Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Income Statement
- Common-Size Balance Sheet: Assets
- Analysis of Liquidity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Capital Asset Pricing Model (CAPM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Current Ratio since 2005
- Total Asset Turnover since 2005
- Price to Sales (P/S) since 2005
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Profitability Ratios (Summary)
UnitedHealth Group Inc., profitability ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The profitability metrics demonstrate a consistent decline across the observed period. Initially, the values exhibited relative stability between 2021 and 2023, followed by marked decreases from 2023 to 2025. This suggests increasing pressure on earnings and potentially evolving business dynamics.
- Gross Profit Margin
- The gross profit margin experienced a slight increase from 23.60% in 2021 to 24.09% in 2022, before stabilizing around 23.64% in 2023. However, a substantial decrease is evident in subsequent years, falling to 21.31% in 2024 and further to 17.81% in 2025. This indicates a diminishing ability to control the cost of goods sold relative to revenue.
- Operating Profit Margin
- Similar to the gross profit margin, the operating profit margin showed initial improvement from 8.40% in 2021 to 8.83% in 2022, remaining relatively consistent at 8.80% in 2023. A downward trend then emerges, with the margin decreasing to 8.17% in 2024 and significantly to 4.27% in 2025. This suggests increasing operating expenses or decreasing operational efficiency.
- Net Profit Margin
- The net profit margin followed the pattern of the other margins, increasing from 6.06% in 2021 to 6.25% in 2022, and holding steady at 6.09% in 2023. A pronounced decline is observed from 2023 onwards, reaching 3.65% in 2024 and 2.72% in 2025. This indicates a weakening overall profitability position.
- Return on Equity (ROE)
- Return on equity increased from 24.09% in 2021 to 25.87% in 2022, then slightly decreased to 25.22% in 2023. A significant reduction is then apparent, with ROE falling to 15.55% in 2024 and 12.81% in 2025. This suggests a decreasing effectiveness in generating profits from shareholder investments.
- Return on Assets (ROA)
- Return on assets remained relatively stable between 2021 and 2023, fluctuating around 8.15% to 8.19%. A notable decline is observed in the later years, decreasing to 4.83% in 2024 and 3.89% in 2025. This indicates a diminishing ability to generate earnings from the company’s assets.
Collectively, the observed trends across all profitability ratios point to a deteriorating financial performance. The consistent decline from 2023 to 2025 warrants further investigation into the underlying causes, such as increased costs, competitive pressures, or changes in revenue streams.
Return on Sales
Return on Investment
Gross Profit Margin
UnitedHealth Group Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross profit | ||||||
| Revenues, customers | ||||||
| Profitability Ratio | ||||||
| Gross profit margin1 | ||||||
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues, customers
= 100 × ÷ =
2 Click competitor name to see calculations.
The gross profit margin exhibited a generally stable pattern from 2021 to 2023, followed by a noticeable decline in the subsequent two years. Gross profit increased consistently from 2021 to 2023, while revenues also rose steadily over the same period. However, from 2023 onward, gross profit began to decrease, and the rate of revenue growth outpaced that of gross profit, resulting in margin compression.
- Gross Profit Margin Trend
- The gross profit margin initially increased from 23.60% in 2021 to 24.09% in 2022, indicating improved efficiency in managing the cost of goods sold relative to revenue. It remained relatively consistent at 23.64% in 2023. A significant decrease was then observed, falling to 21.31% in 2024 and further to 17.81% in 2025. This represents a substantial erosion of profitability at the gross level.
Revenues demonstrated consistent growth throughout the observed period, increasing from US$285,273 million in 2021 to US$443,647 million in 2025. This growth, however, did not translate into proportional growth in gross profit, particularly in the later years. The divergence between revenue and gross profit growth is the primary driver of the declining gross profit margin.
- Revenue and Gross Profit Relationship
- While revenues increased by approximately 55.5% between 2021 and 2025, gross profit only increased by approximately 17.3% over the same timeframe. This disparity suggests increasing costs associated with generating revenue, or a shift in revenue mix towards lower-margin products or services. Further investigation into the components of cost of goods sold would be necessary to determine the specific causes of this trend.
The decline in gross profit margin from 2023 to 2025 warrants further scrutiny. The continued growth in revenues suggests strong demand, but the diminishing gross profit margin indicates potential challenges in maintaining profitability as the business scales. This trend could be attributable to increased competition, rising input costs, or changes in pricing strategies.
Operating Profit Margin
UnitedHealth Group Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Earnings from operations | ||||||
| Revenues, customers | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| Operating Profit Margin, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Operating Profit Margin, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Operating profit margin = 100 × Earnings from operations ÷ Revenues, customers
= 100 × ÷ =
2 Click competitor name to see calculations.
The operating profit margin exhibited a generally positive trend from 2021 to 2023, followed by a significant decline in the most recent two years presented. Earnings from operations increased consistently from 2021 through 2023, while revenues also demonstrated continuous growth throughout the entire period. However, the rate of growth in earnings from operations did not keep pace with revenue growth in 2024 and 2025, resulting in margin compression.
- Operating Profit Margin Trend
- The operating profit margin increased from 8.40% in 2021 to 8.83% in 2022, indicating improved operational efficiency or pricing power. This positive trend continued modestly into 2023, reaching 8.80%. A reversal is then observed in 2024, with the margin decreasing to 8.17%. The most substantial change occurs between 2024 and 2025, where the operating profit margin declines sharply to 4.27%.
- Revenue and Earnings Relationship
- Revenues increased from US$285,273 million in 2021 to US$443,647 million in 2025, representing substantial overall growth. Earnings from operations also increased, moving from US$23,970 million in 2021 to US$32,358 million in 2023. However, earnings from operations decreased to US$32,287 million in 2024 and then significantly to US$18,964 million in 2025. This suggests that while the company continues to generate higher revenues, its ability to translate those revenues into operating profit has diminished considerably in the latter two years.
The substantial decrease in operating profit margin in 2025 warrants further investigation. Potential contributing factors could include increased operating expenses, changes in the revenue mix, or competitive pressures impacting pricing. The divergence between revenue growth and earnings from operations growth suggests a potential shift in the company’s cost structure or operational performance.
Net Profit Margin
UnitedHealth Group Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net earnings attributable to UnitedHealth Group common shareholders | ||||||
| Revenues, customers | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| Net Profit Margin, Sector | ||||||
| Health Care Equipment & Services | ||||||
| Net Profit Margin, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Net profit margin = 100 × Net earnings attributable to UnitedHealth Group common shareholders ÷ Revenues, customers
= 100 × ÷ =
2 Click competitor name to see calculations.
The net profit margin exhibited a fluctuating pattern over the five-year period. Initially, the metric demonstrated growth, followed by a significant decline in later years.
- Net Profit Margin Trend
- In 2021, the net profit margin stood at 6.06%. This increased to 6.25% in 2022, indicating improved profitability. The margin remained relatively stable in 2023, registering at 6.09%. However, a substantial decrease was observed in 2024, with the net profit margin falling to 3.65%. This downward trend continued into 2025, with the margin further declining to 2.72%.
The increase in net earnings attributable to UnitedHealth Group common shareholders from 2021 to 2023 was accompanied by a corresponding increase in revenues, customers. However, despite continued revenue growth in 2024 and 2025, net earnings decreased, resulting in the observed decline in the net profit margin. This suggests that while the company is generating more revenue, its ability to convert that revenue into profit is diminishing.
- Relationship to Revenue Growth
- Revenues, customers increased consistently throughout the period, moving from US$285,273 million in 2021 to US$443,647 million in 2025. This indicates strong top-line growth. However, the decline in net profit margin in 2024 and 2025, despite revenue increases, suggests rising costs or other factors impacting profitability.
The significant drop in net profit margin from 2023 to 2025 warrants further investigation to determine the underlying causes. Potential factors could include increased operating expenses, changes in pricing strategies, or shifts in the revenue mix.
Return on Equity (ROE)
UnitedHealth Group Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net earnings attributable to UnitedHealth Group common shareholders | ||||||
| Shareholders’ equity attributable to UnitedHealth Group | ||||||
| Profitability Ratio | ||||||
| ROE1 | ||||||
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| ROE, Sector | ||||||
| Health Care Equipment & Services | ||||||
| ROE, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
ROE = 100 × Net earnings attributable to UnitedHealth Group common shareholders ÷ Shareholders’ equity attributable to UnitedHealth Group
= 100 × ÷ =
2 Click competitor name to see calculations.
The return on equity (ROE) exhibited a fluctuating pattern over the five-year period. Initially, the metric demonstrated growth, followed by a significant decline in later years.
- ROE Trend (2021-2025)
- In 2021, ROE stood at 24.09%. This increased to 25.87% in 2022, representing a period of improved profitability relative to shareholder equity. A slight decrease was then observed in 2023, with ROE registering at 25.22%. However, 2024 witnessed a substantial drop to 15.55%, and this downward trend continued into 2025, with ROE falling further to 12.81%.
The decline in ROE from 2023 to 2025 suggests a weakening in the company’s ability to generate profits from shareholder investments. This decrease coincides with a reduction in net earnings attributable to UnitedHealth Group common shareholders, while shareholders’ equity continued to increase, albeit at a slowing rate. The increasing equity base, coupled with decreasing net income, mechanically results in a lower ROE.
- Net Earnings and Equity Relationship
- Net earnings increased from US$17,285 million in 2021 to US$22,381 million in 2023. However, net earnings decreased significantly in 2024 to US$14,405 million and further to US$12,056 million in 2025. Simultaneously, shareholders’ equity increased steadily from US$71,760 million in 2021 to US$94,110 million in 2025, though the rate of increase slowed in the final two years.
The observed pattern indicates that while the company continued to grow its equity base, its profitability did not keep pace, particularly in the latter part of the analyzed period. Further investigation into the factors driving the decline in net earnings would be necessary to fully understand the ROE trend.
Return on Assets (ROA)
UnitedHealth Group Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net earnings attributable to UnitedHealth Group common shareholders | ||||||
| Total assets | ||||||
| Profitability Ratio | ||||||
| ROA1 | ||||||
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Abbott Laboratories | ||||||
| Elevance Health Inc. | ||||||
| Intuitive Surgical Inc. | ||||||
| Medtronic PLC | ||||||
| ROA, Sector | ||||||
| Health Care Equipment & Services | ||||||
| ROA, Industry | ||||||
| Health Care | ||||||
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
ROA = 100 × Net earnings attributable to UnitedHealth Group common shareholders ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
The Return on Assets (ROA) exhibited a period of relative stability followed by a significant decline. Initial values demonstrated a consistent performance level, subsequently followed by a marked decrease over the observed period.
- ROA Trend
- From December 31, 2021, to December 31, 2023, the ROA remained relatively consistent, fluctuating between 8.15% and 8.19%. This indicates a stable ability to generate earnings from its asset base during this timeframe. However, a substantial downward trend commenced in December 31, 2024, with the ROA falling to 4.83%. This decline continued into December 31, 2025, reaching 3.89%.
The decrease in ROA from 2023 to 2025 suggests a diminishing efficiency in utilizing assets to generate profit. This could be attributable to several factors, including a decrease in net earnings, an increase in total assets, or a combination of both. While total assets increased consistently throughout the period, the decline in net earnings attributable to UnitedHealth Group common shareholders from 2023 to 2025 appears to be the primary driver of the ROA reduction.
- Net Earnings and ROA Relationship
- Net earnings attributable to UnitedHealth Group common shareholders increased from US$17,285 million in 2021 to US$22,381 million in 2023. However, a significant decrease was observed in subsequent years, falling to US$14,405 million in 2024 and further to US$12,056 million in 2025. This inverse relationship between net earnings and the ROA is evident, as the decline in earnings directly contributed to the decreasing ROA values.
- Asset Growth and ROA Relationship
- Total assets increased steadily from US$212,206 million in 2021 to US$309,581 million in 2025. While asset growth is generally positive, the concurrent decline in net earnings suggests that the increased asset base was not effectively leveraged to generate proportional increases in profitability, thus contributing to the lower ROA.
The observed trend warrants further investigation to determine the underlying causes of the declining profitability and to assess the company’s strategies for improving asset utilization and earnings generation.