Equitable Holdings, Inc. - 10-Q Summary (Q3 2025)
Business Context and Reporting Period
This report covers the quarterly period ended September 30, 2025. Equitable Holdings, Inc. operates as a diversified financial services organization with three primary reportable segments: Retirement, Asset Management, and Wealth Management. The company also reports certain activities in Corporate and Other, which includes the Closed Block and run-off blocks of business. Effective July 1, 2025, the company revised its segment reporting to align with how the Chief Operating Decision Maker assesses performance.
Key Financial Metrics
| Metric | Q3 2025 (3 Months) | Q3 2024 (3 Months) | YTD 2025 (9 Months) | YTD 2024 (9 Months) |
|---|---|---|---|---|
| Total Revenues | $1,450 million | $3,073 million | $8,388 million | $8,810 million |
| Net Income (Loss) Attributable to Holdings | $(1,309) million | $(132) million | $(1,595) million | $388 million |
| Net Income (Loss) Available to Common Shareholders | $(1,325) million | $(146) million | $(1,643) million | $334 million |
| Diluted EPS (Common) | $(4.47) | $(0.46) | $(5.43) | $1.02 |
| Non-GAAP Operating Earnings | $455 million | $517 million | $1,228 million | $1,489 million |
| Non-GAAP Operating EPS | $1.48 | $1.58 | $3.90 | $4.38 |
| Total Assets | $314,409 million | $295,727 million (Dec 31, 2024) | - | - |
| Long-Term Debt | $3,833 million | $3,833 million (Dec 31, 2024) | - | - |
| Cash and Cash Equivalents | $13,604 million | $6,964 million (Dec 31, 2024) | - | - |
Material Changes vs. Prior Period
- GAAP Net Loss: The company reported a significant net loss of $1.3 billion for Q3 2025 compared to a loss of $132 million in Q3 2024. This deterioration was primarily driven by:
- Investment Losses: A $1.1 billion increase in investment losses, largely due to a $1.1 billion loss recognized from assets transferred in the RGA Reinsurance Transaction.
- Net Derivative Losses: Increased by $403 million due to higher equity market appreciation in Q3 2025 compared to Q3 2024.
- Fee Revenue Decline: Fee-type revenue decreased by $131 million, primarily due to the RGA reinsurance transaction.
- Non-GAAP Operating Earnings: Despite the GAAP loss, Non-GAAP Operating Earnings remained positive at $455 million for Q3 2025, down $62 million from Q3 2024. This metric excludes market volatility impacts from derivatives and variable annuity guarantees.
- Retirement Segment: Operating earnings decreased slightly to $401 million due to higher interest credited to policyholders and DAC amortization, offset by higher net investment income.
- Asset Management Segment: Operating earnings increased to $154 million, driven by higher fee-type revenue from increased Assets Under Management (AUM).
- Wealth Management Segment: Operating earnings increased to $59 million, driven by higher advisory fees and distribution fees.
- Reinsurance Transaction: On July 31, 2025, the company completed a major reinsurance transaction with RGA, ceding 75% of its in-force individual life insurance block and Closed Block. This resulted in a $1.1 billion pre-tax loss on asset transfers but significantly reduced future liability exposure.
- Novation Loss: In Q1 2025, the company recorded a $499 million pre-tax loss related to the novation of legacy variable annuity policies to Venerable.
Guidance, Outlook, and Risks
- Market Environment: The company notes that U.S. equity markets delivered strong returns in Q3 2025 (S&P 500 up 8.1%), but volatility remains a concern due to geopolitical conflicts, trade barriers, and potential government shutdowns.
- Capital Management: The company maintains a strong capital position. As of September 30, 2025, Holdings had approximately $1.3 billion remaining in its share repurchase program. The company also redeemed the remaining $165 million of Series B Preferred Stock in September 2025.
- Key Risks:
- Market Risk: Sensitivity to equity market declines and interest rate fluctuations, particularly regarding variable annuity guarantees (GMxB).
- Reinsurance Counterparty Risk: Reliance on RGA and other reinsurers to honor obligations.
- Regulatory Changes: Potential impacts from new NAIC guidelines on reinsurance (AG 55) and investment risk regulation.
- Liquidity: While liquidity is sufficient, collateral calls on derivative positions remain a significant driver of liquidity needs for insurance subsidiaries.
Investor Verification Checklist
- RGA Reinsurance Impact: Verify the long-term capital relief and liability reduction benefits of the RGA transaction against the immediate $1.1 billion GAAP loss.
- Non-GAAP Reconciliation: Review the reconciliation of GAAP Net Loss to Non-GAAP Operating Earnings to understand the magnitude of market-driven volatility (derivatives and MRB changes) excluded from the operating metric.
- Variable Annuity Hedging: Assess the effectiveness of the dynamic and static hedging programs in mitigating the impact of equity market movements on statutory capital and net income.
- Asset Quality: Review the composition of the General Account investment portfolio, specifically the level of unrealized losses in fixed maturities and the credit quality of mortgage loans.
- Share Repurchase Capacity: Confirm the remaining $1.3 billion authorization and the company's intent to utilize it given the current stock price and liquidity position.
- Actuarial Assumption Updates: Monitor the impact of the annual actuarial assumption updates (conducted in Q3) on future earnings, which resulted in a $63 million net income decrease for the nine months ended September 30, 2025.