Utilization Uptick Drove UnitedHealth’s ‘Frankly Unusual and Unacceptable’ 1Q
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Apr 18, 2025
UnitedHealth Group’s shares declined by more than 22% on April 17 after the release of its first-quarter 2025 earnings, which surprised investors and highlighted issues stemming from the Optum Health business and higher-than-expected Medicare Advantage utilization. The company lowered its adjusted earnings per share (EPS) guidance for the year to between $26.00 and $26.50, down from the previous range of $29.50 to $30.00.
For the first quarter, UnitedHealth reported adjusted EPS of $7.20, which came in 1% below the Wall Street consensus, and $109.6 billion in revenue, which was 2% below the consensus. Meanwhile, the company had a medical loss ratio (MLR) of 84.8%, which was lower (better) than the 85.7% consensus. However, UnitedHealth said it expects the full-year MLR to be between 87% and 88%, up significantly from 85.5% for full-year 2024 and 100 basis points higher than its previous guidance.
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