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Reinsurance Group Q2 Earnings and Revenues Miss, Premiums Rise Y/Y
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Key Takeaways
RGA reported Q2 adjusted operating EPS of $4.72, down 13.9% year over year.
Operating revenues were $5.6 billion, missing estimates by 4.7%.
Total benefits and expenses rose 14.1% year over year to $5.2 billion.
Reinsurance Group of America, Incorporated (RGA - Free Report) reported second-quarter 2025 adjusted operating earnings of $4.72 per share, which missed the Zacks Consensus Estimate by 15.4%. The bottom line decreased 13.9% from the year-ago quarter. Net foreign currency fluctuations had a favorable effect of 12 cents per share on adjusted operating income compared with the prior year.
Reinsurance Group witnessed a solid performance in Canada, Europe, the Middle East and Africa (EMEA) and Asia/Pacific segments, partially offset by weakness in the U.S. and Latin America segments.
RGA's operating revenues of $5.6 billion improved 9.6% year over year, driven by higher net premiums, investment income, net of related expenses and other revenues. It missed the consensus estimate by 1.1%.
Reinsurance Group of America, Incorporated Price, Consensus and EPS Surprise
Net premiums of $4.2 billion increased 5.9% year over year. Investment income and net of related expenses increased 30.1% from the prior-year quarter to $1.4 billion. The average investment yield increased 66 basis points to 5.3%.
Total benefits and expenses at Reinsurance Group climbed 14.1% year over year to $5.2 billion on higher claims and other policy benefits, interest credited, policy acquisition costs and other insurance expenses, other operating expenses and interest expense.
Quarterly Segment Update
U.S. and Latin America: Total pre-tax adjusted operating income was $101 million in the quarter, which decreased 59% year over year.
The Traditional segment reported a pre-tax adjusted operating income of $4 million in the quarter, which experienced a sharp deterioration year over year. Net premiums increased 10.5% from the year-ago quarter to $2 billion.
The Financial Solutions segment’s pre-tax adjusted operating income increased 21.3% year over year to $97 million. The results reflected favorable variable investment income and higher investment yields.
Canada: Total pre-tax adjusted operating income increased 12.1% year over year to $37 million.
The Traditional segment’s pre-tax adjusted operating income increased 7.7% year over year to $28 million. Net premiums rose 4% year over year to $339 million. Foreign currency exchange rates had an unfavorable effect on net premiums of $4 million.
The Financial Solutions segment’s pre-tax adjusted operating income increased 28.5% year over year to $9 million. Foreign currency exchange rates had an immaterial effect on pre-tax adjusted operating income.
EMEA: Total pre-tax adjusted operating income was $134 million, which climbed 57.6% year over year.
Pre-tax adjusted operating income of the Traditional segment was $18 million against a loss of $1 million in the year-ago period. Foreign currency exchange rates had a favorable effect of $1 million on adjusted operating income before taxes.
Premiums rose 15.3% year over year to $573 million in the quarter. Foreign currency exchange rates had a favorable effect on net premiums of $24 million for the quarter.
The Financial Solutions segment delivered pre-tax adjusted operating income of $116 million, up 34.9% year over year. Foreign currency exchange rates had a favorable effect of $5 million on pre-tax adjusted operating income.
Asia/Pacific: Total pre-tax adjusted operating income was $181 million, up 6.5% year over year.
The Traditional segment’s pre-tax adjusted operating income was $104 million, up 5.1% year over year. Foreign currency exchange rates had a favorable effect of $2 million on pre-tax adjusted operating income.
Premiums increased 15.3% year over year to $816 million. Foreign currency exchange rates had a favorable effect on net premiums of $9 million.
The Financial Solutions segment’s pre-tax adjusted operating income increased 8.5% year over year to $77 million. Net premiums increased 134% year over year to $117 million. Foreign currency exchange rates had a favorable effect of $2 million on pre-tax adjusted operating income.
Corporate and Other: Pre-tax adjusted operating loss was $32 million, narrower than the year-ago loss of $44 million.
Financial Update
As of June 30, 2025, the company had assets worth $133.5 billion, up 12.5% from 2024-end.
As of June 30, 2025, RGA’s book value per share, excluding accumulated other comprehensive income, rose 5.2% year over year to $155.87.
Adjusted operating return on equity, excluding accumulated other comprehensive income, was 14.3. which contracted 100 basis points year over year.
Capital Deployment
RGA deployed $276 million for in-force block transactions.
The board of directors declared a quarterly dividend of 93 cents. The dividend will be paid out on Aug. 26, 2025, to shareholders of record as of Aug. 12, 2025
Cincinnati Financial Corporation (CINF - Free Report) reported second-quarter 2025 operating income of $1.97 per share, which surpassed the Zacks Consensus Estimate by 41.7%. The bottom line increased 52.7% year over year. Total operating revenues in the quarter under review were $2.8 billion, which improved 15.3% year over year. This improvement was driven by higher earned premiums, investment income and other revenues. However, the top line missed the consensus mark by 0.1%.
Net written premiums climbed 11.1% year over year to $2.7 billion, driven by premium growth initiatives, price increases and a higher level of insured exposures, as well as contributions to growth from Cincinnati Re and Cincinnati Global.
Investment income, net of expenses, increased 17.8% year over year to $285 million and our estimate of $269.6 million
First American Financial (FAF - Free Report) reported a second-quarter 2025 operating income per share of $1.53, which beat the Zacks Consensus Estimate by 9.3%. The bottom line increased 20.5% year over year. Operating revenues of $1.8 billion increased 14.2% year over year due to higher direct premiums and escrow fees, agent premiums, as well as information and other and net investment income. The top line beat the Zacks Consensus Estimate by 5%. Operating revenues of $1.8 billion increased 14.2% year over year due to higher direct premiums and escrow fees, agent premiums, as well as information and other and net investment income. The top line beat the Zacks Consensus Estimate by 5%.
Chubb Limited (CB - Free Report) reported second-quarter 2025 core operating income of $6.14 per share, which outpaced the Zacks Consensus Estimate by 4.2%. The bottom line increased 14.1% year over year. Net premiums written improved 6.3% year over year to $14.2 billion in the quarter, which is in line with the Zacks Consensus Estimate. Our estimate was pegged at $14 billion. Net investment income was $1.5 billion, up 6.8 % year over year. The Zacks Consensus Estimate was pegged at $1.8 billion, while our estimate for the same was $1.9 billion. Revenues of $14.8 million missed the Zacks Consensus Estimate by a whisker but improved 6.9% year over year.
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Reinsurance Group Q2 Earnings and Revenues Miss, Premiums Rise Y/Y
Key Takeaways
Reinsurance Group of America, Incorporated (RGA - Free Report) reported second-quarter 2025 adjusted operating earnings of $4.72 per share, which missed the Zacks Consensus Estimate by 15.4%. The bottom line decreased 13.9% from the year-ago quarter. Net foreign currency fluctuations had a favorable effect of 12 cents per share on adjusted operating income compared with the prior year.
Reinsurance Group witnessed a solid performance in Canada, Europe, the Middle East and Africa (EMEA) and Asia/Pacific segments, partially offset by weakness in the U.S. and Latin America segments.
RGA's operating revenues of $5.6 billion improved 9.6% year over year, driven by higher net premiums, investment income, net of related expenses and other revenues. It missed the consensus estimate by 1.1%.
Reinsurance Group of America, Incorporated Price, Consensus and EPS Surprise
Reinsurance Group of America, Incorporated price-consensus-eps-surprise-chart | Reinsurance Group of America, Incorporated Quote
Net premiums of $4.2 billion increased 5.9% year over year. Investment income and net of related expenses increased 30.1% from the prior-year quarter to $1.4 billion. The average investment yield increased 66 basis points to 5.3%.
Total benefits and expenses at Reinsurance Group climbed 14.1% year over year to $5.2 billion on higher claims and other policy benefits, interest credited, policy acquisition costs and other insurance expenses, other operating expenses and interest expense.
Quarterly Segment Update
U.S. and Latin America: Total pre-tax adjusted operating income was $101 million in the quarter, which decreased 59% year over year.
The Traditional segment reported a pre-tax adjusted operating income of $4 million in the quarter, which experienced a sharp deterioration year over year. Net premiums increased 10.5% from the year-ago quarter to $2 billion.
The Financial Solutions segment’s pre-tax adjusted operating income increased 21.3% year over year to $97 million. The results reflected favorable variable investment income and higher investment yields.
Canada: Total pre-tax adjusted operating income increased 12.1% year over year to $37 million.
The Traditional segment’s pre-tax adjusted operating income increased 7.7% year over year to $28 million. Net premiums rose 4% year over year to $339 million. Foreign currency exchange rates had an unfavorable effect on net premiums of $4 million.
The Financial Solutions segment’s pre-tax adjusted operating income increased 28.5% year over year to $9 million. Foreign currency exchange rates had an immaterial effect on pre-tax adjusted operating income.
EMEA: Total pre-tax adjusted operating income was $134 million, which climbed 57.6% year over year.
Pre-tax adjusted operating income of the Traditional segment was $18 million against a loss of $1 million in the year-ago period. Foreign currency exchange rates had a favorable effect of $1 million on adjusted operating income before taxes.
Premiums rose 15.3% year over year to $573 million in the quarter. Foreign currency exchange rates had a favorable effect on net premiums of $24 million for the quarter.
The Financial Solutions segment delivered pre-tax adjusted operating income of $116 million, up 34.9% year over year. Foreign currency exchange rates had a favorable effect of $5 million on pre-tax adjusted operating income.
Asia/Pacific: Total pre-tax adjusted operating income was $181 million, up 6.5% year over year.
The Traditional segment’s pre-tax adjusted operating income was $104 million, up 5.1% year over year. Foreign currency exchange rates had a favorable effect of $2 million on pre-tax adjusted operating income.
Premiums increased 15.3% year over year to $816 million. Foreign currency exchange rates had a favorable effect on net premiums of $9 million.
The Financial Solutions segment’s pre-tax adjusted operating income increased 8.5% year over year to $77 million. Net premiums increased 134% year over year to $117 million. Foreign currency exchange rates had a favorable effect of $2 million on pre-tax adjusted operating income.
Corporate and Other: Pre-tax adjusted operating loss was $32 million, narrower than the year-ago loss of $44 million.
Financial Update
As of June 30, 2025, the company had assets worth $133.5 billion, up 12.5% from 2024-end.
As of June 30, 2025, RGA’s book value per share, excluding accumulated other comprehensive income, rose 5.2% year over year to $155.87.
Adjusted operating return on equity, excluding accumulated other comprehensive income, was 14.3. which contracted 100 basis points year over year.
Capital Deployment
RGA deployed $276 million for in-force block transactions.
The board of directors declared a quarterly dividend of 93 cents. The dividend will be paid out on Aug. 26, 2025, to shareholders of record as of Aug. 12, 2025
Zacks Rank
Reinsurance Group currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Insurers
Cincinnati Financial Corporation (CINF - Free Report) reported second-quarter 2025 operating income of $1.97 per share, which surpassed the Zacks Consensus Estimate by 41.7%. The bottom line increased 52.7% year over year. Total operating revenues in the quarter under review were $2.8 billion, which improved 15.3% year over year. This improvement was driven by higher earned premiums, investment income and other revenues. However, the top line missed the consensus mark by 0.1%.
Net written premiums climbed 11.1% year over year to $2.7 billion, driven by premium growth initiatives, price increases and a higher level of insured exposures, as well as contributions to growth from Cincinnati Re and Cincinnati Global.
Investment income, net of expenses, increased 17.8% year over year to $285 million and our estimate of $269.6 million
First American Financial (FAF - Free Report) reported a second-quarter 2025 operating income per share of $1.53, which beat the Zacks Consensus Estimate by 9.3%. The bottom line increased 20.5% year over year. Operating revenues of $1.8 billion increased 14.2% year over year due to higher direct premiums and escrow fees, agent premiums, as well as information and other and net investment income. The top line beat the Zacks Consensus Estimate by 5%. Operating revenues of $1.8 billion increased 14.2% year over year due to higher direct premiums and escrow fees, agent premiums, as well as information and other and net investment income. The top line beat the Zacks Consensus Estimate by 5%.
Chubb Limited (CB - Free Report) reported second-quarter 2025 core operating income of $6.14 per share, which outpaced the Zacks Consensus Estimate by 4.2%. The bottom line increased 14.1% year over year. Net premiums written improved 6.3% year over year to $14.2 billion in the quarter, which is in line with the Zacks Consensus Estimate. Our estimate was pegged at $14 billion. Net investment income was $1.5 billion, up 6.8 % year over year. The Zacks Consensus Estimate was pegged at $1.8 billion, while our estimate for the same was $1.9 billion. Revenues of $14.8 million missed the Zacks Consensus Estimate by a whisker but improved 6.9% year over year.