Voya Financial Q1 Earnings Top Estimates, Revenues Fall Y/Y

Voya Financial, Inc. VOYA reported first-quarter 2025 adjusted operating earnings of $2.15 per share, which beat the Zacks Consensus Estimate by 35.2%. The bottom line increased 14.4% year over year.  (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

The results reflected accretion from business from OneAmerica, positive capital markets and net inflows across the business, partially offset by higher expenses in Health Solutions due to strategic investments in Short-Term Disability and Leave Management. 

Behind the Headlines

Total revenues amounted to nearly $2 billion, which decreased 4% year over year.

Voya Financial, Inc. Price, Consensus and EPS Surprise

Voya Financial, Inc. price-consensus-eps-surprise-chart | Voya Financial, Inc. Quote

Net investment income increased 5.9% year over year to $560 million. Meanwhile, fee income of $570 million increased 11.1% year over year. 

Premiums totaled $737 million, down 7.9% from the year-ago quarter. 

Total benefits and expenses were $1.8 billion, up 1.8% from the year-ago quarter. 

As of March 31, 2025, VOYA’s total client assets were $694 billion, up 21% year over year, primarily due to assets onboarded from OneAmerica, positive capital markets and significant recordkeeping wins.

Segmental Update

Wealth Solutions recorded adjusted operating earnings of $207 million, which increased 11.3% year over year. The increase was primarily due to acquired business from OneAmerica, positive capital markets and disciplined spending. 

Health Solutions incurred pre-tax adjusted operating income of $46 million, down 22% year over year as positive prior year Stop Loss reserve developments were tempered by lower reported Group Life and Voluntary underwriting gains and strategic investments in Short-Term Disability and Leave Management. Annualized in-force premiums and fees declined 5% to $3.7 billion, attributable to actions to improve profitability in the Stop Loss business, partially offset by growth in the Voluntary business.

Investment Management posted pre-tax adjusted operating earnings, excluding Allianz's noncontrolling interest, of $41 million, down 2.4% year over year. Growth in fee-based revenues was driven by strong business momentum and positive capital markets year over year, offset by higher seasonal expenses.
Investment Management generated net inflows of $7.7 billion (excluding divested businesses), representing organic growth of 2.5% for the quarter. The growth reflects continued momentum in the Institutional, Insurance and Intermediary channels.

Corporate incurred pre-tax adjusted operating losses, excluding Allianz's noncontrolling interest, of $62 million, narrower than a loss of $63 million incurred in the year-ago quarter.

Financial Update

Voya Financial exited the quarter with cash and cash equivalents of $1.4 billion, which increased 49.3% year over year. 

Total investments amounted to $35 billion, down 4.3% year over year.

Long-term debt at quarter-end was $2.1 billion, up 0.2% from 2024-end. The financial leverage ratio, excluding AOCI, deteriorated 250 basis points year over year to 30.3%. 

As of March 31, 2025, book value per share (excluding AOCI) was $61.31, which increased 5.4% year over year. As of March 31, 2025, Voya Financial had approximately $800 million of excess capital.

Capital Deployment

Voya Financial returned $43 million of excess capital to shareholders in 2024 and retired $400 million of 3.976% Senior Notes using the proceeds from the recent debt issuance. VOYA deployed about $200 million of excess capital to the OneAmerica Financial's full-service retirement plan business acquisition.

As of March 31, 2025, VOYA had a remaining share repurchase authorization of $150 million and excess capital of about $150 million.

Zacks Rank of VOYA

VOYA currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

Radian Group RDN reported first-quarter 2025 adjusted operating income of 99 cents per share, which beat the Zacks Consensus Estimate by 4.2%. The bottom line decreased 3.9% year over year. Operating revenues remained flat year over year at $306 million. The figure missed the Zacks Consensus Estimate by 6.4%. 

Mortgage insurance new insurance written decreased 17.7% year over year to $9.5 billion. Net premiums earned were $234 million, flat year over year. Persistency was 83.7% as of March 31, 2025, contracting 60 basis points year over year.

Prudential Financial, Inc. PRU reported first-quarter 2025 adjusted operating income of $3.29 per share, which beat the Zacks Consensus Estimate by 2.5%. The bottom line also rose 7.8% year over year. Total revenues of $13.4 billion declined 38% year over year and missed the Zacks Consensus Estimate by 7.7%. The decrease in revenues was due to lower premiums. 

Total benefits and expenses amounted to $18.9 billion, which declined 41% year over year in the first quarter. This decrease was due to lower insurance and annuity benefits, interest expense and operating expenses. The figure was higher than our estimate of $13 billion. 

Everest Group EG reported first-quarter 2025 operating income of $6.45 per share, which missed the Zacks Consensus Estimate by 13.5%. The bottom line dropped 60.5% year over year. Total operating revenues of nearly $4.3 billion increased 3.1% year over year on higher premiums earned and net investment income. The top line missed the consensus mark by 4.5%.

Gross written premiums declined 2% year over year to $4.4 billion, attributable to a 1.1% decline in Reinsurance and 0.1% lower gross written premiums in Insurance. The combined ratio deteriorated 1390 bps year over year to 102.7 in the reported quarter. The Zacks Consensus Estimate was pegged at 99, while our estimate was pinned at 93.

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