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UnitedHealth (UNH) is relatively flat after reporting its Q3 results this morning. The managed care giant beat EPS expectations, a nice bounce back after missing in the prior two quarters, while revenue increased 12.2% yr/yr to $113.16 bln, in line with expectations. Encouragingly, management raised its FY25 EPS guidance to $16.25, above expectations.

• UnitedHealthcare revenue increased 16% yr/yr to $87.1 bln; Optum Health and Optum Insight were flat at $25.9 bln and $4.9 bln, while Optum Rx grew 16% to $39.7 bln.
• Medical care ratio of 89.9% (+470 bps yr/yr) remains elevated and reflects lingering cost pressures, though management expects it to land at the low end of the 89.0--89.5% full-year range.
• Broad repricing across Medicare Advantage, Commercial, and residual ACA offerings provides better visibility into margin improvement in 2026, while Medicaid margins remain pressured as funding still lags higher acuity.
• Optum Health's turnaround is progressing, with 90% of 2026 contracts reset, narrowing networks, and exits from 200K underperforming PPO lives aimed at stabilizing cohorts and supporting margin improvement in 2026, followed by a ramp toward the 6-8% target in 2027.
• Looking ahead, management is comfortable with current 2026 consensus and expects margin progress, though V28 and Medicaid funding headwinds remain. The focus is on balancing recovery with investment, setting up a return to more durable double-digit growth in 2027.

Briefing.com Analyst Insight

UnitedHealth is still marred by headwinds, but this report showed flashes of operational improvement. The raised guidance and steady segment performance, UHC and Optum Rx growing nicely while Optum Health and Insight held steady, suggest early progress in the reset. The real story turns to 2026 and beyond, where management sees meaningful earnings growth returning as pricing actions stick and Optum execution improves. For now, the update is constructive but not conclusive, and the muted stock reaction reflects that balance: investors want more proof that margin traction and cost discipline are here to stay.