Unitedhealth Group Inc

Revised Earnings Expectations: UnitedHealth Group has revised its adjusted earnings per share outlook for 2025 to between $26 and $26.50, which is lower than initial expectations. This adjustment reflects increased care activity in the Medicare Advantage (MA) business and challenges with Optum Health member profiles.

Increased Care Activity: There was a significant increase in care activity in UnitedHealthcare's MA business, with Q1 2025 seeing care activity increase at double the rate expected compared to 2024. Notable rises were seen in physician and outpatient services, primarily affecting the senior business. The medical care ratio is now expected to be around 87.5%, up from previous estimates.

Optum Health Challenges: Unanticipated changes in the member profiles, particularly in new Medicare patients who showed less engagement, are affecting revenue growth. This has led to an operational complexity regarding transitioning to a new risk model that is not meeting expectations. The revenue outlook for Optum Health is now forecasted at $106 billion to $107 billion for the year.