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    VOYA
    Earnings call· Mar 2026(Q1 FY26)

    Voya Financial Q1 FY26 earnings call VOYA

    May 6, 2026 Source

    Executive summary

    Voya Financial Q1 FY26 — Strong Start with Earnings Growth and Stop-Loss Margin Recovery

    Voya Financial delivered a strong Q1 FY26, marked by double-digit adjusted EPS growth and robust capital generation, with a significant portion returned to shareholders. The company is executing on its strategy to drive margin expansion in Employee Benefits, particularly stop-loss, while maintaining strong performance in Retirement and Investment Management. Management expressed high confidence in the continued recovery of stop-loss margins and full-year positive net flows for Retirement, despite Q1 outflows.

    Highlights

    5

    • Adjusted operating EPS grew by 13% year-over-year to $2.26 per share.

    • Generated approximately $200 million of excess capital, returning the same amount to shareholders.

    • Return on equity (ROE) above 18%.

    • Employee Benefits generated $63 million in adjusted operating earnings, with stop-loss margins on path to recovery.

    • Investment Management adjusted operating earnings up 12% year-over-year, with 2%+ organic growth expected for the year.

    Concerns

    3

    • Q1 Retirement net flows were negative due to timing and the expected exit of a large recordkeeping plan.

    • Investment Management's U.S. retail flows were affected by industry-wide headwinds, offsetting international demand.

    • Discussion around activist investor interest in divesting stop-loss or selling the company.

    Guidance & targets

    8
    CategoryTargetConfidence
    Retirement net flows
    Positive net flows
    high materiality
    High
    Investment Management organic growth
    2-plus percent
    high materiality
    High
    OneAmerica integration completion
    Completion
    medium materiality
    High
    Retirement expenses
    Step down
    medium materiality
    High
    Retirement expenses (post-integration)
    Further reduction
    medium materiality
    High
    Retirement net flows
    Strong net inflows
    high materiality
    High
    Share repurchases
    $150 million
    high materiality
    High
    Stop-loss loss ratio
    Back within target loss ratio
    high materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Retirement
    Strong profitability and well-positioned for continued growth. OneAmerica integration nearing completion. Expects positive net flows for full year FY26.
    Fee-based revenues: close to 60% of total net revenuesAnnual recurring deposits: >$50BRetirement accounts: nearly 10MPlan retention: >95%Full-service sales (emerging markets): up 13% YoYFull-service sales (government): up 200% YoY
    		Up 8% (fee-based)14% (adjusted operating earnings, TTM)—$209M (adjusted operating earnings, Q1); 39% (trailing 12-month margins)
    Investment Management
    Differentiated client-focused solutions. Strong demand for private market strategies. International retail demand resilient, offsetting U.S. headwinds. Confident in 2%+ organic growth for FY26.
    Assets outperforming peers/benchmarks (3 years): 78%Assets outperforming peers/benchmarks (10 years): 82%Net inflows (trailing 12 months): ~$7B
    		Drove result12% (adjusted operating earnings, Q1); 8% (adjusted operating earnings, TTM)—$46M (adjusted operating earnings, Q1); 28.6% (trailing margin)
    Employee Benefits
    Executing deliberate strategy to expand margins. Strong net underwriting results. Group Life claims favorable. Stop-loss actions positioned business to return margins to target levels.
    Stop-loss rate increases: ~24%Stop-loss in-force premium: flatReserve release (Q1): $25M2025 business completion: >90%Employee benefit sales: up 8% YoYSTAR 26 pipeline: up 10%STAR 26 sales: up 13%STAR 26 block growth: 4%
    		———$63M (adjusted operating earnings, Q1); $169M (adjusted operating earnings, TTM)

    Operational metrics

    11
    Adjusted operating EPS
    $2.26up 13% YoY
    Q1 FY26

    Strong start to 2026.

    Adjusted operating EPS
    $9.11up >20% YoY
    TTM

    Highlights consistent execution and capital discipline.

    Return on equity (ROE)
    >18%
    Q1 FY26

    Business mix and earnings growth driving strong ROE.

    Excess capital generation
    ~$200M
    Q1 FY26

    Strong cash flow quarter.

    Cash conversion
    90%+
    Q1 FY26

    Continued strong cash conversion.

    Diluted shares outstanding reduction
    14%
    since 2022

    Due to consistent share repurchases.

    Dividend payout ratio
    ~20%
    annual

    Maintained while increasing dividends each year.

    Group Life loss ratio
    7.6%vs long-term target of 77-80%
    Q1 FY26

    Very favorable claims experience.

    Stop-loss 2026 loss pick
    87%
    2026 business

    Conservative reserving given actions taken.

    Stop-loss RFP volumes
    up 200% YoY
    Q1 FY26

    Increased demand and limited supply in the market.

    Wealth Management revenue growth
    up >12% YoY
    Q1 FY26

    Expansion remains on track.

    Industry KPIs

    1
    MetricValueDetails
    Capital returns$200MUSD

    Deals & partnerships

    1
    OneAmericaAcquisition of retirement business to strengthen scale and earnings power.

    Integration expected to complete in Q2 FY26, including migration of ~3,000 plans. Now serves nearly 10 million retirement accounts.

    Risks & headwinds

    4
    Q1 Retirement Net OutflowsQ1 FY26

    primarily timing driven and exit of a large recordkeeping plan

    Mitigation: Expects strong net inflows in Q2 and full year FY26, supported by healthy retention and robust pipeline.

    U.S. Retail Investment Management HeadwindsQ1 FY26

    Offset by resilient international demand.

    Mitigation: Continued focus on differentiated income and growth strategies internationally; healthy pipeline.

    Activist Investor InterestCurrent

    Not quantified, but acknowledged as 'out there'.

    Mitigation: Management and Board are fully aligned on current strategic path of growing Retirement/IM and improving Employee Benefits, viewing it as the most value-accretive. Regularly engaging with shareholders.

    Stop-Loss Volatility / Target Loss RatioPast couple of years

    Implied by analyst question about 80% target vs. actual experience.

    Mitigation: Management agrees with the analyst's implicit question, suggesting they are thinking similarly about the end state. Currently pricing to get back to target, with conservative reserving.

    What to watch in Q2 FY26

    5

    OneAmerica integration completion

    Q2 FY26
    CurrentNearing completion, final migration wave later this month.
    TargetCompleted

    Why it matters

    Successful integration is key to realizing the full strategic and financial benefits of the acquisition and reducing associated expenses.

    We expect to complete the integration in the second quarter.

    Q&A highlights

    5

    Asked if the Q1 Group Life loss ratio (7.6% vs 77-80% target) indicates a lower full-year loss ratio, given Q1 is typically the worst.

    Mike Katz stated that while Q1 was encouraging and the calendar year would likely be better than 77-80% given the Q1 result, the base case is for the loss ratio to return to the target range in Q2-Q4.

    “If you factor in the first quarter, from a calendar year perspective, certainly, we would expect to be better than the 77 to 80 given the result in the first quarter. But right now, I think the base case is back to range in the second and third, fourth quarter.”

    asked by Jian Huang · answered by Michael Katz

    2 min read6 chapters

    Detailed Narrative

    01

    Strong Q1 Performance and Strategic Execution

    Voya delivered a strong Q1 FY26, with adjusted operating EPS up 13% year-over-year and a return on equity above 18%. The company generated and returned approximately $200 million in excess capital to shareholders. This performance reflects disciplined execution across its diversified business model, with a focus on growing revenues, earnings, and cash flows.

    02

    Retirement Business Strength and OneAmerica Integration

    The Retirement segment generated over $200 million in adjusted operating earnings with trailing 12-month margins of 39%. The acquisition of OneAmerica has significantly strengthened scale, now serving nearly 10 million retirement accounts, and its integration is expected to complete in Q2 FY26. Despite Q1 outflows due to timing and a planned exit, the company anticipates positive net flows for the full year.

    03

    Investment Management Momentum

    Investment Management reported a 12% year-over-year increase in adjusted operating earnings, driven by strong demand in institutional private market strategies and resilient international retail demand. The segment achieved positive net flows in Q1 and expects to deliver 2%+ organic growth for the full year, supported by a healthy pipeline and strong investment performance.

    04

    Employee Benefits Margin Recovery

    Employee Benefits showed significant improvement, generating $63 million in adjusted operating earnings. This was primarily driven by strong net underwriting results and decisive actions in stop-loss, including 24% rate increases and improved risk selection. Management expressed high confidence in restoring stop-loss margins to target levels, viewing it as the most value-accretive path for shareholders.

    05

    Capital Allocation and Shareholder Returns

    Voya continues to demonstrate strong cash flow generation, converting cash at 90%+ levels. The company returned $200 million to shareholders in Q1 through buybacks and dividends and plans an additional $150 million in share repurchases in Q2. Since 2022, diluted shares outstanding have been reduced by approximately 14%, reflecting a consistent commitment to capital deployment.

    06

    Legislative and Regulatory Tailwinds

    The company highlighted recent legislative and regulatory momentum aimed at expanding access to retirement savings, particularly for underserved small and mid-sized employers. Voya views these policy initiatives, such as coverage mandates and auto-enrollment, as favorable developments that align with its position as a leader in providing retirement security solutions.

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