Centene Corporation Reports 10% Revenue Growth and 52% Net Earnings Increase in Q3 2024

Centene Corporation reported significant financial performance for the third quarter and the first nine months of 2024, reflecting a robust growth trajectory. For the three months ended September 30, 2024, total revenues reached $42,023 million, marking a 10% increase from $38,042 million in the same period of 2023. This growth was driven by Medicaid rate increases, membership growth in the Marketplace business, and increased premium tax revenue. For the nine months ended September 30, 2024, total revenues were $122,266 million, up 7% from $114,539 million in the prior year.

Net earnings attributable to Centene for Q3 2024 were $713 million, a substantial increase of 52% compared to $469 million in Q3 2023. The diluted earnings per share (EPS) also saw a significant rise, reaching $1.36, up from $0.87 in the previous year. For the nine-month period, net earnings attributable to Centene were $3,022 million, compared to $2,657 million in 2023, reflecting a 14% increase.

Operating expenses for Q3 2024 totaled $41,358 million, up from $37,307 million in Q3 2023, with a Health Benefits Ratio (HBR) of 89.2%, compared to 87.0% in the prior year. The increase in medical costs was attributed to higher acuity in Medicaid and impacts from Medicare Star ratings. The company reported a gross margin of $4,006 million for Q3 2024, down from $4,632 million in Q3 2023.

Strategically, Centene has been active in divestitures and acquisitions. In August 2023, the company signed an agreement to sell Circle Health Group, and in January 2024, it completed the divestiture of Magellan Specialty Health, realizing an $83 million gain. The company also completed the sale of Collaborative Health Systems in October 2024, with an estimated after-tax gain of $0 million to $20 million expected in Q4 2024.

Membership metrics showed a slight increase, with total managed care membership reaching 28.6 million as of September 30, 2024, a 2% year-over-year growth. However, total Medicaid membership declined to 13.1 million, down from 15.2 million a year earlier, primarily due to ongoing Medicaid redeterminations.

The company’s financial position remains strong, with total assets of $82,351 million as of September 30, 2024, and total stockholders' equity of $27,396 million. Centene's stock repurchase program continues, with $3.2 billion remaining under the $10 billion authorization. The company anticipates that its available cash and investments will be sufficient to finance operations and capital expenditures for at least the next 12 months.