UnitedHealthcare sign is displayed at its office building in Minnetonka, Minnesota, U.S., Dec. 11, 2025.
Tim Evans | Reuters
UnitedHealth Group on Tuesday posted first-quarter earnings that topped estimates and hiked its 2026 profit outlook, as the company better manages high medical costs and streamlines its operations.
The nation’s largest private insurer said it expects 2026 adjusted earnings of more than $18.25 per share, up from a previous outlook of more than $17.75 per share. UnitedHealth is maintaining its full-year revenue guidance of greater than $439 billion, which the company said in January reflects “right-sizing across the enterprise.”
Here’s what the company reported for the first quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
Earnings per share: $7.23 adjusted vs. $6.57 expectedRevenue: $111.72 billion vs. $109.57 billion expected
UnitedHealth is banking on a new leadership team to carry out a turnaround plan. The strategy involves shrinking membership, selling the U.K. business of its Optum health-care unit, heavily investing in artificial intelligence, streamlining access to care and increasing transparency to restore profitability — along with the company’s reputation — after a series of hurdles over the last two years.
The company posted first-quarter net income of $6.28 billion, or $6.90 per share, compared with $6.29 billion, or $6.85 per share, in the same period a year ago. Excluding items like business divestitures, restructuring and the expected reduction of reserves for unprofitable contracts, UnitedHealth earned $7.23 per share.
Revenue climbed to $111.72 billion from $109.58 billion in the prior-year quarter. The company’s insurer, UnitedHealthcare, and Optum both topped analysts’ sales estimates for the quarter, according to StreetAccount.
Notably, UnitedHealth appears to have a better handle on higher medical costs – an issue that has dogged the broader insurance industry for more than two years. Insurers, particularly those that privately run Medicare plans, have been pinched by an influx of people seeking care they delayed post-pandemic and high-cost specialty drugs like GLP-1s, among other factors.
UnitedHealth’s medical benefit ratio — a measure of total medical expenses paid relative to premiums collected — came in at 83.9% for the first quarter. That’s an improvement from the 84.8% reported in the year-earlier period. A lower ratio typically indicates that the company collected more in premiums than it paid out in benefits, resulting in higher profitability.
Analysts were expecting a ratio of 85.5% for the quarter, according to StreetAccount.
In a release, UnitedHealth said the first-quarter ratio reflects its strong management of medical costs and the release of previously set-aside funds for unprofitable Optum contracts. But that improvement was partially offset by “consistently elevated” medical costs, the company noted.
“We are continuing to help simplify and modernize health care for the people and care providers we serve, bringing greater value, affordability, transparency and connectivity,” UnitedHealth CEO Stephen Hemsley said in the release.
The results come just weeks after the Trump administration finalized a 2027 payment rate increase to Medicare Advantage plans that was far bigger than initially proposed, in a boost to UnitedHealth and other health insurer stocks.
