CVS Health Makes Big Leadership Swap After Stock Dive

CVS Health has seen some big changes at the top. On Friday, the company announced that Karen Lynch is stepping down as CEO. She's been replaced by David Joyner, who was the president of CVS Caremark. This move comes after CVS had to warn that its earnings will miss Wall Street's expectations for the third time this year. Shares took a hit, falling nearly 10% in pre-market trading. So, why the shake-up? CVS has been struggling with rising medical costs and consumers cutting back on spending. To tackle these issues, the company plans to lay off 2, 900 workers. David Joyner, with his 37 years of experience in healthcare and pharmacy benefit management, is expected to help CVS navigate these challenges. The company also said that its third-quarter earnings will be lower than expected, around $1. 05 to $1. 10 per share, while analysts were predicting $1. 69 per share. This is due to higher medical costs. CVS has been dealing with issues like increased claims from Medicare Advantage coverage and drops in quality ratings for these plans. Roger Farah, the current chairman, will now be the executive chairman. He believes that David Joyner's deep understanding of CVS's business can help address the current challenges and make necessary improvements.