Key Points
It missed by a wide margin on second-quarter profitability.
Compounding that, it cut its bottom-line guidance again for full-year 2025.
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Insurance conglomerate Unum Group (NYSE: UNM) wasn’t the safest bet on the stock market Wednesday. The company’s share price cratered by more than 12% on the back of a poorly received earnings report. That decline was especially pronounced on a day when the S&P 500 index only dipped by 0.1%.
Quite the whiff on the bottom line
In its second quarter, Unum took in revenue of $3.36 billion, which bettered the $3.23 billion of the same period of 2024. This was on the back of a nearly 5% year-over-year rise in premium income to $2.75 billion, and a 3% increase in net investment income to almost $561 million. The top-line figure was only slightly higher than the consensus analyst estimate of $3.33 billion.
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However, Unum’s after-tax adjusted operating income fell, sliding by 12% to slightly more than $361 million, or $2.07 per share. Prognosticators tracking the stock were expecting much better, as they were collectively modeling $2.22 per share.
Management attempted to put a positive spin on the quarter, quoting CEO Richard McKenney as saying that “Core fundamentals remain solid and we continued to deliver strong premium growth in our capital-efficient, high-return businesses.”
Yet another chop
A larger factor in the Unum sell-off was the company’s full-year profitability guidance, which was reduced for the second quarter in a row. Over the entirety of 2025, Unum is now modeling an after-tax adjusted operating income of $8.50 per share, which would be less than 1% higher than the 2024 result. Previously, Unum had forecast growth of at least 6% in the line item.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
