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Core Viewpoint - Jackson Financial (JXN) has reached a significant support level and shows potential as a good investment pick from a technical perspective, having recently broken through the 20-day moving average, indicating a short-term bullish trend [1]. Technical Analysis - The 20-day simple moving average (SMA) is a popular trading tool that reflects a stock's price over a 20-day period, smoothing out short-term price trends and providing trend reversal signals [2]. - JXN's stock price has been moving higher over the past four weeks, increasing by 5.2%, and is currently rated as a Zacks Rank 1 (Strong Buy), suggesting potential for continued upward movement [3]. Earnings Estimates - Recent revisions in JXN's earnings estimates show one upward revision for the current fiscal year with no downward revisions, indicating a positive consensus estimate trend [4]. - The combination of the technical indicator and positive earnings estimate revisions suggests that investors should consider adding JXN to their watchlist [4].

Financial Performance - In 2024, annuity sales reached $178 billion, with AUM (Assets Under Management) at $325 billion[8] - Free capital generation for 2024 was $13 billion, and capital return was $631 million[8] - For the first quarter of 2025, the net loss attributable to Jackson Financial Inc common shareholders was $35 million, or $048 per share[15, 16] - Adjusted Operating Earnings for 1Q25 was $376 million, or $510 per share[15, 16] - Retail annuity sales for 1Q25 totaled $40 billion, a 9% increase over the prior year[16] - Consolidated Pretax Adjusted Operating Earnings for 1Q25 was $442 million, while Retail Annuity Pretax Adjusted Operating Earnings was $420 million[16] Capital Management - Cash distributed to JFI increased significantly from $45 million in 1Q24 to $240 million in 1Q25[19] - Free cash flow increased from $20 million in 1Q24 to $213 million in 1Q25[19] - Capital returned to common shareholders increased from $172 million in 1Q24 to $231 million in 1Q25[21] - JNLIC's estimated RBC ratio was 585% as of the end of 1Q25, after reflecting $240 million of distributions from JNLIC to JFI[26]

Group 1 - Jackson Financial (JXN) closed at $85.86, reflecting a +2.29% increase from the previous day, outperforming the S&P 500's 0.03% loss [1] - Prior to the latest trading session, Jackson Financial shares had decreased by 1.29%, which was less than the Finance sector's loss of 1.73% and the S&P 500's gain of 0.6% [1] Group 2 - Jackson Financial is expected to report an EPS of $4.66, indicating a 12.41% decline from the same quarter last year, with a revenue forecast of $1.77 billion, down 36.75% year-over-year [2] - For the full year, analysts project earnings of $19.31 per share and revenue of $7.1 billion, representing changes of +2.77% and -22.25% respectively from the previous year [3] Group 3 - Recent analyst estimate revisions for Jackson Financial suggest a positive outlook for the business, as these changes reflect short-term business trends [3][4] - The Zacks Rank system, which includes estimate changes, currently ranks Jackson Financial at 3 (Hold) [5] Group 4 - Jackson Financial has a Forward P/E ratio of 4.35, which is lower than the industry average of 8.48, indicating that the company is trading at a discount compared to its peers [6] - The Insurance - Life Insurance industry, part of the Finance sector, holds a Zacks Industry Rank of 79, placing it in the top 33% of over 250 industries [6][7]

Financial Data and Key Metrics Changes - Adjusted operating earnings for the first quarter of 2025 were $376 million, reflecting a 13% increase compared to the previous year [5][13] - Adjusted operating earnings per share rose over 20% year-over-year, reaching $5.2, up from $4.16 in the prior year's first quarter [6][16] - The estimated Risk-Based Capital (RBC) ratio increased to 585%, well above the minimum requirement of 425% [29] Business Line Data and Key Metrics Changes - Retail annuity sales exceeded $4 billion, marking a more than 9% increase from the previous year [7] - Sales of variable annuities grew by 9% year-over-year, totaling $2.7 billion, with a notable 40% increase in sales of variable annuities without living benefits [7][8] - Fixed and fixed indexed annuity sales showed meaningful growth, although at a moderated level compared to the second half of the previous year [9] Market Data and Key Metrics Changes - Advisory sales increased by 28% compared to the first quarter of 2024, with an annual run rate exceeding $1 billion [10] - The average retail annuity assets under management (AUM) rose to $246 billion, up from $242 billion in the first quarter of 2024 [19] Company Strategy and Development Direction - The company aims to maintain a disciplined approach to growth, focusing on both organic and inorganic opportunities, including potential acquisitions in the annuity business [38] - Jackson is committed to product innovation and expanding distribution channels, particularly through financial professionals at JPMorgan Wealth Management [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility, emphasizing the importance of providing security to Americans planning for retirement [11][33] - The company remains focused on delivering flexible protection and income-oriented solutions, which are increasingly valued during uncertain market conditions [12] Other Important Information - The company returned over $230 million to common shareholders in the first quarter, with a cash dividend of $0.80 per share approved for the second quarter [10][11] - The hedging program reported a consolidated net hedge loss of $134 million, but the overall strategy has provided stability in capital generation [20][22] Q&A Session Summary Question: Interest in acquiring in the annuity business - Management acknowledged past successful acquisitions and stated that future opportunities would be evaluated against the value of share buybacks or balance sheet strengthening [38] Question: Strategy regarding spread-based products - Management indicated that they are actively evaluating competitiveness and pricing strategies while maintaining discipline in their approach to spread products [41] Question: Fee-based advisers selling more annuities - Management highlighted the importance of providing choice to advisers and the growth of modeling and financial planning tools that support both fee-based and commission structures [50]

Financial Data and Key Metrics Changes - Adjusted operating earnings for the first quarter of 2025 were $376 million, reflecting a 13% increase compared to the previous year [5][14] - Adjusted operating earnings per share rose over 20% year-over-year, with reported earnings per share at $5.1, adjusted to $5.2 after accounting for notable items, marking a 25% increase from $4.16 in the prior year's first quarter [6][17] - The estimated Risk-Based Capital (RBC) ratio increased to 585%, well above the minimum requirement of 425% [29] Business Line Data and Key Metrics Changes - Retail annuity sales exceeded $4 billion, up more than 9% from the previous year, with variable annuities sales increasing by 9% to $2.7 billion [7][18] - Sales of the RILA product reached $1.2 billion, supporting diversification in top-line growth [18] - Advisory sales increased by 28% year-over-year, with an annual run rate exceeding $1 billion [11] Market Data and Key Metrics Changes - The company reported a healthy and profitable book of business, generating excess capital and maintaining a strong liquidity position with over $600 million in holding company liquid assets [11][30] - The company noted that the demand for variable annuity products remains strong, particularly among retiring Americans seeking asset growth and guaranteed income [8] Company Strategy and Development Direction - The company aims to continue delivering on its financial targets while positioning itself for long-term profitability, with a focus on the annuity industry and providing flexible protection and income-oriented solutions [12][34] - The company is open to evaluating inorganic growth opportunities, emphasizing the importance of comparing potential acquisitions to share buybacks and balance sheet strengthening [40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility, highlighting the effectiveness of their hedging program in stabilizing capital generation [25][32] - The company remains committed to serving financial professionals and their clients, focusing on helping Americans grow and protect their retirement savings [36] Other Important Information - The company announced a second-quarter cash dividend of $0.80 per common share, reflecting its commitment to returning capital to shareholders [12] - The company reported a consolidated net hedge loss of $134 million in the first quarter, but noted that their hedging program has provided stability in non-operating results [21][22] Q&A Session Summary Question: Interest in acquiring in the annuity business - Management acknowledged past successful bolt-on acquisitions and stated that any future opportunities would be evaluated against the value of share buybacks or balance sheet strengthening [40] Question: Strategy regarding spread-based products - Management indicated that they approach the market with discipline and are open to ideas and opportunities to enhance competitiveness, while noting growth in sales of spread products [43][44] Question: Fee-based advisers selling more annuities - Management highlighted the importance of providing choice to advisers and the growth of the RIA space, emphasizing the development of modeling and financial planning tools for fee-based advisers [52][53] Question: Impact of capital in April at Brook Re - Management described the impact as modest and reiterated their focus on maintaining sufficient capital above regulatory levels [58][60] Question: Sensitivity to market rates and potential capital contributions - Management explained that scenarios requiring capital contributions would involve high volatility combined with deep equity stress, similar to past financial crises [68][70]

Core Insights - Jackson Financial reported revenue of $1.77 billion for the quarter ended March 2025, a decrease of 36% year-over-year, while EPS increased to $5.10 from $4.23 in the same quarter last year [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $1.78 billion, resulting in a revenue surprise of -0.19%, while the EPS exceeded expectations by 3.45% [1] Financial Performance Metrics - Net investment income was reported at $755 million, surpassing the average estimate of $490.40 million, reflecting a year-over-year increase of 2.9% [4] - Other income significantly increased to $14 million, compared to the average estimate of $16 million, marking a year-over-year change of 1300% [4] - Premium revenue reached $40 million, exceeding the average estimate of $35.41 million, with a year-over-year growth of 5.3% [4] - Fee income was reported at $1.99 billion, which was above the average estimate of $1.24 billion, but showed a slight decline of 0.6% year-over-year [4] - Adjusted earnings before tax for Retail Annuities was $420 million, below the average estimate of $471.09 million [4] - Adjusted earnings before tax for Corporate and Other showed an improvement to -$24 million, compared to the average estimate of -$60.33 million [4] - Adjusted earnings before tax for Closed Life and Annuity Blocks was $28 million, significantly higher than the average estimate of $7.24 million [4] - Adjusted earnings before tax for Institutional Products was reported at $18 million, slightly below the average estimate of $21.98 million [4] Stock Performance - Jackson Financial's shares have returned +15.9% over the past month, outperforming the Zacks S&P 500 composite's +10.6% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Core Viewpoint - Jackson Financial (JXN) reported quarterly earnings of $5.10 per share, exceeding the Zacks Consensus Estimate of $4.93 per share, and showing an increase from $4.23 per share a year ago, indicating a positive earnings surprise of 3.45% [1][2] Financial Performance - The company posted revenues of $1.77 billion for the quarter ended March 2025, which was slightly below the Zacks Consensus Estimate by 0.19%, and a decrease from $2.77 billion in the same quarter last year [2] - Over the last four quarters, Jackson Financial has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] Stock Performance - Jackson Financial shares have declined approximately 6.1% since the beginning of the year, while the S&P 500 has decreased by 4.7% [3] - The current Zacks Rank for Jackson Financial is 4 (Sell), indicating expectations of underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $4.66 on revenues of $1.73 billion, and for the current fiscal year, it is $18.87 on revenues of $6.89 billion [7] - The trend for estimate revisions ahead of the earnings release was unfavorable, which may impact future stock performance [6] Industry Context - The Insurance - Life Insurance industry, to which Jackson Financial belongs, is currently ranked in the bottom 43% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]

Financial Performance - Jackson Financial Inc reported a GAAP net loss attributable to common shareholders of $35 million, or $048 per share[8, 9, 10, 11] - Adjusted Operating Earnings were $376 million, or $510 per common share[12, 13] - Free cash flow was $213 million[13] - The company returned $231 million of capital to common shareholders through dividends and share repurchases[13, 17] Capital and Liquidity - Jackson National Life Insurance Company (JNLIC) estimated risk-based capital (RBC) ratio was 585% as of the end of 1Q25[13, 17, 53] - Holding company cash and highly liquid securities exceeded $600 million as of the end of 1Q25[17, 53] - JNLIC generated $441 million of statutory capital in 1Q25[45, 53] Sales and Diversification - Retail annuity sales increased by 9% compared to the prior year's first quarter[14, 32] - Retail sales reached $4 billion in 1Q25[30] - Fixed and fixed index annuity sales were up 74% from 1Q24[32] Investment Portfolio - The company's U S GAAP investment portfolio totaled $48 billion[60] - The statutory investment portfolio totaled $47 billion[65] - Exposure to below investment grade securities is 7% of the total U S GAAP investment portfolio and 1% of the statutory investment portfolio[63, 68]

[PART I—FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%E2%80%94FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents Jackson Financial Inc.'s unaudited condensed consolidated financial statements for Q1 2025, reflecting a net loss attributable to common shareholders and shifts in total assets and equity [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Total assets | $327,193 | $338,450 | $(11,257) | | Total liabilities | $316,668 | $328,468 | $(11,800) | | Total shareholders' equity | $10,301 | $9,764 | $537 | | Total equity | $10,525 | $9,982 | $543 | [Condensed Consolidated Income Statements](index=5&type=section&id=Condensed%20Consolidated%20Income%20Statements) Consolidated Income Statement Highlights (in millions, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total revenues | $3,750 | $(322) | | Pretax income (loss) | $(17) | $903 | | Net income (loss) attributable to Jackson Financial Inc. | $(24) | $795 | | Net income (loss) attributable to JFI common shareholders | $(35) | $784 | | Basic EPS | $(0.48) | $10.04 | | Diluted EPS | $(0.48) | $9.94 | - The significant decrease in net income was primarily driven by a **$2,200 million loss from Market Risk Benefits** and a **$955 million gain on derivatives and investments**, compared to a **$2,700 million gain** and a **$3,100 million loss**, respectively, in the prior-year period, highlighting the volatility from these items[13](index=13&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Comprehensive Income (Loss) (in millions) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (loss) | $(18) | $802 | | Total other comprehensive income (loss) | $803 | $(615) | | Comprehensive income (loss) attributable to Jackson Financial Inc. | $779 | $180 | [Condensed Consolidated Statements of Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) - Total equity increased from **$9,982 million** at December 31, 2024, to **$10,525 million** at March 31, 2025, driven by a **net loss of $18 million**, **other comprehensive income of $803 million**, **dividends totaling $70 million**, and **treasury stock purchases of $202 million**[19](index=19&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in millions) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,594 | $1,426 | | Net cash used in investing activities | $(953) | $(2,006) | | Net cash (used in) provided by financing activities | $(521) | $433 | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=81&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's Q1 2025 performance, highlighting a U.S. GAAP net loss, positive Adjusted Operating Earnings, and strategic actions including capital return and the establishment of Brooke Re [Executive Summary](index=84&type=section&id=Executive%20Summary) The company reported a Q1 2025 net loss of $35 million, offset by Adjusted Operating Earnings of $376 million, while returning $231 million to shareholders and establishing Brooke Re for capital optimization Selected Financial and Operating Measures (in millions) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (loss) attributable to JFI common shareholders | $(35) | $784 | | Adjusted Operating Earnings (Non-GAAP) | $376 | $334 | | Amount of shares repurchased | $172 | $116 | | Dividends on common shares | $59 | $56 | - In Q1 2024, Jackson established **Brooke Re**, a Michigan-based captive reinsurer, to reinsure variable annuity guaranteed benefit riders, aiming to **moderate statutory capital impact**, enable **efficient economic hedging**, and produce **predictable financial results**[303](index=303&type=chunk)[304](index=304&type=chunk)[305](index=305&type=chunk) - The company returned **$231 million** to common shareholders in Q1 2025, comprising **$59 million in dividends** and **$172 million in share repurchases**, with a 2025 capital return target of **$700-$800 million**[303](index=303&type=chunk) [Key Operating Measures](index=86&type=section&id=Key%20Operating%20Measures) Total sales increased in Q1 2025, driven by institutional and retail annuity products, despite continued net outflows in retail annuities and a slight decrease in total Assets Under Management Total Sales by Product (in millions) | Product | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Retail Annuity Sales | $4,031 | $3,691 | | Total Institutional Product Sales | $1,599 | $100 | | **Total Sales** | **$5,630** | **$3,791** | Net Flows by Segment (in millions) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Retail Annuities Net Flows | $(3,524) | $(2,799) | | Total Institutional Products Net Flows | $736 | $(596) | | Total Closed Life and Annuity Blocks Net Flows | $(69) | $(90) | - Total Assets Under Management (AUM) were **$318,000 million** as of March 31, 2025, compared to **$324,700 million** as of December 31, 2024[315](index=315&type=chunk) [Macroeconomic, Industry, and Regulatory Trends](index=90&type=section&id=Macroeconomic,%20Industry,%20and%20Regulatory%20Trends) The company's performance is influenced by market conditions and regulatory changes, with strategic responses like Brooke Re and ongoing monitoring of new rules like the DOL Fiduciary Advice Rule - The **Brooke Re transaction** in Q1 2024 is expected to largely **moderate the impact of the cash surrender value floor on statutory capital**, previously affected by rising equity markets and interest rates[320](index=320&type=chunk)[321](index=321&type=chunk) - Rising interest rates pose **disintermediation risk**, potentially leading to product lapses and forced asset sales at a loss[321](index=321&type=chunk) - The **Department of Labor's 2024 Fiduciary Advice Rule** is under court challenge, but the company believes its exposure is limited due to distribution partners' existing best interest adaptations[328](index=328&type=chunk)[329](index=329&type=chunk) [Non-GAAP Financial Measures](index=94&type=section&id=Non-GAAP%20Financial%20Measures) The company utilizes non-GAAP measures such as Adjusted Operating Earnings, Adjusted Book Value, and Free Cash Flow to provide a clearer view of underlying business performance by excluding market volatility Reconciliation of Net Income (Loss) to Adjusted Operating Earnings (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (loss) attributable to JFI common shareholders | $(35) | $784 | | Pretax adjusted operating earnings | $442 | $389 | | Less: operating income tax expense (benefit) | $55 | $44 | | Less: dividends on preferred stock | $11 | $11 | | **Adjusted operating earnings** | **$376** | **$334** | Reconciliation of Total Shareholders' Equity to Adjusted Book Value (in millions) | Line Item | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Total shareholders' equity | $10,301 | $10,169 | | Less: Preferred stock | $533 | $533 | | Exclude AOCI attributable to Jackson Financial Inc. | $1,256 | $1,762 | | **Adjusted Book Value Attributable to Common Shareholders** | **$11,024** | **$11,398** | - Free Cash Flow at the parent company was **$213 million** for Q1 2025, compared to **$20 million** in Q1 2024, primarily from **$240 million in dividends** and distributions from subsidiaries, less **$27 million in holding company expenses**[347](index=347&type=chunk)[348](index=348&type=chunk) [Consolidated Results of Operations](index=99&type=section&id=Consolidated%20Results%20of%20Operations) Pretax loss in Q1 2025 was primarily driven by unfavorable movements in market risk benefits, partially offset by favorable movements in net gains on derivatives and investments - The primary driver of the pretax loss was a **$4,964 million unfavorable movement in market risk benefits (gains) losses**, largely due to unfavorable changes in interest rates, fund performance, and volatility[352](index=352&type=chunk) - This was partially offset by a **$4,048 million increase in total net gains on derivatives and investments**, mainly from a **$4,294 million favorable swing in freestanding and embedded derivatives**[350](index=350&type=chunk) - The effective tax rate was **(6)% in Q1 2025** compared to **11% in Q1 2024**, driven by the relationship of taxable income to the consolidated pre-tax loss and changes in the valuation allowance[351](index=351&type=chunk)[354](index=354&type=chunk) [Segment Results of Operations](index=101&type=section&id=Segment%20Results%20of%20Operations) Total Pretax Adjusted Operating Earnings increased in Q1 2025, with stable Retail Annuities earnings, decreased Institutional Products earnings, increased Closed Life and Annuity Blocks earnings, and a smaller loss in Corporate and Other Pretax Adjusted Operating Earnings by Segment (in millions) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Retail Annuities | $420 | $419 | | Institutional Products | $18 | $31 | | Closed Life and Annuity Blocks | $28 | $19 | | Corporate and Other | $(24) | $(80) | | **Total Pretax Adjusted Operating Earnings** | **$442** | **$389** | - Retail Annuities' earnings remained **flat** as higher fee and spread income were offset by increased commissions, general expenses, and policy benefits[358](index=358&type=chunk)[360](index=360&type=chunk) - Corporate and Other's improved result was primarily driven by a **$34 million decrease in general and administrative expenses**, mainly from lower deferred compensation expenses[367](index=367&type=chunk) [Investments](index=108&type=section&id=Investments) The company's investment strategy focuses on a diversified, largely investment-grade fixed income portfolio, with total investments at **$62,950 million** as of March 31, 2025, predominantly in debt securities and mortgage loans Investment Portfolio Composition (in millions) | Investment Type | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Debt Securities (AFS & FVO) | $45,673 | $43,335 | | Mortgage loans (Net of ACL & FVO) | $10,026 | $9,911 | | Policy loans | $4,407 | $4,403 | | Other invested assets | $2,844 | $2,864 | | **Total Investments (excluding derivatives)** | **$62,950** | **$60,513** | - The debt securities portfolio is **92.5% investment grade** as of March 31, 2025, slightly down from **93.0%** at December 31, 2024[57](index=57&type=chunk) - The allowance for credit losses on mortgage loans increased to **$130 million** at March 31, 2025, from **$121 million** at year-end, with a **$15 million provision** recorded for the quarter[383](index=383&type=chunk) [Policy and Contract Liabilities](index=115&type=section&id=Policy%20and%20Contract%20Liabilities) As of March 31, 2025, total policy and contract liabilities were **$284.4 billion**, primarily comprising separate account liabilities, general account liabilities, and reinsured liabilities Policy and Contract Liabilities Breakdown (March 31, 2025, in billions) | Liability Type | Amount | Backing Assets | | :--- | :--- | :--- | | Separate Account Liabilities | $217.6 | Separate Account Assets | | General Account Liabilities | $50.8 | Company Investment Portfolio | | Reinsured Liabilities | $14.5 | Funds Withheld Assets | | **Total** | **$282.9** | | - As of March 31, 2025, **93%** of fixed annuity, fixed-index annuity, and fixed accounts of RILA and variable annuity products had crediting rates at their guaranteed minimums[392](index=392&type=chunk) [Liquidity and Capital Resources](index=117&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity and capital position, relying on subsidiary dividends subject to regulatory approval, supported by a **$1,000 million** revolving credit facility and stable 'A' category financial strength ratings - Jackson Financial Inc. targets a minimum of **$250 million in cash and highly liquid securities**, sufficient to cover two years of fixed net expenses[406](index=406&type=chunk) - For 2025, future dividends from primary insurance subsidiaries, Jackson and Brooke Life, are expected to be **extraordinary** and require prior approval from the Michigan regulator[414](index=414&type=chunk) Financial Strength Ratings (as of May 1, 2025) | Company | A.M. Best | Fitch | Moody's | S&P | | :--- | :--- | :--- | :--- | :--- | | Jackson National Life | A (stable) | A (stable) | A3 (stable) | A (stable) | [Impact of Recent Accounting Pronouncements](index=126&type=section&id=Impact%20of%20Recent%20Accounting%20Pronouncements) The company is evaluating new accounting standards, including ASU 2023-09 on income tax disclosures and ASU 2024-03 on expense disaggregation, with no material impact expected from the former - **ASU 2023-09**, enhancing income tax disclosures, will be effective for the annual period ending December 31, 2025, and is not expected to have a material impact[36](index=36&type=chunk) - **ASU 2024-03**, requiring disaggregated income statement expense disclosure, will be effective for annual periods after December 15, 2026, with its impact currently under evaluation[37](index=37&type=chunk) [Summary of Critical Accounting Estimates](index=126&type=section&id=Summary%20of%20Critical%20Accounting%20Estimates) The company's financial statements rely on several critical accounting estimates, including the valuation of policy reserves, market risk benefits, investments, and derivatives - Critical accounting estimates include reserves for **future policy benefits**, **market risk benefits**, **reinsurance**, **income taxes**, **investment valuation and impairment**, and **derivative instrument valuation**[441](index=441&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=127&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There have been no material changes to the quantitative and qualitative disclosures about market risk since the 2024 Annual Report on Form 10-K - There have been **no material changes** to the market risk disclosures previously reported in the 2024 Annual Report[442](index=442&type=chunk) [Item 4. Controls and Procedures](index=127&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's **disclosure controls and procedures were effective** as of March 31, 2025[443](index=443&type=chunk) - No changes occurred during Q1 2025 that materially affected, or are reasonably likely to materially affect, the company's **internal control over financial reporting**[444](index=444&type=chunk) [PART II—OTHER INFORMATION](index=128&type=section&id=PART%20II%E2%80%94OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=128&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ordinary course litigation, including class action lawsuits, with no expected material adverse effect on its financial condition - The company is involved in ordinary course litigation and does not believe the outcome will have a **material adverse effect** on its financial condition[266](index=266&type=chunk) [Item 1A. Risk Factors](index=128&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the 2024 Annual Report on Form 10-K - There have been **no material changes** to the company's risk factors as discussed in the 2024 Annual Report[446](index=446&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=128&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q1 2025, the company repurchased **1,966,909 common shares** for approximately **$172 million**, with **$431 million** remaining authorized for future repurchases as of May 1, 2025 Share Repurchases (Jan 1, 2025 - Mar 31, 2025) | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | Jan 2025 | 479,387 | $91.79 | | Feb 2025 | 565,063 | $89.82 | | Mar 2025 | 922,459 | $84.25 | | **Total Q1 2025** | **1,966,909** | **$87.69 (approx.)** | - As of May 1, 2025, the company had **$431 million** remaining under its share repurchase authorization[449](index=449&type=chunk) [Item 5. Other Information](index=129&type=section&id=Item%205.%20Other%20Information) No Section 16 officers or directors adopted or terminated a Rule 10b5-1 trading plan during Q1 2025, though a pre-existing plan for an Executive Vice President terminated as scheduled - A **Rule 10b5-1 trading plan** for Craig D. Smith, EVP, terminated on April 7, 2025, as scheduled[451](index=451&type=chunk)[452](index=452&type=chunk) [Item 6. Exhibits](index=129&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including new executive compensation agreements, an offer letter, and required CEO/CFO certifications [Signatures](index=131&type=section&id=SIGNATURES)