Revenue slipped 0.4% but operating income rose 52.1% as the medical care ratio fell to 88.4% 9. Management raised 2026 guidance to at least $19.50 per share, or at least $20.50 adjusted 8-K.
UnitedHealth Group Incorporated · Q3 2026 · Reported 13 Oct 2026 · US
Key figures
Billion USD | Q3 2026 | Q3 2025 | Change |
|---|---|---|---|
Revenue | 112.69 | 113.16 | -0.4 % |
Operating income | 6.56 | 4.32 | +52.1 % |
Net income | 4.11 | 2.35 | +75.0 % |
Diluted EPS | 4.56 USD/share | 2.59 USD/share | +76.1 % |
Operating margin | 5.8 % | 3.8 % | +2.0 pp |
Net margin | 3.6 % | 2.1 % | +1.6 pp |
Figures in USD, as reported. Margins are computed from the reported lines.
Earnings rose sharply because costs fell faster than revenue
Revenue was $112.69B, down 0.4% from a year earlier, while operating income rose 52.1% to $6.56B and diluted EPS rose 76.1% to $4.56 89. Operating margin widened to 5.8% from 3.8% 9. The company also headlined adjusted EPS of $4.69, a company-defined measure kept apart from reported EPS 8-K.
The medical care ratio fell to 88.4% from 89.9% a year earlier, which management ties to medical cost management, benefit design changes and pricing discipline 8-K. The operating cost ratio fell to 12.8% from 13.5% 8-K. Against the prior quarter, earnings from operations fell from $8.0B and net margin from 4.9% 8-K.
Reserve releases and divestiture gains sit inside the improvement
The medical care ratio was affected by $610 million of net favorable prior period reserve development 8-K. A net decrease in loss contract reserves lowered medical costs by a further $95 million in the quarter 3.
Portfolio actions produced a $224 million gain in the quarter, recorded within operating costs, including $85 million at Optum Health 2. The filing also lists a $76 million loss on sale of subsidiaries and subsidiaries held for sale 9. The reserve and gain items feed reported operating income, so the 5.8% margin is not a clean read on run-rate profitability 9.
Revenue is shrinking with membership, and Optum Health is the sharpest case
UnitedHealthcare served 1.8 million fewer people, which the filing attributes to benefit design and pricing actions, reduced Medicaid eligibility and the exit from one state 7. Medicare Advantage people served fell to 7,605 thousand from 8,435 thousand a year earlier, and risk-based commercial fell 10% 16.
Optum Health revenue fell 10% to $22.9B on fewer value-based care patients, yet its earnings from operations rose to $735 million from $41 million, helped by cost management and the net portfolio divestiture gains 8-K. Optum Rx earnings from operations rose to $1.7B from $1.5B even as adjusted scripts fell to 393 million from 414 million 8-K.
Operating cash flow was 1.2x net income, with leverage slightly higher
Third-quarter cash flows from operations were $5.1B, or 1.2x net income 8-K. For the nine months, operating cash flow was $25,087 million against $18,589 million a year earlier, which the filing attributes to higher earnings, timing of government payments, working capital and Inflation Reduction Act changes to pharmacy rebates 19.
Debt-to-capital was 41.7% at September 30, up from 41.2% in the second quarter, against a target of about 40.0% by year-end 8-K. Moody's, S&P and Fitch all carry negative outlooks on senior unsecured debt 22.
What to watch next
Management expects full-year 2026 earnings of at least $19.50 per share and adjusted earnings of at least $20.50 per share 8-K.
The filing says medical cost trend remains above historical levels and Medicare Advantage rates for 2027 still sit below forward trend, so the 88.4% medical care ratio faces pressure 8-K.
Debt-to-capital must come down from 41.7% toward the roughly 40.0% year-end target 8-K.
Sources
Produced by Clarifo Research with the Clarifo financial research engine from the company's public filings. AI was used in parts of the analysis and drafting. Figures are checked automatically against the filings they come from. This is not investment advice.