10-Q: Abacus Global Management Posts Strong Q3 Profit, Revenue Soars

Abacus Global Management, Inc. reported a significant turnaround to net income in Q3 2025, driven by substantial revenue growth across its asset management and life solutions segments.

Summary

• Net income attributable to Abacus Global Management, Inc. for the nine months ended September 30, 2025, was $29,298,620, a significant improvement from a net loss of $5,703,817 in the prior year period.
• Total revenues for the nine months ended September 30, 2025, increased by 107.5% to $163,339,122, up from $78,711,777 in the same period of 2024.
• Asset Management revenue surged by 4567.7% to $25,168,756, primarily due to the Carlisle and FCF Advisors acquisitions in December 2024.
• Life Solutions revenue grew by 76.2% to $137,722,078, attributed to an expanded capital base, increased policy acquisitions, and higher average realized gains on policy sales.
• The company successfully sold $50,000,000 of securitized life insurance assets in October 2025, structured as an above investment-grade rated collateralized note.
• A new stock repurchase program of up to $10 million was authorized on November 6, 2025, extending until May 6, 2027.
• An annual cash dividend of $0.20 per share was approved on November 6, 2025, payable on December 17, 2025.
• Assets Under Management (AUM) increased by 12.0% to $2,906,540,011 as of September 30, 2025, from $2,594,080,293 at December 31, 2024.

Sentiment

Score: 9

Explanation: The company demonstrated a strong financial turnaround, achieving significant net income and substantial revenue growth across all segments. Key metrics like EPS, Adjusted EBITDA, and average realized gains on policies sold showed marked improvement. Strategic acquisitions are integrating well, and the company's post-period actions, including a new stock repurchase program and dividend declaration, signal strong management confidence and commitment to shareholder value. While cash decreased, liquidity is deemed sufficient, and the overall trajectory is highly positive.

Positives

• Achieved a significant turnaround to net income of $29,298,620 for the nine months ended September 30, 2025, compared to a net loss of $5,703,817 in the prior year.
• Total revenues more than doubled, increasing by 107.5% to $163,339,122 for the nine months ended September 30, 2025.
• Asset Management revenue saw exceptional growth of 4567.7% to $25,168,756, largely due to successful acquisitions.
• Life Solutions revenue increased by 76.2% to $137,722,078, driven by an expanded capital base and increased policy trading.
• Gross profit increased by 100.6% to $142,520,373, reflecting strong operational efficiency.
• Operating income surged by 315.5% to $65,959,737.
• Diluted Earnings Per Share (EPS) turned positive at $0.30 for the nine months ended September 30, 2025, from a loss of $0.09 in the prior year.
• Adjusted EBITDA increased by 108.9% to $93,948,926, with a stable Adjusted EBITDA margin of 57.5%.
• Average realized gain on life insurance policies sold improved significantly to 30.2% for the nine months ended September 30, 2025, from 20.2% in the prior year.
• The number of life insurance policies sold increased by 135% to 799 for the nine months ended September 30, 2025.
• Assets Under Management (AUM) grew by 12.0% to $2,906,540,011.
• Successfully completed a $50,000,000 securitization of life insurance assets post-period end.
• Authorized a new $10 million stock repurchase program and declared an annual cash dividend of $0.20 per share, signaling confidence in future performance and commitment to shareholder returns.

Negatives

• Cash and cash equivalents decreased to $86,418,953 at September 30, 2025, from $131,944,282 at December 31, 2024.
• Net cash used in investing activities increased to $(13,979,145) for the nine months ended September 30, 2025, from $(1,167,166) in the prior year, primarily due to the origination of a note receivable.
• Net cash used in financing activities was $(13,305,337) for the nine months ended September 30, 2025, compared to $111,815,591 provided in the prior year, mainly due to decreased proceeds from stock issuances and increased share repurchases.
• Technology Services segment reported a gross loss of $(1,288,088) for the nine months ended September 30, 2025, as revenue activity commenced in December 2024 and compensation expenses were incurred.

Risks

• Inaccurate forecasting of life expectancies or general changes leading to people living longer could result in lower returns on life settlement policies.
• The medical underwriting process for life expectancy estimates is highly subjective and inherently uncertain, with no assurance of accurate or complete health information for insureds.
• Different medical underwriting firms use varying methods, potentially leading to materially different mortality estimates for the same individual.
• Improvements in medicine, disease treatment, and health services could increase insured longevity, delaying expected cash flows from death benefits.
• If an insured survives to the stated maturity date of a term life insurance policy, the issuing company may only be obligated to pay a substantially lower cash surrender value instead of the face value.
• Life expectancy providers are largely unregulated, and increased regulation could materially adversely affect the company's ability to establish appropriate life expectancies.
• The company relies on a multitude of inputs for fair value determination, including historical realized gains, risk score, risk-based discount rate, and life expectancies, which are subject to estimation and market fluctuations.
• Lapetus Solutions, Inc., a provider of life expectancy reports in which the company holds a minority interest, announced its shutdown on August 31, 2025, and the company will cease purchasing reports from them.

Future Outlook

The company believes its current cash and cash equivalents, along with cash generated from operations, will be sufficient to support operating and debt service needs for the next 12 months. The first redemption window for LMAIS II investors opens on March 31, 2026, with the company confident in its liquidity to manage potential redemptions or rollovers. The company may pursue additional equity or debt financing in the future for acquisitions or investments.

Management Comments

• The increase in Life Solutions revenue is mainly due to an increase of $31,460,434 in realized gains, partially offset by $(1,063,870) in unrealized gains and $(4,604,497) in premiums paid related to policies accounted for under the fair value method.
• The realized gain and unrealized activity is mainly due to the Company's expanded capital base and deployment capacity following two major financing events: a $90.0 million equity raise in November 2024 and a $100.0 million debt facility acquired in December 2024.
• The additional capital enabled the Company to acquire a larger portfolio of life insurance policies, with a substantial portion sold during three months ended September 30, 2025 to investors seeking uncorrelated assets to invest in.
• The average realized gain per policy sold also improved markedly, rising from 19.0% for the three months ended September 30, 2024 to 36.6% for the three months ended September 30, 2025.
• This improvement reflects increased institutional demand for life settlement policies as uncorrelated assets, creating more favorable pricing conditions for the Company's portfolio trades.
• In the quarter ended September 30, 2025, the Company's discount rate was 15%, which is based on the historical and current realized gains on policies sold, risk score, duration, and current demand for uncorrelated assets.

Industry Context

The company's strong performance, particularly in its Life Solutions segment, reflects increasing institutional demand for life settlement policies as uncorrelated assets. This trend is creating more favorable pricing conditions and driving higher realized gains for companies with robust capital bases and policy acquisition capabilities. The growth in Assets Under Management (AUM) also indicates a broader market appetite for alternative asset management strategies, especially those focused on longevity-based assets. The company's strategic acquisitions in asset management and technology services position it to capitalize on these trends and expand its market share.

Comparison to Industry Standards

• The average realized gain on policies sold improved to 30.2% for the nine months ended September 30, 2025, from 20.2% in the prior year, indicating strong performance in optimizing policy values compared to industry benchmarks.
• The company's expanded capital base, including a $90.0 million equity raise and a $100.0 million debt facility, enabled it to acquire a larger portfolio of life insurance policies, demonstrating a competitive advantage in capital deployment compared to smaller market participants.
• The successful securitization of $50,000,000 of life insurance assets, structured as an above investment-grade rated collateralized note, highlights the company's ability to access sophisticated capital markets and manage its longevity-based assets effectively, a capability often seen in larger, more established financial institutions.

Management Changes

Legal Proceedings

• The company is not a party to any litigation that is material to ongoing operations as of September 30, 2025.

Related Party Transactions

• The Sponsor PIK Note for $13,699,103 is a related party transaction with East Sponsor, LLC.
• Life policy sales/purchases, management fees, performance fees, servicing fees, and certain expense reimbursements with the Carlisle Funds and LP Funds are considered related party activities.
• The acquisition of National Insurance Brokerage, LLC (NIB) on April 24, 2025, involved Jay Jackson (CEO) and KMG Group Holdings, LLC (owned by Co-Founders/Presidents Matthew Ganovsky, K. Scott Kirby, and Sean McNealy) as sellers.
• The company paid $15,656,875 to acquire policies from the Carlisle Funds for the nine months ended September 30, 2025.
• The company recognized $20,655,765 in asset management fees and $25,662,314 in net revenue from life policy sales from the Carlisle and LP Funds for the nine months ended September 30, 2025.
• The company recognized $1,339,259 in servicing revenue from the Carlisle Funds and LP Funds for the nine months ended September 30, 2025.

Stakeholder Impact

• Shareholders: Positive impact due to significant net income turnaround, strong revenue growth, positive EPS, new stock repurchase program, and declared annual cash dividend.
• Investors in LMAIS II: Will have redemption options starting March 31, 2026, with the company indicating sufficient liquidity to meet obligations.
• Employees: Compensation expenses increased due to growth and acquisitions, suggesting stable or growing employment opportunities.
• Customers: Expanded service offerings through acquisitions (Carlisle, FCF, NIB, AccuQuote) and continued focus on optimizing financial outcomes.
• Creditors: Increased long-term debt but strong financial performance and compliance with debt covenants indicate improved ability to service debt. Successful securitization also diversifies funding sources.

Next Steps

• LMAIS II investors have the option to redeem, extend, or roll over their investment starting March 31, 2026.
• The company will continue to manage its stock repurchase program, with a new authorization of up to $10 million until May 6, 2027.
• An annual cash dividend of $0.20 per share will be paid on December 17, 2025, to shareholders of record on December 2, 2025.
• The company may seek additional equity or debt financing in the future to support its overall business strategy, including funding previously announced and future acquisitions and repayment and refinancing of its indebtedness.

Key Dates

Recommendation

The company has demonstrated an exceptional financial turnaround, moving from a significant net loss to substantial net income. This is supported by robust revenue growth across all segments, particularly in Asset Management due to successful acquisitions and in Life Solutions driven by expanded capital and improved realized gains on policy sales. Key metrics like EPS and Adjusted EBITDA show strong positive trends. The authorization of a new stock repurchase program and the declaration of an annual cash dividend signal strong management confidence and a commitment to enhancing shareholder value. While cash balances decreased, the company asserts sufficient liquidity for future operations and debt obligations, further bolstered by a recent $50 million securitization. The strategic acquisitions are integrating well and expanding the company's market presence. The identified risks, primarily related to life expectancy forecasting, are inherent to the business model but appear to be managed within the context of strong overall performance. Given the significant improvements in profitability, strong growth trajectory, and shareholder-friendly actions, a 'strong buy' recommendation is warranted for long-term investors.

Keywords

Abacus Global Management, SEC Filing, 10-Q, Financial Results, Asset Management, Life Solutions, Technology Services, Net Income, Revenue Growth, EPS, Adjusted EBITDA, Life Settlement Policies, Acquisitions, Carlisle Management Company, FCF Advisors, National Insurance Brokerage, AccuQuote, Stock Repurchase, Dividend, AUM, Securitization, Corporate Governance, Risk Factors