8-K: Voya Financial Reports First-Quarter 2025 Results Driven by Acquisition and Commercial Momentum

Voya Financial announces positive first-quarter 2025 results, driven by the OneAmerica Financial acquisition, strong commercial momentum, and disciplined spending.

Summary

• Voya Financial reported a net income available to common shareholders of $139 million, or $1.42 per diluted share, for the first quarter of 2025.
• After-tax adjusted operating earnings were $195 million, or $2.00 per diluted share.
• These results were driven by positive prior year Stop Loss reserve developments, the successful acquisition of OneAmerica Financial's full-service retirement plan business, disciplined spend, and strong commercial momentum.
• The company returned $43 million to shareholders through common dividends and deployed approximately $200 million for the acquisition of OneAmerica Financial's full-service retirement plan business and strategic growth investments.
• Wealth Solutions' pre-tax adjusted operating earnings were $207 million, up from $186 million in the prior-year period, while Health Solutions' pre-tax adjusted operating earnings were $46 million, down from $59 million.
• Investment Management's pre-tax adjusted operating earnings were $41 million, compared to $42 million in the prior-year period.
• The company generated approximately $200 million of excess capital in the first quarter of 2025.

Sentiment

Score: 7

Explanation: The sentiment is positive due to the strong earnings growth, successful acquisition, and capital deployment. However, there are some concerns about the macroeconomic environment and performance in the Health Solutions segment.

Positives

• The acquisition of OneAmerica Financial's full-service retirement plan business contributed positively to the results.
• Wealth Solutions experienced strong commercial momentum and disciplined spending.
• Investment Management saw growth in fee-based revenues due to strong business momentum and positive capital markets.
• The company generated approximately $200 million of excess capital in the first quarter of 2025.
• Adjusted operating margin for Wealth Solutions for the TTM ended Mar. 31, 2025 was 39.7% compared with 35.7% in the prior-year period.

Negatives

• Health Solutions' pre-tax adjusted operating earnings decreased to $46 million from $59 million in the prior-year period.
• Health Solutions first-quarter 2025 annualized in-force premiums and fees declined 5% to $3.7 billion compared with the prior-year period.
• First-quarter 2025 net income available to common shareholders was $139 million, or $1.42 per diluted share, compared with $234 million, or $2.24 per diluted share, in first-quarter 2024.

Risks

• The company acknowledges uncertainties in the current macroeconomic environment.
• Health Solutions experienced a higher loss ratio in Stop Loss in the current TTM period.

Future Outlook

Despite the uncertainties in the current macroeconomic environment, our commitment to creating long-term value for our shareholders remains steadfast. We are focused on executing on our key priorities while maintaining a strong balance sheet as we balance capital return to shareholders with prudent investment in growth opportunities.

Management Comments

• In the first quarter of 2025, adjusted operating EPS grew 13% compared with the prior-year period, driven primarily by the positive impact of the OneAmerica acquisition and our strong commercial momentum in Wealth Solutions and Investment Management, said Heather Lavallee, chief executive officer, Voya Financial.
• I am encouraged by the commercial momentum we are building across our businesses, fueled by strong inflows, key strategic renewals, and a robust pipeline of opportunities.

Industry Context

Voya's focus on health, wealth, and investment solutions aligns with the broader industry trend of integrated financial services. The acquisition of OneAmerica's retirement plan business positions Voya to compete more effectively in the retirement solutions market.

Comparison to Industry Standards

• Comparing Voya's adjusted operating margin in Wealth Solutions (39.7%) to peers like Principal Financial Group (recent adjusted operating margin ~35%) suggests competitive performance.
• Voya's Investment Management net inflows of $7.7 billion compare favorably to firms like T. Rowe Price, which has faced net outflows in recent periods, indicating strong relative momentum.
• The company's focus on returning capital to shareholders through dividends is in line with industry practices among mature financial services companies like Prudential Financial.

Stakeholder Impact

• Shareholders benefit from the company's strong financial performance and capital return program.
• Employees are part of a company recognized as a Great Place to Work.
• Clients benefit from Voya's integrated health, wealth, and investment solutions.

Next Steps

• Voya will host a conference call on Wednesday, May 7, 2025, at 10 a.m. ET, to discuss the company's first-quarter 2025 results.

Key Dates

Keywords

Voya Financial, financial results, first-quarter 2025, adjusted operating earnings, OneAmerica acquisition, Wealth Solutions, Health Solutions, Investment Management, client assets, net inflows, shareholder returns, excess capital