Elevance Health lowers 2025 guidance amid cost pressures in ACA, Medicaid markets

Shares in Elevance Health dipped slightly premarket as the insurer reported $1.7 billion in profit for the second quarter of 2025, falling short of Wall Street analysts' expectations.

That figure is down by 24% from the $2.3 billion in profit that Elevance earned in Q2 2024. That equals $8.84 in earnings per share, while investors had anticipated $9.16 per share, according to Zacks Investment Research.

Mid-year profits are also down compared to 2024, according to the company's earnings report released on Thursday. Through the first six months of the year, Elevance Health has earned $3.9 billion in profit, a 13.6% decrease from 2024's H1 tally of $4.5 billion,

While the company did miss on earnings, Elevance surpassed analysts' predictions on revenue, posting $49.8 billion. Investors had anticipated $48.2 billion, per Zacks.

Revenues were up by 13% year-over-year, as the company reported $43.9 billion in Q2 2024. Mid-year revenues were $98.7 billion, according to the report.

Elevance Health is the latest insurer to sound the alarm on elevated costs in the Affordable Care Act's marketplaces. In the earnings press release, CEO Gail Boudreaux said the company will adjust its outlook for the year based on those cost trends and "slower rate alignment in Medicaid."

"While the external environment continues to evolve, we are focused on the areas within our control — managing healthcare costs, deploying targeted investments in advanced technology and value-based care delivery, and reinforcing the operational foundation that supports long-term value creation," she said.

The company now expects to earn $30 in earnings per share for the full year, down from its previous estimates of between $34.15 and $34.85 per share.

Elevance Health's medical loss ratio was 88.9% in the second quarter, higher than the 86.4% it reported in the first quarter and reflecting those expected pressures in the ACA and Medicaid markets.

The insurer reported 45.6 million members as of Q2, down by about 212,000 due to lower Medicaid enrollment and lower effectuation rates in the ACA marketplaces.