Centene Shares Drop After Insurer Reports Surprise Losses
Shares dropped 12.7% before markets opened in New York. They had fallen 56% since the start of the year. Centene said it would provide updated guidance on a conference call with analysts, which starts at 8 a.m. New York time, an unusual move given the insurer normally shares its outlook in earnings releases.
'Given how weak results were in the quarter, the lack of guidance in the release could mean that 2025 guidance is weaker than analysts had been projecting,' Morningstar analyst Julie Utterback said. After the earnings miss, Centene executives might want to 'hold investor hands through the rest of 2025 and beyond,' she said.
The insurer chalked up the second-quarter loss to a miscalculation in its Affordable Care Act, or ACA, business — the same reason it pulled its outlook earlier this year. Insurers receive compensation for taking on sicker patients in that program and Centene said it would receive less of that money than previously expected.
For the second quarter, Centene announced an adjusted loss per share of 16 cents. Wall Street analysts expected a profit of 55 cents per share.
'We are disappointed by our second-quarter results, but we have a clear understanding of the trends that have impacted our performance, and are working with urgency and focus to restore our earnings trajectory,' Sarah London, chief executive officer of Centene, said in the company's earnings statement.
In the second quarter, Centene spent 93% of premium revenues of medical costs, higher than the average analyst expectation of 91.6%. Investors prefer a lower number.
The insurer said its health benefits ratio, the percentage of premium revenues spent on medical costs, rose from last year, largely because of the ACA revenue issue. Centene said it also saw higher medical costs in ACA plans, as well as increased costs in Medicaid, which mostly came from behavioral health, home health, and expensive drugs.
Because of various government programs that are likely to reduce health care coverage, patients may be seeking more medical care now while they still can, boosting medical spending, the company said in a regulatory filing Friday.
--With assistance from John Tozzi.
(Updates with analyst comment in third paragraph.)
More stories like this are available on bloomberg.com
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
&w=3840&q=100)
Business Standard
2 hours ago
- Business Standard
New Zealand to charge foreign tourists up to NZ$40 at popular sites
The country's pristine national parks and great walks are "truly special to New Zealanders" and foreigners should pay a fee at high traffic sites, Prime Minister Christopher Luxon said in a speech Bloomberg New Zealand will begin charging foreign tourists up to NZ$40 ($24) to visit its most popular tourist destinations such as Milford Track and Mount Cook as the government seeks ways to help spur economic growth. The country's pristine national parks and great walks are 'truly special to New Zealanders' and foreigners should pay a fee at high traffic sites, Prime Minister Christopher Luxon said in a speech Saturday. The NZ$62 million in annual revenue generated will be re-invested into those locations, he said. 'I have heard many times from friends visiting from overseas their shock that they can visit some of the most beautiful places in the world for free,' Luxon said. 'It's only fair that at these special locations, foreign visitors make an additional contribution of between NZ$20 and NZ$40 per person.' New Zealand has earmarked tourism as a key avenue to generate economic growth as the nation's recovery from a recession last year gathers pace. The government from November will replace a costly transit visa for Chinese travelers in a bid to attract visitors. The government will initially consider introducing the fee at Cathedral Cove, Tongariro Crossing, Milford Track and Mount Cook, sites where foreigners often make up 80 per cent of visitors, Luxon said. 'At the same time, there will be no charge for New Zealanders to access the conservation estate,' he said. 'It's our collective inheritance and Kiwis shouldn't have to pay to see it.'
Time of India
3 hours ago
- Time of India
Trump momentum drives stablecoin urgency in Asian financial hubs
Bloomberg Live Events The crypto-curious nation of South Korea offers a case-in-point. Streamlined Trading Mainland Interest (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Asian markets are hurriedly updating their stablecoin rules as President Donald Trump's embrace of US dollar-pegged cryptocurrencies instills a fresh sense of urgency among the region's developments in South Korea, Hong Kong, Malaysia, Thailand and the Philippines point to a proliferation of stablecoins pegged to Asian currencies — even as authorities raise concerns about capital heavyweights including and Ant Group plan to capitalize by applying to become issuers. Shares in Kakaopay Corp. ballooned on expectations that it would do the same. Even China, which has for years imposed a sweeping crypto ban, appears to be warming to the notion of tokens that serve as yuan all stems from the US, where lawmakers recently passed legislation that will promote wider use of digital tokens that seek to maintain a 1:1 peg with the dollar. The White House earmarked dollar stablecoins as a priority in a January executive order, days after Trump's inauguration.'The Genius Act has opened the floodgates for stablecoin adoption,' said Benjamin Grolimund, General Manager for the UAE at crypto exchange Flipster. 'Whether you support it or not, stablecoins are now unavoidable.'Overhanging Asia's flurry of activity is the fear of capital flight. The dollar reigns supreme in today's stablecoin market, with $256 billion in tokens pegged to the greenback. These maintain their price by managing reserves of cash-like assets, such as US Treasuries. By contrast, there's just $403 million of euro-backed stablecoins in circulation, despite a well established regulatory framework covering such products in the form of the Markets in Crypto-Assets Regulation are already trading piling into dollar-pegged stablecoins. Transactions involving USDT, USDC and USDS — three of the largest dollar proxies — on five domestic exchanges reached 57 trillion won ($41 billion) in the first quarter, Yonhap News reported, citing Bank of Korea lawmakers in recent weeks clashed with the central bank over whether to allow Korean companies to issue won-based stablecoins. President Lee Jae Myung's ruling Democratic Party on June 10 proposed the Digital Asset Basic Act, creating a pathway for local firms to become weeks later, Ryoo Sangdai, Senior Deputy Governor at the Bank of Korea, warned that stablecoins may shift the country's longstanding policy stance on capital liberalization and the won's internationalization. Central bank Governor Rhee Chang Yong went further, arguing that non-bank stablecoins would 'cause big chaos like in the 19th century,' when currencies issued by the private sector flooded the market.'Local stablecoins, while offering regulatory visibility at the point of issuance, carry the risk of becoming efficient bridges to global markets through seamless crypto-to-crypto swaps on decentralised exchanges,' said John Park, head of Korea at Arbitrum central banks need to find ways to channel the momentum, rather than fighting it, Park said. Regulatory frameworks should aim to preserve sovereignty while staying competitive, he digital-asset trading firms, a more diverse stablecoin market is a no-brainer.'Capital controls are a challenge,' said Yoann Turpin, co-founder of crypto market maker Wintermute. 'But stablecoins could provide a vetted, more efficient on-chain system.'Such a setup could streamline arbitrage trades across venues or between markets without the constraint of foreign exchange market hours, said Le Shi, Hong Kong managing director at market making firm Auros. 'There's a real use case for local currency stablecoins — particularly for enabling weekend liquidity and smoother capital movement.'Another possibility is that the growth of local stablecoins could enliven crypto economies in Asia. In South Korea, an estimated 18 million people, over a third of the country's population, are engaged in digital assets. Sam Seo, chairman of the Kaia DLT Foundation, said a won-backed stablecoin would serve different needs than US dollar alternatives.'In the short term, swaps between the won and USDT will dominate. But longer term, we'll need stablecoins from other countries to support direct pairings and faster settlement,' Seo Kong, meanwhile, has quickly become the region's stablecoin laboratory. The Hong Kong Monetary Authority is particularly focused on 'viable and practical use cases,' not just capital buffers, Clara Chiu, founder of QReg Advisory said. Many of the issuers that have taken an interest in yuan-backed stablecoins are trading and payment firms that are already using the yuan in cross-border settlement. 'That's where the practical demand lies,' Chiu China's next steps are far from certain, crypto firms including brokers are already preparing for the prospect of yuan-pegged stablecoins. Kennix Chan, vice president at Victory Securities, said the firm is in active talks with a range of would-be issuers in Hong firm's affiliate, VDX, is close to securing a license to operate a digital-asset exchange, according to Chan, allowing it to offer new trading pairs — such as Bitcoin against stablecoins pegged to the Hong Kong dollar — and eventually yuan-backed equivalents. 'When a yuan-stablecoin is born, the market will definitely be exponentially bigger,' Chan its blanket crypto trading ban, China appears to be warming to blockchain as a financial tool. People's Bank of China Governor Pan Gongsheng said in June that stablecoins could revolutionize international finance, as rising geopolitical tensions highlight the fragility of traditional payment systems.A recent licensing upgrade granted for a major Chinese state-owned brokerage to deal in digital assets through Hong Kong has also stirred optimism among Chinese players. 'It gave hope that there's a way,' Chiu few expect Beijing to open its doors to crypto trading anytime soon. Lily King, chief operating officer at digital-asset custodian Cobo, said Hong Kong will continue to serve as a testing ground for Chinese enterprises looking to build overseas. 'China may not feel the need to open itself,' she added.
India Today
3 hours ago
- India Today
Tim Cook rallies staff, says AI revolution bigger than internet and Apple will invest to grab it
Apple CEO Tim Cook has told employees that the company is going 'all in' on artificial intelligence, describing it as a technology revolution on par with, or even greater than, the internet and the smartphone era. According to Bloomberg, Cook delivered the message in a rare allhands meeting held in the company's oncampus auditorium, following the iPhone maker's latest earnings report. The address was aimed at energising Apple staff around AI and what Cook called the company's 'amazing' pipeline of future must do this. Apple will do this. This is sort of ours to grab,' Cook told staff. 'We will make the investment to do it,' he CEO compared the rise of AI to past technological shifts. 'We've rarely been first,' he said. 'There was a PC before the Mac; there was a smartphone before the iPhone; there were many tablets before the iPad; there was an MP3 player before iPod. This is how I feel about AI.' Cook said the company was 'open' to mergers and acquisitions to accelerate progress. Reports have suggested that Apple has even weighed up potential acquisitions, including AI search engine Perplexity and the French startup Mistral was months behind OpenAI, Alphabet and Microsoft when it announced its Apple Intelligence features last year – and even then, several of those tools failed to arrive in time for the iPhone 16 launch, leading to some awkward delays and Cook downplayed concerns about the slow rollout and said that perhaps not first, but Apple delivers the best. However, he urged employees to speed up how quickly AI is integrated into Apple's work. 'All of us are using AI in a significant way already, and we must use it as a company as well,' Cook said. 'To not do so would be to be left behind, and we can't do that.'AI strategy and Baltra chipsCook noted that 12,000 new hires had joined Apple over the past year, with 40 per cent of those roles focused on research and development. Much of this effort ties into Apple's AI strategy, particularly its inhouse chip development led by Johny has reported that Apple is building a new cloudcomputing chip, codenamed Baltra, specifically designed to power AI features. Alongside that, a dedicated AI server manufacturing facility is being established in retail expansion and new marketsThe meeting also touched on other priorities. Cook acknowledged that tariffs from the Trump administration remain a challenge, saying they will create a $1.1 billion headwind for the current quarter. Even so, Apple has remained optimistic about sales and highlighted that App Store revenue grew by a doubledigit percentage last quarter despite regulatory pressures in Europe and is also a focus area. Cook said Apple is 'opening outlets in India, the United Arab Emirates and China this year, and is preparing to add its first location in Saudi Arabia next year'.'We need to be in more countries, and you'll see us go into more emerging markets in particular,' he told employees. That, he stressed, 'doesn't mean Apple will ignore other places,' but a 'disproportionate amount of growth' will come from new also addressed the company's climate goals, Apple TV+ growth and the increased regulatory scrutiny of Big Tech. 'The reality is that Big Tech is under a lot of scrutiny around the world,' he said. 'We need to continue to push on the intention of the regulation and get them to offer that up, instead of these things that destroy the user experience and user privacy and security,' he added.- Ends
