UnitedHealth Group (UNH) earnings report Q2 2025

United health Group On Tuesday, a 2025 approach was released, which decreased by Wall Street’s expectations, as the company’s insurance unit is struggling with high medical costs.

The United Health Group shares fell nearly 4% in the morning trading on Tuesday.

The company estimates that it would post an adjusted earnings of at least $ 16 per share, with a revenue of $ 445.5 billion to $ 448 billion. Wall Street analysts expected a 2025 adjusted profit of $ 2025 per share and a full-year revenue of $ 449.16 billion, according to unanimous estimates from LSEG.

At the top of high medical costs, the updated outlook extracts approximately 1 billion from “pre -employed portfolio functions” that the company is no longer pursuing it, United Healthcare CEO Tim Noel said during an earning call on Tuesday. He did not provide the nuances on those tasks.

The United Health Group said it expects an increase in income in 2026.

Stock tambal in May after the company Suspended that 2025 guidance Announced the sudden departure of advanced medical costs and the sudden departure of former CEO Andrew Viti. Added to the report on Tuesday Growing string of failures For the company, who owns the country’s largest and most powerful insurer, United Healthcare, and is often seen as an industry bellweather.

The company hopes its insurance unit’s 2025 medical care ratio – a measure of total medical expenses relative to the premium collected – to come between 89% and 89.5%. A low ratio usually indicates that a company collected more in the premium, as it was paid in profit, resulting in high profitability.

For the second quarter, this ratio increased from 85.1% to 89.4% during the year-of-year period, mainly due to medical cost. The company said that during the quarter, health care expenses increased much faster than charging in the premium. At its top, the medicare funding cuts also made things worse.

According to Strikint’s estimates, analysts hoped that the ratio would arrive at 89.3% for the quarter.

The report of the United Health Group indicates that the medical cost in the Medicare Advantage Plan may not be reduced soon for the comprehensive health insurance industry. Unitedhealthcare, the insurance branch of the United Health Group, is the largest provider of those privately run medicare schemes.

In the Medicare Advantage Plan, high expenses have dogs the insurers in the last one year as more seniors return to hospitals, which were to undergo delayed procedures during the cocv -19 epidemic such as joint and hip replacement.

Noel said during the call, “When we prepared our 2025 Medicare Advantage Prasad in the first half of 2024, we rapidly reduce the medical instinct and not amended the assumption or planning offerings, which we are now offering the pressures,” Noel said during the call.

Noel said that physician and outpatient care has collectively represented 70% of pressure on medical costs so far this year. He said that the input care also intensified through the second quarter, and the company hopes that it will be responsible for “relatively large parts of pressure” throughout the year.

Unitedhealthcare continues to use more patients using ER and observation, with noel, with more services offering and bundling more services as part of each travel.

Here the United Health Group reported on a survey of analysts by LSEG, compared to the Wall Street that was expecting for the second quarter:

• earnings per share: $ 4.08 adjusted vs $ 4.48 expected
• Income: $ 111.62 billion vs $ 111.52 billion is expected

The company posted a net income of $ 3.41 billion for the quarter, or $ 3.74 per share. It compares with a net income of $ 4.22 billion or $ 4.54 per share during the year-east period.

Except for some objects, the adjusted earnings were $ 4.08 per share for the quarter.

The United Healthy raked the revenue in revenue for the second quarter to $ 111.62 billion, a year ago due to the increase within the same period of United Healthcare and the company’s optum unit. The section includes Optom Health, which provides care and recommends providers, and the pharmacy profit manager Optom RX.

Despite high medical costs, United Healthcare produced $ 86.1 billion in revenue for the second quarter, up to 17% from the same period a year ago. Striketing estimates stated that analysts expected United Healthcare to book $ 84.89 billion for this period.

While the Optom RX revenue increased by nearly 19% to $ 38.46 billion, the second quarter revenue of Optom Health fell 7% to $ 25.21 billion. The company’s ownership of an insurer, a pharmacy profit manager and care providers has allowed it to dominate the industry, but the fall in Optom Health has attracted the attention of Wall Street.

“We know that optum’s performance has not met expectations. We are again associated with fundamental execution to ensure that we fulfill our ability to help improve the health system for everyone.”

The company hopes that in 2025 sales of $ 266 billion will be the overall optum unit rake for sale of $ 265.7 billion.

In particular, the report comes a few days after the United Health It turned out that it is complying The Department of Justice investigates in its medicare billing practices.

Noel said on Tuesday that the company is expanding its efforts to monitor its commercial practices and prevent additional costs for consumers.

“We have carried forward their audit, clinical policy and payment integrity equipment to save customers and patients from unnecessary costs,” he said, “he said that the company is using AI tools to improve patient and provide service experiences and save costs.

During the earnings call, Stephen Hemsley, the new CEO of the United Health Group, admitted that the company and other insurers face “long -standing practices.”

He said that beyond the “environmental factors” affecting the entire region, “we have made pricing and operational mistakes, and others.”

He said, “They are getting the necessary attention. Our important procedures including risk status, care management, drug services and others are being reviewed by independent experts and will be reviewed every year and reported,” he said. “And these processes can be reviewed at any time by external stakeholders.

Those experts include analysis group and FTI consultation, said Hemsley. He said that the company hopes that the review will be completed by the end of the third quarter this year, with a plan to release the first report on the conclusions in the fourth quarter.

He said, “When we believe in our inspection and integrity of these processes, they will be immediately removed wherever they are determined with the prescribed practice and we will continue on this path,” he said.

It marks unitedhealth First earning report under Hemsley, which has been tasked to restore the investor’s confidence and turn around a struggling company, which has continued a heavy public investigation in recent months. The shares of the United Health Group are more than 44% below for the year, fueling in the part by a DOJ check and its suspended approach.

The company’s 2024 was not better. It was struggling with the assassination of Brian Thompson, CEO of United Healthcare, which was a public shock edge and followed by a historic cyber attack that affected millions of Americans.