UnitedHealth Posts Double-Digit Revenue, Profit Gains In 2016
UnitedHealth said its revenues in 2016 were up 18 percent and profits jumped 24 percent over fiscal 2015’s performance, citing the addition of 2.2 million new customers (pushing its customer based to over 46 million) and a drop in its medical care ratio.
On Tuesday, Minnetonka-based UnitedHealth Group reported revenues of $184.8 billion, a $27.7 billion year-over-year increase. Its earnings for the year totaled $7.3 billion, or $8.05 a share, compared to 2015 earnings of $5.9 billion, or $6.45 a share.
The strongest performer among UnitedHealth Group’s subsidiaries continued to be its IT division, Optum. With $83.6 billion in revenue for the fiscal year—up from $67.6 billion in 2015—Optum made up about 45 percent of UnitedHealth Group’s total annual revenue.
For the quarter, UnitedHealth Group’s revenue rose 9 percent year-over-year to $47.5 billion. Its net income jumped to $1.9 billion, or $1.96 a share, during the three-month period ending December 31. In the same quarter last year, UnitedHealth Group reported $1.2 billion, or $1.26 a share.
The company’s earnings result topped Wall Street’s prediction of $2.07 a share for the quarter.
“We are privileged today to serve more people in more ways than ever before,” UnitedHealth Group CEO Stephen J. Hemsley said in a statement.
Looking to its fiscal 2017 year, UnitedHealth Group reiterated its outlook of $197 billion to $199 billion in revenue with adjusted earnings of $9.30 to $9.60 a share.
In wake of the company’s end-of-year report, shares dropped 1.5 percent from its Friday close of $161.90 to $159.50 as of mid-day Tuesday.
UnitedHealth Group is one of the largest companies in both Minnesota and the nation by revenue. In last year’s Fortune 500 list, UnitedHealth Group ranked sixth and became the first company from Minnesota to ever crack the top 10.