[PART I FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited interim consolidated financial statements for Prudential Financial, Inc. as of March 31, 2025, and for the three months then ended Consolidated Financial Position Summary | Metric | March 31, 2025 (in millions) | December 31, 2024 (in millions) | | :--- | :--- | :--- | | **Total Assets** | $739,262 | $735,587 | | **Total Liabilities** | $707,040 | $705,461 | | **Total Equity** | $30,203 | $28,187 | Consolidated Operations Summary | Metric | Three Months Ended Mar 31, 2025 (in millions) | Three Months Ended Mar 31, 2024 (in millions) | | :--- | :--- | :--- | | **Total Revenues** | $13,470 | $23,509 | | **Net Income (Loss) Attributable to PFI** | $707 | $1,138 | | **Diluted EPS** | $1.96 | $3.12 | [Notes to Unaudited Interim Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Interim%20Consolidated%20Financial%20Statements) The notes detail the basis of presentation and significant accounting policies, including a change in International Businesses segment reporting and disclosures on investments, derivatives, and reinsurance activities - Effective in the first quarter of 2025, the Company's International Businesses are reflected as a single operating and reportable segment, a change from the previous structure of Life Planner and Gibraltar Life and Other segments, applied retrospectively[34](index=34&type=chunk)[364](index=364&type=chunk) - In March 2025, the Company entered into a reinsurance agreement with Prismic Life Reinsurance International, Ltd. to reinsure approximately **$7 billion** of reserves for certain USD-denominated Japanese whole life policies[290](index=290&type=chunk)[388](index=388&type=chunk) - Gross unrealized losses on available-for-sale fixed maturity securities totaled **$33.6 billion** as of March 31, 2025, primarily attributable to increases in interest rates, general credit spread widening, and foreign currency movements[50](index=50&type=chunk)[53](index=53&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=98&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition and results of operations, highlighting the impact of market conditions, particularly interest rates, and segment performance - Net income attributable to Prudential Financial decreased by **$431 million** year-over-year, primarily due to a **$474 million** unfavorable variance in the change in value of market risk benefits and a **$183 million** unfavorable variance from realized investment gains, partially offset by an **$85 million** favorable variance from higher adjusted operating income[449](index=449&type=chunk)[450](index=450&type=chunk) - The company highlights that for both its U.S. and Japanese operations, average reinvestment yields are now generally exceeding current average portfolio yields, a positive indicator for future net investment spread in a higher interest rate environment[431](index=431&type=chunk)[443](index=443&type=chunk) Adjusted Operating Income by Segment (in millions) | Segment | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | PGIM | $156 | $169 | | U.S. Businesses | $931 | $805 | | International Businesses | $848 | $896 | | Corporate and Other | $(415) | $(435) | | **Total** | **$1,520** | **$1,435** | [Results of Operations by Segment](index=108&type=section&id=Results%20of%20Operations%20by%20Segment) This section provides a detailed breakdown of the operating results for each of Prudential's business segments, including PGIM, Retirement Strategies, Group Insurance, Individual Life, and International Businesses - **PGIM:** Adjusted Operating Income (AOI) decreased by **$13 million**, primarily due to lower other related revenues from seed/co-investments and incentive fees, while Assets Under Management (AUM) grew to **$1.385 trillion**[497](index=497&type=chunk)[504](index=504&type=chunk) - **Group Insurance:** AOI increased by **$44 million**, driven by higher underwriting results in both group life and group disability businesses, reflecting favorable mortality and claims experience[557](index=557&type=chunk) - **Individual Life:** AOI loss narrowed by **$87 million**, mainly due to higher underwriting results reflecting the favorable impact of recent reinsurance transactions and lower expenses[566](index=566&type=chunk) - **International Businesses:** AOI decreased by **$48 million** (**$38 million** on a constant currency basis), primarily due to lower net investment spread results and lower earnings from joint ventures[573](index=573&type=chunk) [General Account Investments](index=126&type=section&id=General%20Account%20Investments) The general account investment portfolio totaled $445.4 billion, primarily in fixed maturities, with analysis split by PFI, Closed Block, and Funds Withheld assets General Account Investments Composition (Mar 31, 2025) | Category | PFI (ex-CB/FW) (in billions) | Closed Block (in billions) | Funds Withheld (in billions) | Total (in billions) | | :--- | :--- | :--- | :--- | :--- | | Fixed maturities | $283.5 | $29.5 | $12.5 | $325.5 | | Commercial mortgage & other loans | $54.2 | $7.8 | $0.3 | $62.3 | | Other Investments | $31.9 | $8.5 | $1.9 | $42.3 | | **Total** | **$380.8** | **$47.2** | **$17.4** | **$445.4** | - As of March 31, 2025, **94%** of the PFI (excluding Closed Block and Funds Withheld) fixed maturity portfolio was rated high or highest quality (NAIC 1 or 2)[635](index=635&type=chunk) - The investment income yield for the PFI (excluding Closed Block and Funds Withheld) portfolio increased to **4.19%** in Q1 2025 from **4.04%** in Q1 2024, driven by higher fixed income reinvestment rates[608](index=608&type=chunk)[609](index=609&type=chunk)[611](index=611&type=chunk) [Liquidity and Capital Resources](index=147&type=section&id=Liquidity%20and%20Capital%20Resources) Management asserts that capital and liquidity resources are sufficient, detailing recent debt issuance, reinsurance transactions, and strong regulatory capital ratios - Prudential Financial (parent company) held highly liquid assets of **$4.92 billion** as of March 31, 2025 (excluding net borrowings from its intercompany liquidity account)[707](index=707&type=chunk)[708](index=708&type=chunk) - Key capital actions in 2025 include issuing **$750 million** of senior notes, entering a **$7 billion** reinsurance deal with Prismic Re International, and announcing the redemption of **$1.0 billion** of junior subordinated notes[688](index=688&type=chunk) Regulatory Capital Ratios (as of Dec 31, 2024) | Entity/Metric | Ratio | | :--- | :--- | | PICA RBC Ratio | 409% | | Prudential of Japan Solvency Margin | 763% | | Gibraltar Life Solvency Margin | 973% | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=156&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes in its economic exposure to market risk since its 2024 Annual Report on Form 10-K - As of March 31, 2025, there have been no material changes in the Company's economic exposure to market risk from December 31, 2024[755](index=755&type=chunk) [Item 4. Controls and Procedures](index=157&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2025 - The Chief Executive Officer and Chief Financial Officer concluded that as of March 31, 2025, the Company's disclosure controls and procedures were effective[756](index=756&type=chunk) - No change in internal control over financial reporting occurred during the quarter ended March 31, 2025, that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting[756](index=756&type=chunk) [PART II OTHER INFORMATION](index=158&type=section&id=PART%20II%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=158&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 21 of the financial statements for details on pending litigation and regulatory matters - The company estimates that as of March 31, 2025, the aggregate range of reasonably possible losses in excess of accruals for litigation and regulatory matters is less than **$250 million**[412](index=412&type=chunk) [Item 1A. Risk Factors](index=158&type=section&id=Item%201A.%20Risk%20Factors) This section directs readers to the 'Risk Factors' section of the company's Annual Report on Form 10-K for the year ended December 31, 2024, for a comprehensive description of risks - The report refers to the Risk Factors section in the 2024 Annual Report on Form 10-K for a detailed discussion of business risks[760](index=760&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=158&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first quarter of 2025, Prudential repurchased approximately 2.2 million shares of its common stock at a total cost of $250 million Share Repurchases - Q1 2025 | Period | Total Shares Purchased | Average Price Paid per Share | Total Cost (in millions) | | :--- | :--- | :--- | :--- | | Jan 2025 | 707,994 | $119.04 | ~$84 | | Feb 2025 | 1,517,761 | $113.47 | ~$172 | | Mar 2025 | 761,202 | $110.36 | ~$84 | | **Total Q1** | **2,986,957** | **-** | **~$340** | | *Portion under announced program* | *2,195,805* | - | **$250** | - As of March 31, 2025, approximately **$750 million** remained available for repurchase under the **$1.0 billion** authorization for 2025[761](index=761&type=chunk)[762](index=762&type=chunk) [Item 5. Other Information](index=158&type=section&id=Item%205.%20Other%20Information) The company reports that no directors or officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements during the quarter ended March 31, 2025 - During the quarter ended March 31, 2025, no directors or officers adopted or terminated any Rule 10b5-1 trading plans or other similar arrangements[764](index=764&type=chunk) [Item 6. Exhibits](index=159&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the CEO and CFO certifications and the XBRL interactive data files

Group 1 - Prudential Financial, Inc. held its Q1 2025 Earnings Conference Call on May 1, 2025, featuring key participants including CEO Andy Sullivan and CFO Yanela Frias [1][3] - The call was structured to include prepared comments from the executives followed by a question-and-answer session [2][3] - The company emphasized that the discussion may include forward-looking statements and references to non-GAAP measures, with additional details available on their investor website [4]

Core Insights - Prudential reported a revenue of $13.41 billion for the quarter ended March 2025, reflecting a 38.2% decrease year-over-year and a surprise of -7.71% compared to the Zacks Consensus Estimate of $14.53 billion [1] - The earnings per share (EPS) was $3.29, which is an increase from $3.12 in the same quarter last year, resulting in an EPS surprise of +2.49% against the consensus estimate of $3.21 [1] Financial Performance Metrics - Assets Under Management and Administration (PGIM) for institutional customers stood at $620.2 billion, below the average estimate of $632.98 billion [4] - Retail customer assets were reported at $240.6 billion, significantly lower than the estimated $374.12 billion [4] - Total assets under management for PGIM were $1,385.3 billion, compared to the average estimate of $1,401.42 billion [4] - Total revenues from U.S. businesses were $7.71 billion, a decline of 51.7% year-over-year, and below the average estimate of $8.50 billion [4] - International businesses generated total revenues of $4.74 billion, slightly above the estimated $4.60 billion, with a year-over-year change of +0.5% [4] - Adjusted operating income from policy charges and fee income was $1.11 billion, close to the average estimate of $1.12 billion [4] - Net investment income was reported at $4.52 billion, slightly above the average estimate of $4.47 billion [4] - Premiums totaled $6.45 billion, below the estimated $7.67 billion [4] - Corporate and other revenues reported a loss of $17 million, significantly lower than the average estimate of $70.97 million, representing a year-over-year change of -156.7% [4] - Individual life revenues from U.S. businesses were $1.52 billion, slightly below the estimated $1.57 billion, reflecting a -4.1% change year-over-year [4] - Group insurance revenues from U.S. businesses were $1.75 billion, exceeding the estimated $1.64 billion, with a year-over-year increase of +7% [4] Stock Performance - Prudential's shares have returned -6.9% over the past month, contrasting with the Zacks S&P 500 composite's -0.2% 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 - Prudential (PRU) reported quarterly earnings of $3.29 per share, exceeding the Zacks Consensus Estimate of $3.21 per share, and showing an increase from $3.12 per share a year ago, indicating a 2.49% earnings surprise [1] Financial Performance - The company posted revenues of $13.41 billion for the quarter ended March 2025, which was 7.71% below the Zacks Consensus Estimate, and a decrease from $21.7 billion in the same quarter last year [2] - Over the last four quarters, Prudential has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] Stock Performance - Prudential shares have declined approximately 12.2% since the beginning of the year, compared to a 5.5% decline in the S&P 500 [3] - The current Zacks Rank for Prudential is 4 (Sell), indicating expectations of underperformance in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $3.51 on revenues of $13.96 billion, and for the current fiscal year, it is $13.81 on revenues of $57.36 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 - Multi line industry, to which Prudential belongs, is currently ranked in the top 17% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Another company in the same industry, Kemper (KMPR), is expected to report quarterly earnings of $1.48 per share, reflecting a year-over-year increase of 38.3% [9]

Financial Performance - Total adjusted operating income before income taxes for Q1 2025 was $1,520 million, a 6% increase compared to Q1 2024[6]. - Adjusted operating income for U.S. Businesses increased by 16% year-over-year to $931 million in Q1 2025[6]. - After-tax adjusted operating income for Q1 2025 was $1,188 million, reflecting a 7% increase from the previous year[6]. - Net income attributable to Prudential Financial, Inc. decreased by 38% year-over-year to $707 million in Q1 2025[6]. - Earnings per share (diluted) for Q1 2025 was $1.96, down 37% from $3.12 in Q1 2024[10]. - Total revenues for Q1 2025 were $13,412 million, a decrease of 38% compared to Q1 2024's $21,706 million[19]. - Total revenues for Q1 2025 decreased by 73% to $3,105 million compared to $11,538 million in Q1 2024[45]. - Total revenues for Q1 2025 were $7,706 million, a 52% decrease compared to $15,973 million in Q1 2024[40]. - Total revenues for Q1 2025 decreased by 4% to $1,515 million compared to Q1 2024[63]. - Total revenues for Q1 2025 were $(17) million, a significant decline of 157% compared to Q1 2024[79]. Shareholder Returns - Dividends paid in Q1 2025 amounted to $486 million, a 2% increase from the previous year[6]. - Total capital returned to shareholders in Q1 2025 was $736 million, a 1% increase year-over-year[6]. Assets and Liabilities - Total assets under management and administration reached $1,702.5 billion in Q1 2025, compared to $1,678.9 billion in Q1 2024, indicating growth[17]. - Total assets as of March 31, 2025, amounted to $739,262 million, a slight increase from $735,587 million at the end of 2024[22]. - Total liabilities as of March 31, 2025, were $707,040 million, compared to $705,461 million at the end of 2024, showing a marginal increase[22]. - The company's equity increased to $30,203 million as of March 31, 2025, from $28,187 million at the end of 2024, representing an increase of approximately 7%[22]. Investment Performance - Total investment income for Q1 2025 was $4,519 million, a decrease from $4,120 million in Q1 2024, with realized losses of $673 million compared to $183 million in the previous year[91]. - The yield on fixed maturities increased to 4.38% in Q1 2025 from 4.12% in Q1 2024, with investment income amounting to $3,313 million, up from $3,068 million[91]. - The total amount of equity securities at fair value was $8,309 million, representing 1.8% of the total investment portfolio[82]. - Commercial mortgage and other loans generated $449 million in investment income with a yield of 4.73% in Q1 2025, compared to $363 million and a yield of 4.36% in Q1 2024[100]. Policyholder Accounts - Interest credited to policyholders' account balances increased by 20% to $1,083 million in Q1 2025 from $902 million in Q1 2024[19]. - Policyholders' account balances rose to $170,278 million, up from $166,254 million at the end of 2024, indicating a growth of about 2%[22]. - Interest credited to policyholders' account balances was $1,083 million, a decrease of 30% from $1,641 million in Q1 2024[104]. Operational Metrics - Operating return on average equity based on adjusted operating income was 13.8% for Q1 2025, up from 12.7% in Q1 2024[6]. - The number of Prudential Advisors increased to 2,906 in Q1 2025, up from 2,752 in Q1 2024[17]. - Operating expenses for Q1 2025 were $1,624 million, a decrease of 11.4% from $1,832 million in Q1 2024[104]. Business Segments - PGIM's total revenues for Q1 2025 were $985 million, a decrease of 1% compared to $990 million in Q1 2024[30]. - Total revenues for the group insurance segment increased to $1,748 million in Q1 2025, representing a 7% increase from $1,634 million in Q1 2024[58]. - International businesses reported total revenues of $4,738 million in Q1 2025, a 1% increase from $4,713 million in Q1 2024[71]. Market Position - Common stock market capitalization at the end of Q1 2025 was $39,535 million, down from $42,158 million at the end of Q1 2024[19]. - Prudential's financial strength ratings as of April 30, 2025, include A+ from A.M. Best and AA- from Standard & Poor's for The Prudential Insurance Company of America[153]. - The company’s common stock is traded on the New York Stock Exchange under the symbol PRU[154].

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Group 1: Prudential (PRU) - Prudential shares increased by 9.2% to close at $103.91, following a broader market rally after President Trump announced a 90-day pause of reciprocal tariffs for most countries [1] - The stock experienced a 9.9% loss over the past four weeks prior to this surge [1] - The consensus EPS estimate for Prudential's upcoming quarterly report is $3.34, reflecting a year-over-year increase of 7.1%, while revenues are expected to be $14.58 billion, down 32.8% from the previous year [2] - Over the last 30 days, the consensus EPS estimate for Prudential has been revised 1.3% lower, indicating a negative trend in earnings estimate revisions [3] - Prudential currently holds a Zacks Rank of 3 (Hold) [3] Group 2: James River Group (JRVR) - James River Group's consensus EPS estimate for the upcoming report has decreased by 51.1% over the past month to $0.24, which is a 38.5% decline from the previous year's report [4] - The company currently has a Zacks Rank of 5 (Strong Sell) [4] - In the last trading session, James River Group's stock closed 3.5% higher at $4.10, with a 0.5% return over the past month [3]

Core Viewpoint - Prudential Financial Inc. (PRU) has underperformed in the past year, with a share price decline of 16.2%, contrasting with the industry's slight decline of 0.7% and the S&P 500's decrease of 2.1% [1] Group 1: Stock Performance - PRU shares are currently trading below the 50-day moving average, indicating a bearish trend [1] - The market capitalization of Prudential Financial is $33.94 billion, with an average trading volume of 1.91 million shares over the last three months [1] Group 2: Valuation Metrics - PRU shares are trading at a price to forward 12-month earnings ratio of 6.64X, which is lower than the industry average of 8.04X, presenting a better entry point for investors [4] - The company has a Value Score of B, indicating relative affordability compared to peers [4] Group 3: Growth Projections - The Zacks Consensus Estimate projects a year-over-year increase of 12.4% in earnings per share for Prudential Financial in 2025, with further increases of 6.3% and 3.6% for 2026 earnings per share and revenues, respectively [5] Group 4: Market Demand and Competitive Edge - There is a significant demand for retirement benefit products among baby boomers, with projections indicating that nearly 25% of the U.S. population will be 65 years or older by 2050 [6] - Prudential's extensive distribution network, strong product portfolio, and brand image provide a competitive advantage [6] Group 5: Strategic Initiatives - The company is focused on long-term growth through strategic initiatives, including programmatic acquisitions and partnerships in emerging markets [7][9] - Prudential has a strong international presence, particularly in Japan and Brazil, which are expected to contribute significantly to earnings growth [10] Group 6: Dividend Policy - Prudential Financial has consistently increased its dividend for the past 16 years, balancing business growth investments with capital returns to shareholders [11] Group 7: Business Challenges - The company faces challenges related to its exposure to products like annuities and universal life, which may strain capital due to low interest rates [13] - Sales of individual annuities are expected to remain low in the near term as the company adjusts its product offerings [13]

Company Overview - HighPeak is an innovative, early-stage company leveraging AI technology, machine learning, and proprietary data to deliver accurate life planning data in the market [5] - The company is backed by Prudential Financial, a global financial services leader with approximately $1.5 trillion in assets under management as of December 31, 2024 [6] Leadership and Vision - Sharon Rodriguez, CEO of HighPeak, is leading efforts to transform financial planning for advisors by integrating healthcare costs, longevity insights, and financial risk analysis [1][2] - Rodriguez joined HighPeak in 2023 and has a multifaceted background as a corporate buyer, startup founder, and venture investor, equipping her to drive innovation and growth [3] Product and Technology - HighPeak provides an AI-powered platform that generates precise, real-time forecasts on healthcare costs, longevity, and financial risk, moving beyond traditional planning tools [2][4] - The platform aims to equip financial advisors with tools to anticipate future healthcare expenses confidently, enabling the creation of financial plans that reflect real-world health expenses [4] Market Strategy - HighPeak is focused on expanding partnerships and enhancing predictive capabilities to meet the growing demand for tailored financial planning solutions [4] - The company is launching solutions specifically designed for financial advisors, establishing a strong foundation for broader market expansion [3]

Core Viewpoint - Prudential Financial's recent earnings report showed mixed results, with adjusted operating income missing estimates but showing year-over-year growth. The company is facing a downward trend in estimates, leading to questions about its future performance leading up to the next earnings release [1][2][15]. Financial Performance - Adjusted operating income for Q4 2024 was $2.96 per share, missing the Zacks Consensus Estimate by 9.7%, but increased by 16.5% year over year [2]. - Total revenues reached $13 billion, a 1% increase year over year, but fell short of the Zacks Consensus Estimate by 8% [3]. - Total benefits and expenses were $11.6 billion, a slight decrease of 0.03% year over year, and also lower than the estimate of $13.2 billion [4]. Segment Performance - Prudential Global Investment Management (PGIM) reported adjusted operating income of $259 million, a 50.6% increase year over year, exceeding the estimate of $236.2 million [5]. - PGIM's assets under management grew to $1.375 trillion, a 6% increase year over year [6]. - The U.S. Businesses segment saw adjusted operating income decrease by 10.7% year over year to $860 million, missing the estimate of $1.1 billion [7]. - International Businesses reported adjusted operating income of $742 million, a decrease of 0.8% year over year, but higher than the estimate of $735.8 million [8]. - Corporate and Other incurred an adjusted operating loss of $490 million, an improvement from a loss of $653 million a year ago [9]. Capital Management - Prudential returned $720 million to shareholders through share repurchases of $250 million and dividends of $470 million in Q4 [10]. - The board authorized a share repurchase program of up to $1 billion and increased the quarterly cash dividend by 4% to $1.35 per share, marking the 17th consecutive year of dividend increases [11]. Financial Position - As of the end of Q4, cash and cash equivalents were $18.5 billion, down 4.7% from the end of 2023, while total debt increased by 3.2% to $20.1 billion [12]. - Assets under management and administration rose by 3.3% year over year to $1.69 trillion, with adjusted book value per common share at $95.82, a decrease of 0.8% year over year [13]. Full-Year Update - For 2024, adjusted operating income was $12.62 per share, a 6% increase from 2023, but missed the Zacks Consensus Estimate by 4.7%. Total revenues for the year were $68 billion, a 35% increase from 2023, but also missed estimates by 1.6% [14]. Market Outlook - Estimates for Prudential have been trending downward, indicating a potential shift in market sentiment. The company currently holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the coming months [17].