AON(US:AON)2025-10-31 20:05Revenue Performance - Total revenue for the three months ended September 30, 2025, was $3,997 million, representing a 7.4% increase from $3,721 million in the same period of 2024[37] - Revenue from Commercial Risk Solutions for the three months ended September 30, 2025, was $1,988 million, up 7.3% from $1,852 million in 2024[37] - The U.S. contributed $2,084 million to total revenue for the three months ended September 30, 2025, slightly up from $2,083 million in 2024[39] - The total revenue for the nine months ended September 30, 2025, was $12,881 million, a 11.5% increase from $11,551 million in 2024[37] - The Risk Capital segment generated $2,525 million in revenue for the three months ended September 30, 2025, compared to $2,355 million in 2024, reflecting a 7.2% increase[39] - The Health Solutions segment reported revenue of $935 million for the three months ended September 30, 2025, up from $870 million in 2024, marking a 7.5% increase[37] - The company recognized $258 million and $724 million in revenue during the three and nine months ended September 30, 2025, respectively, from previously deferred revenue[55] - Total segment revenue for Risk Capital and Human Capital combined was $12,881 million for the nine months ended September 30, 2025, compared to $11,551 million in the prior year[134] Costs and Expenses - The Accelerating Aon United Program is expected to incur cumulative costs of $1.0 billion, with $32 million and $236 million incurred for the three and nine months ended September 30, 2025, respectively[42] - The total costs incurred from the inception of the Accelerating Aon United Program to date amount to $760 million[45] - For the three months ended September 30, 2025, total other income (expense) was $(13) million, compared to $35 million in the same period of 2024, with a notable gain from sales of businesses decreasing from $76 million to $1 million[48] - Total operating expenses for the three months ended September 30, 2025, were $3,181 million, an increase from $3,098 million in the same period of 2024[134] Assets and Liabilities - Cash and cash equivalents and short-term investments were $1.3 billion as of September 30, 2025, with $136 million restricted for use[47] - Other current assets increased significantly to $2,210 million as of September 30, 2025, compared to $759 million as of December 31, 2024, primarily due to assets held for sale rising to $1,274 million[50] - Total current liabilities rose to $2,189 million as of September 30, 2025, from $1,773 million as of December 31, 2024, with deferred revenue slightly increasing from $280 million to $286 million[55] - As of September 30, 2025, total assets classified as held for sale amounted to $1.3 billion, including $754 million in intangible assets and $389 million in goodwill[73] - The carrying value of the current portion of long-term debt is $1,335 million with a fair value of $1,335 million as of September 30, 2025[117] - The total long-term debt carrying value is $15,055 million with a fair value of $14,602 million as of September 30, 2025[117] Acquisitions and Dispositions - The company completed the acquisition of Griffiths & Armour for approximately $418 million on January 1, 2025, enhancing its Risk Capital segment[58] - The total consideration for the NFP acquisition was $9.1 billion, including $3.2 billion for settling indebtedness and $5.9 billion in class A ordinary shares[63] - The net assets acquired from the NFP acquisition totaled $9.1 billion, with goodwill recognized at $6.8 billion and intangible assets at $6.8 billion[66] - Aon signed a definitive agreement to sell a significant portion of NFP's wealth businesses for total proceeds of $2.3 billion, with the sale completed on October 30, 2025[74] - The total liabilities assumed from acquisitions in the nine months ended September 30, 2025, amounted to $222 million, with total assets acquired valued at $1,053 million[61] Shareholder Actions - Aon repurchased 0.7 million shares at an average price of $362.00 during the three months ended September 30, 2025, with total repurchase costs recorded at $250 million[93] - The remaining authorized amount for share repurchases under the program was approximately $1.6 billion as of September 30, 2025, with a total of 174.2 million shares repurchased for about $25.9 billion[93] Legal and Regulatory Matters - The Company is monitoring legal challenges related to the SEC's climate-related disclosure rules, which may impact future reporting requirements[36] - The company recognized legal settlement expenses of $197 million in Q4 2023 related to ongoing legal matters, with a $23 million reduction in the third quarter of 2025[122] - Aon faces legal claims totaling up to $300 million related to a fatal plane crash, with ongoing litigation and counterclaims[121] - The company has been involved in legal proceedings regarding allegations of fraudulent letters of credit, with potential liabilities being assessed[122] Tax and Pension - The effective tax rate on net income was 21.3% for the three months ended September 30, 2025, compared to 20.9% for the same period in 2024[89] - The total contributions to significant pension plans in Q3 2025 amounted to $26 million, compared to $16 million in Q3 2024, reflecting a 62.5% increase[99] - The net periodic cost (benefit) for the U.K. pension plan for Q3 2025 was $16 million, up from $11 million in Q3 2024, indicating a 45.5% increase[98] - The company expects to make total cash contributions of approximately $76 million to its U.S. pension plans during 2025, compared to $31 million in 2024[99] Foreign Exchange and Derivatives - The notional amount of foreign exchange contracts accounted for as hedges was $419 million as of September 30, 2025, down from $597 million at December 31, 2024[104] - The company recorded a loss of $5 million in Other income (expense) for foreign exchange derivatives not designated as hedges during Q3 2025, compared to a gain of $9 million in Q3 2024[107] - The total notional amount of derivative instruments as of September 30, 2025, was $919 million, a decrease from $991 million at December 31, 2024[104] Other Financial Metrics - Operating income for the nine months ended September 30, 2025, was $3,136 million, up 14.3% from $2,744 million in the prior year[134] - The operating margin for Risk Capital was 23.2% in Q3 2025, slightly down from 23.8% in Q3 2024, while Human Capital improved to 22.5% from 14.8%[134] - The Company reported a diluted earnings per share impact of unfavorable $0.12 for the three and nine months ended September 30, 2025, due to foreign exchange rate fluctuations[249] - Fiduciary investment income was affected by changes in short-term interest rates, with a decrease in global rates adversely impacting income[250]