Centene posts $6.6B loss on massive value writedown

Core Insights - Centene's results exceeded Wall Street expectations, indicating a "fairly positive" performance despite a mixed quarter overall [3] - The company reported a net loss of $6.6 billion in the third quarter, primarily due to a non-cash goodwill impairment charge of $6.7 billion [8] - Operationally, Centene is making progress on its turnaround, with a medical loss ratio of 92.7% in Q3, which is an increase from 89.2% year-over-year but lower than analysts' expectations [6] Financial Performance - Centene's earnings improved on an adjusted basis compared to the second quarter, although they were down year-over-year [3] - The company's stock hit a decade low in July following disappointing second quarter results, resulting in significant value loss [4] - The full-year earnings outlook was increased by executives following the quarterly results, indicating confidence in future performance [8] Market Context - The GOP's "One Big Beautiful Bill," which includes cuts to Medicaid and changes to the ACA, has negatively impacted Centene's goodwill and contributed to the impairment charge [5] - Medicaid remains a crucial segment for Centene, accounting for 45% of its nearly 28 million medical members and 52% of its $44.9 billion in premium and service revenue [7] - Elevated utilization in Medicaid continues to be a challenge for the company, but executives expressed satisfaction with managing medical costs [8]