Revenue up. Earnings down. That was the news for investors the last time Anthem (ELV -0.89%) reported its quarterly results in January. But a quarter has come and gone since then.

Anthem announced its first-quarter results before the market opened on Wednesday. Did investors receive good news or bad news? Here are the highlights from Anthem's Q1 update.

Man signing up for healh insurance with female insurance agent

Image source: Getty Images.

By the numbers

Anthem announced Q1 revenue of $24.7 billion, a 9.4% increase from the $22.5 billion reported in the same quarter of the previous year. The company's reported revenue was higher than the average analysts' revenue estimate of $24.28 billion .

The company announced GAAP net income of $1.55 billion, or $5.91 per share, in the first quarter. This represented an 18.2% increase from $1.31 billion, or $4.99 per share, reported in the same quarter of 2018.

The company's adjusted net income in the first quarter was $6.03 per share. This was an improvement over Anthem's result in the prior-year period, when the company announced net income of $5.41 per share. It was also better than the consensus analysts' adjusted earnings estimate of $5.86 per share.

Behind the numbers

There were several reasons Anthem's revenue grew this quarter. The company's medical enrollment increased by nearly 3% from the prior-year period to 40.8 million members. This growth stemmed largely from the growth in the company's Medicare and Medicaid programs. 

Anthem also benefited from premium rate increases. However, the impact of these increases was offset to some extent by the waiver of the health insurance tax in 2019.

The health insurer's strong earnings growth was primarily due to lower selling, general, and administrative costs and lower income tax expense compared to the prior-year period. These were offset somewhat, though, by a higher benefit expense ratio of 84.4%, compared with 81.5% in the prior-year period, an increase that resulted mainly from the one-year waiver of the health insurance tax. 

Looking ahead

Anthem anticipates full-year 2019 GAAP earnings per share (EPS) of $18.27, with adjusted non-GAAP EPS expected to be greater than $19.20. Medical membership is also expected to be between 40.9 million and 41.3 million. 

President and CEO, Gail K. Boudreaux expressed optimism about Anthem's prospects this year. She said: 

Looking ahead, the upcoming launch of IngenioRx is a key milestone in the realization of our vision and strategy. With IngenioRx, we finally have a strong integrated pharmacy and medical platform, one that is predicated on providing the lowest absolute cost of care, and we are well positioned for accelerated growth.