Prudential(PRU) - 2025 Q4 - Annual Results

Financial Performance - Total adjusted operating income before income taxes for Q4 2025 was $1,505 million, a 12% increase from Q4 2024[5] - After-tax adjusted operating income for Q4 2025 was $1,168 million, reflecting a 12% increase year-over-year[5] - Net income attributable to Prudential Financial, Inc. for Q4 2025 was $905 million, a 31% increase compared to Q4 2024[5] - The operating return on average equity based on adjusted operating income for Q4 2025 was 13.3%[5] - The company reported a total of $4,086 million in adjusted operating income year-to-date for 2025, a 10% increase from 2024[5] - Adjusted operating income before income taxes for the year-to-date 2025 was $878 million, showing stability compared to $875 million in the previous year[27] - Adjusted operating income before income taxes for U.S. businesses was $1.051 billion in Q4 2025, a 10% increase from $860 million in Q4 2024[35] - Adjusted operating income before income taxes for Q4 2025 was a loss of $552 million, compared to a loss of $490 million in Q4 2024, indicating a worsening performance[72] Shareholder Returns - Total capital returned to shareholders in 2025 was $2,932 million, a 1% increase from 2024[5] - Dividends paid in Q4 2025 totaled $480 million, consistent with the previous quarter[5] - Diluted earnings per share for Q4 2025 was $2.55, a 33% increase from Q4 2024[9] - Adjusted operating income per diluted share for Q4 2025 was $3.30, a 14% increase year-over-year[9] Revenue and Premiums - Total revenues for Q4 2025 were $14,520 million, a decrease of 15% compared to $16,239 million in Q4 2024[17] - Premiums in Q4 2025 amounted to $7,028 million, down 30% from $8,691 million in Q4 2024[17] - Total revenues for Q4 2025 reached $1,108 million, reflecting a 3% increase from $1,118 million in Q4 2024[27] - Total revenues for Q4 2025 decreased by 24% to $8.946 billion compared to Q4 2024, which reported $7.579 billion[35] - Premiums in Q4 2025 were $4.401 billion, a 40% decline from $7.0 billion in Q4 2024[35] - Total revenues for Q4 2025 decreased by 41% to $4,291 million compared to Q4 2024, with year-to-date revenues at $16,657 million[39] - Premiums for Q4 2025 were $2,831 million, a 52% decline from $4,285 million in Q4 2024, with year-to-date premiums totaling $10,987 million[39] Assets and Liabilities - Total assets under management and administration reached $1,804.2 billion by the end of Q4 2025, slightly down from $1,806.6 billion in Q3 2025[15] - Total assets increased to $773,740 million as of December 31, 2025, up from $735,587 million a year earlier, representing a growth of 5.2%[21] - Total liabilities amounted to $738,159 million, an increase from $705,461 million, marking a growth of 4.6%[23] - Total equity increased to $32,787 million, up from $28,187 million, representing a growth of 16.5%[23] - The company reported a total of $21,530 million in deferred policy acquisition costs, an increase from $20,448 million, reflecting a growth of 5.3%[23] Investment Income - Net investment income for Q4 2025 was $48 million, a significant increase of 1,107% compared to $28 million in Q4 2024[27] - Net investment income increased by 9% year-over-year to $2.982 billion in Q4 2025, up from $2.731 billion in Q4 2024[35] - Total investment income for Q4 2025 was $4,947 million, an increase from $4,601 million in Q4 2024, with realized losses of $556 million compared to $874 million in the previous year[82] - Gross investment income before investment expenses for the full year 2025 was $17,596 million, compared to $16,591 million in 2024, with realized losses of $615 million versus $2,311 million[82] Operating Expenses - Operating expenses for the year-to-date 2025 were $1,973 million, a 7% increase from $1,841 million in 2024[27] - Operating expenses for Q4 2025 were $1,966 million, compared to $1,810 million in Q4 2024, reflecting an increase of 8.6%[100] - Total benefits and expenses for the twelve months ended December 31, 2025, were $51,040 million, compared to $56,118 million in 2024, representing a decrease of 9.1%[96] Market and Risk Management - The change in market value for institutional assets was $4.1 billion in Q4 2025, compared to a decrease of $14.6 billion in Q4 2024[32] - The change in value of market risk benefits, net, was $(22) million in Q4 2025, compared to $(77) million in Q4 2024[100] - The total change in value of market risk benefits, net of related hedging gains, was $(475) million for the twelve months ended December 31, 2025[96] Business Segments - Total revenues for Prudential Financial's U.S. Individual Life segment decreased by 1% year-over-year to $6,130 million in 2025, down from $6,195 million in 2024[60] - Total revenues for Prudential's International Businesses segment increased by 1% year-over-year to $18,148 million in 2025, compared to $17,925 million in 2024[64] - Total revenues for the Group Insurance segment in Q4 2025 were $1,645 million, representing a 5% increase compared to $1,694 million in Q3 2025[54] Policyholder Information - Interest credited to policyholders' account balances increased by 19% to $1,271 million in Q4 2025 from $1,057 million in Q4 2024[17] - The ending balance of policyholders' account balances for the U.S. Individual Life segment increased to $35,018 million in 2025, compared to $33,773 million in 2024[62] - The persistency ratio for Group Disability Insurance was 91.8% in Q4 2025, down from 92.9% in Q3 2025, indicating a slight decline in customer retention[56] Ratings and Financial Strength - Prudential's financial strength ratings from A.M. Best and Fitch reflect strong ratings, with the Prudential Insurance Company of America rated A+ by A.M. Best and AA by Fitch[143] - The company emphasizes the importance of adjusted operating income as a measure to enhance understanding of underlying performance trends, excluding certain volatile items[114]