Jackson(US:JXN)2025-11-04 21:24Financial Performance - Jackson Financial Inc. reported significant revenues primarily from fee income, spread income, and margins on insurance products[286]. - Net income attributable to common shareholders for Q3 2025 was $65 million, a significant improvement from a loss of $480 million in Q3 2024[291]. - Adjusted Operating Earnings for Q3 2025 increased to $433 million, compared to $350 million in Q3 2024, while for the nine months ended September 30, 2025, it reached $1,159 million, up from $1,094 million in the same period last year[291]. - Total revenues for the nine months ended September 30, 2025, increased to $4,695 million, up from $3,046 million in the same period of 2024, representing a growth of 54.0%[337]. - The company experienced a pretax income of $72 million for the three months ended September 30, 2025, a significant improvement from a pretax loss of $579 million in the same period of 2024[338]. - Net investment income for the three months ended September 30, 2025, was $856 million, an increase of 17.9% from $726 million in the same period of 2024[337]. - The company reported a total of $1,344 million in benefits and expenses for the three months ended September 30, 2025, down from $2,700 million in the same period of 2024[337]. Business Segments - The company manages its business through three reportable segments: Retail Annuities, Institutional Products, and Closed Life and Annuity Blocks[289]. - Total retail annuity sales for Q3 2025 were $5,362 million, slightly up from $5,272 million in Q3 2024, and for the nine months ended September 30, 2025, total sales reached $13,773 million, compared to $13,192 million in the prior year[297]. - Operating revenues for the Retail Annuities segment totaled $1,411 million for the three months ended September 30, 2025, compared to $1,344 million for the same period in 2024[348]. - Total operating revenues for the Institutional Products segment rose to $148 million in Q3 2025 from $101 million in Q3 2024, reflecting strong performance in net investment income[354]. - For the Closed Life and Annuity Blocks segment, pretax adjusted operating earnings improved by $8 million to $15 million for Q3 2025, compared to $7 million in Q3 2024, mainly due to a $50 million increase in spread income[359]. Assets and Investments - The company holds significant assets due to funds withheld reinsurance arrangements, including the Athene Reinsurance Transaction, which impacts investment performance[287]. - As of September 30, 2025, total assets under management (AUM) reached $350,322 million, up from $324,718 million as of December 31, 2024, reflecting a growth of approximately 7.5%[305]. - Jackson invested assets increased to $55,285 million as of September 30, 2025, compared to $46,143 million at the end of 2024, representing a growth of about 19.9%[305]. - Total investments reached $67,691 million as of September 30, 2025, compared to $61,007 million at December 31, 2024, representing an increase of 10.9%[370]. - Available-for-sale debt securities increased to $46,087 million as of September 30, 2025, from $40,289 million at December 31, 2024, representing a growth of 14.0%[370]. Cash Flow and Shareholder Returns - Free cash flow for the parent company was $216 million in Q3 2025, down from $278 million in Q3 2024, while for the nine months ended September 30, 2025, it was $719 million compared to $527 million in the same period last year[292]. - The company returned $657 million to common shareholders from January 1, 2025, to September 30, 2025, consisting of $173 million in dividends and $484 million in share repurchases[292]. - During Q3 2025, Jackson Financial paid cash dividends totaling $67 million, including $56 million for common stock and $11 million for preferred stock[410]. - A total of 5,523,157 shares of common stock were repurchased for $484 million in the nine months ended September 30, 2025[412]. Risk Management and Regulatory Environment - The company emphasizes disciplined risk management and efficient operating platforms as core strengths[284]. - Net income volatility is experienced due to the lack of direct hedging against market risk benefit liabilities[288]. - The company is subject to various economic, industry, and regulatory trends that may affect its operations[290]. - The 2024 Fiduciary Advice Rule may lead to changes in compensation practices and product offerings, potentially impacting sales of annuities through distribution partners[320]. - Rising interest rates could increase cash surrender values of certain products, leading to higher regulatory reserves and potentially affecting the company's ability to pay dividends[311]. Demographic Trends and Market Positioning - Jackson Financial is positioned to grow profitably as the aging U.S. population transitions into retirement, supported by a strong distribution network[284]. - The company expects demographic trends, particularly the increase in retirement-age individuals, to drive significant demand for its products[317]. Financial Strength and Ratings - Jackson's principal insurance subsidiaries received financial strength ratings of A from A.M. Best and S&P, and A3 from Moody's, all with a stable outlook as of October 24, 2025[427]. - The financial strength ratings are influenced by factors such as market positioning, profitability, leverage, and liquidity, which are critical for consumer confidence and competitive positioning[428]. - As of September 30, 2025, the insurance company subsidiaries had statutory surplus well above the minimum required capital levels[399].