Cigna completed the sale of its Medicare Advantage, Medicare Individual Stand-Alone Prescription Drug Plans, and CareAllies businesses to HCSC for $4.8B. This signifies a strategic decision to focus on other core business areas.

The company commenced an enterprise-wide initiative to evolve the business and deliver a more efficient and improved experience. This program is expected to continue through December 2026 and includes severance and other employee costs, accelerated asset amortization, and the operating results of certain small non-strategic businesses that we plan to discontinue.

The Company replaced its previous revolving credit agreements and entered into a $6.5 billion, five-year revolving credit and letter of credit agreement that will mature in April 2030, with an option to extend the maturity date for additional one-year periods, subject to consent of the banks.

Cigna reported $215M in pre-tax costs associated with the Strategic Optimization Program, primarily related to employee severance. This indicates active management efforts to streamline operations, but also highlights the short-term costs associated with these initiatives.

The effective tax rate decreased from 368.4% to 14.5%, primarily due to the absence of a valuation allowance related to the impairment of equity securities in 2024. This suggests improved management of the investment portfolio and a more favorable tax environment.

Cigna repurchased 5.0 million shares for approximately $1.5B during the quarter, signaling management's confidence in the company's financial position and future prospects. From April 1, 2025 through May 1, 2025, we repurchased 3.2 million shares for approximately $1.1 billion.

The preparation of interim Consolidated Financial Statements necessarily relies heavily on estimates. This and certain other factors call for caution in estimating full-year results based on interim results of operations.

Our ability to prevent or contain effects of a potential cyberattack or other privacy or data security incident; risks related to our use of artificial intelligence and machine learning

The substantial level of government regulation over our business and the potential effects of new laws or regulations or changes in existing laws or regulations; uncertainties surrounding participation in government-sponsored programs and providing services to payors who participate in government-sponsored programs

The 16% increase in Pharmacy revenues and 9% increase in U.S. Healthcare revenues suggest that Cigna is maintaining or gaining market share in these key segments despite competitive pressures.

The 6% decrease in medical customers, driven by the HCSC transaction, indicates a need for Cigna to strategically adapt to changing market dynamics and potentially explore new growth opportunities to offset the customer loss.

Our client contract pricing is impacted by our ongoing ability to negotiate favorable contracts for pharmacy network, pharmaceutical and wholesaler purchasing, and manufacturer rebates (also referred to as affordability improvements)

The Strategic Optimization Program, with associated costs of $215M, is designed to improve the overall efficiency and effectiveness of Cigna's operations. The program includes severance and other employee costs, accelerated asset amortization, and the operating results of certain small non-strategic businesses that we plan to discontinue.

In Cigna Healthcare, the SG&A expense ratio decreased 110 bps, primarily due to revenue growth outpacing volume-related expenses. This indicates improved efficiency in managing administrative costs.

Operating cash flows decreased for the three months ended March 31, 2025 primarily driven by the timing of settlements related to the accounts receivable facility as well as the absence of favorable net cash flow impacts from onboarding significant new clients in 2024.

We prioritize our use of capital resources to (i) invest in capital expenditures (primarily related to technology to support innovative solutions for our clients and customers)

risks related to our use of artificial intelligence and machine learning; political, legal, operational, regulatory, economic and other risks that could affect our multinational operations, including currency exchange rates

Cigna repurchased 5.0 million shares for approximately $1.5B during the quarter, signaling management's confidence in the company's financial position and future prospects.

We anticipate using the proceeds in alignment with our capital deployment priorities, with the majority allocated to share repurchases.

We prioritize our use of capital resources to (i) invest in capital expenditures (primarily related to technology to support innovative solutions for our clients and customers), provide the capital necessary to maintain or improve the financial strength ratings of subsidiaries, and to repay debt and fund pension obligations if necessary

Primary risks facing many of the issuers in our portfolio include ongoing geopolitical events and economic conditions. To date, most issuers have been successful in managing these issues without a meaningful change in credit quality.

Our portfolio remains in a net unrealized depreciation position due to generally increasing interest rates over the past few years.