Humana Inc. reported its fourth‑quarter 2025 financial results on February 11 2026, posting a GAAP net loss of $6.61 per share and an adjusted net loss of $3.96 per share. Revenue rose 11.3% year‑over‑year to $32.52 billion, while the operating cost ratio improved to 13.7% from 14.4% in the prior year, reflecting ongoing investments in value‑based care and specialty pharmacy services.
Revenue growth was driven primarily by higher Medicare Advantage premiums and a 12% increase in CenterWell integrated‑care revenue, which includes pharmacy, primary care, and home‑health services. The mix shift toward higher‑margin CenterWell segments helped offset the impact of a 1.5% decline in legacy Medicare Advantage revenue, which was partially attributable to a lower Star Rating for the bonus year 2026.
The adjusted loss widened from a $2.16 per share loss in Q4 2024 to $3.96 per share in Q4 2025, largely because of higher medical loss ratios and increased cost of care under the Inflation Reduction Act. No one‑time charges were reported, so the loss expansion reflects sustained cost pressure and a less favorable mix of services.
For the full year 2026, Humana guided to at least $8.89 GAAP EPS and at least $9.00 adjusted EPS, well below analyst consensus estimates of $11.92–$12.04. Management cited a lower Star Rating for the bonus year 2026 as the primary headwind that will compress margins, but it expects the rating to improve in 2027. CEO Jim Rechtin said the company remains confident in its consumer‑focused strategy and anticipates continued growth in individual Medicare Advantage membership.
Investors reacted negatively to the guidance miss, with analysts noting that the lower earnings forecast signals near‑term profitability challenges. The company’s revenue beat and margin improvement were offset by the guidance shortfall, leading to a cautious market stance.
Looking ahead, Humana’s focus on expanding CenterWell and Medicaid platforms, coupled with projected 25% growth in individual Medicare Advantage membership, positions it for long‑term value creation. However, the Star Rating headwind and ongoing cost inflation present short‑term risks that management must navigate to restore earnings momentum.
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