UnitedHealth Raises 2026 Profit Outlook to at Least $20.50 a Share After Third-Quarter Beat

UnitedHealth Group reported third-quarter results today, Oct. 13, that beat Wall Street estimates, and it raised its full-year profit forecast for the third time this year.

The company now expects 2026 adjusted earnings of at least $20.50 per share. In July it guided to $19.50 to $20.00. LSEG's analyst average for the year was $19.86. GAAP earnings are projected at no less than $19.50.

The quarter in numbers

Adjusted earnings came in at $4.69 per share, up from $2.92 a year ago. The LSEG average estimate was $4.14. GAAP earnings were $4.56 per share on net income of $4.11 billion, versus $2.59 per share and $2.35 billion in the third quarter of 2025.

Revenue was $112.7 billion, down slightly from $113.2 billion a year earlier. Earnings from operations jumped to $6.6 billion from $4.3 billion.

Both main businesses contributed. UnitedHealthcare, the insurer, earned $2.8 billion from operations versus $1.8 billion. Optum, which runs clinics, pharmacy benefits and data services, earned $3.7 billion versus $2.5 billion.

Cash flow from operations was $5.1 billion, or 1.2 times net income. The debt-to-capital ratio was 41.7% as of Sept. 30.

CEO Stephen Hemsley credited "the discipline and execution our teams are bringing to every part of our business."

Medical costs improved, with caveats

The medical care ratio, the share of premiums paid out for care, was 88.4%. That compares with 89.9% a year ago and a StreetAccount analyst expectation of 89.9%.

The company credited "medical cost management initiatives, benefit design changes and pricing discipline, as well as care delivery enhancements focused on affordability and integrated value-based care."

Part of the improvement came from accounting. The company's release says the ratio "was impacted by $610 million of net favorable prior period reserve development related to 2026 dates of service."

Stock Titan's editorial team calculated that adding that $610 million back to medical costs of $76.98 billion against premiums of $87.08 billion yields a ratio of about 89.1%. By that calculation, nearly half of the ratio's drop came from lower estimates of earlier claims, and the remainder does not show care getting cheaper. That is the outlet's own arithmetic, not a figure the company reported.

CFO Wayne DeVeydt struck a cautious note in an interview with CNBC. Medical costs, he said, "continue to be elevated versus historical norms." He added: "I don't want that to be misleading in terms of [medical cost trends]."

DeVeydt also said the independent dispute resolution process under the No Surprises Act is adding at least 100 basis points.

Shrinking to get profitable

The margin gains are coming alongside a smaller insurance book. UnitedHealthcare revenue fell to $86.3 billion from $87.1 billion. Employer-sponsored membership dropped by 165,000 on attrition, and another 85,000 people left Medicaid rolls because of eligibility changes.

Since the end of 2025, 935,000 members have exited the company's Medicare Advantage business.

The company has exited some insurance products this year and, in Reuters' account, named new top executives after missing financial estimates last year. Optum also walked away from less favorable health plan contracts that had weighed on first-quarter earnings.

The company says technology investments have cut the cost of delivering medical services. It is also putting money into value-based care, which ties doctor and facility pay to patient outcomes and cost rather than the volume of services.

The turnaround follows a rough stretch. UnitedHealth suffered the largest healthcare cyberattack on record, missed financial targets and withdrew its outlook. Its investor day was also followed by the killing of a top executive outside the event in New York nearly two years ago.

Market reaction

Regular trading has not begun today. In pre-market indications, shares were up about 3% in CNBC's account and up 4.5% at $395.50 in Reuters' account. Those are pre-market levels, not an opening price.

What comes next

The company's conference call is scheduled for 8:00 a.m. ET today, Oct. 13. Executives will face questions on two points: how much of the profit gain depends on favorable reserve revisions, and how long they can keep margins rising while membership falls. DeVeydt's own warning about elevated costs suggests the pressure on pricing and benefits is not over.