UnitedHealth Group posted second-quarter earnings that exceeded Wall Street forecasts and lifted its 2026 profit outlook, sending shares up about 7 percent in premarket trading. The largest private U.S. insurer said adjusted earnings per share came in at $6.38, well above the $4.90 analysts had expected, while revenue reached $112.03 billion against a $110.85 billion consensus.

Net income rose to $5.48 billion, or $6.04 per share, from $3.41 billion, or $3.74 per share, a year earlier. Excluding divestitures, restructuring and reserve reductions for unprofitable contracts, the company earned $6.38 per share. Revenue edged higher from $111.62 billion in the same quarter last year, with both the UnitedHealthcare insurance unit and the Optum health-services segment topping sales estimates, according to StreetAccount.

The beat prompted management to raise its 2026 adjusted earnings forecast to a range of $19.50 to $20 per share, up from a previous target of more than $18.25. Full-year revenue guidance of greater than $439 billion was unchanged, though Chief Financial Officer Wayne DeVeydt said he expects the company to exceed that mark. The upgrade reflects a turnaround plan that includes restructuring, an executive shuffle and a $1.5 billion investment in artificial intelligence aimed at streamlining operations.

DeVeydt cautioned that medical costs remain elevated over historical levels, a pressure that has persisted across the industry for more than two years. He said the quarter’s results reflect efforts to push down that elevated base rather than a fundamental bend in the cost trend. AI tools are being deployed to accelerate prior authorizations and improve payment accuracy by detecting fraud, waste and abuse, but they do not determine whether care is approved or denied.

Membership pressure underscores the affordability challenge. UnitedHealthcare served 48.5 million people in the quarter, down 525,000 from the prior period. DeVeydt attributed the decline to higher healthcare costs driving premium increases and benefit adjustments, and he forecast a loss of roughly 500,000 ACA exchange members and 1.1 million Medicare Advantage members in 2026. Revenue has held steady because pricing gains have offset enrollment erosion, a dynamic DeVeydt said is not sustainable for the broader system.

Insurers continue to grapple with a post-pandemic surge in utilization and high-cost specialty drugs such as GLP-1s. The company’s medical benefit ratio, a key gauge of claims costs relative to premiums, will be a critical metric to watch as the multi-year turnaround unfolds and AI-driven efficiencies are tested against persistent cost inflation.