Shares of UnitedHealth Group Inc. climbed more than 5 per cent on Tuesday on strong second quarter earnings.
At 11:49 a.m. EDT, UnitedHealth shares were at $541.35, higher $25.98 or 5.04 per cent. On Tuesday,UnitedHealth had closed at $515.37.
The Minnetonka, Minnesota-based company said its adjusted earnings were $6.80 per share on $98.85 billion in total revenue in the second quarter. Its net income fell 23 per cent to $4.22 billion.
UnitedHealth’s medical costs rose more than 8 per cent to $65.46 billion in the reported quarter.
The healthcare company’s medical-loss ratio stood at 85.1 per cent, driven higher by its response to the cyberattack.
Its revenue from Optum services unit surged about 12 per cent to $62.9 billion in the second quarter.
Full year outlook
For full year 2024, UnitedHealth sticked to its earlier forecast of adjusted earnings between $27.50 and $28 per share.
The outlook includes estimated business disruption costs like lost revenue of between 60 cents and 70 cents per share from the cyberattack.
It expects 30 cents per share higher hit to full year adjusted profit from the disruptions caused by the hack.
Hackers had gained access in February to Change’s system and unleashed a ransomware attack that encrypted and froze large parts of it.
The company booked $1.1 billion in total costs from the cyberattack in the second quarter.
UnitedHealth said it has restored most of the Change services affected by the attack.
The company, which recently sold its business in Brazil, said it intends to sell its remaining operations in South America.
The company also indicated that it would resume share buybacks after pausing them due to the hack.
UnitedHealth provides health insurance for more than 49 million people in the United States. Its Optum segment also provides care, runs one of the nation’s largest pharmacy benefits management businesses and offers technology services.