Molina Healthcare (MOH) Q1 2025 earnings summary

Executive summary

• Q1 2025 adjusted EPS was $6.08 (up 6% year-over-year) and GAAP EPS was $5.45 (up 5%), with net income of $298 million and premium revenue of $10.6B, driven by new contracts, acquisitions, and rate increases.

• Membership reached 5.8 million, up 0.4% year-over-year, supported by Marketplace growth and the ConnectiCare acquisition, partially offset by Medicaid redeterminations.

• Consolidated MCR was 89.2%, up from 88.5% year-over-year, mainly due to higher Medicaid utilization and Marketplace impacts from ConnectiCare.

• G&A ratio improved to 6.9% from 7.2% year-over-year, reflecting operating discipline and fixed cost leverage.

• Full-year 2025 guidance reaffirmed: $42B premium revenue and at least $24.50 adjusted EPS, representing 8% growth.

Financial highlights

• Q1 2025 total revenue was $11.1B, with $10.6B premium revenue, up 12% year-over-year.

• Operating income was $433M, up from $426M year-over-year; GAAP net income was $298M, adjusted net income $333M.

• Adjusted pre-tax margin was 3.9%, after-tax margin 2.7% GAAP and 3.0% adjusted.

• Operating cash flow for Q1 was $190M; cash and investments at parent company were $191M as of March 31, 2025.

• $500M in share repurchases completed in Q1 2025; long-term debt increased to $3.57B.

Outlook and guidance

• Full-year 2025 premium revenue guidance remains at $42B; adjusted EPS guidance reaffirmed at $24.50+.

• Long-term adjusted EPS growth target is 13%-15%; embedded earnings projected at $8.65 per share.

• Medicaid rates for 2025 projected slightly higher than prior expectations, offset by a conservative increase in cost trend.

• Marketplace MCR guidance increased from 79% to 80% due to non-recurring Q1 impacts; mid-single-digit pre-tax margins expected.

• Year-end membership outlook raised by 40,000 to 620,000.