UnitedHealth shares plunged more than 7% after it disappointed investors with its second quarter (Q2) earnings and outlook for the 2025 financial year (FY25).
The American health insurer said earnings from operations fell 34% to US$5.2 billion (A$7.97 billion) in the three months ended 30 June 2025 compared with the previous corresponding period despite revenue rising 13% to $111.6 billion.
Diluted earnings per share (EPS) dropped 18% to $3.74 and adjusted EPS dived 40% to $4.08.
The results included $1.2 billion of unfavourable ‘discrete impacts’ of $620 million related to the individual exchange business, including the acceleration of losses in the second half of 2025, and others related to settlements and other provisions.
UnitedHealth also updated its FY25 outlook to forecast revenue of between $445.5 billion and $448.0 billion, compared with $400.3 billion in 2024, net earnings of at least $14.65 per share, compared with $15.51, and adjusted earnings EPS of at least $16, compared with $27.66.
“The new outlook reflects first half 2025 performance and expectations for the remainder of the year, including higher realised and anticipated care trends. The company expects to return to earnings growth in 2026,” it said in a press release.
For the six months ended 30 June, net earnings surged 245% to $9.698 billion, diluted EPS soared 251% to $10.61 and revenue rose 11% to $221.2 billion but adjusted EPS fell 21% to $11.29.
“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,” Chief Executive Officer Stephen Hemsley said.
Shares in the company fell more than 20% in February when it decided not to comment on the outlook for FY25.
The second quarter profit and updated adjusted earnings forecasts were below expectations.
UnitedHealth Group shares (NYSE: UNH) closed $21.05 (7.46%) lower at $261.07, capitalising the company at $236.83 billion, before bouncing back up to $262.69 in after-hours trading.
