CENTENE CORPORATION REPORTS THIRD QUARTER 2026 RESULTS
The higher earnings outlook accompanies $1.1 billion of debt reduction since June 30, despite quarterly operating cash outflow.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Summary
Centene (NYSE: CNC) raised its full-year 2026 adjusted diluted earnings guidance to greater than $5.20 per share after reporting third-quarter results. The adjusted outlook increased by $0.40; GAAP diluted EPS guidance rose to greater than $3.46. Third-quarter GAAP loss per share narrowed to $0.14 from $13.50 a year earlier, while adjusted EPS increased to $0.58 from $0.50.
Premium and service revenues increased 0.5% to $45.105 billion. The health benefits ratio, medical costs relative to premium revenues, remained at 92.7%. Centene improved its expected full-year ratio midpoint by 15 basis points to 90.75%. Quarterly operating cash outflow was $3.669 billion, primarily reflecting payment timing. Debt fell by $1.1 billion since June 30, including October's full redemption of the 2027 senior notes. Marketplace membership fell to 3,403,300 from 5,828,100 a year earlier.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Major point. Forward-looking: it has not happened yet and may not happen.2026 adjusted diluted EPS guidance increased $0.40 to greater than $5.20; GAAP guidance rose to greater than $3.46.
- Moderate pointThird-quarter GAAP loss per share narrowed to $0.14 from $13.50 a year earlier.
- Moderate pointThird-quarter adjusted diluted EPS increased to $0.58 from $0.50 a year earlier.
- Moderate pointNine-month GAAP net earnings reached $2.561 billion, versus a $5.573 billion loss a year earlier.
- Moderate pointNine-month adjusted diluted EPS increased to $6.45 from $3.26 a year earlier.
- Moderate pointThird-quarter Medicaid premium and service revenues increased 4% to $24.039 billion year over year.
- Moderate pointThird-quarter Medicare premium and service revenues increased 20% to $11.263 billion year over year.
- Moderate pointDebt declined $1.1 billion since June 30, 2026, including October's full redemption of 2027 senior notes. 3.3% of market cap
9 minor points
- Minor pointThird-quarter premium and service revenues increased 0.5% to $45.105 billion year over year.
- Minor point. Forward-looking: it has not happened yet and may not happen.Expected 2026 health benefits ratio midpoint improved 15 basis points to 90.75%.
- Minor pointThird-quarter adjusted SG&A expense ratio decreased to 6.5% from 7.0% a year earlier.
- Minor pointPrescription drug plan membership increased to 8,947,200 from 7,972,500 at September 30, year over year.
- Minor pointIndividual and Commercial Group membership increased to 497,400 from 447,900 at September 30, year over year.
- Minor pointSenior-note repurchase authorization increased $2.0 billion in October; $1.9 billion remained available on October 27.
- Minor pointThe $4.0 billion revolving credit facility had no borrowings at September 30.
- Minor pointThird-quarter real estate transactions generated a $18 million net gain.
- Minor pointNine-month provider-network sale generated a $10 million gain in the Other segment.
Negative
- Moderate pointThird-quarter operating cash outflow totaled $3.669 billion, primarily reflecting payment timing, as expected.
- Moderate pointThird-quarter Commercial premium and service revenues declined 21% to $8.700 billion year over year.
- Moderate pointMarketplace membership declined to 3,403,300 from 5,828,100 at September 30, year over year.
- Moderate pointTotal Medicaid membership declined to 11,895,900 from 12,706,400 at September 30, year over year.
- Moderate pointThird-quarter severance costs for enterprise optimization and contract exits totaled $276 million.
- Moderate pointThird-quarter effective tax rate increased to 46.7% from 0.6% a year earlier.
- Moderate pointThird-quarter adjusted effective tax rate increased to 14.5% from 2.5% a year earlier.
- Moderate point. Forward-looking: it has not happened yet and may not happen.Full-year guidance includes approximately $355 million to $405 million in severance costs for optimization and contract exits.
8 minor points
- Minor pointThird-quarter Other premium and service revenues declined 18% to $1.103 billion year over year.
- Minor pointMedicare membership declined to 954,400 from 1,013,200 at September 30, year over year.
- Minor pointThird-quarter SG&A expense ratio increased to 7.2% from 7.0% a year earlier.
- Minor pointThird-quarter enterprise optimization third-party vendor costs totaled $35 million.
- Minor pointThird-quarter additional loss associated with a prior divestiture totaled $15 million.
- Minor pointThird-quarter acquired intangible asset amortization totaled $161 million.
- Minor point. Forward-looking: it has not happened yet and may not happen.Full-year guidance includes approximately $85 million to $115 million in enterprise optimization third-party vendor costs.
- Minor point. Forward-looking: it has not happened yet and may not happen.Full-year guidance includes approximately $1 million in acquisition and divestiture expenses.
News Explained
A further $1.9 billion remained available under the senior-note repurchase program as of October 27, 2026.
Centene has reported its third-quarter results; at
As of
Details
Market Reaction – CNC
On Oct 27, the day this news came out, the latest delayed price for CNC is 2.26% below the previous close. Argus tracked a trough of -3.8% from its starting point during tracking. Our momentum scanner has recorded 4 alerts for this stock so far that day. The latest delayed price is $66.49. Relative volume is exceptionally heavy at 33.0x the average.
Data tracked by StockTitan Argus (15 min delayed). Upgrade to Gold for real-time data.
Key Figures
- GAAP diluted EPS
- $(0.14)
- Third quarter 2026
- Adjusted diluted EPS
- $0.58
- Third quarter 2026
- 2026 GAAP diluted EPS guidance
- Greater than $3.46
- Full year 2026
- 2026 adjusted diluted EPS guidance
- Greater than $5.20
- Full year 2026; adjusted guidance increased by $0.40
- Health benefits ratio
- 92.7%
- Third quarter 2026; described as better than expectations
- Debt reduction
- $1.1 billion
- Reduced since June 30, 2026
Previous Earnings Reports
-
Reported adjusted diluted EPS of $2.51 and raised 2026 adjusted EPS guidance above $4.80.
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Reported adjusted diluted EPS of $3.37 and set 2026 adjusted EPS guidance above $3.40.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Key Terms
health benefits ratio financial
days in claims payable technical
non-gaap financial measures financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
-- Third Quarter GAAP Diluted Loss Per Share of
-- Increases 2026 GAAP Diluted EPS Guidance: Greater than
- Increases 2026 full year adjusted diluted EPS guidance by
$0.40 - Consolidated HBR of
92.7% in the third quarter, better than expectations, driven by the Medicare segment, with Medicaid and Marketplace on track. - Full year 2026 HBR mid-point expectation improved by 15 basis points to
90.75% . - Debt reduced by
$1.1 billion
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Total revenues (in millions) |
$ 50,647 |
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Premium and service revenues (in millions) |
$ 45,105 |
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Health benefits ratio |
92.7 % |
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SG&A expense ratio |
7.2 % |
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Adjusted SG&A expense ratio (1) |
6.5 % |
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GAAP diluted loss per share |
$ (0.14) |
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Adjusted diluted earnings per share (1) |
$ 0.58 |
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Total cash flow (used in) operations (in millions) |
$ (3,669) |
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(1) |
Represents a non-GAAP financial measure. A full reconciliation of the adjusted diluted earnings (loss) per share and adjusted selling, general and administrative (SG&A) expenses is shown in the Non-GAAP Financial Presentation section of this release. |
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"Solid underlying fundamentals within our core businesses have powered a faster recovery to our earnings trajectory than previously anticipated," said Chief Executive Officer of Centene, Sarah M.
Membership
The following table sets forth membership by line of business:
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September 30, |
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2026 |
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2025 |
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Traditional Medicaid (1) |
10,544,300 |
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11,115,400 |
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High Acuity Medicaid (2) |
1,351,600 |
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1,591,000 |
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Total Medicaid |
11,895,900 |
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12,706,400 |
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Marketplace |
3,403,300 |
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5,828,100 |
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Individual and Commercial Group (3) |
497,400 |
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447,900 |
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Total Commercial |
3,900,700 |
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6,276,000 |
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Medicare (4) |
954,400 |
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1,013,200 |
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Medicare Prescription Drug Plan (PDP) |
8,947,200 |
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7,972,500 |
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Total at-risk membership |
25,698,200 |
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27,968,100 |
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(1) |
Membership includes Temporary Assistance for Needy Families (TANF), Medicaid Expansion, Children's Health Insurance Program (CHIP), Foster Care, and Behavioral Health. |
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(2) |
Membership includes Aged, Blind, or Disabled (ABD), Intellectual and Developmental Disabilities (IDD), Long-Term Services and Supports (LTSS), and Medicare-Medicaid Plans (MMP) Duals. The Company operated MMPs through December 31, 2025. In 2026 these members are included in Medicare as a result of the Centers for Medicare and Medicaid Services (CMS) transition to Dual Eligible Special Needs Plans (D-SNP) based integration. |
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(3) |
Membership includes Commercial Group, CHOICE Arrangements (formerly Individual Coverage Health Reimbursement Arrangement, or ICHRA) and Other Off-Exchange Individual. |
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(4) |
Membership includes Medicare Advantage, Medicare Supplement, and Applicable Integrated Plans (AIPs) as a result of the CMS transition to D-SNP based integration in 2026. |
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Premium and Service Revenues
The following table sets forth supplemental revenue information ($ in millions):
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Three Months Ended September 30, |
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2026 |
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2025 |
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% Change |
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Medicaid |
$ 24,039 |
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$ 23,171 |
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4 % |
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Commercial |
8,700 |
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10,992 |
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(21) % |
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Medicare (1) |
11,263 |
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9,391 |
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20 % |
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Other |
1,103 |
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1,344 |
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(18) % |
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Total premium and service revenues |
$ 45,105 |
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$ 44,898 |
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0.5 % |
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(1) |
Medicare includes Medicare Advantage, Medicare PDP and Medicare Supplement. |
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Statement of Operations: Three Months Ended September 30, 2026
- For the third quarter of 2026, premium and service revenues increased
0.5% to$45.1 billion $44.9 billion
- Health benefits ratio (HBR) of
92.7% for the third quarter of 2026, unchanged from92.7% in the comparable period in 2025. The consolidated HBR benefited from a lower Marketplace HBR resulting from improved pricing and risk transfer reflecting the acuity of the Marketplace membership as well as strong fundamental performance in both the Medicare Advantage and PDP businesses. The HBR in 2025 was positively impacted by a decrease to the premium deficiency reserve versus no premium deficiency reserve in 2026 for our Medicare Advantage business as a result of our progression towards profitability.
- The SG&A expense ratio was
7.2% for the third quarter of 2026, compared to7.0% in the third quarter of 2025. The adjusted SG&A expense ratio was6.5% for the third quarter of 2026, compared to7.0% in the third quarter of 2025. The increase in the SG&A expense ratio was primarily driven by enterprise optimization severance and vendor costs. The decrease in the adjusted SG&A expense ratio was driven by strong cost management, leveraging of expenses over higher revenues and reduced Marketplace membership, which operates at a meaningfully higher SG&A expense ratio. The decrease was also driven by growth in the PDP business, which operates at a meaningfully lower SG&A expense ratio as compared to the overall company.
- The effective tax rate was
46.7% for the third quarter of 2026, compared to0.6% in the third quarter of 2025. For the third quarter of 2026, our effective tax rate on adjusted earnings was14.5% , compared to2.5% in the third quarter of 2025. The GAAP and adjusted effective tax rates for 2026 reflect a decrease to the estimated annual effective tax rate applied to year-to-date operating results. The GAAP and adjusted effective tax rates for 2025 reflect the impact of estimating interim period taxes on the year-to-date tax method. The effective tax rate for 2025 also reflects the non-deductible nature of the goodwill impairment.
- GAAP diluted loss per share of
$(0.14)
- Adjusted diluted earnings per share (EPS) of
$0.58
- Cash flow used in operations for the third quarter of 2026 was
$3.7 billion
Balance Sheet
At September 30, 2026, the Company had cash, investments and restricted deposits of
During the third quarter of 2026, the Company repurchased
Outlook
Please refer to the Forward-Looking Statements, which should be reviewed in conjunction with the Company's 2026 outlook.
The Company is updating its 2026 GAAP diluted EPS guidance floor to greater than
The Company's annual guidance for 2026 is as follows and will be discussed further on our conference call:
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Full Year 2026 |
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GAAP diluted EPS |
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> |
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Adjusted diluted EPS (1) |
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> |
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(1) A full reconciliation of adjusted diluted EPS is shown in the Non-GAAP Financial Presentation section of this |
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Full Year 2026 |
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Low |
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High |
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Total revenues (in billions) |
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$ 196.5 |
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$ 200.5 |
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Premium and service revenues (in billions) |
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$ 173.0 |
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$ 177.0 |
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HBR |
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90.4 % |
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91.1 % |
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SG&A expense ratio |
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7.2 % |
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7.8 % |
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Adjusted SG&A expense ratio (2) |
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6.9 % |
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7.5 % |
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Effective tax rate |
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26.5 % |
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27.5 % |
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Adjusted effective tax rate (3) |
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25.5 % |
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26.5 % |
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Diluted shares outstanding (in millions) |
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497.0 |
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500.0 |
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(2) Adjusted SG&A expense ratio excludes severance costs due to enterprise optimization and contract exits of |
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(3) Adjusted effective tax rate excludes income tax effects of adjustments of approximately |
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Conference Call
As previously announced, the Company will host a conference call Tuesday, October 27, 2026, at 8:30 a.m. ET to review the financial results for the third quarter ended September 30, 2026.
Investors and other interested parties are invited to listen to the conference call by dialing 1-877-883-0383 (toll free) in the
A webcast replay will be available for on-demand listening shortly following the completion of the call for the next 12 months or until 11:59 p.m. ET on Tuesday, October 26, 2027, at the aforementioned URL. In addition, a digital audio playback will be available until 9 a.m. ET on Tuesday, November 3, 2026, by dialing 1-855-669-9658 (toll free) in
Non-GAAP Financial Presentation
The Company is providing certain non-GAAP financial measures in this release as the Company believes that these figures are helpful in allowing investors to more accurately assess the ongoing nature of the Company's operations and measure the Company's performance more consistently across periods. The Company uses the presented non-GAAP financial measures internally in evaluating the Company's performance and for planning purposes, by allowing management to focus on period-to-period changes in the Company's core business operations, and in determining employee incentive compensation. Therefore, the Company believes that this information is meaningful in addition to the information contained in the GAAP presentation of financial information. The Company strongly encourages investors to review its consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP financial measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.
Specifically, the Company believes the presentation of non-GAAP financial measures that excludes amortization of acquired intangible assets, acquisition and divestiture related expenses, as well as other items, allows investors to develop a more meaningful understanding of the Company's core performance over time.
The tables below provide reconciliations of non-GAAP items ($ in millions, except per share data):
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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GAAP net earnings (loss) attributable to Centene |
$ (71) |
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$ (6,631) |
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$ 2,561 |
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$ (5,573) |
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Amortization of acquired intangible assets |
161 |
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170 |
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488 |
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516 |
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Acquisition and divestiture related expenses |
— |
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— |
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— |
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1 |
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Other adjustments (1) |
307 |
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6,754 |
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360 |
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6,815 |
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Income tax effects of adjustments (2) |
(107) |
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(48) |
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(199) |
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(148) |
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Adjusted net earnings |
$ 290 |
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$ 245 |
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$ 3,210 |
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$ 1,611 |
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(1) Other adjustments include the following pre-tax items: |
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2026: |
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(a) |
for the three months ended September 30, 2026: severance costs due to enterprise optimization and contract exits of |
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(b) |
for the nine months ended September 30, 2026: severance costs due to enterprise optimization and contract exits of |
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2025: |
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(a) |
for the three months ended September 30, 2025: goodwill impairment of |
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(b) |
for the nine months ended September 30, 2025: goodwill impairment of |
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(2) |
The income tax effects of adjustments are based on the effective income tax rates applicable to each adjustment. The three and nine months ended September 30, 2025, include a tax benefit of |
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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Annual Guidance |
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2026 |
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2025 |
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2026 |
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2025 |
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GAAP diluted earnings (loss) per share attributable to Centene |
$ (0.14) |
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$ (13.50) |
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$ 5.15 |
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$ (11.29) |
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greater than |
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Amortization of acquired intangible assets |
0.33 |
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0.35 |
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0.98 |
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1.05 |
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Other adjustments (3) |
0.62 |
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13.75 |
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0.72 |
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13.81 |
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Income tax effects of adjustments (4) |
(0.22) |
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(0.10) |
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(0.40) |
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(0.30) |
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Effect of basic to diluted shares (5) |
(0.01) |
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— |
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— |
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(0.01) |
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~$— |
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Adjusted diluted EPS |
$ 0.58 |
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$ 0.50 |
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$ 6.45 |
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$ 3.26 |
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greater than |
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(3) Other adjustments include the following pre-tax items: |
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2026: |
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(a) |
for the three months ended September 30, 2026: severance costs due to enterprise optimization and contract exits of |
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(b) |
for the nine months ended September 30, 2026: severance costs due to enterprise optimization and contract exits of |
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(c) |
for the year ended December 31, 2026, an estimated: |
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2025: |
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(a) |
for the three months ended September 30, 2025: goodwill impairment of |
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(b) |
for the nine months ended September 30, 2025: goodwill impairment of |
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(4) |
The income tax effects of adjustments are based on the effective income tax rates applicable to each adjustment. The three and nine months ended September 30, 2025, include a tax benefit of |
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(5) |
Reflects the |
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Reflects the |
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Three Months Ended September 30, |
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Nine Months Ended September 30, |
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2026 |
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2025 |
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2026 |
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2025 |
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GAAP selling, general and administrative expenses |
$ 3,235 |
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$ 3,145 |
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$ 9,735 |
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$ 9,534 |
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Less: |
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Acquisition and divestiture related expenses |
— |
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— |
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— |
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1 |
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Severance |
276 |
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9 |
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294 |
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9 |
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Enterprise optimization costs |
35 |
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— |
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85 |
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— |
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Real estate transaction costs |
— |
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2 |
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— |
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2 |
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Adjusted selling, general and administrative expenses |
$ 2,924 |
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$ 3,134 |
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$ 9,356 |
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$ 9,522 |
To provide clarity on the way management defines certain key metrics and ratios, the Company is providing a description of how the metric or ratio is calculated as follows:
- Health Benefits Ratio (HBR) (GAAP) = Medical costs divided by premium revenues.
- SG&A Expense Ratio (GAAP) = Selling, general and administrative expenses divided by premium and service revenues.
- Adjusted SG&A Expense Ratio (non-GAAP) = Adjusted selling, general and administrative expenses divided by premium and service revenues.
- Adjusted Effective Tax Rate (non-GAAP) = GAAP income tax expense (benefit) excluding the income tax effects of adjustments to net earnings divided by adjusted earnings (loss) before income tax expense.
- Adjusted Net Earnings (non-GAAP) = Net earnings less amortization of acquired intangible assets, less acquisition and divestiture related expenses, as well as adjustments for other items, net of the income tax effect of the adjustments.
- Adjusted Diluted EPS (non-GAAP) = Adjusted net earnings divided by weighted average common shares outstanding on a fully diluted basis.
- Debt to Capitalization Ratio (GAAP) = Total debt, divided by total debt plus total stockholder's equity.
- Average Medical Claims Expense (GAAP) = Medical costs for the period divided by number of days in such period. Average medical claims expense is most often calculated for the quarterly reporting period.
- Days in Claims Payable (GAAP) = Medical claims liabilities divided by average medical claims expense. Days in claims payable is most often calculated for the quarterly reporting period.
In addition, the following terms are defined as follows:
- State-directed Payments: Payments directed by a state that have minimal risk but are administered as a premium adjustment. These payments are recorded as premium revenue and medical costs at close to a
100% HBR. In many instances, the Company has little visibility to the timing of these payments until they are paid by a state.
- Pass-through Payments: Non-risk supplemental payments from a state that the Company is required to pass through to designated contracted providers. These payments are recorded as premium tax revenue and premium tax expense.
About Centene Corporation
Centene Corporation, a Fortune 500 company, is a leading healthcare enterprise that is committed to helping people live healthier lives. The Company takes a local approach with local teams to provide fully integrated, high-quality, and cost-effective services to government-sponsored and commercial healthcare programs, focusing on under-insured individuals. Centene offers affordable and high-quality products to more than 1 in 15 individuals across the nation, including Medicaid and Medicare members (including Medicare Prescription Drug Plans) as well as individuals and families served by the Health Insurance Marketplace.
Centene uses its investor relations website to publish important information about the Company, including information that may be deemed material to investors. Financial and other information about Centene is routinely posted and is accessible on Centene's investor relations website, https://investors.centene.com.
Forward-Looking Statements
All statements, other than statements of current or historical fact, contained in this press release are forward-looking statements. Without limiting the foregoing, forward-looking statements often use words such as "believe," "anticipate," "plan," "expect," "estimate," "predict," "intend," "seek," "target," "goal," "potential," "may," "will," "would," "could," "should," "can," "continue," and other similar words or expressions (and the negative thereof). Our 2026 full year guidance, including our estimated severance costs in connection with the voluntary separation program, is a forward-looking statement. Centene Corporation and its subsidiaries (Centene, the Company, our or we) intends such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and we are including this statement for purposes of complying with these safe-harbor provisions. In particular, these statements include, without limitation, statements about our expected future operating or financial performance, changes in laws and regulations, market opportunity, expectations concerning pricing actions, competition, expected contract start dates and terms, expected activities in connection with completed and future acquisitions and dispositions, our investments, and the adequacy of our available cash resources. These forward-looking statements reflect our current views with respect to future events and are based on numerous assumptions and assessments made by us in light of our experience and perception of historical trends, current conditions, business strategies, operating environments, future developments, and other factors we believe appropriate. By their nature, forward-looking statements involve known and unknown risks and uncertainties and are subject to change because they relate to events and depend on circumstances that will occur in the future, including economic, regulatory, competitive, and other factors that may cause our or our industry's actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and assumptions. All forward-looking statements included in this press release are based on information available to us on the date hereof. Except as may be otherwise required by law, we undertake no obligation to update or revise the forward-looking statements included in this press release, whether as a result of new information, future events, or otherwise, after the date hereof. You should not place undue reliance on any forward-looking statements, as actual results may differ materially from projections, estimates, or other forward-looking statements due to a variety of important factors, variables, and events including, but not limited to: our ability to design and price products that are competitive and/or actuarially sound; our ability to accurately predict and effectively manage health benefits and other operating expenses and reserves, including fluctuations in medical costs; rate cuts, insufficient rate changes or other payment reductions or delays by government payors affecting our government businesses; the effect of social, economic, and political conditions, geopolitical events and state and federal policies, including the amount and terms of state and federal funding for government-sponsored healthcare programs, including as a result of changes in
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CENTENE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In millions, except shares in thousands and per share data in dollars) |
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|
|
September 30, |
|
December 31, |
|
|
(Unaudited) |
|
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
$ 20,700 |
|
$ 17,888 |
|
Premium and trade receivables |
20,329 |
|
18,105 |
|
Short-term investments |
2,886 |
|
2,432 |
|
Other current assets |
1,546 |
|
1,945 |
|
Total current assets |
45,461 |
|
40,370 |
|
Long-term investments |
14,794 |
|
17,035 |
|
Restricted deposits |
1,470 |
|
1,412 |
|
Property, software and equipment, net |
2,109 |
|
2,037 |
|
Goodwill |
10,835 |
|
10,835 |
|
Intangible assets, net |
4,042 |
|
4,530 |
|
Other long-term assets |
569 |
|
528 |
|
Total assets |
$ 79,280 |
|
$ 76,747 |
|
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND |
|
|
|
|
Current liabilities: |
|
|
|
|
Medical claims liability |
$ 21,495 |
|
$ 20,544 |
|
Accounts payable and accrued expenses |
15,459 |
|
13,796 |
|
Return of premium payable |
1,346 |
|
1,592 |
|
Unearned revenue |
680 |
|
736 |
|
Current portion of long-term debt |
88 |
|
50 |
|
Total current liabilities |
39,068 |
|
36,718 |
|
Long-term debt |
15,454 |
|
17,351 |
|
Deferred tax liability |
719 |
|
833 |
|
Other long-term liabilities |
1,732 |
|
1,789 |
|
Total liabilities |
56,973 |
|
56,691 |
|
Commitments and contingencies |
|
|
|
|
Redeemable noncontrolling interests |
24 |
|
23 |
|
Stockholders' equity: |
|
|
|
|
Preferred stock, |
— |
|
— |
|
Common stock, |
1 |
|
1 |
|
Additional paid-in capital |
20,926 |
|
20,777 |
|
Accumulated other comprehensive (loss) |
(514) |
|
(58) |
|
Retained earnings |
11,235 |
|
8,674 |
|
Treasury stock, at cost (131,706 and 131,706 shares, respectively) |
(9,441) |
|
(9,441) |
|
Total Centene stockholders' equity |
22,207 |
|
19,953 |
|
Nonredeemable noncontrolling interest |
76 |
|
80 |
|
Total stockholders' equity |
22,283 |
|
20,033 |
|
Total liabilities, redeemable noncontrolling interests and stockholders' equity |
$ 79,280 |
|
$ 76,747 |
|
CENTENE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except shares in thousands and per share data in dollars) (Unaudited) |
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|
|||||||
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|
Three Months Ended |
|
Nine Months Ended |
||||
|
|
2026 |
|
2025 |
|
2026 |
|
2025 |
|
Revenues: |
|
|
|
|
|
|
|
|
Premium |
$ 44,370 |
|
$ 44,126 |
|
|
|
|
|
Service |
735 |
|
772 |
|
2,296 |
|
2,276 |
|
Premium and service revenues |
45,105 |
|
44,898 |
|
134,135 |
|
129,854 |
|
Premium tax |
5,542 |
|
4,792 |
|
20,035 |
|
15,198 |
|
Total revenues |
50,647 |
|
49,690 |
|
154,170 |
|
145,052 |
|
Expenses: |
|
|
|
|
|
|
|
|
Medical costs |
41,128 |
|
40,902 |
|
118,460 |
|
116,213 |
|
Cost of services |
675 |
|
651 |
|
2,106 |
|
1,990 |
|
Selling, general and administrative expenses |
3,235 |
|
3,145 |
|
9,735 |
|
9,534 |
|
Depreciation expense |
138 |
|
147 |
|
411 |
|
430 |
|
Amortization of acquired intangible assets |
161 |
|
170 |
|
488 |
|
516 |
|
Premium tax expense |
5,617 |
|
4,886 |
|
20,218 |
|
15,449 |
|
Impairment |
— |
|
6,743 |
|
— |
|
6,798 |
|
Total operating expenses |
50,954 |
|
56,644 |
|
151,418 |
|
150,930 |
|
Earnings (loss) from operations |
(307) |
|
(6,954) |
|
2,752 |
|
(5,878) |
|
Other income (expense): |
|
|
|
|
|
|
|
|
Investment and other income |
333 |
|
450 |
|
1,175 |
|
1,203 |
|
Gain on debt extinguishment |
1 |
|
— |
|
2 |
|
— |
|
Interest expense |
(149) |
|
(170) |
|
(466) |
|
(510) |
|
Earnings (loss) before income tax |
(122) |
|
(6,674) |
|
3,463 |
|
(5,185) |
|
Income tax (benefit) expense |
(57) |
|
(42) |
|
902 |
|
392 |
|
Net earnings (loss) |
(65) |
|
(6,632) |
|
2,561 |
|
(5,577) |
|
(Earnings) loss attributable to noncontrolling interests |
(6) |
|
1 |
|
— |
|
4 |
|
Net earnings (loss) attributable to Centene Corporation |
$ (71) |
|
$ (6,631) |
|
$ 2,561 |
|
$ (5,573) |
|
|
|
|
|
|
|
|
|
|
Net earnings (loss) per common share attributable to Centene Corporation: |
|
|
|
|
|||
|
Basic earnings (loss) per common share |
$ (0.14) |
|
$ (13.50) |
|
$ 5.19 |
|
$ (11.29) |
|
Diluted earnings (loss) per common share |
$ (0.14) |
|
$ (13.50) |
|
$ 5.15 |
|
$ (11.29) |
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding: |
|
|
|
|
|
|
|
|
Basic |
494,143 |
|
491,141 |
|
493,351 |
|
493,644 |
|
Diluted |
494,143 |
|
491,141 |
|
497,643 |
|
493,644 |
|
CENTENE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions, unaudited) |
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|
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|
|
Nine Months Ended |
||
|
|
2026 |
|
2025 |
|
Cash flows from operating activities: |
|
|
|
|
Net earnings (loss) |
$ 2,561 |
|
$ (5,577) |
|
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities |
|
|
|
|
Depreciation and amortization |
899 |
|
946 |
|
Stock compensation expense |
178 |
|
146 |
|
Impairment |
— |
|
6,798 |
|
(Gain) loss on debt extinguishment |
(2) |
|
— |
|
Deferred income taxes |
35 |
|
13 |
|
(Gain) loss on divestitures, net |
15 |
|
10 |
|
Changes in assets and liabilities |
|
|
|
|
Premium and trade receivables |
(2,262) |
|
(3,338) |
|
Other assets |
403 |
|
(245) |
|
Medical claims liabilities |
1,024 |
|
3,176 |
|
Unearned revenue |
(56) |
|
(5) |
|
Accounts payable and accrued expenses |
1,178 |
|
2,681 |
|
Other long-term liabilities |
163 |
|
38 |
|
Other operating activities, net |
151 |
|
8 |
|
Net cash provided by operating activities |
4,287 |
|
4,651 |
|
Cash flows from investing activities: |
|
|
|
|
Capital expenditures |
(568) |
|
(554) |
|
Purchases of investments |
(3,511) |
|
(3,765) |
|
Sales and maturities of investments |
4,728 |
|
4,131 |
|
Divestiture proceeds, net of divested cash |
3 |
|
— |
|
Net cash provided by (used in) investing activities |
652 |
|
(188) |
|
Cash flows from financing activities: |
|
|
|
|
Proceeds from long-term debt |
— |
|
750 |
|
Payments and repurchases of long-term debt |
(1,872) |
|
(1,708) |
|
Common stock repurchases |
(57) |
|
(473) |
|
Proceeds from common stock issuances |
26 |
|
29 |
|
Purchase of noncontrolling interest |
— |
|
(19) |
|
Other financing activities, net |
(3) |
|
(13) |
|
Net cash (used in) financing activities |
(1,906) |
|
(1,434) |
|
Net increase in cash, cash equivalents and restricted cash and cash equivalents |
3,033 |
|
3,029 |
|
Cash and cash equivalents reclassified (to) held for sale |
(103) |
|
— |
|
Cash, cash equivalents and restricted cash and cash equivalents, beginning of period |
17,957 |
|
14,156 |
|
Cash, cash equivalents and restricted cash and cash equivalents, end of period |
$ 20,887 |
|
$ 17,185 |
|
Supplemental disclosures of cash flow information: |
|
|
|
|
Interest paid |
$ 438 |
|
$ 458 |
|
Income taxes paid, net |
$ 15 |
|
$ 540 |
|
|
|
|
|
|
The following table provides a reconciliation of cash, cash equivalents and restricted cash and cash equivalents reported within the Consolidated |
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|
|
September 30, |
||
|
|
2026 |
|
2025 |
|
Cash and cash equivalents |
$ 20,700 |
|
$ 17,058 |
|
Restricted cash and cash equivalents, included in restricted deposits |
187 |
|
127 |
|
Total cash, cash equivalents and restricted cash and cash equivalents |
$ 20,887 |
|
$ 17,185 |
|
CENTENE CORPORATION SUPPLEMENTAL FINANCIAL DATA |
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||||||||||
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|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
|
|
2026 |
|
2026 |
|
2026 |
|
2025 |
|
2025 |
|
MEMBERSHIP |
|
|
|
|
|
|
|
|
|
|
|
Traditional Medicaid (1) |
10,544,300 |
|
10,745,800 |
|
10,923,100 |
|
10,932,600 |
|
11,115,400 |
|
|
High Acuity Medicaid (2) |
1,351,600 |
|
1,364,900 |
|
1,503,800 |
|
1,585,800 |
|
1,591,000 |
|
|
Total Medicaid |
11,895,900 |
|
12,110,700 |
|
12,426,900 |
|
12,518,400 |
|
12,706,400 |
|
|
Marketplace |
3,403,300 |
|
3,494,700 |
|
3,582,200 |
|
5,541,400 |
|
5,828,100 |
|
|
Individual and Commercial Group (3) |
497,400 |
|
497,000 |
|
481,000 |
|
452,500 |
|
447,900 |
|
|
Total Commercial |
3,900,700 |
|
3,991,700 |
|
4,063,200 |
|
5,993,900 |
|
6,276,000 |
|
|
Medicare (4) |
954,400 |
|
980,000 |
|
1,002,200 |
|
1,002,600 |
|
1,013,200 |
|
|
Medicare PDP |
8,947,200 |
|
8,803,000 |
|
8,780,600 |
|
8,118,600 |
|
7,972,500 |
|
|
Total at-risk membership |
25,698,200 |
|
25,885,400 |
|
26,272,900 |
|
27,633,500 |
|
27,968,100 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Membership includes TANF, Medicaid Expansion, CHIP, Foster Care and Behavioral Health. |
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|
(2) Membership includes ABD, IDD, LTSS and MMPs. The Company operated MMPs through December 31, 2025. In 2026 these members are included in |
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|
(3) Membership includes Commercial Group, CHOICE Arrangements (formerly ICHRA) and Other Off-Exchange Individual. |
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|
(4) Membership includes Medicare Advantage, Medicare Supplement and AIPs as a result of the CMS transition to D-SNP based integration in 2026. |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NUMBER OF EMPLOYEES |
53,900 |
|
59,800 |
|
61,000 |
|
61,100 |
|
60,900 |
|
|
|
|
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|
DAYS IN CLAIMS PAYABLE |
48 |
|
47 |
|
48 |
|
46 |
|
48 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH, INVESTMENTS AND RESTRICTED DEPOSITS (in millions) |
||||||||||
|
Regulated |
$ 38,425 |
|
$ 43,015 |
|
$ 40,239 |
|
$ 37,289 |
|
$ 37,574 |
|
|
Unregulated |
1,425 |
|
1,831 |
|
1,533 |
|
1,478 |
|
1,259 |
|
|
Total |
$ 39,850 |
|
$ 44,846 |
|
$ 41,772 |
|
$ 38,767 |
|
$ 38,833 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DEBT TO CAPITALIZATION |
41.1 % |
|
41.6 % |
|
43.2 % |
|
46.5 % |
|
45.5 % |
|
|
|
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|
|
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|
OPERATING RATIOS |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||
|
|
2026 |
|
2025 |
|
2026 |
|
2025 |
|
HBR |
92.7 % |
|
92.7 % |
|
89.9 % |
|
91.1 % |
|
SG&A expense ratio |
7.2 % |
|
7.0 % |
|
7.3 % |
|
7.3 % |
|
Adjusted SG&A expense ratio |
6.5 % |
|
7.0 % |
|
7.0 % |
|
7.3 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HBR BY PRODUCT |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|||||
|
|
|
2026 |
|
2025 |
|
2026 |
|
2025 |
|
Medicaid |
93.6 % |
|
93.4 % |
|
93.6 % |
|
93.9 % |
|
|
Commercial |
89.0 % |
|
89.9 % |
|
80.9 % |
|
85.3 % |
|
|
Medicare (5) |
93.8 % |
|
94.3 % |
|
89.5 % |
|
90.6 % |
|
|
|
|
|
|
|
|
|
|
|
|
(5) |
Medicare includes Medicare Advantage, Medicare PDP and Medicare Supplement. |
|||||||
MEDICAL CLAIMS LIABILITY
The changes in medical claims liability are summarized as follows (in millions):
|
Balance, September 30, 2025 |
|
$ 21,493 |
|
Less: Reinsurance recoverables |
|
73 |
|
Balance, September 30, 2025, net |
|
21,420 |
|
Incurred related to: |
|
|
|
Current period |
|
161,795 |
|
Prior periods |
|
(1,564) |
|
Total incurred |
|
160,231 |
|
Paid related to: |
|
|
|
Current period |
|
141,483 |
|
Prior periods |
|
18,332 |
|
Total paid |
|
159,815 |
|
Plus: Premium deficiency reserve |
|
(282) |
|
Plus: Divestitures |
|
(109) |
|
Balance, September 30, 2026, net |
|
21,445 |
|
Plus: Reinsurance recoverables |
|
50 |
|
Balance, September 30, 2026 |
|
$ 21,495 |
Centene's claims reserving process utilizes a consistent actuarial methodology to estimate Centene's ultimate liability. Any reduction in the "Incurred related to: Prior periods" amount may be offset as Centene actuarially determines the "Incurred related to: Current period." Additionally, approximately
The amount of the "Incurred related to: Prior periods" above represents favorable development and includes the effects of reserving under moderately adverse conditions, new markets where we use a conservative approach in setting reserves during the initial periods of operations, receipts from other third-party payors related to coordination of benefits and lower medical utilization and cost trends for dates of service September 30, 2025, and prior.
View original content to download multimedia:https://www.prnewswire.com/news-releases/centene-corporation-reports-third-quarter-2026-results-302920048.html
SOURCE Centene Corporation
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What is Centene's updated 2026 earnings guidance?
Centene expects 2026 GAAP diluted EPS greater than $3.46 and adjusted diluted EPS greater than $5.20. The adjusted EPS outlook increased by $0.40. Adjusted EPS excludes specified items and is a non-GAAP measure.
How did Centene's third-quarter 2026 earnings compare with last year?
Centene's third-quarter GAAP diluted loss per share narrowed to $0.14 from $13.50, while adjusted diluted EPS increased to $0.58 from $0.50. GAAP net loss attributable to Centene was $71 million, compared with $6.631 billion a year earlier; the 2025 quarter included a $6.723 billion goodwill impairment.
What revenue range does Centene expect for 2026?
Centene expects full-year 2026 total revenues of $196.5 billion to $200.5 billion and premium and service revenues of $173.0 billion to $177.0 billion.
How much cash and debt did Centene have at September 30, 2026?
Centene had $39.9 billion in cash, investments and restricted deposits and $15.5 billion in total debt at September 30, 2026. Cash available for general corporate use was $175 million. Medical claims liabilities totaled $21.5 billion.