CVS Caremark Corp.'s (CVS) second-quarter profit rose 15% Tuesday amid revenue gains at its pharmacy-benefits business and another solid performance at its traditional retail-drugstores.

That prompted the hybrid pharmacy benefit manager-drug store chain to boost its 2009 outlook to $2.59 to $2.64 a share. In May, an uptick in its PBM business prompted CVS to raise its target slightly to $2.55 to $2.63.

Tuesday's upbeat results provided more evidence that the drugstore chain's $27 billion purchase of pharmacy-benefits manager Caremark in 2007 may be starting to pay off, until recently a big investor concern.

CVS shares recently traded up 2.79% to $34.95, and are up more than 20% so far this year.

Earlier this year, CVS renegotiated some pharmacy contracts at lower price rates and bid aggressively to keep others, which at the time reignited investors' concerns about the underperforming Caremark business.

While CVS has seen an uptick in its pharmacy-benefits business since then, and Chairman and Chief Executive Tom Ryan said in the company's conference call he expects additional contract wins this season, he cautioned that "the remaining opportunities are probably not sizable enough to offset the losses, since the term contracts I reviewed totalled about $2 billion."

Ryan said the company was in the midst of the 2010 PBM selling season, describing it as having "some good successes" and well as disappointments. He noted that the company had more than 3,000 clients, with a 96% retention rate, slightly higher than this year's rate.

CVS' retail pharmacy sales, which rose 17.2% to $13.8 billion, benefited again from its Maintenance Choice program, which allows PBM customers enrolled in a client's program to pick up 90-day prescriptions at a CVS store instead of receiving them through the mail for the same price.

CVS reported continued uptake of the program, which now has 270 clients, up from 200 in the first quarter, CEO Ryan said in the earnings call. A fourth of the clients are new to the company's pharmacy-benefit business, he added.

"Maintenance Choice continues to grow in popularity," Ryan said. "The feedback has been extremely positive."

The company's same-store sales jumped 6.1% in the quarter, much stronger than the rest of the industry, with growth of 7.5% at the pharmacy.

Maintenance Choice's performance also gave a boost to the pharmacy-services segment, the revenue of which jumped 22% as processed claims rose 8.8%.

A later Easter and increased cigarette prices ahead of the federal excise tax in the second quarter helped lift the company's front-of-store sales.

CVS's second-quarter profit increased to $886.5 million, or 60 cents a share, from $774.8 million, or 53 cents a share, a year earlier. Excluding acquisition-related costs from the purchase of Longs Drug Stores last fall, earnings rose to 65 cents a share from 60 cents.

Revenue rose 18% to $24.9 billion, in part on the acquisition of Longs.

Analysts polled by Thomson Reuters were expecting earnings, excluding items, of 64 cents a share on revenue of $24.41 billion.

Gross margin fell to 20.3% from 20.7%.

-By Kelly Nolan; Dow Jones Newswires; 212-416-2167; kelly.nolan@dowjones.com

(Mike Barris contributed to this report.)