UnitedHealth Reports $3.4 Billion Profit And Sees 2026 Earnings Growth

UnitedHealth Group profits fell to $3.4 billion in the second quarter as the giant provider of health benefits and services grapples with rising costs of providing health insurance to millions of Americans.

But the company, which brought back Stephen Hemsley to be chief executive officer earlier this year, says the “company expects to return to earnings growth in 2026.”

In May, UnitedHealth Group suspended its financial outlook for the rest of the year and replaced its top executive, Andrew Witty, as the parent of UnitedHealthcare grapples with rising healthcare costs in its Medicare Advantage business. Medicare Advantage plans contract with the federal government to provide health benefits to seniors.

On Tuesday, UnitedHealth Group updated its 2025 outlook, which includes revenues of $445.5 billion to $448.0 billion, net earnings of at least $14.65 per share and adjusted earnings of at least $16 per share. The new outlook, which fell below what some analysts were forecasting, “reflects first half 2025 performance and expectations for the remainder of the year, including higher realized and anticipated care trends,” the company said.

“UnitedHealth Group has embarked on a rigorous path back to being a high-performing company fully serving the health needs of individuals and society broadly,” Hemsley said in a statement accompanying the earnings report. “As we strengthen operating disciplines, positioning us for growth in 2026 and beyond, the people at UnitedHealth Group will continue to support the millions of patients, physicians and customers who rely on us, guided by a culture of service and longstanding values.”

UnitedHealth Group, which has more than 50 million health plan subscribers under its UnitedHealthcare health insurance business, is seeing rising costs among health plan members in all three government-subsidized benefits it helps manage: Medicaid, Medicare Advantage and individual coverage under the Affordable Care Act, also known as Obamacare.

In the company’s second quarter, UnitedHealthcare’s “consolidated medical care ratio of 89.4% increased 430 basis points year-over-year.” That compares to 84.8% in the company’s first quarter yet well below the ratio in the lower 80th percentile where health insurers like to be.

The increase in the medical cost ratio, which is the percentage of premium that goes toward medical costs, “was primarily due to medical cost trends which significantly exceeded pricing trends, including both unit costs and the intensity of services delivered, and the ongoing effects of Medicare funding reductions,” the company said.

UnitedHealth’s cost struggles are among the parade of health insurance companies that have struggled in the last two years to control costs of subscribers in plans subsidized by the government.

“While we face challenges across our lines of business, we believe we can resolve these issues and recapture our earnings growth potential while ensuring people have access to high-quality, affordable health care,” UnitedHealthcare CEO Tim Noel said in a release.

Just last week, Centene reported a rare quarterly as the provider of government-subsidized benefits struggles to manage costs of its health plan members. And earlier this month, Elevance Health, which sells Blue Cross and Blue Shield plans in 14 states, lowered its profit forecast for the rest of 2025 due to rising costs in its Medicaid plans and individual policies it sells under the ACA.

In addition, Molina Healthcare lowered its earnings guidance for the rest of the year in the face of cost pressures in all three of the government-subsidized health insurance programs it helps manage.

In May, UnitedHealth Group suspended its financial outlook for the rest of the year and replaced its top executive, Andrew Witty, as the parent of UnitedHealthcare grapples with rising healthcare costs in its Medicare Advantage business. Medicare Advantage plans contract with the federal government to provide health benefits to seniors.

Medicare Advantage plans also contributed to struggles last year for Humana and CVS Health, which elevated a new chief executive in part to help gain control of its struggling Aetna health insurance business. CVS is also exiting the individual health insurance business, leaving about 1 million Aetna members in 17 states looking for new coverage in 2026.