UnitedHealth Group (UNH) earnings Q4 2025

UnitedHealth Group on Tuesday posted a modest fourth-quarter earnings beat, but issued soft revenue guidance, as the parent company of the nation’s largest private insurer works to turn itself around amid higher-than-expected medical costs. 

Here’s what the company reported for the fourth quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

• Earnings per share: $2.11 adjusted vs. $2.10 expected
• Revenue: $113.2 billion vs. $113.82 billion expected

The results come two days after UnitedHealth CEO Stephen Hemsley and other chief executives of Minnesota’s largest businesses banded together to sign an open letter calling for an “immediate deescalation of tensions” in the state after federal immigration agents fatally shot U.S. citizen Alex Pretti, a 37-year-old ICU nurse.

UnitedHealth is banking on a new leadership team to carry out a turnaround plan. The strategy involves shrinking membership, raising prices, cutting benefits and increasing transparency to restore profitability — along with the company’s reputation — after a series of hurdles over the last two years.

UnitedHealth expects 2026 revenue to exceed $439 billion, a 2% year-over-year decline that reflects “right-sizing across the enterprise,” the company said in a release. That comes far below the $454.6 billion in sales that analysts were expecting for the year. 

“It’s the first time in a decade that UnitedHealth Group has had declining revenue,” CFO Wayne DeVeydt said in an interview, referring to the sales guidance. 

He pointed to three factors driving the expected decline, including the company’s divestitures in the fourth quarter and others set for later this year, such as its operations in the U.K. and South America. He also pointed to a “fairly sizable” overall U.S. membership decline of more than 3 million in 2026.

“I would say that in the fourth quarter, we righted the ship in the sense that we removed through the fraction, obviously, South America, European operations,” he said. “We are focusing on American domestic businesses and we have essentially strengthened the balance sheet and repositioned the company for the historical growth that investors have seen.”

The third factor is that 2026 is the final year of the transition to Medicare’s new coding system – known as V28 – which has reduced payments to insurers by changing how patient diagnoses are weighted, DeVeydt said. That will translate to a $6 billion revenue hit, $2 billion of which will impact the company’s insurer, UnitedHealthcare, with the rest affecting its Optum health-care unit, he noted. 

On Monday, shares of UnitedHealth and other health insurers plunged after the Centers for Medicare & Medicaid Services proposed nearly flat payment rates for insurers in Medicare Advantage, the privately run insurance program that now covers more than half of all Medicare beneficiaries.

That closely watched government payment rate determines how much insurers can charge for monthly premiums and plan benefits they offer — and ultimately helps to shape their profits. 

Medical costs from Medicare Advantage patients have spiked over the last two years as more older adults return to hospitals to undergo procedures they had delayed during the pandemic, such as joint and hip replacements. In the fourth quarter, those medical costs were “still elevated and high but not growing beyond expectations,” DeVeydt said. 

For 2026, UnitedHealth expects its insurance segment’s medical benefit ratio — a measure of total medical expenses paid relative to premiums collected — to come in at 88.8%, plus or minus 50 basis points. That would be an improvement from the 89.1% ratio reported for 2025. A lower ratio typically indicates that the company collected more in premiums than it paid out in benefits, resulting in higher profitability.