CVS Health has announced that David Joyner will replace Karen Lynch as CEO as the company struggles to improve profits and stock performance. This change comes as CVS shares have dropped nearly 20% this year due to challenges such as higher medical costs affecting its insurance unit, Aetna, and declining consumer spending at its retail pharmacies. In response to these issues, CVS slashed its profit guidance and plans to cut $2 billion in costs over the next few years. The company also expects adjusted earnings between $1.05 and $1.10 per share in the third quarter, citing higher medical costs than previously forecasted.
Major shareholder Glenview Capital has been pushing for changes at CVS, prompting the company’s board to engage strategic advisors to explore options, including potentially separating its insurance and retail businesses. David Joyner, who previously oversaw the pharmacy services business, will now lead the company as CEO. Lynch, who held the top job since February 2021, has stepped down from the board of directors, with Joyner taking her place and Chairman Roger Farah becoming executive chairman. Joyner’s extensive experience in the company, including roles at Aetna and CVS Health, is expected to help address industry challenges, drive operational improvements, and maximize the company’s value. CVS is set to report third-quarter earnings on November 6.
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