2036 771 771 6.75% senior notes due December 2037 533 533 4.78% senior notes due March 2038 5,000 5,000 6.125% senior notes due September 2039 447 44 …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table disaggregates the Companys revenue by major source in each segment for the years ended December 31, 2025, 2024 and 2023: In millions Health Care Benefits Health Services Pharmacy & Consumer Wellness Corporate/ Other Intersegment Eliminations Consolidated Totals 2025 Major goods/services lines: Pharmacy $ $ 181,109 $ 115,510 $ $ (67,594) $ 229,025 Front Store 21,459 21,459 Premiums 134,749 45 (43) 134,751 Net investment income 1,782 20 431 2,233 Other 6,823 9,296 2,398 8 (3,926) 14,599 Total $ 143,354 $ 190,425 $ 139,367 $ 484 $ (71,563) $ 402,067 Health Services distribution channel: Pharmacy network (1) $ 101,775 Mail & specialty (2) 79,334 Net investment income 20 Other 9,296 Total $ 190,425 2024 Major goods/services lines: Pharmacy $ $ 162,527 $ 100,687 $ $ (52,942) $ 210,272 Front Store 21,522 21,522 Premiums 122,849 47 122,896 Net investment income 1,473 285 395 2,153 Other 6,343 10,793 2,291 9 (3,470) 15,966 Total $ 130,665 $ 173,605 $ 124,500 $ 451 $ (56,412) $ 372,809 Health Services distribution channel: Pharmacy network (1) $ 91,650 Mail & specialty (2) 70,877 Net investment income 285 Other 10,793 Total $ 173,605 In millions Health Care Benefits Health Services Pharmacy & Consumer Wellness Corporate/ Other Intersegment Eliminations Consolidated Totals 2023 Major goods/services lines: Pharmacy $ $ 180,710 $ 92,111 $ $ (49,369) $ 223,452 Front Store 22,458 22,458 Premiums 99,144 48 99,192 Net investment income (loss) 765 (1) (5) 39 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

Stock Incentive Plans The terms of the CVS Health 2017 Incentive Compensation Plan (ICP) provide for grants of annual incentive and long-term performance awards to executive officers and other officers and employees of the Company or any subsidiary of the Company, as well as equity compensation to outside directors of CVS Health Corporation. Payment of such annual incentive and long-term performance awards will be in cash, stock, other awards or other property, at the discretion of the Management Planning and Development Committee (the MP&D Committee) of CVS Health Corporations Board of Directors (the Board). The ICP allows for a maximum of 92 million shares of CVS Health Corporation common stock to be reserved and available for grants. As of December 31, 2025, there were approximately 27 million shares of CVS Health Corporation common stock available for future grants under the ICP. Stock-Based Compensation Expense Stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period of the stock award (generally three to five years) using the straight-line method. The following table is a summary of stock-based compensation for the years ended December 31, 2025, 2024 and 2023: In millions 2025 2024 2023 Restricted stock units and performance stock units $ 467 $ 461 $ 497 Stock options and stock appreciation rights (SARs) (1) 68 79 91 Total stock-based compensation $ 535 $ 540 $ 588 ____ …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

Fair Value The preparation of the Companys consolidated financial statements requires certain assets and liabilities to be reflected at their fair value and others to be reflected on another basis, such as an adjusted historical cost basis. In this note, the Company provides details on the fair value of financial assets and liabilities and how it determines those fair values. The Company presents this information for those financial instruments that are measured at fair value for which the change in fair value impacts net income attributable to CVS Health or other comprehensive income separately from other financial assets and liabilities. Financial Instruments Measured at Fair Value on the Consolidated Balance Sheets Certain of the Companys financial instruments are measured at fair value on the consolidated balance sheets. The fair values of these instruments are based on valuations that include inputs that can be classified within one of three levels of a hierarchy established by GAAP. The following are the levels of the hierarchy and a brief description of the type of valuation information (valuation inputs) that qualifies a financial asset or liability for each level: Level 1 Unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 Valuation inputs other than Level 1 that are based on observable market data. These include: quoted prices for similar assets in active markets, quoted prices for identical assets in inactive markets, valuation i …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

Goodwill and Other Intangibles Goodwill Below is a summary of the changes in the carrying amount of goodwill by segment for the years ended December 31, 2025 and 2024: In millions Health Care Benefits Health Services Pharmacy & Consumer Wellness Total Balance at December 31, 2023 $ 46,644 $ 34,066 $ 10,562 $ 91,272 Balance at December 31, 2024 46,644 34,066 10,562 91,272 Impairment (5,725) (5,725) Divestiture (69) (69) Balance at December 31, 2025 $ 46,644 $ 28,272 $ 10,562 $ 85,478 During 2025, the Health Care Delivery reporting unit continued to experience challenges, including the impact of persistent elevated utilization levels. In order to best respond to these challenges, the Company made a number of changes to its Health Care Delivery management team during 2025. During the third quarter of 2025, this new management team finalized certain strategic changes, including the determination that it would reduce the number of new primary care clinics it would open in 2026 and annually thereafter. The Company also determined that it would close certain existing Oak Street Health clinics in 2026. The strategy changes were presented to CVS Health Corporations Board of Directors in September 2025. These changes are expected to impact managements ability to grow the business at the rate that was originally estimated when the Company acquired the associated care delivery assets in 2023 and when the prior year annual goodwill impairment test was performed. Accordingly, the Healt …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

Income Taxes The components of income before income tax provision, based on tax jurisdiction, consisted of the following for the years ended December 31, 2025, 2024 and 2023: In millions 2025 2024 2023 Income before income tax provision: United States $ 1,335 $ 5,964 $ 11,107 Foreign 801 184 66 Total $ 2,136 $ 6,148 $ 11,173 The income tax provision (benefit) consisted of the following for the years ended December 31, 2025, 2024 and 2023: In millions 2025 2024 2023 Current: Federal $ (217) $ 1,622 $ 2,814 State 409 476 662 Foreign 114 36 5 Total current 306 2,134 3,481 Deferred: Federal 92 (456) (543) State 10 (119) (139) Foreign 3 6 Total deferred 102 (572) (676) Total income tax provision (benefit): Federal (125) 1,166 2,271 State 419 357 523 Foreign 114 39 11 Total $ 408 $ 1,562 $ 2,805 The following table is a reconciliation of the statutory income tax rate to the Companys effective income tax rate for the years ended December 31, 2025, 2024 and 2023: 2025 2024 2023 In millions, except percentages $ % $ % $ % Federal statutory tax rate $ 449 21.0 % $ 1,291 21.0 % $ 2,346 21.0 % State and local income taxes, net of federal income tax effect 340 15.9 302 4.9 435 3.9 Foreign tax effects: Ireland Statutory tax rate difference between Ireland and United States (66) (3.1) * Other 19 0.9 * Total foreign tax effects (47) (2.2) (15) (0.2) 7 0.1 Effect of changes in tax laws or rates enacted in the current period Effect of cross-border tax laws: Global intangible low-taxed income 3 …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Leases The Company leases most of its retail stores, mail order facilities and primary care centers, as well as certain distribution centers and corporate offices under operating or finance leases, typically with initial terms of 15 to 25 years. The Company also leases certain equipment and other assets under operating or finance leases, typically with initial terms of 3 to 10 years. In addition, the Company leases pharmacy space at the stores of another retail chain for which the noncancelable contractual term of the pharmacy lease arrangement exceeds the remaining estimated economic life of the buildings. For these pharmacy lease arrangements, the Company concluded that for accounting purposes the lease term was the remaining estimated economic life of the buildings. Consequently, most of these individual pharmacy leases are finance leases. The following table is a summary of the components of net lease cost for the years ended December 31, 2025, 2024 and 2023: In millions 2025 2024 2023 Operating lease cost $ 2,403 $ 2,423 $ 2,532 Finance lease cost: Amortization of right-of-use assets 90 92 84 Interest on lease liabilities 69 71 73 Total finance lease costs 159 163 157 Short-term lease costs 36 33 22 Variable lease costs 646 635 635 Less: sublease income (69) (67) (63) Net lease cost $ 3,175 $ 3,187 $ 3,283 Supplemental cash flow information related to leases for the years ended December 31, 2025, 2024 and 2023 was as follows: In millions 2025 2024 2023 Cash paid for amou …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

New Accounting Pronouncements Recently Adopted Segment Reporting In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures . This standard requires the Company to disclose significant segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and are included within each reported measure of segment operating results. The standard also requires the Company to disclose the total amount of any other items included in segment operating results which were not deemed to be significant expenses for separate disclosure, along with a qualitative description of the composition of these other items. In addition, the standard also requires disclosure of the CODMs title and position, as well as detail on how the CODM uses the reported measure of segment operating results to evaluate segment performance and allocate resources. The standard also aligns interim segment reporting disclosure requirements with annual segment reporting disclosure requirements. The Company adopted the standard on January 1, 2024 for fiscal year reporting and the standard became effective for interim reporting periods in fiscal years beginning after December 15, 2024. The standard requires retrospective application to all prior periods presented. While the standard requires additional disclosures related to the Companys reportable segments, the stand …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Pension Plans and Other Postretirement Benefits Defined Contribution Plans As of December 31, 2025, the Company sponsors 401(k) savings plans that cover all employees who meet plan eligibility requirements. The Company makes matching contributions consistent with the provisions of the respective plans. At the participants option, account balances, including the Companys matching contribution, can be invested among various investment options under each plan. The CVS Health Future Fund 401(k) Plan offers CVS Health Corporations common stock fund as an investment option. The Company also maintains nonqualified, unfunded deferred compensation plans for certain key employees. The plans provide participants the opportunity to defer portions of their eligible compensation and for certain nonqualified plans, participants receive matching contributions equivalent to what they could have received under the CVS Health Future Fund 401(k) Plan absent certain restrictions and limitations under the Internal Revenue Code. The Companys contributions under its defined contribution plans were $657 million, $610 million and $581 million in the years ended December 31, 2025, 2024 and 2023, respectively. Defined Benefit Pension Plans The Company sponsors a tax-qualified defined benefit pension plan that was frozen in 2010 and a nonqualified supplemental pension plan that was frozen in 2007. The Company also sponsors several other defined benefit pension plans that are unfunded nonqualified supplem …

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Segment Reporting The Company has four reportable segments: Health Care Benefits, Health Services, Pharmacy & Consumer Wellness and Corporate/Other. The Companys segments maintain separate financial information, and the CODM, the Companys Chief Executive Officer, evaluates the segments operating results on a regular basis in deciding how to allocate resources among the segments and in assessing segment performance. The CODM evaluates the performance of the Companys segments based on adjusted operating income. Total assets by segment are not used by the CODM to assess the performance of, or allocate resources to, the Companys segments, therefore total assets by segment are not disclosed. Adjusted operating income (loss) is defined as operating income (loss) (GAAP measure) excluding the impact of amortization of intangible assets, net realized capital gains or losses, and other items, if any, that neither relate to the ordinary course of the Companys business nor reflect the Companys underlying business performance. The CODM uses adjusted operating income as its principal measure of segment performance as it enhances the CODMs ability to compare past financial performance with current performance and analyze underlying business performance and trends. Non-GAAP financial measures the Company discloses, such as consolidated adjusted operating income, should not be considered a substitute for, or superior to, financial measures determined or calculated in accordance with GAAP. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Shareholders Equity Share Repurchase Programs The following share repurchase programs have been authorized by the Board: In billions Authorization Date Authorized Remaining as of December 31, 2025 November 17, 2022 (2022 Repurchase Program) $ 10.0 $ 10.0 December 9, 2021 (2021 Repurchase Program) 10.0 1.5 Each of the share Repurchase Programs was effective immediately and permit the Company to effect repurchases from time to time through a combination of open market repurchases, privately negotiated transactions, accelerated share repurchase (ASR) transactions, and/or other derivative transactions. Both the 2022 and 2021 Repurchase Programs can be modified or terminated by the Board at any time. During the year ended December 31, 2025, the Company did not repurchase any shares of its common stock. During the years ended December 31, 2024 and 2023, the Company repurchased an aggregate of 39.7 million shares of common stock for approximately $3.0 billion and an aggregate of 22.8 million shares of common stock for approximately $2.0 billion, respectively, each pursuant to the 2021 Repurchase Program. This activity includes the share repurchases under the ASR transactions described below. Pursuant to the authorization under the 2021 Repurchase Program, the Company entered into a $3.0 billion fixed dollar ASR with Morgan Stanley & Co. LLC. Upon payment of the $3.0 billion purchase price on January 4, 2024, the Company received a number of shares of CVS Health Corporations comm …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing

Commitments and Contingencies Lease Guarantees Between 1995 and 1997, the Company sold or spun off a number of subsidiaries, including Linens n Things and Marshalls. In many cases, when a former subsidiary leased a store, the Company provided a guarantee of the former subsidiarys lease obligations for the initial lease term and any extension thereof pursuant to a renewal option provided for in the lease prior to the time of the disposition. When the subsidiaries were disposed of and accounted for as discontinued operations, the Companys guarantees remained in place, although each initial purchaser agreed to indemnify the Company for any lease obligations the Company was required to satisfy. If any of the purchasers or any of the former subsidiaries fail to make the required payments under a store lease, the Company could be required to satisfy those obligations. As of June 30, 2026, the Company guaranteed 58 such store leases (excluding the lease guarantees related to Linens n Things, which have been recorded as a liability on the unaudited condensed consolidated balance sheets), with the maximum remaining lease term extending through 2036. Guaranty Fund Assessments, Market Stabilization and Other Non-Voluntary Risk Sharing Pools Under guaranty fund laws existing in all states, insurers doing business in those states can be assessed (in most states up to prescribed limits) for certain obligations of insolvent insurance companies to policyholders and claimants. The life and he …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

The following tables disaggregate the Companys revenue by major source in each segment for the three and six months ended June 30, 2026 and 2025: In millions Health Care Benefits Health Services Pharmacy & Consumer Wellness Corporate/ Other Intersegment Eliminations Consolidated Totals Three Months Ended June 30, 2026 Major goods/services lines: Pharmacy $ $ 49,194 $ 27,781 $ $ (16,149) $ 60,826 Front Store 5,407 5,407 Premiums 35,119 11 (13) 35,117 Net investment income (loss) 508 (1) 134 641 Other 1,911 2,602 628 2 (1,038) 4,105 Total $ 37,538 $ 51,795 $ 33,816 $ 147 $ (17,200) $ 106,096 Health Services distribution channel: Pharmacy network (1) $ 26,617 Mail & specialty (2) 22,577 Net investment income (loss) (1) Other 2,602 Total $ 51,795 Three Months Ended June 30, 2025 Major goods/services lines: Pharmacy $ $ 44,276 $ 27,631 $ $ (16,558) $ 55,349 Front Store 5,368 5,368 Premiums 34,184 11 34,195 Net investment income (loss) 407 (3) 83 487 Other 1,667 2,180 582 2 (915) 3,516 Total $ 36,258 $ 46,453 $ 33,581 $ 96 $ (17,473) $ 98,915 Health Services distribution channel: Pharmacy network (1) $ 24,665 Mail & specialty (2) 19,611 Net investment income (loss) (3) Other 2,180 Total $ 46,453 In millions Health Care Benefits Health Services Pharmacy & Consumer Wellness Corporate/ Other Intersegment Eliminations Consolidated Totals Six Months Ended June 30, 2026 Major goods/services lines: Pharmacy $ $ 94,849 $ 53,904 $ $ (30,988) $ 117,765 Front Store 10,666 10,6 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

Fair Value The preparation of the Companys unaudited condensed consolidated financial statements in accordance with GAAP requires certain assets and liabilities to be reflected at their fair value and others to be reflected on another basis, such as an adjusted historical cost basis. The Companys assets and liabilities carried at fair value have been classified within one of three levels of a hierarchy established by GAAP. The following are the levels of the hierarchy and a brief description of the type of valuation information (valuation inputs) that qualifies a financial asset or liability for each level: Level 1 Unadjusted quoted prices for identical assets or liabilities in active markets. Level 2 Valuation inputs other than Level 1 that are based on observable market data. These include: quoted prices for similar assets in active markets, quoted prices for identical assets in inactive markets, valuation inputs that are observable that are not prices (such as interest rates and credit risks) and valuation inputs that are derived from or corroborated by observable markets. Level 3 Developed from unobservable data, reflecting the Companys assumptions. For a description of the methods and assumptions that are used to estimate the fair value and determine the fair value hierarchy classification of each class of financial instrument, see Note 5 Fair Value in the 2025 Form 10-K. There were no financial liabilities measured at fair value on a recurring basis on the unaudited con …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

New Accounting Pronouncements Not Yet Adopted Disaggregation of Income Statement Expenses In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses . The standard requires the Company to provide further disaggregated information of relevant expense captions within its consolidated statements of operations, including the purchases of inventory, employee compensation, depreciation and intangible asset amortization, as well as the inclusion of other specific expenses, gains and losses required by existing GAAP. The new standard also requires the Company to disclose its total selling expenses and, on an annual basis, provide a qualitative description of its selling expenses. The standard is effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The standard may be applied prospectively or retrospectively. While the standard will require additional disclosures related to certain expenses included in the consolidated statements of operations, the standard is not expected to have any impact on the Companys consolidated operating results, financial condition or cash flows. Internal-Use Software In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accou …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Segment Reporting The Company has four reportable segments: Health Care Benefits, Health Services, Pharmacy & Consumer Wellness and Corporate/Other. The Companys segments maintain separate financial information, and the Chief Operating Decision Maker (the CODM), the Companys Chief Executive Officer, evaluates the segments operating results on a regular basis in deciding how to allocate resources among the segments and in assessing segment performance. The CODM evaluates the performance of the Companys segments based on adjusted operating income. Total assets by segment are not used by the CODM to assess the performance of, or allocate resources to, the Companys segments, therefore total assets by segment are not disclosed. Adjusted operating income (loss) is defined as operating income (loss) (GAAP measure) excluding the impact of amortization of intangible assets, net realized capital gains or losses and other items, if any, that neither relate to the ordinary course of the Companys business nor reflect the Companys underlying business performance. The CODM uses adjusted operating income as its principal measure of segment performance as it enhances the CODMs ability to compare past financial performance with current performance and analyze underlying business performance and trends. Non-GAAP financial measures the Company discloses, such as consolidated adjusted operating income, should not be considered a substitute for, or superior to, financial measures determined or …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Shareholders Equity Share Repurchase Programs The following share repurchase programs have been authorized by CVS Health Corporations Board of Directors (the Board): In billions Authorization Date Authorized Remaining as of June 30, 2026 November 17, 2022 (2022 Repurchase Program) $ 10.0 $ 10.0 December 9, 2021 (2021 Repurchase Program) 10.0 1.5 Each of the share repurchase programs was effective immediately and permit the Company to effect repurchases from time to time through a combination of open market repurchases, privately negotiated transactions, accelerated share repurchase (ASR) transactions, and/or other derivative transactions. Both the 2022 and 2021 Repurchase Programs can be modified or terminated by the Board at any time. During the six months ended June 30, 2026 and 2025, the Company did not repurchase any shares of its common stock. Dividends The quarterly cash dividend declared by the Board was $0.665 per share in both the three months ended June 30, 2026 and 2025. Cash dividends declared by the Board were $1.33 per share in both the six months ended June 30, 2026 and 2025. CVS Health Corporation has paid cash dividends every quarter since becoming a public company. Future dividend payments will depend on the Companys earnings, capital requirements, financial condition and other factors considered relevant by the Board. …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing