UnitedHealth Group Inc on Thursday reported better-than-expected quarterly earnings, helped by a jump in revenue at its Optum healthcare services unit, prompting the company to raise its profit forecast for the year. Shares of UnitedHealth jumped 1.58% in morning trading.
The Optum business, which manages drug benefits and offers healthcare data analytics services, has helped withstand fluctuating medical costs during the pandemic at the company's health insurance business.
Revenue from Optum rose 18.9% to $43.26 billion in the quarter ended March 31, while the health insurance business brought in revenue of $62.6 billion, an increase of 13.6%.
The largest U.S. health insurer's medical care ratio rose to 82% for the first quarter, compared with 80.9% a year earlier due to COVID-19 effects. The ratio refers to the percentage of premiums paid out for medical services.
However, the number was still below analysts' estimates of 82.29%, according to Refinitiv IBES data.
UnitedHealth said it now expects an adjusted profit of between $21.20 and $21.70 per share in 2022, compared with its prior forecast of $21.10 to $21.60 per share.
On an adjusted basis, the company earned $5.49 per share in the first quarter, beating estimates of $5.38 per share.
UnitedHealth's shares were up 0.5% at $539.80 in premarket trading.
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