Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 1-16725 (Commission file number) PRINCIPAL FINANCIAL GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 42-1520346 (State or other jurisdiction of incorporati ...

Group 1 - Principal Financial Group (NASDAQ: PFG) has underperformed over the past year, losing approximately 5% of its value while missing out on a significant bull market [1] - The company has a history of making contrarian bets based on macro views and stock-specific turnaround stories to achieve outsized returns with a favorable risk/reward profile [1]

Core Insights - Principal Financial Group, Inc. (PFG) reported a second-quarter 2025 operating net income of $2.16 per share, exceeding the Zacks Consensus Estimate by 9% and reflecting a 33% year-over-year increase [1][9] - Operating revenues fell by 9.4% year over year to $3.6 billion, missing the Zacks Consensus Estimate by 7.8% due to decreased premiums [1][9] Revenue and Earnings Performance - Investment Management, Specialty Benefits, and Life Insurance segments experienced higher revenues, contributing to improved asset under management (AUM) [2] - Total expenses decreased by 18% year over year to $3.2 billion, lower than the estimate of $4.3 billion, driven by reduced benefits, claims, and operating expenses [3] - As of June 30, 2025, AUM reached $753 billion, a 7.6% increase year over year, while assets under administration (AUA) totaled $1.7 trillion [3] Segment Analysis - **Retirement and Income Solution**: Revenues decreased by 21.7% year over year to $1.7 billion, missing the estimate of $2.2 billion; however, pre-tax operating earnings rose by 9% to $292.1 million [4] - **Investment Management**: Revenues increased by 5.2% year over year to $467.2 million, surpassing the estimate of $454.4 million; pre-tax operating earnings grew by 18.2% to $157.9 million [5] - **International Pension**: Revenues fell by 1.7% year over year to $240.8 million, below the estimate of $243.3 million; pre-tax operating earnings surged by 41% to $78.5 million [6] - **Specialty Benefits**: Revenues rose by 4% year over year to $892.2 million, exceeding the estimate of $863.3 million; pre-tax operating earnings increased by 17% to $127.6 million [7] - **Life Insurance**: Revenues increased by 7.6% year over year to $354.2 million, beating the estimate of $205.8 million [8] Financial Position - As of June 30, 2025, cash and cash equivalents were $3.6 billion, down 13.1% from the end of 2024; long-term debt was $3.9 billion, a decrease of 0.8% [11] - Book value per share increased by 2.4% to $54.97 from the end of 2024 [11] Shareholder Returns - Principal Financial returned $320 million to shareholders, including $150 million in share repurchases and $170 million in dividends [12] - The board declared a third-quarter dividend of 78 cents per share, an 8% increase from the third quarter of 2024 [12]

Financial Data and Key Metrics Changes - Adjusted non-GAAP earnings for Q2 2025 were $469 million, or $2.7 per share, representing an 18% increase in EPS compared to 2024 [6][16] - Reported non-GAAP operating earnings were $489 million, up 27% year over year, with EPS at $2.16, a 33% increase [15][16] - Total company managed AUM reached $753 billion, a 5% increase sequentially and an 8% increase year over year [8][11] - Net cash flow was negative $2.6 billion for the quarter, but showed improvement driven by positive net cash flow from global institutional clients [8][11] Business Line Data and Key Metrics Changes - In Retirement, overall RIS sales were $6 billion, a 7% year-over-year increase, driven by Workplace Savings and Retirement Solutions [9][10] - Principal Asset Management AUM increased to $723 billion, a 5% sequential increase, with sales of $33 billion, up 19% year over year [11][12] - Specialty Benefits saw a 10% growth in earnings, with a margin expansion of 100 basis points [12][20] - Life Insurance premium fees increased by 5% compared to 2024, driven by strong business market growth [21] Market Data and Key Metrics Changes - The market volatility in April impacted daily averages, leading to lower fee revenue for the quarter [7] - Positive market performance in May and June contributed to the increase in AUM [8] - The pension risk transfer (PRT) sales were $445 million, reflecting a more moderate quarter due to a smaller pipeline of opportunities [10][39] Company Strategy and Development Direction - The company remains focused on aligning revenue and expenses, with a disciplined approach to expense management while investing for growth [27][29] - Continued emphasis on capital return to shareholders, with $320 million returned in Q2, including $150 million in share repurchases [7][24] - The company is committed to maintaining a strong capital position and expects to deliver on full-year capital return targets of $1.4 billion to $1.7 billion [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the second half of the year, expecting full-year results to align with 2025 outlook and financial targets [8][9] - The company anticipates improved results in the latter half of 2025, particularly in investment management and performance fees [45][46] - Management acknowledged challenges in flows due to elevated markets but noted improvements in transfer deposits and account retention [61][62] Other Important Information - The company was recognized for its leadership in disability inclusion and AI application in financial services [13] - A $0.78 common stock dividend was announced for Q3, marking an 8% increase over the previous year [25] Q&A Session Summary Question: On overall expense levels - Management indicated a focus on aligning expenses with revenue, with continued margin expansion observed [27][29] Question: On spread balances within RIS - Management noted a decrease in investment-only issuance and emphasized a disciplined approach to PRT opportunities [32][34] Question: On competitive environment in PRT - Management acknowledged increased competition but remains optimistic about converting existing DB clients into PRT [39][40] Question: On variable investment income - Management reported improved performance in variable investment income, with expectations for better results in the latter half of 2025 [44][46] Question: On performance fees in investment management - Management confirmed that performance fees were primarily driven by alternative debt strategies and expect levels to be similar to 2024 [53][54] Question: On dental business outlook - Management highlighted competitive pressures but noted improvements in loss ratios and potential for growth in the second half of the year [81][84] Question: On asset management flows - Management acknowledged challenges in achieving positive flows but noted strong sales momentum and a robust pipeline of client opportunities [100][102]

Financial Data and Key Metrics Changes - Adjusted non-GAAP earnings for Q2 2025 were $469 million, or $2.7 per share, representing an 18% increase in EPS compared to 2024 [5][6] - Reported non-GAAP operating earnings were $489 million, up 27% year over year, with EPS at $2.16, a 33% increase [15][16] - Total company managed AUM reached $753 billion, a 5% increase sequentially and an 8% increase year over year [7][11] - Net cash flow was negative $2.6 billion for the quarter, but showed improvement sequentially [7][11] Business Line Data and Key Metrics Changes - In Retirement, overall RIS sales were $6 billion, a 7% year-over-year increase, driven by Workplace Savings and Retirement Solutions [9][10] - Principal Asset Management AUM increased to $723 billion, a 5% sequential increase, with sales of $33 billion, up 19% year over year [11][12] - Specialty Benefits saw a 10% growth in earnings, with a margin expansion of 100 basis points [12][21] - Life Insurance premium fees increased by 5% compared to 2024, driven by strong business market growth [22] Market Data and Key Metrics Changes - The market drop in April affected daily averages, impacting second quarter fee revenue, but a strong rebound in May and June provided positive momentum [6][7] - International Pension net revenue was impacted by foreign currency, but increased by 2% on a constant currency basis [20] Company Strategy and Development Direction - The company remains focused on disciplined expense management while investing for growth, aiming to align revenue and expenses effectively [29][31] - Continued emphasis on capital return targets, with $320 million returned to shareholders in Q2, including $150 million in share repurchases [6][24] - The company is committed to maintaining a strong capital position and expects to deliver on full-year capital return targets of $1.4 billion to $1.7 billion [24][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the second half of the year, expecting full-year results to align with 2025 outlook and financial targets [7][8] - The company anticipates improved results in the latter half of 2025, particularly in investment management and performance fees [48][49] - Management acknowledged the competitive environment in pension risk transfer (PRT) but remains optimistic about achieving targeted returns [40][42] Other Important Information - The company was recognized for its leadership in disability inclusion and AI application in financial services [13] - A $0.78 common stock dividend was announced for Q3, reflecting an 8% increase over the previous year [26] Q&A Session Summary Question: Overall expense levels and future focus - Management confirmed a continued focus on aligning expenses with revenue while maintaining investments in the business [29][31] Question: Spread balances within RIS - Management noted that investment-only issuance and PRT sales were moderate, emphasizing a disciplined approach to prioritizing returns over volume [34][38] Question: Competitive environment in PRT - Management acknowledged increased competition but remains optimistic about converting existing DB clients into PRT opportunities [40][42] Question: Variable investment income experience - Management indicated improved performance in variable investment income, with expectations for better results in the latter half of 2025 [47][49] Question: Dental business outlook - Management highlighted competitive pricing and renewal rates, with expectations for improved sales in the second half of the year [84][88]

Financial Performance - The company's non-GAAP operating earnings were $489 million, a 27% increase compared to Q2 2024[3] - Non-GAAP EPS reached $2.16, up 33% from Q2 2024[3] - Investment Management revenue increased 6% over 2Q24, with operating margin improving 250 bps to 36%[2] - Specialty Benefits incurred loss ratio improved 130 basis points from 2Q24[2] Capital Management - The company returned $320 million of excess capital to shareholders, including $150 million in share repurchases and $170 million in common stock dividends during 2Q25[2, 4] - The common stock dividend was raised to $0.78 for 3Q25, an 8% increase from both 3Q24 and TTM[2] - Excess and available capital position stands at $1.4 billion[2, 3] Business Segment Highlights - Retirement and Income Solutions (RIS) saw pre-tax operating earnings increase by 8%[9] - Principal Asset Management's AUM increased to $723 billion, up 8% year-over-year[18] - Life Insurance premium and fees growth of 5% over 2Q24 driven by 17% growth in the business market segment[2] Investment Performance - 56% of fund-level AUM has a 4 or 5-star rating from Morningstar[26]

Core Viewpoint - Principal Financial (PFG) reported quarterly earnings of $2.16 per share, exceeding the Zacks Consensus Estimate of $1.98 per share, and showing an increase from $1.63 per share a year ago, representing an earnings surprise of +9.09% [1][2] Financial Performance - The company posted revenues of $3.69 billion for the quarter ended June 2025, which missed the Zacks Consensus Estimate by 7.82% and decreased from $4.07 billion year-over-year [2] - Over the last four quarters, Principal Financial has surpassed consensus EPS estimates just once and topped consensus revenue estimates two times [2] Stock Performance - Principal Financial shares have increased approximately 4.7% since the beginning of the year, compared to the S&P 500's gain of 8.6% [3] - The current status of estimate revisions translates into a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the coming quarter is $2.13 on revenues of $4.06 billion, and for the current fiscal year, it is $8.05 on revenues of $16.22 billion [7] - The outlook for the industry, particularly the Insurance - Multi line sector, is currently in the bottom 34% of over 250 Zacks industries, which may impact stock performance [8]

[Q2 2025 Earnings Announcement](index=1&type=section&id=Principal%20Financial%20Group%20Announces%20Second%20Quarter%202025%20Results) Principal Financial Group announced strong second quarter 2025 results, demonstrating significant growth in earnings and capital returns to shareholders [Overview & Highlights](index=1&type=section&id=Second%20Quarter%202025%20Highlights) Principal Financial Group reported strong second quarter 2025 results, highlighted by significant growth in earnings per share and an expansion in ROE. The company demonstrated confidence in its strategy by returning $320 million to shareholders and increasing its third-quarter dividend, while maintaining a robust capital position with $1.4 billion in excess and available capital Q2 2025 Earnings Per Share and Net Income Summary | Diluted earnings per common share | 2Q25 | Net income attributable to PFG (in millions) | 2Q25 | | :--- | :--- | :--- | :--- | | Net income attributable to PFG | $1.79 | Net income attributable to PFG | $406 | | Non-GAAP net income attributable to PFG, excluding exited business | $1.91 | Non-GAAP net income attributable to PFG, excluding exited business | $432 | | Non-GAAP operating earnings | $2.16 | Non-GAAP operating earnings | $489 | - **CEO Deanna Strable** attributed the strong results to a continued focus on high-growth markets, competitive advantages, and solid execution, positioning the company to meet its full-year financial outlook[3](index=3&type=chunk)[4](index=4&type=chunk) - **Capital Return:** Returned **$320 million** to shareholders, comprising **$150 million** in share repurchases and **$170 million** in dividends - **Dividend Increase:** Raised the **Q3 2025 common stock dividend by 2 cents to $0.78 per share**, an **8% increase YoY** - **AUM/AUA:** Assets under management (AUM) reached **$753 billion**, part of **$1.7 trillion** in assets under administration (AUA) - **Capital Position:** Maintained a strong financial position with **$1.4 billion** of excess and available capital[6](index=6&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) The company's financial performance in Q2 2025 showed strong enterprise-level growth and robust segment contributions, with most business lines reporting increased earnings [Enterprise-Level Results](index=2&type=section&id=Second%20Quarter%20Enterprise%20Results) For Q2 2025, the company reported significant year-over-year growth across key metrics. Net income attributable to PFG increased by 15% to $406.2 million, and non-GAAP operating earnings surged 27% to $489.3 million. This translated to a 33% increase in non-GAAP operating EPS to $2.16. Assets under management (AUM) grew 8% to $752.7 billion, although AUM net cash flow was negative at $(2.6) billion Q2 2025 Enterprise Financial Results (in millions, except per share) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Net income attributable to PFG | $406.2 | $353.1 | 15% | | Non-GAAP operating earnings | $489.3 | $386.1 | 27% | | Non-GAAP operating EPS | $2.16 | $1.63 | 33% | | Assets under management (billions) | $752.7 | $699.2 | 8% | | AUM net cash flow (billions) | $(2.6) | $(2.1) | (24)% |[7](index=7&type=chunk) [Segment-Level Overview](index=2&type=section&id=Second%20Quarter%20Segment%20Highlights) Most business segments demonstrated strong performance in Q2 2025. Retirement and Income Solutions saw increased deposits, while Investment Management improved revenue and margins through higher fees and expense control. Specialty Benefits benefited from an improved loss ratio. Life Insurance was the only segment to report a decline in earnings, impacted by higher claims, though it still achieved premium growth - **Retirement and Income Solutions (RIS):** Transfer deposits **increased 8%** over 2Q24 - **Investment Management:** Revenue **increased 6%** and margin **improved by 360 basis points to 38%** - **Specialty Benefits:** Incurred loss ratio **improved by 130 basis points** from 2Q24 - **Life Insurance:** Premium and fees **grew 5%**, driven by **17% growth** in the business market segment[8](index=8&type=chunk) [Retirement and Income Solutions (RIS)](index=3&type=section&id=Retirement%20and%20Income%20Solutions) The RIS segment's pre-tax operating earnings grew 9% year-over-year to $292.1 million in Q2 2025. This growth was driven by a 2% increase in net revenue to $713.9 million and an expansion of the operating margin to 40.9% from 38.2% in the prior-year quarter RIS Financials (in millions) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Pre-tax operating earnings | $292.1 | $267.8 | 9% | | Net revenue | $713.9 | $700.9 | 2% | | Operating margin | 40.9% | 38.2% | |[9](index=9&type=chunk) - The **$24.3 million** increase in pre-tax operating earnings was primarily due to higher net revenue and margin expansion, achieved while continuing to invest in the business[13](index=13&type=chunk) [Investment Management](index=3&type=section&id=Investment%20Management) This segment's pre-tax operating earnings rose 18% to $157.9 million, fueled by a 6% increase in operating revenues less pass-through expenses. The operating margin significantly improved to 37.5% from 33.9% in the prior-year quarter, reflecting higher management and performance fees Investment Management Financials (in millions) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Pre-tax operating earnings | $157.9 | $133.6 | 18% | | Operating revenues less pass-through expenses | $429.0 | $406.5 | 6% | | Operating margin | 37.5% | 33.9% | |[10](index=10&type=chunk) - The increase in operating revenues was primarily driven by higher management and performance fees[14](index=14&type=chunk) [International Pension](index=4&type=section&id=International%20Pension) International Pension delivered strong results with a 41% year-over-year increase in pre-tax operating earnings to $78.5 million. This was driven by a 13% rise in net revenue, which benefited from favorable encaje performance compared to an unfavorable result in the prior-year quarter International Pension Financials (in millions) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Pre-tax operating earnings | $78.5 | $55.7 | 41% | | Net revenue | $159.2 | $141.4 | 13% | | Operating margin | 49.3% | 39.4% | |[15](index=15&type=chunk) - Net revenue increased by **$17.8 million**, primarily due to favorable encaje performance in the current quarter[18](index=18&type=chunk) [Specialty Benefits](index=4&type=section&id=Specialty%20Benefits) Pre-tax operating earnings for Specialty Benefits increased by 17% to $127.6 million, supported by business growth and a more favorable underwriting experience. The incurred loss ratio improved to 60.2% from 61.5% a year ago, primarily due to better performance in group disability and group life Specialty Benefits Financials (in millions) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Pre-tax operating earnings | $127.6 | $108.7 | 17% | | Premium and fees | $840.2 | $813.5 | 3% | | Incurred loss ratio | 60.2% | 61.5% | |[16](index=16&type=chunk) - The incurred loss ratio improved to **60.2%** driven by more favorable underwriting experience, particularly in group disability and group life[19](index=19&type=chunk) [Life Insurance](index=5&type=section&id=Life%20Insurance) The Life Insurance segment's pre-tax operating earnings decreased by 15% to $20.0 million, a change attributed to higher claims severity. Despite the earnings decline, premium and fees grew by 5% to $238.0 million, as strong growth in the business market offset the runoff of legacy business Life Insurance Financials (in millions) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Pre-tax operating earnings | $20.0 | $23.6 | (15)% | | Premium and fees | $238.0 | $227.0 | 5% | | Operating margin | 8.4% | 10.4% | |[20](index=20&type=chunk) - The decrease in pre-tax operating earnings was driven by higher claims severity, while premium and fees increased due to strong business market growth[20](index=20&type=chunk) [Corporate](index=5&type=section&id=Corporate) The Corporate segment significantly reduced its pre-tax operating loss by 21% to $(81.2) million, compared to a loss of $(103.4) million in Q2 2024. This improvement was primarily the result of higher net investment income and lower operating expenses Corporate Financials (in millions) | Metric | 2Q25 | 2Q24 | % Change | | :--- | :--- | :--- | :--- | | Pre-tax operating losses | $(81.2) | $(103.4) | 21% |[21](index=21&type=chunk) - The decrease in pre-tax operating losses was primarily due to higher net investment income and lower operating expenses[21](index=21&type=chunk) [Shareholder Returns](index=1&type=section&id=Shareholder%20Returns) The company demonstrated its commitment to shareholders through significant capital returns and an increased common stock dividend in Q2 2025 [Capital Return and Dividends](index=1&type=section&id=Common%20Stock%20Dividend) In Q2 2025, PFG returned a total of $320 million to shareholders, consisting of $150 million in share repurchases and $170 million in common stock dividends. The company also announced an increased third-quarter 2025 cash dividend of $0.78 per share, payable on September 26, 2025. This represents an 8% increase over the Q3 2024 dividend - The company returned **$320 million** of capital to shareholders in Q2 2025, including **$150 million** of share repurchases and **$170 million** of common stock dividends[6](index=6&type=chunk) - A third-quarter cash dividend of **$0.78 per share** was announced, payable on Sept 26, 2025, to shareholders of record as of Sept 4, 2025. This is a **2-cent increase** over the Q2 dividend[22](index=22&type=chunk) [Financial Statements and Reconciliations](index=6&type=section&id=Financial%20Statements%20and%20Reconciliations) Detailed financial statements and reconciliations provide insights into the company's balance sheet, significant variances, and non-GAAP financial measures [Impact of Significant Variances (Exhibit 1)](index=6&type=section&id=Exhibit%201) Exhibit 1 quantifies the impact of significant variances on earnings. In Q2 2025, these variances contributed a net positive $24.1 million to pre-tax operating earnings, a reversal from the negative $38.3 million impact in Q2 2024. Key drivers for the quarter included variable investment income fluctuations, encaje performance in Latin America, and a one-time expense accrual release Impact of Significant Variances on Pre-Tax Operating Earnings (in millions) | Period | Impact on Pre-Tax Operating Earnings | | :--- | :--- | | 2Q25 | $24.1 | | 2Q24 | $(38.3) |[23](index=23&type=chunk) - Significant variances in 2Q25 included: - Variable investment income performance (mixed across segments) - Higher than expected encaje performance in International Pension - A one-time expense accrual release across multiple segments[24](index=24&type=chunk) [Selected Balance Sheet Statistics](index=9&type=section&id=Selected%20Balance%20Sheet%20Statistics) As of the end of Q2 2025, the company's balance sheet showed total assets of $323.1 billion and total stockholders' equity of $11.5 billion. Book value per common share increased to $51.14 from $49.01 at the end of 2024, while book value per share excluding AOCI and other adjustments rose to $54.97 Balance Sheet Data (in billions, except per share) | Metric | 2Q25 | 4Q24 | | :--- | :--- | :--- | | Total assets | $323.1 | $313.7 | | Stockholders' equity | $11.5 | $11.1 | | Book value per common share | $51.14 | $49.01 | | Book value per common share (adjusted) | $54.97 | $53.69 |[34](index=34&type=chunk)[36](index=36&type=chunk) [GAAP to Non-GAAP Reconciliations](index=7&type=section&id=Reconciliation%20of%20U.S.%20GAAP%20to%20Non-GAAP%20Financial%20Measures) The report provides extensive reconciliations from U.S. GAAP to non-GAAP financial measures, which management believes better represent ongoing operational performance by excluding items like net realized capital gains/losses and results from exited businesses. For Q2 2025, GAAP net income of $406.2 million was reconciled to non-GAAP operating earnings of $489.3 million - Management uses non-GAAP measures to illustrate the performance of normal, ongoing operations, which is important for evaluating the company's financial condition and results[27](index=27&type=chunk)[33](index=33&type=chunk) Q2 2025 GAAP to Non-GAAP Reconciliation Summary (in millions) | Line Item | Amount | | :--- | :--- | | Net income attributable to PFG (GAAP) | $406.2 | | Adjustments for exited business | $26.1 | | Adjustments for net realized capital gains/losses | $57.0 | | **Non-GAAP Operating Earnings** | **$489.3** |[31](index=31&type=chunk) Q2 2025 Per Diluted Share Reconciliation | Line Item | Amount | | :--- | :--- | | Net income attributable to PFG (GAAP) | $1.79 | | **Non-GAAP Operating Earnings** | **$2.16** | | Non-GAAP Operating Earnings, ex. significant variances | $2.07 |[32](index=32&type=chunk) [Supplementary Information](index=7&type=section&id=Supplementary%20Information) This section provides details on the earnings conference call, forward-looking statements, and an overview of Principal Financial Group [Conference Call and Forward-Looking Statements](index=7&type=section&id=Earnings%20Conference%20Call) The company scheduled an earnings conference call for July 29, 2025, to discuss the quarterly results and future outlook. The report also contains a standard forward-looking statements disclaimer, advising that actual results could differ materially from expectations and referencing its SEC filings for a comprehensive list of risk factors - An earnings conference call with **CEO Deanna Strable** and **CFO Joel Pitz** is scheduled for 10:00 a.m. (ET) on Tuesday, July 29, 2025[25](index=25&type=chunk) - The release contains forward-looking statements based on current expectations, which are not guarantees of future performance. The company assumes no obligation to update these statements[26](index=26&type=chunk) [About Principal Financial Group](index=8&type=section&id=About%20Principal) Principal Financial Group is a global financial services company with a 146-year history. It employs approximately 20,000 people and serves over 70 million customers worldwide with planning, insurance, investment, and retirement solutions. The company has been recognized as one of the 2025 World's Most Ethical Companies - Principal is a global financial company with approximately **20,000 employees**, serving over **70 million customers**[29](index=29&type=chunk) - The company has been in business for **146 years** and is recognized as one of the **2025 World's Most Ethical Companies**[29](index=29&type=chunk)

Core Viewpoint - Analysts forecast that Principal Financial (PFG) will report quarterly earnings of $1.98 per share, reflecting a year-over-year increase of 21.5%, while revenues are expected to be $4 billion, a decrease of 1.7% compared to the previous year [1]. Earnings Projections - The consensus EPS estimate for the quarter has been revised upward by 0.3% over the past 30 days, indicating a collective reassessment by analysts [2]. - Changes in earnings projections are crucial for predicting investor reactions, with empirical studies showing a strong correlation between earnings estimate trends and short-term stock price movements [3]. Revenue Estimates - Analysts estimate 'Revenue- Net investment income' will reach $1.19 billion, a change of +9.8% year-over-year [5]. - 'Revenue- Premiums and other considerations' is projected at $1.89 billion, indicating a -1.7% change from the prior year [5]. - 'Revenue- Fees and other revenues' is expected to be $1.08 billion, reflecting a +1.8% change year-over-year [5]. Segment-Specific Revenue Projections - 'Revenue- Principal Asset Management Segment- Net investment income' is estimated at $179.23 million, a +9% change from the previous year [6]. - 'Revenue- Benefits and Protection Segment- Specialty Benefits- Fees and other revenues' is projected to be $9.13 million, indicating an +8.7% change [6]. - 'Revenue- Benefits and Protection Segment- Specialty Benefits- Premiums and other considerations' is expected to reach $834.00 million, reflecting a +3.6% change [7]. Additional Segment Insights - The total revenue for 'Benefits and Protection Segment- Specialty Benefits' is estimated at $894.05 million, suggesting a +4.2% change year-over-year [8]. - 'Revenue- Benefits and Protection Segment- Life Insurance- Fees and other revenues' is projected at $96.98 million, indicating a -9.1% change [8]. - 'Revenue- Benefits and Protection Segment- Life Insurance- Total' is expected to be $301.70 million, reflecting an -8.3% change from the prior year [10]. Stock Performance - Principal Financial shares have increased by +2.9% over the past month, compared to a +5.9% increase in the Zacks S&P 500 composite [10].

Core Viewpoint - Wall Street anticipates a year-over-year increase in earnings for Principal Financial (PFG) despite lower revenues, with a focus on how actual results compare to estimates impacting stock price [1][2]. Earnings Expectations - Principal Financial is expected to report quarterly earnings of $1.98 per share, reflecting a year-over-year increase of +21.5%, while revenues are projected at $4 billion, a decrease of 1.7% from the previous year [3]. - The earnings report is scheduled for release on July 28, and better-than-expected results could lead to a stock price increase, whereas disappointing results may cause a decline [2]. Estimate Revisions - The consensus EPS estimate has been revised 0.31% higher in the last 30 days, indicating a slight positive reassessment by analysts [4]. - However, the Most Accurate Estimate for Principal Financial is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -1.14%, suggesting a bearish outlook from analysts [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict the likelihood of actual earnings deviating from consensus estimates, with a strong predictive power for positive readings [9][10]. - Principal Financial's current Zacks Rank is 3, which complicates the prediction of an earnings beat given the negative Earnings ESP [12]. Historical Performance - In the last reported quarter, Principal Financial's actual earnings of $1.81 per share fell short of the expected $1.85, resulting in a surprise of -2.16% [13]. - The company has not surpassed consensus EPS estimates in any of the last four quarters, indicating a trend of underperformance [14]. Conclusion - Principal Financial does not appear to be a strong candidate for an earnings beat, and investors should consider other factors when evaluating the stock ahead of the earnings release [17].