CVS Health (CVS 0.13%) has taken investors on something of a roller-coaster ride this year. Its shares have swung up or down by at least 10% three times. But it's been a fun ride overall so far.

CVS Health announced its first-quarter results before the market opened on Tuesday. The healthcare stock jumped more than 3% in early trading. Here are the highlights from CVS' Q1 update.

Pharmacist speaking with customer at pharmacy counter.

Image source: Getty Images.

By the numbers

CVS Health reported first-quarter revenue of $69.1 billion. This reflected a 3.5% increase from the prior-year period revenue total of $66.8 billion. The consensus among Wall Street analysts projected Q1 revenue of $68.39 billion.

The company announced first-quarter net income of $2.2 billion, or $1.68 per share, based on generally accepted accounting principles (GAAP). In the prior-year period, CVS posted GAAP earnings of $2 billion, or $1.53 per share.

CVS Health's adjusted net income in the first quarter came in at $2.04 per share, up from $1.91 per share in the prior-year period. This result easily beat analysts' average adjusted earnings estimate of $1.71 per share.

Behind the numbers

The company achieved growth across all of its businesses in the first quarter. CVS Health's healthcare benefits segment, which includes Aetna, delivered the strongest performance. Revenue for the segment jumped 6.7% year over year to $20.5 billion. This increase was fueled primarily by growth in the company's Medicare and Medicaid business.

Pharmacy services remained CVS Health's biggest revenue generator, though. Total revenue for the segment rose 3.8% year over year to $36.3 billion. The company attributed this growth to net new business, especially with its specialty pharmacy, along with a change in product mix and price increases for brand drugs. However, growth was also negatively impacted by a weak cough, cold, and flu season and by overall price compression.

CVS Health's retail/LTC (long-term care) segment recorded revenue of $23.3 billion in the first quarter, up 2.3% year over year. COVID-19 diagnostic testing and vaccinations provided a nice tailwind for the segment. Sales also increased due to higher brand-drug prices.

This growth was offset to some extent, though, by decreased front-store sales. The main reason for this decline was that sales in the prior-year period were artificially higher due to consumers stocking up during the early days of the COVID-19 pandemic. The weak cough, cold, and flu season also dampened retail sales, as did continued reimbursement pressure and the negative impact of recent generic-drug launches.

Looking ahead

CVS Health raised its full-year 2021 guidance after its solid Q1 results. The company now projects GAAP earnings per share will be between $6.24 and $6.36, up from its previous forecast of $6.06 to $6.22. Non-GAAP earnings per share are expected to be between $7.56 and $7.68, up from the previous guidance of $7.39 to $7.55.

COVID-19 is likely to still play a key role in the company's fortunes throughout the rest of this year. CVS Health's retail business could benefit from the recent launches of three over-the-counter COVID-19 tests that don't require prescriptions.