CVS Health Corporation reported total revenues of $88.9 billion for the three months ended June 30, up 10.3 per cent year over year.

Operating income was $3.2 billion compared to $4.6 billion in the second quarter of fiscal year 2022.

Year-to-date revenues were $174.2 billion, a 10.6 per cent increase compared to prior year.

“Our diversified business model delivered strong results this quarter. We continue to execute on our strategy to expand access to health services across our care delivery channels and strengthen our engagement with consumers to improve their health and well-being,” said Karen S Lynch, CVS Health President and CEO.

All of CVS Health’s divisions contributed to the strong growth, especially the health care benefit segment where revenues increased by 17.6 per cent, commented Neil Saunders, MD at GlobalData.

Higher revenues, however, are not translating into gains, Saunders continued, adding that operating income fell by 30.7 per cent over last year while net income plunged by 37 per cent.

“CVS’s bottom line numbers are still softer than the prior year as demand for Covid-related services abates and cost inflation runs higher.”

Although CVS maintains good levels of service across its stores to foster customer loyalty, front of store sales decreased by 1.9 per cent on an overall basis and by 0.3 per cent in comparable terms, the first decline in a while.

CVS also does itself no favors on the more premium side of beauty retail as it has not put together a compelling offer nor does it have the in-store standards required to attract customers, Saunders elaborated.

“The second half of the year looks to bring more of the same as CVS continues to feel bottom-line pressures and undertakes further restructuring. The group will likely get back to profit growth as it moves into its next fiscal year,” he said.