MetLife Q2 Earnings Lag Estimates on Soft MetLife Holdings Unit

Core Insights - MetLife, Inc. reported second-quarter 2025 adjusted operating earnings per share (EPS) of $2.02, missing the Zacks Consensus Estimate by 7.8% and declining 11% year over year [1][11] - Adjusted operating revenues decreased 4.1% year over year to $17.9 billion, also missing the consensus mark by 2.6% [1][11] Financial Performance - Weaker quarterly results were attributed to poor performance in Asia, lower underwriting results, less favorable investments, and declining earnings in group benefits, RIS, and MetLife Holdings [2][11] - Adjusted PFOs, excluding pension risk transfer (PRT), were $12.4 billion, growing 5% year over year [3] - Adjusted net investment income increased by 1% year over year to $5.2 billion due to asset growth [3] - Total expenses were $16.4 billion, down 1.6% year over year, driven by decreased policyholder benefits and claims [4] - Net income fell 23% year over year to $698 million, with adjusted return on equity deteriorating 270 basis points to 14.6% [4] Segment Performance - Group Benefits: Adjusted earnings declined 25% year over year to $400 million, below the consensus estimate of $468.6 million [5] - RIS: Adjusted earnings totaled $368 million, down 10% year over year, missing the consensus mark of $376.2 million [6] - Asia: Adjusted earnings fell 22% year over year to $350 million, lagging behind the consensus estimate of $397.6 million [7] - Latin America: Adjusted earnings rose 3% year over year to $233 million, exceeding the consensus mark of $227 million [8] - EMEA: Adjusted earnings advanced 30% year over year to $100 million, surpassing the consensus estimate of $76.1 million [9] - MetLife Holdings: Adjusted earnings decreased 5.9% year over year to $144 million, beating the consensus mark of $142.1 million [10] Financial Position - As of June 30, 2025, MetLife had cash and cash equivalents of $22.2 billion, up from $20.1 billion at the end of 2024 [13] - Total assets increased to $702.5 billion from $677.5 billion at the end of 2024 [13] - Long-term debt rose to $15.4 billion from $15.1 billion as of December 31, 2024 [13] - Total equity was $27.9 billion, up from $27.7 billion at the end of 2024 [13] - Book value per share grew 7.5% year over year to $35.79 [14] Capital Deployment - MetLife repurchased shares worth approximately $510 million in the second quarter and an additional $140 million in July 2025 [15] - The company paid a dividend of $382 million during the quarter [15] Future Outlook - Management expects variable investment income of around $1.7 billion for 2025 and anticipates Corporate & Other adjusted losses between $850 million and $950 million [16] - Adjusted PFOs in Group Benefits are projected to rise 4-7% annually over the next three years [17] - MetLife aims for an adjusted return on equity in the range of 15-17% and expects free cash flow to exceed $25 billion [18]