Voya Financial Q4 Earnings Call Highlights

Core Insights - Voya Financial reported strong financial performance for 2025, exceeding targets with over $1 billion in pre-tax adjusted operating earnings and $775 million in excess capital generation [1][3][7] - The company achieved a 22% increase in earnings per share (EPS), reaching $8.85, with a notable 39% year-over-year growth in Q4 EPS [2][7] Financial Performance - Pre-tax adjusted operating earnings were more than $1 billion, an increase of $168 million from the previous year [2] - Adjusted return on equity expanded by over 200 basis points to 18.6% [1] - The company generated $775 million in excess cash for 2025, surpassing its $700 million target [1][3] Business Segments Retirement - The Retirement segment had a record year, generating nearly $1 billion in adjusted operating earnings, up 17% from 2024 [8] - Defined contribution net flows exceeded $28 billion, the highest in the company's history, contributing to a 30% increase in total DC assets to approximately $730 billion [9] - Fee-based revenue in Retirement surpassed $1.4 billion, driven by commercial momentum and the integration of OneAmerica [8][9] Investment Management - Investment Management achieved record annual net revenue of $1 billion, with 4.8% organic growth, exceeding long-term targets [10] - The segment's performance was supported by broad-based flows of about $15 billion across various channels and strategies [10] - Adjusted operating earnings for Investment Management were $226 million, with both institutional and retail revenues increasing year-over-year [10][11] Employee Benefits - Employee Benefits showed significant margin recovery, with adjusted operating earnings rising to $152 million from $40 million the previous year [12] - Stop Loss loss ratios improved from 94% to 84%, despite a $37 million reserve build in Q4 [5][13] - The company achieved an average net effective rate increase of 24% for January 2026, up from 21% the previous year [15] Capital Deployment and Future Priorities - Voya plans to repurchase $150 million of shares in Q1 and expects a similar pace in Q2 of 2026 [17] - Future priorities include growing excess cash generation, maintaining balance sheet strength, and improving Employee Benefits margins [18] - The company is assessing M&A opportunities in the retirement sector while prioritizing shareholder capital returns [18]