Cigna Group runs two big businesses under one roof. The first, Evernorth Health Services, processes prescription drug claims through its Express Scripts pharmacy benefit network, ships medications from its own pharmacies directly to patients' homes, and distributes specialty drugs to hospitals and clinics. The second, Cigna Healthcare, collects premiums or fees from employers to cover their workers' medical costs, running health plans in the United States and internationally. Every time a pharmacist fills a prescription inside the Express Scripts network, Cigna earns a fee. Every time an employer pays to insure their workers, Cigna collects a premium. The diagram below traces where the money goes.
Five years of financial data tell a clear story about which engine is doing the heavy lifting. Total revenue has grown every single year, from $174.1 billion in 2021 to $274.9 billion in 2025. But almost all of that growth has come from Evernorth, the pharmacy side, not from the health insurance side. Pharmacy revenues alone reached $216.7 billion in 2025, up from $137.2 billion in 2023. That is a very large number moving very fast.
There is a catch buried inside that revenue growth. Gross margin, the share of each revenue dollar left after paying for pharmacy drugs and medical care, has been falling steadily. It stood at roughly 32% in 2021 and dropped to about 22% in 2025. This means Cigna is processing far more volume, but keeping a smaller slice of each dollar it handles. The pharmacy business is built on thin margins run at enormous scale, so the math only works if volume keeps growing.
Operating cash flow tells a slightly different story. It reached a peak of $11.8 billion in 2023, then slipped to $10.4 billion in 2024 and $9.6 billion in 2025. That dip happened even as revenue kept climbing, which means the business is spending more to support its growth than the top-line numbers suggest. Net debt has also stayed stubbornly high, sitting at $23.8 billion at the end of 2025, only modestly improved from $28.6 billion in 2021.
The health insurance side of the business, Cigna Healthcare, went through a major change in 2025. Cigna sold its Medicare Advantage business to Health Care Service Corporation for $4.9 billion, completing the deal on March 19, 2025. This removed a large block of government-funded customers from the books. Medical customers fell by about 1 million as a result, dropping from 19.1 million to 18.1 million. The Cigna Healthcare segment's revenues also fell 11% to $47.2 billion in 2025. The company framed this as a strategic refocus toward its Evernorth pharmacy business.
Now for the risks. Cigna's filing names several specific threats that are worth understanding clearly, because they are not vague possibilities but documented vulnerabilities in how the business actually works.
The ten largest pharmacy chains make up about 47% of the stores in Cigna's biggest pharmacy network. If one of those chains walked away or demanded much worse terms, millions of customers could lose convenient access to pharmacies overnight. That kind of disruption would hurt clients and could cause them to switch to a competitor. Separately, a single pharmacy benefit client generated approximately 19% of total revenue from external customers in 2025. That is an enormous concentration in one relationship. The filing also notes that the U.S. Federal Government, through programs like the military's TRICARE health coverage, accounted for 11% of total revenue from external customers in 2024. Governments can cut funding or cancel contracts on short notice.
There is also the problem of predicting medical costs. Cigna sets insurance premium rates before it knows what it will actually pay out. If real medical costs come in higher than expected, the company absorbs the difference. The medical care ratio for Cigna Healthcare, which measures medical costs as a percentage of premiums, rose from 81.3% in 2023 to 83.2% in 2024 and then to 84.4% in 2025. That trend is moving in the wrong direction. Higher ratios mean less money left over after paying claims. The Individual and Family Plans business was specifically called out as a drag on results in 2025.
On the legal front, the U.S. Federal Trade Commission filed an administrative complaint against Cigna in 2024, alleging unfair rebate practices related to insulin pricing. A settlement was reached in February 2026 without financial penalties, but the company noted it continues to face ongoing government investigations and audits. These could result in fines, restrictions, or limits on participating in government health programs.
Cigna launched a strategic optimization program in early 2025, reporting $749 million in pre-tax costs for the year. The company expects that program to generate annualized after-tax savings of at least $500 million once complete, with a portion already realized in 2025. It also repurchased 11.9 million shares for approximately $3.6 billion during 2025, a significant step down from the $7.0 billion spent on repurchases in 2024.