The insurer is gearing up for growth in more lucrative MA markets next year.

Surging healthcare utilization and medical costs weighed heavily on insurers’ bottom lines in 2024 and 2025. UnitedHealth was no exception. But the Minnesota-based healthcare giant has made progress this year, outperforming analysts’ expectations and boosting its 2026 outlook in the first, second and now third quarters — signs of momentum that have boosted investors’ conviction in the turnaround.

UnitedHealth “delivered another solid quarter ... reinforcing our confidence that the company remains on track,” Morgan Stanley analysts wrote in a note.

Payer arm UnitedHealthcare and care delivery unit Optum Health — the businesses recovering from the most drastic profit degradation — both reported stronger earnings than Wall Street had expected, thanks to plan cuts and other actions that’ve yielded fewer but more profitable members.

UnitedHealth’s medical loss ratio, an important marker of spending on patient care, fell to 88.4% in the quarter, down from 89.9% same time last year. That means the company was able to keep a greater share of patient’s premium dollars for administrative expenses — and for profits.

Optum Health reported $735 million in operating income in the quarter, almost 18 times higher than in the same time last year. Meanwhile, UnitedHealthcare brought in $2.8 billion in operating profit, $1 billion more than in the prior year.

Much of the insurer’s future progress depends on continued margin improvement in its Medicare Advantage business. UnitedHealthcare hiked premiums, cut benefits and dropped unprofitable plans coming into this year, sending its MA membership plummeting — the insurer expects to lose more than 1 million enrollees in its privatized Medicare plans in 2026.

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