Molina Healthcare Q2 Earnings Plunge 76% as Medical Costs Surge; Membership Drops 14%
MOH sits 64% above its 52-week low of $121.06.
Summary
Molina Healthcare's Q2 net income fell 76% to $60 million as medical costs spiked and membership dropped 14%. The company raised full-year adjusted EPS guidance but faces margin pressure and a credit rating downgrade.
Key Events · Earnings and Guidance · MOH
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Q2 Net Income Plunges 76%
Net income fell to $60 million ($1.19 diluted EPS) from $255 million ($4.75) a year ago, driven by higher medical costs and lower membership.
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Medical Care Ratio Surges
Consolidated MCR increased to 92.2% from 90.4%, with all segments deteriorating: Medicaid 92.7%, Medicare 90.7%, Marketplace 88.9%.
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Membership Declines 14%
Total membership dropped to 4.9 million from 5.7 million, primarily due to Medicaid market contraction and strategic Marketplace reductions.
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MAPD Exit and $93M Impairment
Molina plans to exit the Medicare Advantage-Part D product in 2027, resulting in a $93 million intangible asset impairment recorded in Q1 2026.
Analysis · MOH · Finance
A sharp rise in medical costs across all segments drove Molina's Q2 net income down to $60 million from $255 million a year ago. The consolidated medical care ratio jumped to 92.2%, underscoring a challenging cost environment. Membership fell 14% to 4.9 million, and premium revenue declined 6%. The company is exiting its MAPD product in 2027, taking a $93 million impairment. A credit agreement amendment temporarily eases covenant pressure, but an S&P downgrade to BB- raises borrowing costs. The results highlight the margin squeeze in government-sponsored health plans, even as Molina raised full-year adjusted EPS guidance to at least $5.25.
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At the time of this filing, MOH was trading at $198.23 on NYSE in the Finance sector, with a market capitalization of approximately $10.6B. The 52-week trading range was $121.06 to $244.89. This filing was assessed with negative market sentiment and an importance score of 8 out of 10.