Equitable (NYSE:EQH) executives told investors the company entered 2026 with “solid momentum” following a year marked by record assets under management, strong retirement and wealth flows, and the completion of a life reinsurance transaction designed to reduce mortality volatility.
On the company’s full-year and fourth-quarter earnings call, President and CEO Mark Pearson said Equitable has continued refining its business mix toward three “core growth engines”: U.S. retirement, asset management, and wealth management. He also pointed to ongoing balance sheet actions to become “more capital light,” including a 2025 life reinsurance transaction with RGA that he said freed $2 billion of capital and reduced Equitable’s mortality exposure by 75%.
Full-year results: cash generation and record AUM, with mortality weighing on EPS
Equitable produced $1.6 billion of organic cash generation for 2025, consistent with its $1.6 billion to $1.7 billion guidance range. Management forecast organic cash generation of approximately $1.8 billion in 2026 and reiterated a target of $2 billion in 2027.
Assets under management and administration ended 2025 at a record $1.1 trillion, up 10% year-over-year, which management said should support fee- and spread-based earnings. The company also returned $1.8 billion to shareholders in 2025, including $500 million of additional share repurchases executed following the RGA transaction. Excluding those incremental buybacks, Pearson said the payout ratio was 68%, at the high end of the company’s 60% to 70% target range.
Business flows: Retirement and Wealth strong; AllianceBernstein mixed
In retirement, Equitable reported $5.9 billion of net flows in 2025, representing 4% organic growth, which Pearson said was helped by another year of record RILA sales. The company also issued $5 billion in funding agreement-backed notes (FABN) during 2025, which Pearson said is not included in retirement net flows but is expected to support spread-based earnings.
Wealth management posted $8.4 billion of net inflows for the full year, a 13% organic growth rate. Pearson said the number of “wealth planners” increased 12% year-over-year.
AllianceBernstein (AB) saw “mixed dynamics,” according to Pearson. AB had net outflows of $11.3 billion for 2025, including $4 billion of low-fee outflows related to the RGA transaction. At the same time, Pearson highlighted AB’s private markets growth, with private markets AUM up 18% to $82 billion, and said AB ended 2025 with a $20 billion institutional pipeline, plus more than $3 billion of additional insurance wins expected to fund in 2026.
Pearson also identified commercial real estate lending as an incremental growth opportunity and said AB would onboard more than $10 billion of Equitable’s commercial mortgage loan portfolio in the second half of the year, describing it as a “win for both companies” and an example of “flywheel” benefits between Equitable and AB.
Fourth-quarter details: operating EPS, segment trends, and mortality in Corporate and Other
Chief Financial Officer Robin Raju reported fourth-quarter non-GAAP operating earnings of $513 million, or $1.73 per share, alongside net income of $215 million. The quarter included a $10 million non-cash corporate expense tied to the write-off of a legacy software investment; excluding that item, Raju said non-GAAP operating EPS would have been $1.76, up 8% year-over-year. The consolidated tax rate was approximately 18% in the quarter.
Raju said adjusted book value per share ex-AOCI and with AB at market value was $33.84, which he called “more meaningful” than reported book value per share because it “significantly understates” the fair value of Equitable’s AB stake. On that basis, Equitable’s adjusted debt-to-capital ratio ended the year at 25%.
On segment performance:
- Retirement: Fourth-quarter earnings increased 4% year-over-year and 2% sequentially (adjusted for notable items). Net interest margin increased 2% sequentially, driven by general account asset growth. Raju said spreads compressed modestly versus the third quarter due to runoff of a “very profitable older RILA block” and timing noise in investment income. Management expects additional spread compression in the first half of 2026, stabilizing thereafter.
- Asset management: Raju said AB delivered strong fourth-quarter results, with earnings up 4% sequentially. Performance fees of $82 million exceeded management’s guidance, and AB’s 2025 adjusted operating margin was 33.7%, at the upper end of its 30% to 35% targeted range.
- Wealth management: Fourth-quarter earnings increased 40% year-over-year. Raju said the quarter benefited from a favorable commission adjustment from retirement and elevated transaction fees, and he described $60 million of quarterly earnings as a better run rate. Wealth attracted $2.1 billion of advisory net flows in the quarter.
- Corporate and Other: The segment posted a loss of $123 million. Raju attributed the result to $10 million of one-time expenses, about $25 million of elevated mortality, and a lower tax rate. He said adverse mortality was concentrated in December and driven by a high number of small claims with less reinsurance coverage.
Capital, cash, and new business value
Raju said Equitable returned $354 million to shareholders in the fourth quarter, including $277 million of share repurchases. The company ended 2025 with $1.1 billion of holding company cash, above its $500 million minimum target, after receiving roughly $600 million of subsidiary dividends in the fourth quarter. Raju noted the holding company cash position typically runs higher at year-end and is expected to trend lower in the first half of 2026.
Total cash generation in 2025 was $2.6 billion, including $1 billion of proceeds from the RGA transaction, while organic cash generation was “modestly above” $1.6 billion. Raju also said the year-end 2025 combined NAIC RBC ratio is expected to be approximately 475%, above the company’s “400% plus” target.
Discussing value of new business (VNB), Raju said 2025 record retirement sales helped lift VNB to $600 million, with about $580 million of capital deployed to support those sales. While VNB margin declined modestly due to sales mix and a low-spread environment, he said the company continues to generate a 15%+ internal rate of return on new business.
2026 outlook: EPS growth expected to exceed 12%–15% target
Management’s 2026 guidance assumptions include an 8% total return for equity markets and interest rates following the forward curve, alongside an 8% to 9% return for the alternative portfolio.
Raju outlined key expectations:
- Retirement: Mid- to high-single-digit growth in pre-tax earnings, with spreads stabilizing in the second half of the year.
- Asset management: Results remain market-sensitive, but AB has “good visibility” into performance fees of at least $80 million to $100 million in 2026.
- Wealth management: Double-digit earnings growth from the full-year 2025 level.
- Corporate and Other: Full-year loss of $350 million to $400 million, with quarterly volatility tied to seasonal mortality patterns. Raju said the company increased its baseline GAAP assumption for mortality based on recent experience.
Raju also guided to an approximately 20% total company tax rate, with segment tax rates of 16% for retirement, 26% for wealth management, and 28% for asset management, and said opportunistic tax planning initiatives could reduce the consolidated rate below 20% in the first half of 2026.
“Putting it all together,” Raju said the company expects 2026 earnings-per-share growth, excluding notable items, to exceed its 12% to 15% target. Pearson reiterated the company remains focused on achieving its 2027 targets, pointing to record assets across segments, reduced mortality exposure following the RGA transaction, and the impact of share repurchases that reduced share count by 9% over the past year.
About Equitable (NYSE:EQH)
Equitable Holdings, Inc (NYSE: EQH) is a leading provider of life insurance, annuities and retirement plan services in the United States. Through its insurance subsidiary, AXA Equitable Life Insurance Company, the firm offers a broad range of permanent and term life insurance products designed to help individuals and families manage risk and build wealth. In addition, Equitable provides fixed, variable and indexed annuity solutions to support income planning in retirement, as well as a suite of group retirement and pension plan services for employers and plan sponsors.
The company also maintains an asset management arm that delivers investment strategies across equities, fixed income and alternative asset classes for both retail and institutional clients.
