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    AXS
    Earnings call· Mar 2026(Q1 FY26)

    AXIS CAPITAL HOLDINGS Q1 FY26 earnings call AXS

    Apr 30, 2026 Source

    Executive summary

    AXIS Capital Q1 FY26 — Strong Underwriting Performance and Strategic Growth

    AXIS Capital delivered a strong Q1 FY26, marked by robust underwriting performance and strategic growth initiatives, particularly in its insurance segment. The company's focus on portfolio remediation and expanded classes drove an 11% increase in gross written premiums and an 18% operating ROE, while efficiency gains lowered the G&A ratio to 10.7%. Management remains disciplined in navigating market softening in property and cyber, actively reallocating capital to attractive markets and leveraging AI for operational efficiency.

    Highlights

    5

    • Achieved an annualized operating Return on Average Common Equity of 18% for the quarter.

    • Reported a strong combined ratio of 89.8%, with the Insurance segment at 86.3% (0.4% improvement year-over-year).

    • Gross written premiums increased by 11% to over $3 billion, driven predominantly by growth in attractive short-tail lines.

    • Consolidated G&A ratio improved to 10.7% from 11.9% a year ago, reaching a target level.

    • Operating cash flow was robust at $590 million, significantly up from $309 million in the prior year quarter.

    Concerns

    5

    • Property pricing was down 13% in the quarter, following an 8-year period of compounded rate increases.

    • Cyber rates were down 6% in the quarter, with group-level cyber growth down 7% due to a cautious underwriting stance.

    • Reinsurance long-tail lines writings were reduced by over $130 million or 24% as the market remains competitive.

    • Incurred a $23 million below-the-line charge for expense and restructuring actions during the quarter.

    • Experienced unrealized losses in the investment portfolio due to market fluctuations, creating a headwind to book value per share growth.

    Guidance & targets

    6
    CategoryTargetConfidence
    G&A Ratio (Consolidated)
    11%
    medium materiality
    High
    Reinsurance Premiums Growth
    down double digits
    medium materiality
    Medium
    Underlying Loss Ratio (Insurance ex-cat)
    around 53.3%
    high materiality
    High
    Insurance Core Business Growth
    low single digits
    medium materiality
    High
    Insurance Expanded Lines Growth
    high single digits
    medium materiality
    High
    Capital Allocation to Growth
    about 50%
    high materiality
    Medium

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Insurance
    Strong quarter with gross written premiums of almost $2 billion, driven by underlying business execution, expanded products, and AXIS Capacity Solutions (ACS) initiatives including Funds at Lloyd's transactions. Underlying loss ratio is in line with forecast.
    Combined ratio: 86.3%Combined ratio improvement YoY: 0.4%Underlying loss ratio: 53.3%Expanded classes as % of total insurance portfolio: 17%Expanded classes growth: high single-digitACS contribution to growth: 10 pointsCore business growth: low single-digitsCyber premium growth: $6MCyber production (YE23): $649MCyber production (YE25): $473MCyber as % of total insurance portfolio (YE23): 10.6%Cyber as % of total insurance portfolio (YE25): 6.6%
    		—20%—$157M underwriting income
    Reinsurance
    Continued selective growth in specialty product set, with short-tail lines growing significantly. Actively managing the cycle in casualty lines, resulting in a substantial reduction in long-tail writings due to competitive market conditions.
    Combined ratio: 92.7%Fee income: $20MShort-tail lines as % of total: 61% (up from 50% YoY)New business: $180M (70% from short-tail specialty)Long-tail lines writings reduction: $130M or 24%
    		—-2%—$30M underwriting income

    Operational metrics

    26
    Annualized Return on Average Common Equity
    17%
    Q1 FY26

    Annualized return on average common equity of 17%.

    Annualized Operating Return on Average Common Equity
    18%
    Q1 FY26

    Annualized operating ROE of 18%.

    G&A Ratio (Consolidated)
    10.7%vs 11.9% a year ago
    Q1 FY26

    Produced a 10.7% GA ratio in the quarter, driven by efficiency gains and higher earned premium.

    Catastrophe Losses
    $48M
    Q1 FY26

    Cat losses were $48 million, producing a cat loss ratio of 3.2%.

    Reserve Release
    $18M
    Q1 FY26

    Recorded a reserve release of $18 million with $15 million in insurance and $3 million in reinsurance for the quarter, primarily from short-tail lines.

    Expense and Restructuring Actions Charge
    $23M
    Q1 FY26

    Incurred a below-the-line charge of $23 million for expense and restructuring actions taken during the quarter, largely in reinsurance as well as for the planned departure of 2 members of senior leadership.

    Underwriting Fees
    $23M
    Q1 FY26

    Underwriting fees were $23 million, including both insurance-related and other income and offsets the G&A, largely stemming from ILS investments but expecting growing contribution from ACS.

    Investment Income
    $185Msimilar to the level of the fourth quarter
    Q1 FY26

    Investment income was $185 million, similar to the level of the fourth quarter as our book yield remained largely flat.

    Capital Returned to Shareholders
    $93M
    Q1 FY26

    Returned $93 million to shareholders through dividends of $33 million and share repurchases of $60 million.

    Share Repurchase Authorization Remaining
    $53M
    Q1 FY26

    At quarter's end, $53 million remained on the 2025 $400 million authorization.

    New Share Repurchase Authorization
    $300M
    Q1 FY26

    Management presented and the Board approved an additional $300 million authorization during the quarter.

    Net Income Available to Common Shareholders
    $247M
    Q1 FY26

    Net income available to common shareholders was $247 million, or $3.29 per diluted common share.

    Operating Income
    $257M
    Q1 FY26

    Operating income was $257 million or $3.42 per diluted common share.

    Gross Written Premiums
    $3Bup 11% over the prior year
    Q1 FY26

    Gross written premiums of just over $3 billion were up 11% over the prior year quarter driven by accelerated growth initiatives in insurance.

    Net Written Premiums Growth
    9%
    Q1 FY26

    On a net basis, premiums were up 9%.

    Short-tail Lines as % of Overall Premiums
    60%
    Q1 FY26

    Short-tail lines now constituting 60% of our overall premiums.

    Property Pricing Change
    -13%
    Q1 FY26

    In property, pricing was down 13% in the quarter.

    Liability Rates Growth
    9%
    Q1 FY26

    In liability, rates grew 9% in the quarter.

    U.S. Excess Casualty Writings Change
    -2%
    Q1 FY26

    In U.S. Excess Casualty, total writings were down 2% with positive rate change of 12% ahead of trend.

    Primary Casualty Volume Change
    -28%
    Q1 FY26

    In primary casualty volume was down 28%, with positive rate change of 9%, again, ahead of trend.

    Transactional Liability Growth
    $45M
    Q1 FY26

    $45 million of growth came from transactional liability, where rates were up 4%.

    Cyber Rates Change
    -6%
    Q1 FY26

    The market remains competitive and rates were down 6% in the quarter.

    Cyber Group Growth
    -7%
    Q1 FY26

    At a group level, our growth was down 7%.

    Submission Auto Ingestion Time Improvement
    65%
    Q1 FY26

    Where we have introduced auto ingestion, the time to clear, register and route submissions to our signed underwriters has improved by over 65% in our initial rollout.

    Quote Cycle Time Reduction (Next-Gen Underwriting Platform)
    30%
    Q1 FY26

    The platform has proven to reduce quote cycle time by up to 30% in the initial areas where we have deployed the new systems.

    Capital Needed for Growth (as % of earnings)
    50%
    FY26

    Approximately 50% of earnings generated in FY26 expected to be deployed into the business to support growth.

    Industry KPIs

    9
    MetricValueDetails
    Combined ratio89.8%%
    Capital returns$93M returned; $53M remaining; $300M new authorizationUSD
    ROE operating ROE17% ROE; 18% Operating ROE%
    Catastrophe losses$48MUSD
    Book value per share—
    Net investment income$185MUSD
    Net premiums written earned$3.1B GWP; 9% NWP growthUSD
    Renewal rate change pricingProperty: -13%; Liability: +9%; U.S. Excess Casualty: +12%; Primary Casualty: +9%; Transactional Liability: +4%; Cyber: -6%%
    Prior year reserve development$18M favorableUSD

    Deals & partnerships

    2
    Ryan SpecialtyStrategic partnership, performing as expected.

    The Ryan deal is performing as expected, contributing to ACS initiatives.

    Alpha SecurePartnership to support middle market cyber strategy and risk diagnosis.

    AXIS has a partnership and financial interest in Alpha Secure, which helps prosecute the middle market cyber strategy by providing risk diagnosis capabilities and surveillance throughout the policy period.

    Risks & headwinds

    5
    Property pricing pressureQ1 FY26

    Pricing was down 13% in Q1 FY26.

    Mitigation: Maintaining a diversified portfolio with low single-digit million average net limits, balanced peril and geographic mix, and Cat XL protection attaching at $100 million per event. Business written continues to meet underwriting return expectations.

    Cyber market competitiveness and rate pressureQ1 FY26

    Rates were down 6% in Q1 FY26; group growth was down 7%.

    Mitigation: Maintaining a cautious underwriting stance, selectively deploying capacity between insurance and reinsurance platforms, managing exposures, and steering capital towards the best returns. Focus on large accounts with strong hygiene standards.

    Geopolitical uncertainty (Middle East conflict)Q1 FY26

    Approximately 1/3 of Q1 FY26 cat losses ($48 million total) related to the conflict.

    Mitigation: Actively monitoring exposures, practicing vigilance, supporting customers, and having a clear understanding of limits and exposures. A $15 million provision was thoughtfully put up, with expectations for some increase as time proceeds.

    Technological disruption and intensifying cyber threats (AI)Ongoing

    Discussed, not quantified.

    Mitigation: Providing specialty solutions, focusing on large account segments with strong hygiene standards, and leveraging partnerships like Alpha Secure for risk diagnosis and surveillance to address emerging exposures.

    Social inflation in U.S. casualty marketOngoing

    Discussed, not quantified.

    Mitigation: Leaning into opportunistic growth in international liability businesses for diversification, and exhibiting a disciplined stance in U.S. casualty (U.S. Excess Casualty writings down 2%, Primary Casualty volume down 28%).

    What to watch in Q2 FY26

    5

    Consolidated G&A Ratio

    FY26
    Current10.7%
    Target11%

    Why it matters

    Indicates the company's ability to maintain efficiency gains and manage expenses while investing in growth initiatives.

    For the full year, we are still targeting 11%, and I would remind you that as we discussed on the fourth quarter call, we will continue to make attractive investments when opportunities arise and reward our high performers.

    Q&A highlights

    7

    Can you provide color on reserve developments for 2021-2024, given some competitors reported unfavorable developments?

    Management is comfortable with their loss reserve position, noting an $18 million release from short-tail lines. They emphasize a philosophy of being slow to recognize good news and deliberate with concerns, and maintain a cautious underwriting stance in casualty classes.

    “I think overall, we're comfortable with our loss reserve position. I mentioned our philosophy that we are going to be slow to recognize good news and very deliberate when we have concerned.”

    asked by Andrew Kligerman · answered by Matthew Kirk

    2 min read6 chapters

    Detailed Narrative

    01

    Strategic Portfolio Repositioning and Growth Drivers

    AXIS is actively repositioning its portfolio, emphasizing growth in insurance while being more selective in reinsurance. This strategy leverages third-party structures like Funds at Lloyd's (FA transactions) and strategic reinsurance vehicles to enhance client relevance and sustain top-line momentum. These mechanisms also help manage net exposure and generate fee income, reflecting a disciplined approach to cycle management. The company's expanded classes, which are largely short-tail, now constitute 17% of the total insurance portfolio and are a key growth engine.

    02

    Strong Insurance Segment Performance

    The insurance business delivered a strong quarter, with gross written premiums increasing by 20% to nearly $2 billion and achieving an 86.3% combined ratio. This growth was driven by continued execution in the core business, high single-digit growth from expanded classes, and approximately 10 points from AXIS Capacity Solutions (ACS). ACS includes FA transactions, which provide capital-efficient exposure to niche specialty lines, and strategic use of reinsurance to align interests with distribution partners while managing net appetite.

    03

    Selective Reinsurance Strategy

    In the reinsurance segment, gross written premiums were down 2%, with a combined ratio of 92.7%. The segment saw healthy growth of 20% in targeted short-tail lines such as A&H and credit and surety, which contributed $180 million in new business. Conversely, long-tail lines writings were reduced by over $130 million or 24% due to competitive market conditions and risk-adjusted returns not meeting expectations, indicating active cycle management.

    04

    AI and Operational Efficiency Initiatives

    AXIS is making significant advancements in leveraging AI and data analytics to enhance efficiency and productivity. Key initiatives include auto-ingestion, which has improved submission routing time by over 65% in its initial rollout, and a next-generation underwriting platform that has reduced quote cycle time by up to 30%. These investments contribute to a flat G&A dollar spend year-over-year, allowing the company to write more high-quality business on the same expense base and purposefully scale headcount.

    05

    Market Dynamics and Underwriting Discipline

    The company continues to navigate dynamic micro markets, with property pricing down 13% and cyber rates down 6%. Despite these pressures, AXIS maintains underwriting discipline, ensuring business meets risk-adjusted return expectations. Capital is being reallocated to attractive markets, and a cautious stance is maintained in areas like U.S. casualty and London market property lines. Management emphasizes that terms, conditions, and limits are generally holding, and premium adequacy is observed across most of the business.

    06

    Capital Management and Shareholder Returns

    AXIS maintains a strong financial position, returning $93 million to shareholders in Q1 FY26 through $33 million in dividends and $60 million in share repurchases. An additional $300 million share repurchase authorization was approved by the Board. Management indicated an opportunistic approach to buybacks, with approximately 50% of generated earnings expected to support organic growth, while still seeing current valuation as a good opportunity for share repurchases.

    AI-generated summary of the company’s earnings call. Not investment advice.