Centene (CNC) Q4 2024 earnings summary

Executive summary

• Entering 2025 with strong operational momentum, clear strategy, and embedded earnings power across all business lines.

• 2024 adjusted diluted EPS rose 7% to $7.17, with GAAP diluted EPS at $6.31, despite industry headwinds.

• Achieved significant operational improvements, leveraging AI and data to modernize processes and improve healthcare quality.

• Membership grew 12% in Marketplace and 50% in Medicare PDP sequentially from Q3 2024.

• 2025 premium and service revenue guidance increased by $4 billion, reflecting strong Medicare enrollment and Medicaid program expansion.

Financial highlights

• Full year 2024 premium and service revenues increased 4% to $145.5B; Q4 premium and service revenue: $36.3 billion.

• Q4 consolidated HBR: 89.6%; full-year consolidated HBR: 88.3%, up from 87.7% in 2023.

• Q4 Medicaid HBR: 93.4%; full-year Medicaid HBR: 92.5%, temporarily elevated due to redeterminations.

• Adjusted SG&A expense ratio: 8.9% in Q4, down from 9.7% last year; full-year SG&A: 8.5%.

• Cash flow from operations for 2024: $154 million, impacted by timing of pharmacy rebates and premium receivables.

Outlook and guidance

• 2025 adjusted diluted EPS guidance remains above $7.25; GAAP diluted EPS floor set at >$6.19.

• 2025 premium and service revenue guidance raised to $158–$160 billion, reflecting Medicaid, Medicare Advantage, and PDP outperformance.

• Expect Medicaid membership stability and improved rate/acuity alignment in 2025.

• Medicare segment premium revenue expected to be $2.5 billion higher than prior guidance; Medicaid revenue up $1.5 billion from program expansion.

• Marketplace membership expected to peak above 5 million in Q1, with year-end attrition to mid-4 million range.