Shares of UnitedHealth Group, the largest health insurance company in the U.S., surged nearly 6% during Tuesday morning trading after the company provided an update on a major cyberattack earlier this year.
In its second quarterly earnings report, UnitedHealth stated that it has restored the majority of services affected at its subsidiary, Change Healthcare, a medical record and payment manager.
UnitedHealth disclosed that the cyberattack impacts in its second quarter amounted to $0.92 per share. To date, the company has provided over $9 billion in advance funding and interest-free loans to support impacted healthcare providers. Because of these financial efforts and the cost of notifying affected customers, UnitedHealth increased its estimated financial impact to between $1.90 to $2.05 per share for the full year.
Despite this, UnitedHealth reaffirmed its adjusted net earnings outlook of $27.50 to $28.00 per share, confident it can manage the cyberattack costs. The company reported $98.9 billion in revenue for the three months ending June 30, surpassing Wall Street’s expectations of $98.7 billion, according to FactSet.
“During the quarter, we prioritized supporting care providers in the wake of the cyber attack over activities such as share repurchase,” said UnitedHealth President and CFO John Franklin Rex during a call with investors on Tuesday. “It was the right thing to do, providing stability for the health system.”
In February, the ransomware group ALPHV breached Change Healthcare, delaying prescriptions and paychecks for healthcare workers. A preliminary review of the targeted data found files containing protected health information and personally identifiable information, potentially covering a significant portion of the U.S. population.
For the three months ending June 30, UnitedHealth’s net income fell 22% to $4.2 billion, compared to $5.5 billion in the same period the prior year. However, revenue increased 6% year-over-year to $98.9 billion from $93 billion. Earnings per share reached $6.80, exceeding Wall Street’s expectations of $6.66, according to a consensus estimate from FactSet.