Equitable (EQH) Q1 2025 earnings summary

Executive summary

• Reported net income of $63 million for Q1 2025, down from $92 million in Q1 2024, primarily due to a $499 million pre-tax loss from novation of legacy variable annuity policies and elevated mortality claims in Protection Solutions.

• Non-GAAP operating earnings were $421 million ($1.30 per share), or $434 million ($1.35 per share) adjusting for notable items, reflecting a 3% year-over-year decline on an adjusted basis.

• Strong net inflows and growth in Retirement ($1.6B), Wealth Management ($2.0B), and Asset Management ($2.4B) offset some headwinds.

• Increased ownership in AllianceBernstein to ~69% through a $760 million investment.

• Life reinsurance transaction with RGA is on track to close mid-2025, expected to free over $2 billion in capital and reduce mortality volatility.

Financial highlights

• Total AUM/A reached $1.0 trillion, up 3% year-over-year, driven by positive net flows and higher markets.

• Book value per share (ex-AOCI) was $27.62 as of March 31, 2025; adjusted book value per share was $39.96.

• GAAP net income was $63 million, lower than non-GAAP due to non-economic hedging impacts and annuity novation loss.

• Advisor productivity increased 8% year-over-year; Wealth Management organic growth rate was 12% trailing 12 months.

• AB’s adjusted margin was 33.7% for the quarter, up 340 basis points year-over-year.

Outlook and guidance

• The RGA reinsurance transaction is expected to close mid-2025, freeing over $2 billion in capital and increasing the RBC ratio by 75-100 points.

• $500 million of incremental share repurchases planned post-close, with potential for additional buybacks depending on market conditions.

• Full-year cash flow guidance remains at $1.6-1.7 billion, assuming an 8% normal equity market return; currently tracking toward the lower end of the range.

• Quarterly dividend to increase from $0.24 to $0.27 per share in Q2 2025, pending board approval.

• Long-term cash flow target of $2 billion for 2027 remains intact, with confidence in execution.