Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-16725 PRINCIPAL FINANCIAL GROUP, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdicti ...

Core Viewpoint - The Bank of America U.S. Financial Service Conference features a segment focused on Principal Financial, highlighting the company's leadership and its ongoing developments in the financial services sector [1][2]. Company Overview - Deanna Strable, the President and CEO of Principal Financial, has been with the company since 1990, progressing through various roles to reach her current position [2]. - Strable's tenure as CEO is noted to be around 13 to 14 months, indicating a relatively new leadership phase for the company [2]. Industry Context - The conference serves as a platform for discussing key trends and developments within the financial services industry, emphasizing the importance of leadership and experience in navigating the sector [1].

Summary of Principal Financial Group Conference Call Company Overview - **Company**: Principal Financial Group (NasdaqGS:PFG) - **Event**: 2026 Conference on February 11, 2026 - **Speaker**: Deanna Strable, President and CEO Key Financial Highlights - **2025 Performance**: - Adjusted EPS growth of 12%, at the top end of the targeted range - Reported EPS growth nearly 20% - Free cash flow at the top end of the targeted range - Return on Equity (ROE) increased by 120 basis points, within the top half of the targeted range [11][12] - **2026 Outlook**: - Targeting 9%-12% EPS growth - Raised ROE target from 14%-16% to 15%-17% - Confidence in maintaining 75%-85% free cash flow [13][14] Business Segments and Strategies - **Focus Areas**: - Retirement ecosystem - Small to midsize businesses (SMBs) - Global asset management [13] - **SMB Market Insights**: - SMBs defined as employers with up to 1,000 employees - Principal has a strong platform for growth in this segment, particularly in retirement and benefits [18] - SMB customers have been in business for an average of 30 years, indicating stability [19] - 95% of SMB employers plan to increase or maintain salaries, and 85% plan to keep or increase employment levels [20] Cross-Selling Opportunities - **Cross-Sell Strategy**: - Focus on leveraging advantages in SMB to drive growth in both retirement and benefits - Challenges in cross-selling due to reliance on third-party advisors [22] - Successful cross-sell examples include Total Retirement Solutions and executive business owner solutions [23][24] Employee Benefits Trends - **Claims Trends**: - Dental claims have increased, while life and disability loss ratios have decreased [25][26] - Work-from-home dynamics have changed disability claims [26] - **Pricing Strategy**: - Ability to reprice benefits annually, allowing for stable premiums while adjusting for claims trends [28] Global Asset Management - **International Strategy**: - Focus on leveraging U.S. strengths in select international markets (China, Brazil, Chile, Mexico) [38] - 40%-45% of AUM from affiliated sources, indicating strong integration with other business lines [39] - **Real Estate Market**: - Six consecutive quarters of growth in real estate returns, with positive flows expected to continue [42] - Interest from Asian and Middle Eastern customers in U.S. capabilities [43] Technology and AI Integration - **AI Utilization**: - AI is viewed as a tool to enhance distribution and service, particularly for SMBs [47] - Proprietary AI tools have been rolled out to a significant portion of employees, enhancing productivity and customer service [51][52] Dividend and Capital Allocation - **Dividend Policy**: - Targeting a 40% payout ratio with a commitment to quarterly dividend increases [57] - Balancing dividends with share buybacks to maintain a 75%-85% payout ratio [58] Cultural Considerations - **Company Culture**: - Emphasis on maintaining a unified culture across global operations, with a focus on leveraging technology and AI [66][67] Conclusion - Principal Financial Group is positioned for continued growth with a strong focus on SMBs, a diversified asset management strategy, and a commitment to leveraging technology for operational efficiency. The company maintains a balanced approach to capital allocation, ensuring shareholder returns while investing in growth opportunities.

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Core Viewpoint - Principal Financial Group (PFG) has shown strong performance over the past year, with a stock price increase of approximately 14% and reaching a 52-week high recently [1] Group 1: Stock Performance - PFG's stock has gained about 14% over the past year [1] - The stock has recently rallied to a 52-week high [1] Group 2: Valuation and Returns - The company has experienced mixed performance previously, but a more attractive valuation and ongoing capital returns have contributed to its recent success [1]

Core Insights - Principal Financial Group, Inc. (PFG) reported a fourth-quarter 2025 operating net income of $2.19 per share, which missed the Zacks Consensus Estimate by 1.8%, but showed a 13% year-over-year increase [1][8] - Total revenues increased by 9.2% year over year to $4.4 billion, driven by higher premiums, fees, and net investment income [1][8] Revenue Performance - Higher revenues were observed across the Retirement and Income Solution, Investment Management, Specialty Benefits, and Life Insurance segments, despite increased expenses [2] - Total expenses rose by 8.2% year over year to $3.9 billion, attributed to higher benefits, claims, and operating expenses [3] Segment Analysis - **Retirement and Income Solution**: Revenues increased by 15.6% year over year to $2.5 billion, with pre-tax operating earnings rising 7% to $299.5 million [4] - **Investment Management**: Revenues reached $482.7 million, up 1.7% from the prior year, with pre-tax operating earnings increasing by 2% to $166.7 million [4][5] - **International Pension**: Revenues decreased by 9.6% year over year to $216.6 million due to lower premiums and net investment income [5] - **Specialty Benefits**: Revenues increased by 2.8% year over year to $898.2 million, while pre-tax operating earnings decreased by 3% to $142.1 million [6] - **Life Insurance**: Revenues rose by 5.1% year over year to $346.1 million, with pre-tax operating earnings surging more than threefold to $27.5 million [7] Financial Position - As of December 31, 2025, assets under management totaled $781 billion, part of $1.8 trillion in assets under administration [3] - Cash and cash equivalents were $4.4 billion, a 5.2% increase from the end of 2024, while long-term debt decreased by 0.7% to $3.9 billion [10] Shareholder Returns - PFG returned $1.5 billion to shareholders in 2025, including $0.9 billion in share repurchases and $0.7 billion in dividends [11] - The quarterly dividend was raised by 7% to 80 cents per share, payable on March 27, 2026 [11] Full-Year Overview - For 2025, PFG reported an operating net income of $8.27 per share, missing estimates by 0.3%, but reflecting a 19% year-over-year increase [12] - Total operating revenues for the year were $15.93 billion, up 2% year over year [12] Future Guidance - PFG anticipates 9-12% annual non-GAAP operating earnings per diluted share growth and expects a 75-85% free capital flow conversion [13] - The company projects $1.5-$1.8 billion in capital deployment, including $0.8-$1.1 billion for share repurchases and a 40% dividend payout ratio [13]

Financial Data and Key Metrics Changes - The adjusted non-GAAP earnings per share (EPS) growth for full year 2025 was 12%, at the high end of the target range, while reported EPS growth was nearly 20% [4][5] - Full year non-GAAP operating earnings were $1.9 billion, or $8.55 per diluted share, representing a 12% increase over 2024 [14] - Non-GAAP operating return on equity (ROE) for 2025 was 15.7%, an improvement of 120 basis points compared to the previous year [15] - The company returned over $1.5 billion to shareholders in 2025, including approximately $850 million in share repurchases and $685 million in dividends [5][16] Business Line Data and Key Metrics Changes - In the retirement ecosystem, total retirement transfer deposits grew 9% year-over-year to $35 billion, with workplace savings and retirement solutions recurring deposits increasing by 5% [6][7] - Small and midsize business (S&B) market WSRS recurring deposits grew 8% in 2025, with account value net cash flow of positive $1.5 billion [8][9] - Global asset management gross sales reached $127 billion in 2025, up 16% from 2024, with private markets sales increasing by 50% [9][10] Market Data and Key Metrics Changes - The international pension AUM grew 24% to record levels, demonstrating the strength of the diversified global platform [10] - Managed account adoption accelerated, with participant enrollment up 51% in 2025, and account values exceeding $9 billion [11] - Demand for private market solutions was reflected in increased RFP volume, up 16% over the average of the last three years [11] Company Strategy and Development Direction - The company remains focused on three attractive profit pools: the retirement ecosystem, small and midsize businesses, and global asset management [6] - The recent sale of the runoff annuities business in Chile reflects a strategic focus on higher growth, higher return, and more capital-efficient businesses [12] - The company aims to deliver on its enterprise financial targets in 2026, with 9%-12% growth in EPS and a return on equity target of 15%-17% [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering financial goals, citing strong execution and favorable market conditions [23] - The company is not currently seeing any meaningful impact from employment challenges, with positive employment growth remaining stable [42] - Management highlighted the importance of leveraging data and emerging technologies, including AI, to enhance customer engagement and experience [11] Other Important Information - The company received several recognitions, including being named a Best Place to Work in Money Management for the 14th consecutive year [12] - The adjusted loss ratio for the year was 59%, the best in the company's history, reflecting effective management actions [22] Q&A Session Summary Question: Outlook for performance fees in 2026 - Management expects performance fees to remain in the typical range of $30 million-$40 million for 2026, similar to 2025 [31][32] Question: Definition of operating earnings related to real estate - Management confirmed that operating earnings include real estate properties, and improvements in variable investment income are expected for 2026 [33][35] Question: Employment growth expectations for 2026 - Management noted that employment growth remains positive and stable, with no significant near-term impact expected from AI [40][42] Question: Strategy for small divestitures in international - Management emphasized ongoing portfolio optimization to focus on higher growth and higher return businesses [51][54] Question: Confidence in raising ROE target to 15%-17% - Management cited strong competitive positioning and capital-light businesses as reasons for the increased ROE target [55][57] Question: Capital benefits from announced divestitures - Management indicated that divestitures will free up capital for share buybacks and organic growth, with minimal impact on profitability [62][66] Question: Specialty benefits loss ratio expectations - Management anticipates continued improvement in the dental loss ratio, potentially moving into the high 60s range [70][74] Question: Free cash flow production strategy - Management highlighted a focus on capital-efficient businesses and strategic capital deployment as key to strong free cash flow [75][80] Question: Outlook for net flows in investment management - Management noted a growing pipeline of committed transactions and new diligence activity, particularly in European real estate [84][87]

Financial Data and Key Metrics Changes - Adjusted non-GAAP earnings per share (EPS) growth for full year 2025 was 12%, at the high end of the target range, while reported EPS growth was nearly 20% [4][5] - Full year non-GAAP operating earnings were $1.9 billion, or $8.55 per diluted share, representing a 12% increase over 2024 [14] - Non-GAAP operating return on equity (ROE) for 2025 was 15.7%, an improvement of 120 basis points compared to the previous year [15] - The company returned over $1.5 billion to shareholders in 2025, including approximately $850 million in share repurchases and $685 million in dividends [5][16] Business Line Data and Key Metrics Changes - In the retirement ecosystem, total retirement transfer deposits grew 9% year-over-year to $35 billion, with workplace savings and retirement solutions recurring deposits increasing by 5% [6][19] - Small and midsize business (SMB) market saw WSRS recurring deposits grow 8% in 2025, with transfer deposits increasing by 32% [8] - Investment Management gross sales reached $127 billion in 2025, up 16% from 2024, with private markets sales increasing by 50% [9][20] - Benefits and Protection pre-tax operating earnings increased by 7% in 2025, driven by a 29% increase in life insurance [21] Market Data and Key Metrics Changes - Total company managed assets under management (AUM) was $781 billion at year-end, a 10% increase compared to the fourth quarter of 2024 [17] - International Pension AUM grew 24% year-over-year to record levels [20] - The company experienced a net cash flow of -$2 billion for the quarter, with positive private flows of $1 billion [17] Company Strategy and Development Direction - The company remains focused on three strategic profit pools: the retirement ecosystem, small and midsize businesses, and global asset management [6] - Recent divestitures, including the sale of the runoff annuities business in Chile, reflect a strategic focus on higher growth and more capital-efficient businesses [12][54] - The company is committed to returning excess capital to shareholders, targeting $1.5-$1.8 billion in capital deployments in 2026 [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering financial targets for 2026, with expected EPS growth of 9%-12% and ROE of 15%-17% [24] - The company is not currently seeing significant impacts from employment challenges in the market, with stable employment growth expected [40][42] - Management highlighted the importance of leveraging data and emerging technologies, including AI, to enhance customer engagement and experience [11] Other Important Information - The company received several recognitions, including being named a Best Place to Work in Money Management for the 14th consecutive year [12] - The company is focused on optimizing its portfolio to align with growth priorities and enhance strategic focus [54] Q&A Session Summary Question: Outlook for performance fees in Investment Management for 2026 - Management expects performance fees to remain similar to the $30 million-$40 million range seen in 2025 [31][32] Question: Impact of job market challenges on employment growth - Management noted that employment growth remains stable and positive, with no significant impact observed [40][42] Question: Strategy for small divestitures in international markets - Management emphasized that divestitures are part of ongoing portfolio optimization to focus on higher growth businesses [51][54] Question: Confidence in raising ROE target to 15%-17% - Management cited strong competitive positioning and capital-light business model as reasons for increased confidence in ROE [55][56] Question: Capital benefits from divestitures - Management indicated that divestitures will free up capital for share buybacks and organic growth opportunities [62][66] Question: Expectations for loss ratios in Specialty Benefits - Management anticipates improved loss ratios in 2026 driven by pricing and network optimization efforts [70][74] Question: Free cash flow performance compared to peers - Management highlighted a lower capital-intensive business model as a key factor in achieving strong free cash flow [75][80] Question: Outlook for net flows in Investment Management - Management noted a growing pipeline of committed transactions and new diligence activity, particularly in European real estate [84][86]

Financial Data and Key Metrics Changes - The adjusted non-GAAP earnings per share (EPS) growth for full year 2025 was 12%, at the high end of the target range, while reported EPS growth was nearly 20% [3][4] - Full year non-GAAP operating earnings were $1.9 billion, or $8.55 per diluted share, representing a 12% increase over 2024 [13] - Non-GAAP operating return on equity (ROE) for 2025 was 15.7%, an improvement of 120 basis points compared to the previous year [14] - The company returned over $1.5 billion to shareholders in 2025, including approximately $850 million in share repurchases and $685 million in dividends [4][15] Business Line Data and Key Metrics Changes - In the retirement ecosystem, total retirement transfer deposits grew 9% year-over-year to $35 billion, with workplace savings and retirement solutions recurring deposits increasing by 5% [5][6] - Small and midsize business (S&B) market WSRS recurring deposits grew 8% in 2025, and transfer deposits increased by 32% [7] - Investment management gross sales reached $127 billion in 2025, up 16% from 2024, with private markets sales increasing by 50% [8][9] - The benefits and protection segment saw pre-tax operating earnings increase by 7%, driven by a 29% increase in life insurance [20] Market Data and Key Metrics Changes - The company’s total managed assets under management (AUM) was $781 billion at year-end, a 10% increase compared to the fourth quarter of 2024 [16] - International pension AUM grew 24% year-over-year, reaching record levels [9][19] - The company experienced a net cash flow of -$2 billion for the quarter, with positive private flows of $1 billion [16] Company Strategy and Development Direction - The company remains focused on three strategic growth areas: the retirement ecosystem, small and midsize businesses, and global asset management [5][10] - The recent sale of the runoff annuities business in Chile reflects the company's strategy to focus on higher growth, higher return, and more capital-efficient businesses [11] - The company is leveraging data and emerging technologies, including AI, to enhance customer engagement and experience [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering financial targets for 2026, with expected EPS growth of 9%-12% and ROE of 15%-17% [23] - The company anticipates continued strong performance driven by disciplined execution and strategic investments [10][22] - Management noted that employment growth remains stable, with no significant impact from market challenges observed in 2025 [41][43] Other Important Information - The company received several recognitions, including being named a Best Place to Work in Money Management for the 14th consecutive year [11] - The company is committed to returning excess capital to shareholders, targeting $1.5-$1.8 billion in capital deployments in 2026 [23] Q&A Session Summary Question: Outlook for performance fees in 2026 - Management expects performance fees to remain similar to the $30 million-$40 million range seen in 2025 [31][33] Question: Strategy for small divestitures in international - Management emphasized that divestitures are part of ongoing portfolio optimization to focus on higher growth businesses [53][55] Question: Confidence in raising ROE target to 15%-17% - Management cited strong competitive positioning and capital-light business model as reasons for the increased ROE target [56][60] Question: Capital benefits from divestitures - Management indicated that divestitures would free up capital for share buybacks and organic growth investments [66][68] Question: Specialty benefits loss ratio expectations - Management anticipates improved loss ratios in 2026 due to pricing and network optimization efforts [71][75] Question: Free cash flow generation strategy - Management highlighted a focus on capital-efficient businesses and disciplined capital deployment as key to strong free cash flow [77][80] Question: Investment management net flows outlook - Management noted a growing pipeline of committed transactions and new diligence activity in international markets [85][88]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]