On 8/20/25, Loews, AFLAC, and Marketaxess Holdings will all trade ex-dividend for their respective upcoming dividends. Loews will pay its quarterly dividend of $0.0625 on 9/2/25, AFLAC will pay its quarterly dividend of $0.58 on 9/2/25, and Marketaxess Holdings will pay its quarterly dividend of $0.76 on 9/3/25.10 Stocks Where Yields Got More Juicy »As a percentage of Loew's recent stock price of $95.00, this dividend works out to approximately 0.07%, so look for shares of Loews to trade 0.07% lower — all e ...

Core Insights - Aflac Incorporated (AFL) has expanded its share repurchase program by adding 100 million shares to the existing 30.9 million, bringing the total buyback capacity to approximately 130.9 million shares, indicating management's confidence in the company's long-term prospects [1][8] - In Q2, Aflac repurchased 7.9 million shares for $829 million and declared a dividend of 58 cents per share, with a dividend yield of 2.24%, surpassing the industry average of 2.05% [2][8] - Aflac ended Q2 with $7 billion in cash and cash equivalents, an 11.8% increase from year-end 2024, and maintained a total debt-to-capital ratio of 24.7%, below the industry average [3] Financial Performance - Adjusted net investment income rose to $1 billion in Q2, with the U.S. segment's pre-tax profit margin improving to 21.6% from 21.1% in 2024 [3] - Aflac Japan reported an 18.7% year-over-year sales increase to $236 million in H1 2025, driven by sales momentum from Miraito and new product launches [4][8] Industry Context - Other insurers like Aon plc and Marsh & McLennan are also engaging in shareholder-friendly initiatives, including share repurchase programs and dividends [5] - Aon repurchased 0.7 million shares for approximately $250 million in Q2, while Marsh & McLennan bought back 1.4 million shares worth $300 million [6] Valuation and Estimates - Aflac shares have gained 2.2% year-to-date, slightly outperforming the industry growth of 2% [7] - The company trades at a forward price-to-earnings ratio of 14.91, above the industry average of 12.14, with a Zacks Consensus Estimate for 2025 earnings at $6.81 per share, reflecting a 5.6% decline from the previous year [10][11]

Core Points - Aflac Incorporated's Board of Directors has authorized the purchase of up to 100 million shares of its common stock, increasing the total number of shares available for repurchase to approximately 130.9 million [1] - The company plans to conduct the share repurchase in open market or negotiated transactions based on market conditions [1] Company Overview - Aflac Incorporated is a Fortune 500 company providing financial protection and peace of mind for nearly seven decades to millions of policyholders and customers through its subsidiaries in the U.S. and Japan [2] - In the U.S., Aflac is the leading provider of supplemental health insurance products, while in Japan, it is the top provider of cancer and medical insurance in terms of policies in force [2] - The company has been recognized as one of the World's Most Ethical Companies for 19 consecutive years and has been included in Fortune's World's Most Admired Companies for 24 years [2] - Aflac became a signatory of the Principles for Responsible Investment in 2021 and has been part of the Dow Jones Sustainability North America Index for 11 years [2]

Core Insights - Aflac Incorporated (AFL) reported second-quarter 2025 adjusted earnings per share (EPS) of $1.78, exceeding the Zacks Consensus Estimate by 4.1%, although it represented a 2.7% decline year over year [1][9] - Adjusted revenues fell 11.7% year over year to $4.5 billion, but still beat the consensus mark by 2.3% [1][2] Financial Performance - The quarterly results were bolstered by increased new annualized premium sales in the Japan segment, particularly from the Miraito cancer insurance product, alongside strong sales and persistency rates in the U.S. business [2] - Adjusted net investment income was $1 billion, a slight increase of 0.3% year over year [3] - Total net benefits and claims rose 4.6% year over year to $2 billion, while total acquisition and operating expenses increased 10.9% year over year to $1.3 billion [3] Segment Analysis - **Aflac Japan**: Adjusted revenues reached $2.5 billion, a 1% increase year over year, surpassing the Zacks Consensus Estimate of $2.4 billion [4] - Total net earned premiums in Japan improved 2.7% year over year to $1.76 billion, though it slightly missed the consensus mark [4] - New annualized premium sales in Japan climbed 23.2% year over year to $143 million, driven by strong demand for the Miraito product [5] - **Aflac U.S.**: Adjusted revenues were $1.73 billion, a 2.6% year-over-year growth, but marginally missed the Zacks Consensus Estimate of $1.74 billion [6] - Total net earned premiums in the U.S. rose 3.4% year over year to $1.5 billion, supported by sales growth and strong persistency rates [6] Financial Position - As of June 30, 2025, Aflac had total cash and cash equivalents of $7 billion, an 11.8% increase from the end of 2024 [8] - Total assets grew 6.1% year over year to $124.7 billion, while adjusted debt rose 12.8% to $8.1 billion [8] - Total shareholders' equity increased 4.2% from the end of 2024 to $27.2 billion [10] Capital Deployment - Aflac repurchased 7.9 million shares for $829 million in the second quarter, with 30.9 million shares remaining for buyback [11] - The company announced a dividend of 58 cents per share for the second quarter, payable on September 2, 2025 [11] 2025 Outlook - Aflac expects a benefit ratio of 64-66% for the Japan unit and 48-52% for the U.S. unit in 2025 [12] - The expense ratios for Aflac Japan and U.S. are projected to be 20-23% and 36-39%, respectively [12] - The pretax profit margins for Aflac Japan and U.S. are estimated to be within 30-33% and 17-20%, respectively [12]

Financial Data and Key Metrics Changes - Aflac Incorporated reported net earnings per diluted share of $1.11 and adjusted earnings per diluted share of $1.78 for Q2 2025, with adjusted earnings per diluted share decreasing by 2.7% year over year [5][16] - Adjusted book value per share excluding foreign currency remeasurement increased by 5.2% [16] - The adjusted return on equity (ROE) was 13.7% to 16.4%, indicating an acceptable spread to the cost of capital [16] Business Line Data and Key Metrics Changes - Aflac Japan experienced a 23.2% year-over-year sales increase, with a notable 53% increase in cancer insurance sales driven by the new product MiRyto [6][8] - Aflac US generated $340 million in new sales during Q2, reflecting a 2.7% year-over-year increase, with strong premium persistency of 79.2% and a 3.4% increase in net earned premium [9][10] - The total benefit ratio for Aflac US was 47.3%, which is 60 basis points higher than Q2 2024, driven by business mix [21] Market Data and Key Metrics Changes - Aflac Japan's net earned premiums declined by 4.8%, while underlying earned premiums, excluding certain impacts, declined by 1.1% [17] - Persistency in Japan remained solid at 93.7%, up approximately 40 basis points year over year [19] - In the US, the expense ratio improved to 36.3%, down 60 basis points year over year, driven by improved scale and expense efficiency [22] Company Strategy and Development Direction - The company is focused on maintaining strong premium persistency and expanding its product offerings to meet customer needs throughout different life stages [8][10] - Aflac is leveraging its broad distribution channels in Japan to optimize opportunities for financial protection [9] - The company aims to continue driving profitable growth with a stronger underwriting discipline and prudent expense management [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing need for Aflac's products, emphasizing the importance of being a partner in health for policyholders [11][15] - The company anticipates a stronger second half of 2025, driven by fourth-quarter bookings and a robust pipeline [66] - Management acknowledged the competitive landscape in the medical insurance market and plans to launch a new medical product within a year [84] Other Important Information - Aflac repurchased $829 million of its own stock and paid dividends of $312 million in Q2 2025, returning a total of $1.1 billion to shareholders [12][27] - The company celebrated several milestones, including the 30th anniversary of the Aflac Cancer and Blood Disorders Center [13] Q&A Session Summary Question: Impact of new cancer product on sales - Management indicated that the new cancer product, MiRyto, has gained traction and is expected to continue performing well, with strong sales across all channels [40] Question: Japan investment income trajectory - Management noted that variable net investment income (NII) improved due to better portfolio marks and strategic trades, with optimism for a solid second half of the year [44] Question: Approach to capital deployment and M&A - Management stated that capital deployment is based on operating capital generation, with a focus on organic growth and returning capital to shareholders through dividends and buybacks [61][75] Question: U.S. sales performance and expectations - Management acknowledged sluggish sales growth in the U.S. but expects stronger performance in the second half, driven by improved recruitment and pipeline strength [66] Question: Expense ratio trends in Japan - Management expects the expense ratio in Japan to remain within the guidance range of 20% to 23%, with some technology projects driving expenses higher [73]

Financial Data and Key Metrics Changes - Aflac reported net earnings per diluted share of $1.11 and adjusted earnings per diluted share of $1.78 for Q2 2025, with adjusted earnings per diluted share decreasing by 2.7% year over year [4][14] - Adjusted book value per share excluding foreign currency remeasurement increased by 5.2% [14] - The adjusted return on equity (ROE) was 13.7% to 16.4%, excluding foreign currency remeasurement [14] Business Line Data and Key Metrics Changes - Aflac Japan experienced a 23.2% year-over-year sales increase, with a notable 53% increase in cancer insurance sales driven by the new product MiRyto [5][6] - Aflac US generated $340 million in new sales during Q2, reflecting a 2.7% year-over-year increase, with strong premium persistency of 79.2% and a 3.4% increase in net earned premium [7][8] - Aflac Japan's net earned premiums declined by 4.8%, while underlying earned premiums, excluding certain impacts, declined by 1.1% [15] Market Data and Key Metrics Changes - Aflac Japan's total benefit ratio was 66.5%, down 40 basis points year over year, while the third sector benefits ratio was 57.4%, also down approximately 40 basis points [16] - In the US, the total benefit ratio was 47.3%, which was 60 basis points higher than Q2 2024, driven by business mix [20] Company Strategy and Development Direction - The company is focusing on maintaining strong premium persistency and expanding its distribution channels in Japan, including agencies and banks, to meet changing customer needs [6][7] - Aflac aims to leverage its innovative products, such as MiRyto, to attract new and younger customers while maintaining a strong reputation for financial protection [5][13] - The company is committed to prudent liquidity and capital management, with a focus on tactical capital deployment to drive strong risk-adjusted returns [10][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for Aflac's products, emphasizing the importance of being a partner in health for policyholders [9][13] - The company anticipates a stronger second half of 2025, driven by fourth-quarter bookings and improved performance in various business segments [62][65] - Management acknowledged the competitive landscape in Japan, particularly in medical insurance, and plans to launch new products to enhance market position [82][86] Other Important Information - Aflac repurchased $829 million of its own stock and paid dividends of $312 million in Q2 2025, returning a total of $1.1 billion to shareholders [10][25] - The company celebrated several milestones, including the 30th anniversary of the Aflac Cancer and Blood Disorders Center and the 70th anniversary of its founding [11][12] Q&A Session Summary Question: Impact of new cancer product on sales - Management indicated that the new cancer product, MiRyto, has gained traction and is expected to continue driving strong sales performance [33][36] Question: Japan investment income and sustainability - Management noted that variable net investment income from alternatives contributed significantly to the improvement in Japan's investment income, with optimism for a solid second half [39][41] Question: Approach to capital deployment and M&A - Management emphasized a balanced approach to capital deployment, focusing on organic growth and shareholder returns, while remaining open to M&A opportunities [59][60] Question: U.S. sales performance and expectations - Management acknowledged the sluggish sales growth in the U.S. but expressed optimism for a stronger second half driven by improved recruitment and performance in specific segments [62][65] Question: Frequency of product refresh cycles - Management confirmed that the refresh cycle for cancer insurance is three years, while medical insurance is two years, contingent on regulatory approval [97]

Forward-Looking Information and Non-U.S.GAAP Financial Measures The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" to encourage companies to provide prospective information, so long as those informational statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those included in the forward-looking statements. The company desires to take advantage of ...

Core Insights - Aflac reported revenue of $4.54 billion for the quarter ended June 2025, reflecting an 11.7% decrease year-over-year, but exceeded the Zacks Consensus Estimate by 2.3% [1] - Earnings per share (EPS) for the quarter was $1.78, down from $1.83 in the same quarter last year, surpassing the consensus EPS estimate of $1.71 by 4.09% [1] Financial Performance Metrics - Aflac Japan's Total Benefit/Premium was 66.5%, exceeding the average estimate of 65.3% [4] - Aflac U.S. Total Adjusted Expenses/Total Adjusted Revenue was 36.3%, better than the average estimate of 38.1% [4] - Aflac U.S. Total Adjusted Revenues were reported at $1.73 billion, slightly below the estimated $1.74 billion, but showed a year-over-year increase of 2.6% [4] - Aflac Japan's Total Adjusted Revenues were $2.47 billion, surpassing the estimate of $2.38 billion, with a year-over-year change of 1% [4] - Total net earned premiums for Aflac U.S. were $1.5 billion, compared to the estimate of $1.52 billion, reflecting a 3.4% increase year-over-year [4] - Other income for Aflac Japan was reported at $12 million, significantly higher than the estimated $6.67 million, marking a 71.4% year-over-year increase [4] - Net investment income was $1.08 billion, slightly below the estimate of $907.26 million, showing a 1.3% decrease year-over-year [4] - Total net earned premiums across the company were $3.47 billion, exceeding the estimate of $3.44 billion, with a year-over-year increase of 4.4% [4] - Corporate and other adjusted revenues were $336 million, surpassing the average estimate of $328.5 million, representing a 34.9% year-over-year change [4] Stock Performance - Aflac's shares have returned -4.2% over the past month, contrasting with a +1% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Company Performance - Aflac reported quarterly earnings of $1.78 per share, exceeding the Zacks Consensus Estimate of $1.71 per share, but down from $1.83 per share a year ago, representing an earnings surprise of +4.09% [1] - The company posted revenues of $4.54 billion for the quarter, surpassing the Zacks Consensus Estimate by 2.30%, but down from $5.14 billion year-over-year [2] - Over the last four quarters, Aflac has surpassed consensus EPS estimates two times and topped revenue estimates just once [2] Future Outlook - The sustainability of Aflac's stock price movement will depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $1.73 on revenues of $4.47 billion, and for the current fiscal year, it is $6.75 on revenues of $17.68 billion [7] Industry Context - The Insurance - Accident and Health industry, to which Aflac belongs, is currently ranked in the bottom 15% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Aflac's performance [5][6]

[Aflac Incorporated](index=2&type=section&id=Aflac%20Incorporated) Aflac Incorporated's Q2 2025 results reflect a decline in net earnings driven by investment losses, alongside continued share repurchases and stable adjusted performance across its segments [Share Data](index=2&type=section&id=Share%20Data) The company continued its share repurchase program in Q2 2025, reducing shares outstanding to **534.8 million** from **542.5 million** at the quarter's start Share Repurchase Activity (Q2 2025) | Metric | Value (In Thousands) | | :--- | :--- | | Beginning Shares Outstanding | 542,493 | | Treasury Shares Purchased | 7,916 | | Ending Shares Outstanding | 534,809 | | QTD Weighted Avg. Diluted Shares | 538,425 | [Summary of Adjusted Results by Business Segment](index=3&type=section&id=Summary%20of%20Adjusted%20Results%20by%20Business%20Segment) Aflac Incorporated's Q2 2025 pretax adjusted earnings decreased **5.7%** to **$1,198 million**, primarily due to an **8.6%** decline in Aflac Japan, while net earnings fell **65.9%** to **$599 million** Pretax Adjusted Earnings by Segment (Q2, In Millions) | Segment | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Aflac Japan | $864 | $790 | (8.6)% | | Aflac U.S. | $383 | $388 | 1.3% | | **Total Pretax Adjusted Earnings** | **$1,270** | **$1,198** | **(5.7)%** | Consolidated Earnings Summary (Q2, In Millions, except per-share data) | Metric | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Adjusted Earnings | $1,035 | $957 | (7.5)% | | Net Earnings | $1,755 | $599 | (65.9)% | | Adjusted Earnings (diluted EPS) | $1.83 | $1.78 | (2.7)% | | Net Earnings (diluted EPS) | $3.10 | $1.11 | (64.2)% | [Statements of Earnings (U.S. GAAP)](index=4&type=section&id=Statements%20of%20Earnings%20(U.S.%20GAAP)) U.S. GAAP total revenues for Q2 2025 decreased **19.0%** to **$4,160 million** due to a swing to net investment losses, resulting in a **65.9%** drop in net earnings to **$599 million** Consolidated Earnings Highlights (Q2, In Millions) | Line Item | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Total Net Earned Premiums | $3,325 | $3,470 | 4.4% | | Net Investment Gains (Losses) | $696 | $(421) | N/A | | **Total Revenues** | **$5,138** | **$4,160** | **(19.0)%** | | Total Benefits and Expenses | $3,119 | $3,338 | 7.0% | | **Net Earnings** | **$1,755** | **$599** | **(65.9)%** | [Analysis of Net Earnings and Net Earnings Per Share](index=5&type=section&id=Analysis%20of%20Net%20Earnings%20and%20Net%20Earnings%20Per%20Share) Q2 2025 net earnings of **$599 million** were significantly impacted by **$(358) million** in after-tax net investment losses, partially offset by a **$23 million** positive foreign currency impact Net Earnings Analysis (Q2 2025, In Millions) | Item | Amount | | :--- | :--- | | Net Earnings | $599 | | Net Investment Gains (Losses) (net of tax) | $(358) | | Foreign Currency Impact | $23 | Net Earnings Per Diluted Share Analysis (Q2 2025) | Item | Amount per Share | | :--- | :--- | | Net Earnings Per Share | $1.11 | | Net Investment Gains (Losses) Per Share | $(0.66) | | Foreign Currency Impact Per Share | $0.04 | [Consolidated Balance Sheets](index=6&type=section&id=Balance%20Sheets) As of June 30, 2025, total assets increased to **$124.7 billion** from **$117.6 billion** at year-end 2024, with shareholders' equity rising to **$27.2 billion** Consolidated Balance Sheet Summary (In Millions) | Account | Dec 31, 2024 | June 30, 2025 | | :--- | :--- | :--- | | Total Investments and Cash | $105,087 | $111,769 | | **Total Assets** | **$117,566** | **$124,736** | | Total Policy Liabilities | $77,508 | $78,904 | | Notes Payable | $7,498 | $8,933 | | **Total Liabilities** | **$91,468** | **$97,536** | | **Total Shareholders' Equity** | **$26,098** | **$27,200** | [Quarterly Financial Results](index=7&type=section&id=Quarterly%20Financial%20Results) Q2 2025 saw a **4.4%** increase in net earned premiums, but total revenues declined due to investment losses, leading to a **65.9%** drop in net earnings and a **2.7%** decrease in adjusted diluted EPS Quarterly Performance Comparison (Q2, In Millions) | Metric | Q2 2024 | Q2 2025 | | :--- | :--- | :--- | | Net Earned Premiums | $3,325 | $3,470 | | Net Investment Income | $1,095 | $1,081 | | Total Revenues | $5,138 | $4,160 | | Net Earnings | $1,755 | $599 | | Adjusted Earnings | $1,035 | $957 | [Quarterly Book Value Per Share](index=8&type=section&id=Quarterly%20Book%20Value%20Per%20Share) Book value per share increased **9.6%** to **$50.86** in Q2 2025, while adjusted book value per share (excluding AOCI) decreased **0.9%** to **$51.78** year-over-year Book Value Per Share Comparison (as of June 30) | Metric | 2024 | 2025 | % Change | | :--- | :--- | :--- | :--- | | Equity BV Per Share | $46.40 | $50.86 | 9.6% | | Adjusted BV Per Share | $52.26 | $51.78 | (0.9)% | | Adjusted BV Per Share Excl. Foreign Currency | $41.98 | $44.17 | 5.2% | [Return on Equity](index=9&type=section&id=Return%20on%20Equity) U.S. GAAP ROE significantly decreased to **9.0%** in Q2 2025 from **28.3%** in Q2 2024, while adjusted ROE remained more stable at **13.7%** Return on Equity (3 Months Ended June 30) | Metric | 2024 | 2025 | | :--- | :--- | :--- | | U.S. GAAP ROE - Net earnings | 28.3% | 9.0% | | Adjusted ROE - reported | 14.3% | 13.7% | | Adjusted ROE, excluding foreign currency | 17.5% | 16.4% | [Adjusted Earnings Per Share Excluding Current Period Foreign Currency Impact](index=10&type=section&id=Adjusted%20Earnings%20Per%20Share%20Excluding%20Current%20Period%20Foreign%20Currency%20Impact) Q2 2025 adjusted EPS decreased **2.7%** to **$1.78**, with a **$0.04** positive foreign currency impact, resulting in a **5.5%** decrease to **$1.73** excluding currency effects Adjusted EPS Reconciliation (Q2, Diluted Basis) | Metric | Q2 2024 | Q2 2025 | | :--- | :--- | :--- | | Adjusted EPS | $1.83 | $1.78 | | QTD Foreign Currency Impact | $(0.07) | $0.04 | | Adjusted EPS Excluding Foreign Currency | $1.89 | $1.73 | [Investment Results](index=11&type=section&id=Investment%20Results) As of June 30, 2025, the **$102.1 billion** investment portfolio was **85.7%** in fixed maturity securities, maintaining high credit quality with **98.4%** investment grade ratings Composition of Invested Assets (June 30, 2025, In Millions) | Asset Class | Amount | % of Total | | :--- | :--- | :--- | | Fixed Maturity Securities | $87,464 | 85.7% | | Commercial mortgage and other loans | $10,264 | 10.1% | | Equity Securities | $882 | 0.9% | | Alternatives | $3,464 | 3.4% | | **Total Portfolio** | **$102,074** | **100.0%** | - The credit quality of the fixed maturity portfolio remains high, with **98.4%** of assets rated investment grade (A, AA, AAA, or BBB) as of June 30, 2025[35](index=35&type=chunk) - For Q2 2025, Aflac Japan's new money yield was **5.26%**, while Aflac U.S. achieved a new money yield of **6.97%**[37](index=37&type=chunk) [Long-Term Debt Data](index=14&type=section&id=Long-Term%20Debt%20Data) As of June 30, 2025, total notes payable increased to **$8.9 billion**, raising the adjusted debt to adjusted capitalization ratio to **22.5%** from **19.5%** year-over-year Adjusted Leverage Ratios | Metric | June 30, 2024 | June 30, 2025 | | :--- | :--- | :--- | | Notes Payable (in millions) | $7,430 | $8,933 | | Adjusted Debt (in millions) | $7,154 | $8,139 | | Adjusted debt to adjusted capitalization ex-AOCI | 19.5% | 22.5% | [Ratings](index=15&type=section&id=Ratings) Aflac and its subsidiaries maintain strong financial strength ratings, including 'A+' from AM Best and S&P, and 'Aa3' from Moody's, with a stable outlook across all ratings Selected Insurer Financial Strength Ratings | Company | AM Best | Moody's | S&P | | :--- | :--- | :--- | :--- | | Aflac of Columbus | A+ | Aa3 | A+ | | Aflac Life Insurance Japan Ltd. | A+ | Aa3 | A+ | - Aflac Incorporated's long-term senior debt is rated **'a' by AM Best**, **'A3' by Moody's**, and **'A-' by S&P**, with a stable outlook across all ratings[50](index=50&type=chunk) [Aflac U.S.](index=16&type=section&id=Aflac%20U.S.) Aflac U.S. segment reported a **1.3%** increase in pretax adjusted earnings to **$388 million** in Q2 2025, driven by growth in net earned premiums and sales [Statement of Pretax Adjusted Earnings](index=16&type=section&id=Aflac%20U.S.%3A%20Statement%20of%20Pretax%20Adjusted%20Earnings) Aflac U.S. pretax adjusted earnings increased **1.3%** to **$388 million** in Q2 2025, driven by a **3.4%** rise in total net earned premiums Aflac U.S. Pretax Adjusted Earnings (Q2, In Millions) | Line Item | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Total Net Earned Premiums | $1,455 | $1,504 | 3.4% | | Total Adjusted Revenues | $1,684 | $1,728 | 2.6% | | Total Benefits and Claims, Net | $680 | $712 | 4.7% | | Total Benefits and Adjusted Expenses | $1,301 | $1,340 | 3.0% | | **Pretax Adjusted Earnings** | **$383** | **$388** | **1.3%** | [Balance Sheets](index=17&type=section&id=Aflac%20U.S.%3A%20Balance%20Sheets) As of June 30, 2025, Aflac U.S. total assets slightly increased to **$22.0 billion**, with shareholders' equity growing to **$9.3 billion** from **$9.0 billion** at year-end 2024 Aflac U.S. Balance Sheet Summary (In Millions) | Account | Dec 31, 2024 | June 30, 2025 | | :--- | :--- | :--- | | Investments and Cash | $16,775 | $16,864 | | **Total Assets** | **$21,930** | **$22,038** | | Future Policy Benefits | $10,584 | $10,712 | | **Shareholders' Equity** | **$9,043** | **$9,266** | [Quarterly Pretax Adjusted Earnings](index=18&type=section&id=Aflac%20U.S.%3A%20Quarterly%20Pretax%20Adjusted%20Earnings) Aflac U.S. pretax adjusted earnings grew **1.3%** in Q2 2025, supported by a **3.4%** increase in net earned premiums, outpacing total adjusted revenues growth Aflac U.S. Quarterly Performance (Q2) | Metric | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Net Earned Premiums | $1,455 | $1,504 | 3.4% | | Total Adjusted Revenues | $1,684 | $1,728 | 2.6% | | Pretax Adjusted Earnings | $383 | $388 | 1.3% | [Operating Ratios](index=19&type=section&id=Aflac%20U.S.%3A%20Operating%20Ratios) Aflac U.S. pretax profit margin was **22.5%** in Q2 2025, slightly down from **22.7%** in Q2 2024, with a **79.2%** 12-month rolling premium persistency rate Aflac U.S. Key Operating Ratios (Q2) | Ratio | Q2 2024 | Q2 2025 | | :--- | :--- | :--- | | 12-Mo. Rolling Premium Persistency | 78.7% | 79.2% | | Total Benefit/ Premium | 46.7% | 47.3% | | Pretax Profit Margin | 22.7% | 22.5% | [Sales](index=20&type=section&id=Aflac%20U.S.%3A%20Sales) Aflac U.S. new annualized premium sales increased **2.7%** to **$340 million** in Q2 2025, with Disability, Critical Care, and Accident leading the product mix Aflac U.S. Sales Performance (Q2, In Millions) | Metric | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | New Annualized Premiums Sales | $331 | $340 | 2.7% | | Annualized Premiums In Force | $6,239 | $6,506 | 4.3% | - In Q2 2025, the top three product categories by new sales were **Disability (27.7%)**, **Critical Care (21.8%)**, and **Accident (19.0%)**[63](index=63&type=chunk) - The total number of recruited agents (Career and Broker) was **3,421** in Q2 2025, compared to **3,535** in Q2 2024[65](index=65&type=chunk) [Aflac Japan](index=22&type=section&id=Aflac%20Japan) Aflac Japan's Q2 2025 pretax adjusted earnings decreased **15.0%** in yen terms, despite strong growth in new annualized premium sales, particularly in third sector products [Statement of Pretax Adjusted Earnings](index=22&type=section&id=Aflac%20Japan%3A%20Statement%20of%20Pretax%20Adjusted%20Earnings) Aflac Japan's pretax adjusted earnings decreased **15.0%** to **¥114.3 billion** in Q2 2025, driven by declines in net earned premiums and adjusted net investment income Aflac Japan Pretax Adjusted Earnings (Q2) | Currency | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Yen (Billions) | ¥134.5 | ¥114.3 | (15.0)% | | U.S. Dollars (Millions) | $864 | $790 | (8.6)% | - The decline in yen-denominated earnings was primarily due to a **4.8%** decrease in total net earned premiums and a **10.5%** decrease in adjusted net investment income[68](index=68&type=chunk) [Balance Sheets](index=24&type=section&id=Aflac%20Japan%3A%20Balance%20Sheets) As of June 30, 2025, Aflac Japan's total assets were **¥14.0 trillion** (**$96.6 billion**), with shareholders' equity at **¥2.8 trillion** (**$19.4 billion**) Aflac Japan Balance Sheet Summary (June 30, 2025) | Account | Yen (Millions) | U.S. Dollars (Millions) | | :--- | :--- | :--- | | Investments and Cash | ¥12,005,337 | $82,904 | | **Total Assets** | **¥13,987,461** | **$96,592** | | Future Policy Benefits | ¥8,913,737 | $61,555 | | **Shareholders' Equity** | **¥2,800,466** | **$19,366** | [Quarterly Pretax Adjusted Earnings](index=26&type=section&id=Aflac%20Japan%3A%20Quarterly%20Pretax%20Adjusted%20Earnings) Aflac Japan's pretax adjusted earnings fell **15.0%** to **¥114.3 billion** in Q2 2025, driven by a **6.2%** decline in total adjusted revenues Aflac Japan Quarterly Performance (Q2, In Billions of Yen) | Metric | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Net Earned Premiums | ¥267.3 | ¥254.6 | (4.8)% | | Total Adjusted Revenues | ¥381.2 | ¥357.5 | (6.2)% | | Pretax Adjusted Earnings | ¥134.5 | ¥114.3 | (15.0)% | [Operating Ratios](index=27&type=section&id=Aflac%20Japan%3A%20Operating%20Ratios) Aflac Japan's pretax profit margin decreased to **32.0%** in Q2 2025 from **35.3%** in Q2 2024, while premium persistency remained strong at **93.7%** Aflac Japan Key Operating Ratios (Q2) | Ratio | Q2 2024 | Q2 2025 | | :--- | :--- | :--- | | 12-Month Rolling Premium Persistency | 93.3% | 93.7% | | Total Benefit/ Premium (3rd sector) | 57.8% | 57.4% | | Pretax Profit Margin | 35.3% | 32.0% | [Sales](index=28&type=section&id=Aflac%20Japan%3A%20Sales) Aflac Japan's total new annualized premium sales grew **23.2%** to **¥20.7 billion** in Q2 2025, with third sector sales increasing **37.4%** and Cancer products dominating the mix Aflac Japan Sales Performance (Q2, In Billions of Yen) | Metric | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Third Sector New Annualized Premium Sales | ¥12.7 | ¥17.5 | 37.4% | | Total New Annualized Premium Sales | ¥16.8 | ¥20.7 | 23.2% | - Cancer products dominated the sales mix in Q2 2025, accounting for **73.0%** of total new annualized premium sales[85](index=85&type=chunk) - As of Q2 2025, sales contribution was led by **Affiliated Corporate agencies (50.4%)** and **Individual/Independent Corporate agencies (46.8%)**[87](index=87&type=chunk) [Yen/Dollar Exchange Rates](index=31&type=section&id=Yen%2FDollar%20Exchange%20Rates) The yen strengthened **2.7%** against the dollar in Q2 2025, with the average exchange rate at **144.60 yen per dollar** compared to **155.70** in Q2 2024 Yen/Dollar Exchange Rate | Metric | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Closing Rate | 161.07 | 144.81 | N/A | | Quarterly Average | 155.70 | 144.60 | 2.7% (Strengthening) | [Corporate and Other](index=32&type=section&id=Corporate%20and%20Other) The Corporate and Other segment reported a reduced pretax adjusted loss of **$20 million** in Q2 2025, driven by higher adjusted net investment income [Statement of Pretax Adjusted Earnings](index=32&type=section&id=Corporate%20and%20Other%3A%20Statement%20of%20Pretax%20Adjusted%20Earnings) The Corporate and Other segment reported a reduced pretax adjusted loss of **$20 million** in Q2 2025, primarily due to a **40.7%** increase in adjusted net investment income Corporate and Other Pretax Adjusted Earnings (Q2, In Millions) | Line Item | Q2 2024 | Q2 2025 | % Change | | :--- | :--- | :--- | :--- | | Adjusted Net Investment Income | $91 | $128 | 40.7% | | Total Adjusted Revenues | $249 | $336 | 34.9% | | Total Benefits and Adjusted Expenses | $226 | $316 | 39.8% | | **Pretax Adjusted Earnings (Loss)** | **$(23)** | **$(20)** | **(13.0)%** | [Non-U.S. GAAP Financial Measures](index=33&type=section&id=Non-U.S.%20GAAP%20Financial%20Measures) This section defines key non-U.S. GAAP financial measures, such as adjusted earnings and adjusted book value, used to provide clearer insights into the company's underlying business performance [Definitions of Non-U.S. GAAP Measures](index=33&type=section&id=Definitions%20of%20Non-U.S.%20GAAP%20Measures) This section defines key non-U.S. GAAP measures like adjusted earnings, adjusted book value, and adjusted ROE, which are used to provide insights into underlying business performance by excluding volatile items - **Adjusted Earnings:** Excludes items that may obscure underlying fundamentals, such as adjusted net investment gains/losses and non-recurring items; management uses this to evaluate the financial performance of insurance operations[93](index=93&type=chunk)[100](index=100&type=chunk) - **Adjusted Book Value:** Represents total shareholders' equity less accumulated other comprehensive income (AOCI); this measure is used because AOCI fluctuates with market movements outside of management's control[95](index=95&type=chunk) - **Adjusted Return on Equity (ROE):** Calculated as annualized adjusted earnings divided by average shareholders' equity excluding AOCI; it is used to evaluate the financial performance and underlying profitability drivers of the insurance business[102](index=102&type=chunk)