09:12 AM EST, 02/12/2025 (MT Newswires) -- CVS Health ( CVS ) reported better-than-expected fourth-quarter results on Wednesday, while the healthcare company projected higher 2025 earnings on a year-over-year basis.

Adjusted earnings came in at $1.19 per share for the December quarter, down from $2.12 the year before, but above the FactSet-polled consensus of $0.91. Overall revenue improved 4.2% year over year to $97.71 billion, ahead of the Street's view for $97.09 billion. The stock jumped 9.5% in premarket activity.

"We have continued to see growth in key areas of our business, including the pharmacy and consumer wellness segment, while we address the industry-wide challenges that have impacted our health care benefits segment," Chief Executive David Joyner said in a statement. "We will be positioned for strong performance in 2025 as we deliver simply better care for consumers while improving outcomes and reducing costs."

For the full year 2025, the company anticipates adjusted EPS to be in a range of $5.75 to $6, while the Street is looking for $5.86. In the previous year, the metric declined to $5.42 from $8.74 on an annual basis. CVS Health ( CVS ) forecasts revenue of at least $385.9 billion for the current year, compared with the $372.81 billion recorded in 2024, according to an earnings presentation. The average analyst estimate is for sales of $385.97 billion.

The company expects its medical benefits ratio, which is used to measure medical costs as a percentage of premium revenue, to improve by 100 basis points over 2024 to about 91.5%, Chief Financial Officer Tom Cowhey said during an earnings call, according to a FactSet transcript. "Outperformance on this ratio is one of the largest potential factors that could drive us higher than our adjusted EPS guidance range," according to Cowhey.

For the fourth quarter, sales in the firm's health care benefits segment climbed 23% to $32.96 billion, buoyed by gains in the Medicare and individual exchange product lines. The division's medical benefit ratio came in 94.8% versus 88.5% in the prior-year quarter due to increased utilization and higher acuity in Medicaid, among other factors. A lower ratio likely indicates higher profitability.

Health services revenue decreased 4.3% to $47.02 billion due to the loss of a "large client" and continued pharmacy client price improvements, according to the company. Pharmacy and consumer wellness sales inclined 7.5% to $33.51 billion, boosted by increased prescription volume and pharmacy drug mix.

Total operating costs rose to $95.34 billion from $90.44 billion last year.