Humana Q2 earnings beat estimates as 2026 profit outlook holds

Humana Q2 earnings exceeded Wall Street estimates, with adjusted profit of $7.61 a share and revenue of $40.87 billion, while the health insurer kept its 2026 adjusted earnings outlook at at least $9 a share. The result showed medical costs broadly matching management’s expectations, although the unchanged forecast weighed on investor reaction after several peers raised guidance.

Shares of Humana fell more than 4% in premarket trading Wednesday, according to CNBC, even after the company beat analyst expectations compiled by LSEG. Analysts had expected adjusted earnings of $7.22 a share on revenue of $40.61 billion.

Humana reported second-quarter net income of $694 million, or $5.73 a share, compared with $545 million, or $4.51 a share, a year earlier. Excluding items including amortization and impairment charges, the company earned $7.61 a share.

Revenue rose to $40.87 billion from $32.39 billion in the same quarter last year. Both Humana’s insurance operations and its CenterWell health-care services business exceeded sales estimates tracked by StreetAccount.

Why did Humana shares fall after earnings?

Cantor Fitzgerald analysts said in a Wednesday note that keeping the profit outlook unchanged was a disappointment relative to recent results elsewhere in the managed-care sector. CNBC reported that investors have become more demanding as some Medicare Advantage insurers raise forecasts and show signs of controlling elevated medical costs.

Medicare Advantage plans are privately run alternatives to traditional Medicare for older Americans and some people with disabilities. Insurers in that market have faced pressure for more than two years as members used more care they had deferred after the pandemic, while high-cost specialty drugs, including GLP-1 medicines, added to expenses.

What Humana said about medical costs

Humana’s medical benefit ratio was 91.2% in the second quarter, in line with analyst expectations. The ratio measures medical claims and related expenses as a share of premiums collected, so a lower figure usually points to stronger underwriting profitability.

The latest ratio was above the 89.9% reported a year earlier. Celeste Mellet, Humana’s chief financial officer, told CNBC that medical and pharmacy cost trends were consistent with the company’s assumptions across both new and existing members.

Mellet said Humana saw modestly favorable medical costs in inpatient care, especially among members treated by value-based providers. She attributed the outcome to stabilizing cost trends and company actions intended to improve health outcomes for members and patients.

For next year, Mellet said medical cost expectations are fairly consistent. She said Humana is monitoring whether inpatient admissions continue to decline this year, while describing medical costs as more stable at this stage.

Pharmacy costs remain under pressure, according to Mellet. She told CNBC that pharmacy medical cost trends are still very elevated because of drug prices and new medicine launches, and said those expenses are expected to be slightly higher next year than in 2026.

Mellet said Humana expects changes to its 2027 Medicare Advantage plans to support profitability and help move the company toward a sustainable pretax margin of at least 3% by 2028. She also cited membership growth, Medicare Advantage quality ratings, pricing discipline and cost control as areas the company expects to use to support earnings.

This story draws on original reporting from CNBC.