I can understand that much, but CVS doesn't (privately) reap the returns from healthier customers. That dynamic would apply to a health insurer or provider, not a glorified convenience store.
Assuming that customer retention is cheaper than acquisition, it directly reaps the returns from not killing its customers.
> That dynamic would apply to a health insurer or provider, not a glorified convenience store.
CVS is, among other things, an insurer (or, rather, a pharmacy benefit management company serving insurers, but the incentives are pretty similar with regard to not killing the insurers customers), and also operates the nations largest walk-in clinic brand in its in-store clinics (so, its also a provider, and not just in the sense that every pharmacy is.)
Public goods problem -- you have to subtract off all the customers you lose to other companies that have extra money due to not cutting off the cigarette revenue stream.
If people smoke and die sooner, they will in theory (and practice) need no more of the prescription drugs which CVS sells and profits from. Heck, statistics showing that smoking reduces total health care costs (and, less relevantly to the immediate discussion, pension costs) by killing people younger have been used by cigarette smoking companies as part of campaigns against government anti-smoking campaigns around the world.
Aside from the moral aspects of that argument, the financial aspects work exactly the opposite for people selling health care services -- which CVS does, both as a pharmacy and a clinic operator -- as they would on people funding health care costs.
They are actually paid by the insurance companies to provide these services.
Might also help them position themselves to shift more and more towards being a credible health care service provider.
CVS is a pharmacy so keeping patients alive longer means more money on perscription medication.