Humana released second-quarter results that exceeded Wall Street estimates, driven by solid performance across its insurance operations and CenterWell healthcare services division. The health insurer’s spending on medical services aligned with internal projections, and the company demonstrated particular strength in controlling inpatient costs, especially among members receiving care through value-based provider arrangements.
The company reported second-quarter net income of $694 million, or $5.73 per share, compared with $545 million, or $4.51 per share, in the prior-year period. On an adjusted basis, Humana earned $7.61 per share. Revenue increased substantially to $40.87 billion from $32.39 billion in the year-earlier quarter, with both the insurer and CenterWell divisions surpassing analyst sales expectations. Humana maintained its 2026 adjusted profit outlook of at least $9 per share.
The company’s medical benefit ratio, which measures total medical expenses relative to premiums collected, reached 91.2% for the second quarter, matching analyst expectations and the company’s internal forecasts. However, this represented an increase from 89.9% in the prior-year quarter. CFO Celeste Mellet attributed the stable cost environment to a combination of normalizing medical cost trends and company initiatives designed to improve member health outcomes.
Despite the earnings beat, some analysts characterized the unchanged profit guidance as disappointing, particularly given that competing Medicare Advantage providers have recently raised their outlooks. Shares declined more than 6% in afternoon trading. Mellet indicated that pharmacy costs remain elevated due to drug pricing and new medicine launches, though she characterized overall medical costs as stable. The company expects Medicare Advantage plan adjustments in 2027 to support profitability improvements and reach a sustainable pretax margin of at least 3% by 2028.
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