UnitedHealth Group Inc ( UNH ) announced Tuesday morning that its CEO, Andrew Witty, will resign for personal reasons. The change is effective immediately.

Stephen Hemsley, who previously held the CEO title from 2006 to 2017, will succeed him.

Hemsley will also remain chairman of UnitedHealth’s board of directors, and Witty will become senior adviser to the CEO.

Hemsley joined UnitedHealth Group ( UNH ) in 1997 as chief operating officer and became president in 1999. He has been chair of the company’s board since leaving the CEO role in 2017.

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The company also revealed that it would suspend its 2025 outlook, citing that care activity continued to accelerate.

UnitedHealth ( UNH ) noted broadening to more types of benefit offerings than seen in the first quarter, and the medical costs of many Medicare Advantage beneficiaries new to UnitedHealthcare remained higher than expected.

It said it “expects to return to growth in 2026,” according to the announcement.

“UnitedHealth Group has tremendous opportunities to grow as we continue to help improve health care and to perform to our potential — and, in so doing, return to our long-term growth objective of 13 to 16 percent,” Hemsley continued.

The insurance giant reported adjusted EPS of $7.20 in April, up from $6.91 a year ago, missing the consensus of $7.29. Revenues increased 6.8% year over year to $109.6 billion, missing the consensus of $111.60 billion.

“UnitedHealth Group…did not perform up to our expectations, and we are aggressively addressing those challenges to position us well for the years ahead and return to our long-term earnings growth rate target of 13 to 16%,” Witty said.

Prior Guidance: UnitedHealth Group ( UNH ) cuts its 2025 performance outlook. It expected adjusted earnings of $26.00-$26.50 per share versus prior guidance of 29.50-$30.00 per share, versus consensus of $29.73, reflecting:

Heightened care activity indications within UnitedHealthcare’s Medicare Advantage businesses became visible as the quarter closed, far above the planned 2025 increase consistent with the elevated levels in 2024, most notable within physician and outpatient services.

Unanticipated changes in the profile of Optum Health members are impacting planned 2025 reimbursement due to unexpectedly minimal 2024 beneficiary engagement by plans exiting markets. In addition, a greater-than-expected impact to current and new complex patients from the ongoing Medicare funding reductions enacted by the previous administration.

Price Action: At the last check on Tuesday, UNH stock was down 11% at $337.02 during the premarket session.

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