Humana (HUM) Q2 2025 earnings summary

Executive summary

• Delivered strong Q2 and first half 2025 results, with Adjusted EPS at $6.27 for Q2 and $17.85 YTD, and GAAP EPS at $4.51 for Q2 and $14.81 YTD; Adjusted EPS outlook for 2025 raised to ~$17.00, while GAAP EPS guidance lowered to ~$13.77.

• Outperformance driven by CenterWell Pharmacy and Insurance segment, with higher script volumes, favorable drug mix, and better-than-expected individual MA membership trends.

• Revenue growth supported by higher Medicare and state-based contract premiums, despite a decline in individual Medicare Advantage membership due to plan exits.

• Strategic investments of ~$100 million are being made to improve member outcomes and operational excellence.

• Value creation initiatives resulted in $53 million in charges for the first half of 2025, including $32 million impairment on indefinite-lived intangibles.

Financial highlights

• Q2 2025 consolidated revenues were $32.4 billion, up 9.6% year-over-year; YTD revenues reached $64.5 billion.

• Insurance segment benefit ratio was 89.9% for Q2 2025; consolidated operating cost ratio was 11.0%.

• Adjusted EPS for Q2 2025 was $6.27, slightly above guidance.

• Cash and cash equivalents increased to $4.0 billion at June 30, 2025.

• Debt-to-total capitalization improved to 40.7% as of June 30, 2025.

Outlook and guidance

• Full-year 2025 Adjusted EPS outlook raised to ~$17.00; GAAP EPS guidance revised down to ~$13.77.

• FY 2025 consolidated revenue guidance increased to at least $128 billion; Insurance segment at least $123 billion; CenterWell at least $21.5 billion.

• Insurance segment benefit ratio guidance affirmed at 90.1%-90.5%; consolidated operating cost ratio guidance at 11.3%-11.7%.

• Individual Medicare Advantage membership expected to decline by up to 500,000, improved from previous guidance.

• Operating cash flows projected at $2.4B-$2.9B; capital expenditures at ~$650M.