Brighthouse Financial Q3 Earnings Miss Estimates, Premiums Fall Y/Y

Brighthouse Financial, Inc. BHF reported third-quarter 2025 adjusted net income of $4.54 per share, which missed the Zacks Consensus Estimate by 10.8%. The bottom line increased 13.7% year over year. 

The quarterly results reflected improved net investment income, a decline in total expenses, offset by reduced premiums.

Behind the Headlines

Total operating revenues of $2.2 billion increased 0.3% year over year, driven by higher net investment income. Premiums of $170 million decreased 5.5% year over year.

Adjusted net investment income was $1.3 billion in the quarter under review, up 2.5% year over year, primarily driven by higher alternative investment income. The adjusted investment income yield was 4.40%.

Total expenses were $1.2 million, which decreased 32.7% year over year. Corporate expenses, pretax, were $205 million, up 0.9% year over year.

Quarterly Segmental Update

Annuities recorded adjusted earnings of $304 million, down 7% year over year. Annuity sales increased 8% to $2.7 billion due to record sales of Shield Level Annuities and higher sales of fixed annuities.

Life’s adjusted earnings were $40 million against the loss of $25 million in the year-ago quarter. Life insurance sales increased 27% to $38 million, primarily driven by sales of Brighthouse SmartCare.

Adjusted earnings at Run-off were $641 million, up 38.4% year over year. The increase reflects a higher underwriting margin, higher net investment income, and lower expenses.

Corporate & Other recorded adjusted loss of $15 million against the year-ago income of $2 million. The adjusted loss was due to lower net investment income and a lower tax benefit, partially offset by lower expenses.

Financial Update

Cash and cash equivalents were $6.6 billion, up 17.3% year over year.

Shareholders’ equity of $6.4 billion at the end of the third quarter 2025 increased 15.2% year over year.

Book value per share, excluding accumulated other comprehensive income, was $151.94 as of Sept. 30, 2025, up 14.3% year over year.

Statutory combined total adjusted capital was $5.4 billion as of Sept. 30, 2025, down 5.2% year over year.

As of Sept. 30, 2025, the estimated combined risk-based capital ratio was between 435% and 455%.

2025 Outlook

BHF expects to remain within the combined RBC ratio target range of 400% to 450% in normal market conditions at the end of 2025, without contributing capital to the insurance subsidiaries.

Zacks Rank

BHF currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Reinsurance Group of America, Incorporated RGA reported third-quarter 2025 adjusted operating earnings of $6.37 per share, which beat the Zacks Consensus Estimate by 9.8%. Moreover, the bottom line increased 3.9% from the year-ago quarter’s figure. Net foreign currency fluctuations had an adverse effect of 1 cent per diluted share on net income available to RGA shareholders, and a favorable effect of 4 cents per diluted share on adjusted operating income, both as compared with the prior year. 

RGA's operating revenues of $6.2 billion beat the Zacks Consensus Estimate by 0.9%. Net premiums of $4.3 billion declined 2.5% year over year. Investment income increased 24% from the prior-year quarter to $1.5 billion. The average investment yield decreased to 4.73% in the third quarter from 5.08% in the prior-year period due to lower variable investment income.

Sun Life Financial Inc. SLF delivered a third-quarter 2025 underlying net income of $1.35 per share, which beat the Zacks Consensus Estimate by 3.8%. Moreover, the bottom line increased 4.6% year over year. The underlying net income was reported at $760.21 million (C$1,047 million), which increased 2.1% year over year. 

Wealth sales & asset management gross flows increased 46.8% year over year to $45.10 billion (C$62.12 billion) in the quarter under review. The new business contractual service margin was $323.83 million (C$446 million), up 15.3% year over year.

American Financial Group, Inc. AFG reported third-quarter 2025 net operating earnings per share of $2.69, which beat the Zacks Consensus Estimate by 14.5%. The bottom line increased 16.4% year over year. Total revenues of $2.2 billion decreased 1.4% year over year. However, the top line beat the Zacks Consensus Estimate by 8.8%.

Net investment income climbed 2.5% year over year to $205 million in the quarter under review. The figure was higher than our estimate of $193.2 million and beat the Zacks Consensus Estimate of $191 million. Total cost and expenses decreased 3.6% year over year to $2.1 billion. The figure was higher than our estimate of $1.9 billion. 

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This article originally published on Zacks Investment Research (zacks.com).

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