Skip to content
    MET
    Earnings call· Dec 2025(Q4 FY25)

    METLIFE Q4 FY25 earnings call MET

    Feb 5, 2026 Source

    Executive summary

    MetLife Q4 FY25 — Strong Performance and Strategic Execution Drive Growth

    MetLife delivered a strong Q4 FY25, exceeding financial commitments and advancing its New Frontier strategy with robust growth across segments and disciplined capital deployment. The company successfully integrated PineBridge Investments, resegmented its reporting to include MetLife Investment Management, and made significant progress on efficiency targets, positioning it for continued growth despite a dynamic market environment.

    Highlights

    5

    • Adjusted EPS, excluding notable items, rose 24% to $2.58 per share in Q4 FY25, marking MetLife's highest single EPS quarter.

    • Full-year 2025 adjusted EPS grew approximately 10% to $8.89 per share, meeting the double-digit target.

    • Adjusted return on equity (ROE) for FY25 was 16%, within the 15-17% target range.

    • Direct expense ratio lowered to 11.7% in FY25, well ahead of the 5-year target of 11.3%.

    • Generated $4.9 billion in free cash flow in FY25, contributing to the $25 billion 5-year cumulative target.

    Concerns

    3

    • Disability experience in Group Benefits trailed expectations in Q4 FY25 due to higher average severity and incidents, impacting the nonmedical health interest adjusted benefit ratio by slightly over 1 point.

    • Full-year 2025 variable investment income (VII) of $1.5 billion was below the $1.7 billion target, primarily due to real estate and other funds.

    • Mexico VAT change is expected to impact Latin America adjusted earnings by approximately $50 million in 2026, mostly in the first half.

    Guidance & targets

    33
    CategoryTargetConfidence
    Adjusted EPS growth
    Double-digit
    high materiality
    High
    Adjusted ROE
    15% to 17%
    high materiality
    High
    2-year average free cash flow ratio
    65% to 75% of adjusted earnings
    high materiality
    High
    Direct expense ratio
    12.1%
    medium materiality
    High
    Direct expense ratio
    11.3%
    medium materiality
    High
    Variable investment income (VII)
    ~$1.6 billion pretax
    medium materiality
    High
    Corporate & Other adjusted loss
    $500 million and $700 million after tax
    medium materiality
    High
    Effective tax rate
    24% to 26%
    low materiality
    High
    Share repurchases
    In line with 2025
    high materiality
    High
    Private equity annual returns
    9%
    low materiality
    High
    Real estate and other funds annual returns
    7%
    low materiality
    High
    Group Benefits adjusted PFO growth
    4% to 7%
    medium materiality
    High
    Group Life mortality ratio target range
    83% to 88%
    medium materiality
    High
    Group Non-Medical Health interest adjusted benefit ratio target range
    70% to 75%
    medium materiality
    High
    Group Benefits adjusted earnings growth
    7% to 9%
    medium materiality
    High
    RIS retained liability exposures growth
    3% to 5%
    medium materiality
    High
    RIS adjusted earnings
    $1.6 billion and $1.8 billion
    medium materiality
    High
    Total general account investment spread
    100 to 120 basis points
    medium materiality
    High
    Asia annual sales growth
    Mid- to high single digits on a constant currency basis
    medium materiality
    High
    Asia general account AUM growth
    Mid-single digits
    medium materiality
    High
    Asia adjusted earnings growth
    Mid-single digits
    medium materiality
    High
    Japan ESR target range
    170% to 190%
    medium materiality
    High
    Latin America adjusted PFOs growth
    High single digits
    medium materiality
    High
    Latin America adjusted earnings growth
    6% to 8%
    medium materiality
    High
    Latin America adjusted earnings growth
    High single-digit growth
    medium materiality
    High
    EMEA adjusted PFOs growth
    High single digits
    medium materiality
    High
    EMEA adjusted earnings quarterly run rate
    $90 million to $100 million
    medium materiality
    High
    EMEA adjusted earnings growth
    Mid- to high single digits
    medium materiality
    High
    MIM revenues growth
    ~30%
    medium materiality
    High
    MIM revenues growth
    Mid-single digits
    medium materiality
    High
    MIM adjusted earnings
    $240 million to $280 million
    medium materiality
    High
    MIM adjusted earnings growth
    15% to 20% per year
    medium materiality
    High
    MIM operating margin
    ~32%
    medium materiality
    High

    Segment performance

    7
    SegmentRevenueYoYQoQMargin
    Group Benefits
    Adjusted earnings were up 12% YoY in Q4, driven by favorable underwriting in Life and Dental, partially offset by weaker disability experience. Life mortality continues to trend favorably, while disability results were below expectations due to higher average severity and incidents.
    Adjusted earnings (ex-notable) Q4: $465 millionAdjusted earnings (ex-notable) FY25: $1.7 billionGroup Life mortality ratio Q4: 81.1%Group Life mortality ratio FY25: 83.1%Nonmedical health interest adjusted benefit ratio Q4: 72.2%Adjusted PFOs YoY growth Q4/FY25: 2%Adjusted PFOs YoY growth (ex-participating life) Q4/FY25: 4%
    		———$465 million
    Retirement and Income Solutions (RIS)
    Adjusted earnings increased 18% YoY in Q4, primarily due to higher variable investment income. The segment delivered substantial inflows in 2025, with record sales driven by PRT and U.K. longevity transactions, leveraging strategic reinsurance for capital flexibility.
    Adjusted earnings (ex-notable) Q4: $454 millionAdjusted earnings (ex-notable) FY25: $1.7 billionInvestment spreads (ex-VII): 99 basis pointsSales FY25: $42 billionPension risk transfer sales FY25: >$14 billionU.K. longevity transactions FY25: $11 billion (including $7 billion in Q4)
    		—18%—$454 million
    Asia
    Adjusted earnings were essentially flat YoY (up 1% constant currency) in Q4, benefiting from volume growth and favorable expense margins, partially offset by less favorable underwriting margins compared to the prior year. Strong sales growth was seen in Japan and Korea.
    Adjusted earnings (ex-notable) Q4: $444 millionAdjusted earnings (ex-notable) FY25: $1.6 billionGeneral account assets under management (amortized cost) constant currency growth FY25: 7%Sales constant currency growth Q4/FY25: 18%
    		—1% (constant currency)—$444 million
    Latin America
    Adjusted earnings increased 13% YoY (4% constant currency) in Q4, driven by volume growth across the region. The segment demonstrated outstanding business momentum, with strong PFO and sales growth, particularly in Mexico and Brazil.
    Adjusted earnings (ex-notable) Q4: $227 millionAdjusted PFOs YoY growth Q4: 25%Adjusted PFOs constant currency growth Q4: 16%Sales constant currency growth Q4: 26%
    		—13% (4% constant currency)—$227 million
    EMEA
    Adjusted earnings surged 64% YoY in Q4, driven by robust volume growth and favorable underwriting margins. The segment showed strong momentum across most markets, led by Turkey and the U.K.
    Adjusted earnings (ex-notable) Q4: $97 millionAdjusted PFOs YoY growth Q4: 21%Adjusted PFOs constant currency growth Q4: 17%Sales constant currency growth Q4: 24%
    		—64% (reported and constant currency)—$97 million
    MetLife Investment Management (MIM)
    MIM is reported as a stand-alone business segment for the first time, reflecting the critical mass gained from the PineBridge acquisition. The primary driver for the increase in adjusted earnings was the transition to general account market fees.
    Adjusted earnings Q4 FY25: $60 millionAdjusted earnings Q4 FY24: $16 millionAssets under management (AUM) year-end: $742 billionAUM a year ago: ~$600 billion
    		———$60 million
    Corporate & Other
    The adjusted loss improved in Q4 FY25 compared to the prior year, driven by favorable investment and expense margins, partially offset by less favorable life underwriting margins. This segment now includes MetLife Holdings, the legacy runoff business.
    Adjusted loss Q4 FY25: $38 millionAdjusted loss Q4 FY24: $72 million
    		———($38 million)

    Operational metrics

    27
    Adjusted EPS (ex-notable items)
    $2.58up 24%
    Q4 FY25

    Highest single EPS quarter for MetLife on an ex-notable basis.

    Adjusted EPS (ex-notable items)
    $8.89up ~10%
    FY25

    Met the double-digit adjusted EPS growth commitment.

    Adjusted ROE (ex-notable items)
    16%
    FY25

    Within the 15% to 17% target range.

    Direct expense ratio
    11.7%
    FY25

    Lowered from 11.3% target over 5 years, putting the company ahead of schedule.

    Variable investment income (VII)
    $497 million
    Q4 FY25

    Contributed to outperformance in the quarter.

    Variable investment income (VII)
    $1.5 billion
    FY25

    Below the $1.7 billion target for 2025.

    Private equity portfolio return
    2.8%
    Q4 FY25

    Reported on a 1-quarter lag.

    Private equity portfolio return
    8.2%
    FY25

    Modestly below the annual expected return of 9%.

    Real estate and other funds return
    1.1%
    Q4 FY25

    Modest rebound in returns, reported on a 1-quarter lag.

    Adjusted PFOs
    $12.8 billionrose 8%
    Q4 FY25

    Rose 29% to $18.6 billion when retained pension risk transfer deals are included.

    Adjusted earnings impact from real estate depreciation accounting change
    $57 million
    Q4 FY25

    Change to exclude noncash accounting of real estate depreciation to better reflect recurring cash flow and returns.

    HoldCo cash and liquid assets
    $3.6 billion
    Dec 31, 2025

    Falls firmly within the target liquidity buffer of $3 billion to $4 billion.

    US statutory adjusted capital (NAIC basis)
    $17.2 billionup 1% from Q3
    Dec 31, 2025

    Reflects strong capitalization.

    Japan solvency margin ratio (SMR)
    ~770%
    Dec 31, 2025

    Pending final statutory filings, this will be the last stat filing based on SMR.

    Total VII assets
    $19 billion
    Dec 31, 2025

    Concentrated in Asia, RIS, and Corporate & Other.

    Adjusted earnings impact from notable items
    $61 million
    Q4 FY25

    Reduced adjusted earnings in the aggregate.

    Group Benefits new adjusted PFOs
    $600 million
    FY25

    Reinforcing market leadership.

    Group Benefits voluntary PFOs growth
    10%YoY
    FY25

    Higher-margin voluntary PFOs rising.

    Asia constant currency sales growth
    18%
    FY25

    Aided by strong contribution from Japan.

    Latin America constant currency sales growth
    12%
    FY25

    With Mexico leading the charge.

    Capital deployed for organic new business
    ~$4 billion
    FY25

    Driven by PRT origination and Asia/LatAm sales production.

    Acquisitions and business investments
    ~$1.2 billion
    FY25

    Includes PineBridge, Mesirow, Chariot Re, and PNB MetLife India JV.

    Policyholder benefits and claims paid
    ~$50 billion
    FY25

    Highlights dedication to MetLife's purpose.

    Investments to support liabilities
    >$90 billion
    FY25

    Demonstrates financial strength.

    Share repurchases
    $200 million
    January 2026

    Additional repurchases made in the month following the quarter end.

    US NAIC RBC ratio
    >360%
    FY25

    Expected to be above target for combined U.S. companies.

    MIM Q1 adjusted earnings
    ~$50 million
    Q1 FY26

    Lower than implied quarterly run rate due to higher seasonal expenses.

    Industry KPIs

    8
    MetricValueDetails
    Capital returns$4.4 billionUSD
    ROE operating ROE16%%
    Net investment income$497 millionUSD
    Retention persistencyIncreased
    Life specific when present$14 billionUSD
    Net premiums written earned$12.8 billionUSD
    Statutory regulatory capital~770%%
    Prior year reserve development$30 millionUSD

    Deals & partnerships

    6
    PineBridge InvestmentsAcquisition to accelerate growth in Asset Management and establish MetLife Investment Management as a new business segment.

    The acquisition closed, leading to the establishment of MetLife Investment Management as a new business segment, aligning with New Frontier strategic priorities.

    MesirowInvestment as part of $1.2 billion in acquisitions and business investments.

    Part of the broader investment strategy in 2025.

    Chariot ReSeeding a sidecar and executing two strategic reinsurance transactions totaling about $11 billion of liabilities.$11 billion

    Two separate deals with Chariot Re were executed, transferring approximately $11 billion of liabilities. Also involved in seeding the sidecar.

    PNB MetLifeBoosting investment in the India joint venture.

    Part of the $1.2 billion in acquisitions and business investments in 2025.

    TalcottRisk transfer agreement totaling $10 billion of liabilities.$10 billion

    A strategic reinsurance transaction to transfer liabilities.

    Undisclosed partnersFlow reinsurance deals to tap the U.S. retail retirement space.

    Two partners have flow reinsurance deals in place, leveraging MetLife's financial strength, investment capability, and capital flexibility.

    Risks & headwinds

    6
    Disability experience in Group BenefitsQ4 FY25

    Slightly over 1 point impact on nonmedical health ratio in Q4 FY25

    Mitigation: Management does not extrapolate Q4 results as a trend for 2026, noting full-year recoveries were strong and incidents largely in line with expectations.

    Variable investment income (VII) shortfallFY25

    $1.5 billion for FY25, below $1.7 billion target

    Mitigation: Company is strategically repositioning the portfolio to higher-yielding fixed income securities in 2026 to align with the higher interest rate environment.

    Mexico VAT change impactFY26, mostly H1

    ~$50 million impact on Latin America adjusted earnings

    Mitigation: Management expects adjusted earnings in Latin America to return to high single-digit growth in 2027 and 2028 after this impact.

    Short-term sales impact from macro volatility in JapanShort-term

    Temporary fluctuations in sales

    Mitigation: MetLife's diversified product portfolio and strong distribution channels allow it to meet demand through periods of yen or dollar product preference. Value proposition remains solid.

    Increased surrender activity in JapanQ4 FY25

    Q4 FY25 surrender trend slightly higher than Q3 FY25

    Mitigation: Full-year 2025 surrenders were down compared to 2024, and the 2026 outlook assumes surrenders return to long-term assumptions.

    Higher expense ratios from asset management businessFY26

    PineBridge acquisition will add 50 basis points to direct expense ratio in 2026 (target 12.1%)

    Mitigation: MetLife intends to maintain its 2029 direct expense ratio target of 11.3% due to considerable progress made in efficiency.

    What to watch in Q1 FY26

    5

    Group Benefits disability experience

    Next quarter
    CurrentBelow expectations in Q4 FY25
    TargetStabilization or improvement, not extrapolating Q4 trend

    Why it matters

    Disability experience negatively impacted Q4 results and is a key underwriting metric for the Group Benefits segment.

    While this has been an unfavorable quarter, it certainly does not make a trend, and I wouldn't extrapolate from the outcomes in this quarter into 2026.

    Q&A highlights

    5

    What are the observations on renewal season, pricing actions, and competitive landscape in Group Benefits, especially for dental and disability?

    MetLife observed robust 1/1 results with increased persistency in dental due to prior pricing actions. Sales growth is good across the book, particularly in disability, and competition is manageable.

    “I would say if we look at our 1/1 results, in particular, with respect to persistency and renewals, we're seeing pretty robust results. I would say, increase in persistency, in particular, in dental.”

    asked by Jamminder Bhullar · answered by Ramy Tadros

    2 min read6 chapters

    Detailed Narrative

    01

    Strategic Progress on New Frontier Initiatives

    MetLife has made significant strides in its New Frontier strategy, launched a year ago. Key achievements include adding approximately $600 million in new adjusted premiums, fees, and other revenues (PFOs) in Group Benefits, originating over $14 billion in pension risk transfer (PRT) sales, and closing the acquisition of PineBridge Investments to establish MetLife Investment Management (MIM) as a new segment. The company also deployed nearly $4 billion for organic new business and returned approximately $4.4 billion to shareholders in 2025.

    02

    Strong Financial Performance and Efficiency Gains

    The company reported strong Q4 FY25 adjusted earnings of $2.58 per share (ex-notable items), up 24% YoY, and full-year adjusted EPS growth of 10%, meeting its double-digit target. Adjusted ROE for FY25 was 16%, within the target range. MetLife also achieved a direct expense ratio of 11.7% for the year, ahead of schedule, driven by AI adoption and process reengineering, demonstrating strong operating efficiency.

    03

    Reinsurance Strategy and Capital Flexibility

    MetLife is strategically leveraging reinsurance to enhance capital flexibility and support liability growth. This includes two deals with Chariot Re totaling about $11 billion of liabilities and a risk transfer agreement with Talcott totaling $10 billion of liabilities. The company has also tapped the U.S. retail retirement space via flow reinsurance, establishing two partnerships to participate in the annuity market as an institutional reinsurer, leveraging its financial strength and investment capabilities.

    04

    MetLife Investment Management (MIM) Segment Launch

    The introduction of MetLife Investment Management as a stand-alone business segment aligns with New Frontier priorities and reflects the critical mass gained from the PineBridge acquisition. MIM reported $742 billion in assets under management (AUM) at year-end, up from $600 billion a year ago. The segment is expected to see revenues grow approximately 30% in 2026, driven by PineBridge, with a target operating margin of around 32% by 2028.

    05

    Real Estate Depreciation Accounting Change

    MetLife revised its definition of adjusted earnings to exclude the noncash accounting of real estate depreciation. This change aims to better align the impact of real estate asset value changes with recurring cash flow and returns. It increased Q4 adjusted earnings by $57 million and is expected to add approximately $200 million annually, primarily benefiting Corporate & Other.

    06

    Japan Market Dynamics and Regulatory Transition

    Japan's sales saw an 18% constant currency jump in 2025, driven by foreign currency-denominated products. While macroeconomic volatility🌐 (FX, rates) can cause short-term sales fluctuations, the company's value proposition and diversified product portfolio remain strong. MetLife is also preparing for the transition from the Solvency Margin Ratio (SMR) to an Economic Solvency Ratio (ESR) in Japan, expecting an initial ESR within a 170-190% range for March 2026, resilient to rate changes.

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