AXIS Capital Reports Q4 Earnings Growth Despite Higher Expenses

AXIS Capital Holdings Limited AXS reported fourth-quarter 2025 operating income of $3.25 per share, which outpaced the Zacks Consensus Estimate by 9.4% and rose 9.4% year over year.

The strong performance was driven by higher net premiums earned and net investment gains, partially offset by higher expenses.

Axis Capital Holdings Limited Price, Consensus and EPS Surprise

Axis Capital Holdings Limited price-consensus-eps-surprise-chart | Axis Capital Holdings Limited Quote

AXS’s Quarterly Operational Update

Total operating revenues of $1.7 billion beat the Zacks Consensus Estimate by 5.2%. The top line rose nearly 9% year over year on higher premiums earned.

Net premiums written rose 13% to $1.4 billion with an increase of 14% in the Insurance segment, and growth of 5% in the Reinsurance segment.

Net investment income decreased 4.5% year over year to $187 million, due to lower income from cash and fixed maturities. The Zacks Consensus Estimate was pegged at $198 million. Our estimate was $215 million.

Total expenses in the quarter increased 16.6% year over year to $1.4 billion due to higher net losses and loss expenses, acquisition costs, general and administrative expenses and foreign exchange losses. Our estimate was pegged at $1.2 billion.

Pre-tax catastrophe and weather-related losses and net of reinsurance were $30 million, including $17 million attributable to Hurricane Melissa and other weather-related events.

AXIS Capital’s underwriting income of $184 million increased 42% year over year. The combined ratio improved to 90.4 in the quarter from 94.2 a year ago, reflecting stronger underwriting performance. The Zacks Consensus Estimate was pegged at 91. Our estimate was 91.2.

Segment Results

Insurance: Gross premiums written improved 11.7% year over year to $1.9 billion. Our estimate was $1.8 billion. Net premiums earned increased 13.3% year over year to $1.2 billion. This gain is attributable to most lines of business. Our estimate was $1 billion. 
Underwriting income of $157.6 million increased 74.2% year over year. The combined ratio improved 470 basis points to 86.5. The Zacks Consensus Estimate for the combined ratio was pegged at 94.

Reinsurance: Gross premiums written increased 13% year over year to $310.7 million, primarily attributable to new business in motor lines, and credit and surety lines, together with premium adjustments in credit and surety lines. Our estimate was $372 million. Net premiums earned increased 4.2% year over year to $365.6 million. Our estimate was $400 million.
Underwriting income of $26.6 million decreased 31.9% year over year. The combined ratio deteriorated 300 basis points, up 93.3%. The Zacks Consensus Estimate for the combined ratio was pegged at 103.

Full-Year Highlights

The company reported full-year 2025 operating income of $12.92 per share, which outpaced the Zacks Consensus Estimate by 1.9% and rose 15.6% year over year.

Total operating revenues of $6.5 billion beat the Zacks Consensus Estimate by 1.2%. The top line rose 6.7% year over year on higher net investment gains and higher premiums earned.

Net premiums written increased 6% to $6.1 billion, driven by a 9% increase in the Insurance segment, partially offset by a 1% decline in the Reinsurance segment.

Underwriting income was $725 million, reflecting a 27% year-over-year increase. The combined ratio improved 250 basis points to 89.8 from 92.3 a year ago.

Financial Update

AXIS Capital exited the fourth quarter with cash and cash equivalents of $820.3 million, down 61.7% from the 2024-end level. Debt was $1.3 billion at quarter-end, up 0.1% from the 2024-end level.

Book value per diluted common share was $77.20, up 18.3% from the Dec. 31, 2024, level.

An annualized operating ROACE of 18.1% reflected strong capital efficiency despite easing from 18.6% a year ago.

Capital Deployment

AXIS repurchased $888 million of common shares in full-year 2025, underscoring its commitment to reducing share count and enhancing earnings per share.

The company also declared and paid a quarterly cash dividend of 44 cents per share, resulting in total annual common share dividends of $139 million for 2025.

AXS’s Zacks Rank

AXIS Capital currently has 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

The Travelers Companies, Inc. TRV reported fourth-quarter 2025 core income of $11.13 per share, which beat the Zacks Consensus Estimate by 32% and improved 22% year over year. Travelers’ total revenues increased 3.2% from the year-ago quarter to $12.4 billion, primarily driven by higher premiums, net investment income and other revenues. The top line beat the Zacks Consensus Estimate by 0.08%.

Net written premiums increased 1% year over year to a record $10.8 billion. Net investment income increased 10.3% year over year to $1 billion. The figure matched the Zacks Consensus Estimate. Travelers witnessed an underwriting gain of $1.7 billion, up 21.7% year over year. The consolidated underlying combined ratio of 82.2 improved 180 bps year over year.

Brown & Brown, Inc.’s BRO fourth-quarter 2025 adjusted earnings of 93 cents per share beat the Zacks Consensus Estimate by 2.1%. The bottom line increased 8.1% year over year.

Total revenues of $1.6 billion missed the Zacks Consensus Estimate by 2.1%. The top line improved 35.7% year over year. Adjusted EBITDAC was $529 million, up 35.6% year over year. EBITDAC margin remained unchanged year over year at 32.9%. Investment income and other income increased 17.3% year over year to $27 million.

The Progressive Corporation’s PGR fourth-quarter 2025 earnings per share of $4.67 beat the Zacks Consensus Estimate by 5.2%. The bottom line increased 14.4% year over year.

Operating revenues increased 10.6% year over year to $22.49 billion and beat the consensus estimate by 2.5%. Net premiums earned grew 10% to $21 billion. The reported figure surpassed the Zacks Consensus Estimate of $20.9 billion.

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