Total Revenues

37% decline (from $5,436M to $3,398M)

Total Revenues dropped by 37% in Q1 2025 primarily due to a dramatic reversal in investment performance—shifting from a net gain of $951M in Q1 2024 to a net investment loss of $963M—combined with adverse market conditions impacting derivative and foreign currency activities compared to the previous period. " "

Net Earnings

98% decline (from $1,879M to $29M)

Net Earnings collapsed by over 98% as the severe reversal in net investment outcomes, including significant losses in derivatives, equity securities, and higher credit loss allowances, overwhelmed the previously robust profitability, leading to a dramatic erosion from $1,879M to $29M. " "

Aflac Japan Segment Revenue

8% decline (from $2,473M to $2,272M)

The 8% reduction in Aflac Japan’s revenue was driven by a decline in net earned premiums, influenced by internal reinsurance transactions, limited-pay products reaching paid-up status, and the impact of currency fluctuations, all of which contrasted with more stable performance in the prior period. " "

Aflac U.S. Segment Revenue

Nearly unchanged (from $1,699M to $1,721M)

Aflac U.S. revenue remained stable due to balanced contributions from net earned premiums and adjusted net investment income, highlighting the segment’s resilience despite broader market volatility, as opposed to the significant shifts seen in other areas. " "

Corporate and Other Segment

32% increase (from $247M to $326M)

A 32% surge in revenue in this segment was primarily due to higher reinsurance activity and improved adjusted net investment income driven by a lower volume of tax credit investments, which generated enhanced earnings relative to the previous period. " "

Net Investment Gains Reversal

Reversed from a $951M gain to a $963M loss

The reversal from a $951M gain in Q1 2024 to a $963M loss in Q1 2025 was mainly due to adverse derivative and foreign currency performance (with $888M losses), a $61M decline in equity securities’ fair value, and increased credit loss allowances, marking a sharp downturn compared to the prior quarter’s positive results. " "

Aflac Japan – Pretax Profit Margin

FY 2025

Expected to be at the low end of the 30% to 33% range "

No explicit metrics provided " " "

no current guidance

Aflac Japan – Benefit Ratio

FY 2025

Expected to be toward the higher end of the 64% to 66% range "

No explicit metrics provided " " "

no current guidance

Aflac Japan – Expense Ratio

FY 2025

Expected to be at the lower end of the 20% to 23% range "

No explicit metrics provided " " "

no current guidance

Aflac U.S. – Benefit Ratio

FY 2025

Expected to be at the lower end of the 48% to 52% range "

No explicit metrics provided " " "

no current guidance

Aflac U.S. – Expense Ratio

FY 2025

Expected to be at the upper end of the 36% to 39% range "

No explicit metrics provided " " "

no current guidance

Aflac U.S. – Pretax Profit Margin

FY 2025

Expected to be at the upper end of the 17% to 20% range "

No explicit metrics provided " " "

no current guidance

Innovative Product Launches in Japan

In Q4 2024, Aflac outlined staged launches for a new cancer insurance product with enhanced coverage and introduced Sumitas; in Q2 2024, the focus was on launching the Tsumitas product to drive growth. " " " " "

In Q1 2025, the company launched Merito—a new cancer insurance product with full and simple coverage—and highlighted a comprehensive sales strategy across channels, demonstrating positive market results and optimism for continued growth. " " "

Consistent presence with improved execution and positive sentiment as product launches evolve from planning to successful implementation.

Youth Targeting Strategy

In Q4 2024, Aflac stressed targeting younger customers via the Sumitas product along with indirect cross‐selling hints; in Q2 2024, they discussed launching Tsumitasu aimed at younger clients with long‐term cross‐sell opportunities. " " " " "

In Q1 2025, the focus on youth targeting is re‐affirmed with strong sales of Sumitas among younger customers and effective cross-selling strategies, indicating success in attracting the desired demographic. " "

Continuously emphasized with stronger outcomes. The sentiment has shifted positively as the targeted demographic engagement shows success.

Cross‑Selling Challenges

Q4 2024 discussion noted challenges in cross-selling dental products with a reported 33% decline affecting the “halo” effect; Q2 2024 highlighted opportunities through Tsumitasu while noting cautious sales force approaches. " " " "

In Q1 2025, while the primary focus remains on youth targeting, cross-selling strategies (including those in the dental business) are mentioned with improved performance through technology and key partnerships, thus mitigating earlier challenges. "

Consistent focus with improvements noted. Earlier challenges in cross‑selling appear to be mitigated with enhanced strategies and technological upgrades.

Disciplined Capital Management

Q4 2024 featured significant share repurchases ($2.8B) and record buyback activity, coupled with strong dividend growth; Q2 2024 reinforced a stable liquidity and tactical repurchase approach. " " " "

Q1 2025 continued to show disciplined capital management with $900M deployed for repurchases, ongoing dividend growth (42 consecutive years), and robust liquidity management, underscoring a strong commitment to returning value to shareholders. " "

Consistent and strong, with capital management strategies maintained and scaled appropriately, reinforcing investor confidence.

U.S. Segment Performance and Persistency

In Q4 2024, U.S. persistency improved to 79.3% with a 2.7% premium growth and favorable expense management; Q2 2024 reported 2% sales growth, persistency near 78.7%, and improved expense ratios. " " " "

Q1 2025 reported a 3.5% sales increase and persistency maintained at 79.3%, along with steady expense management, reflecting robust U.S. segment performance despite evolving market conditions. " " "

Steady performance with a slight enhancement in persistency and sales growth. The topic remains consistently positive with gradual improvements.

U.S. Dental Business Performance

Q4 2024 noted significant volatility due to a failed system implementation (33% decline) affecting broker trust; Q2 2024 focused on stabilization efforts and partnerships to improve the dental platform. " " "

In Q1 2025, the dental business is described as stabilized following technology improvements, enhanced talent hiring, and a successful partnership with SkyGen, alongside an effective cross‑selling strategy that boosted sales by 20% for agents selling both dental and voluntary benefits. "

Recovery in progress. After significant volatility, current improvements and stabilization efforts mark a recovery with positive momentum.

Floating Rate Headwinds and NII Pressure

Q2 2024 discussed attractive short rates and strong net investment income from tactical adjustments; Q4 2024 detailed a 100 bp SOFR decline and increased pressure on the floating rate portfolio, impacting NII. " " " "

In Q1 2025, the company faces persistent floating rate headwinds with a 100 bp decline in SOFR affecting U.S. and Japan net investment income, although strategic repositioning is underway to mitigate the impacts. " "

Persistent challenges with a more pronounced negative sentiment in Q1 2025 compared to the more favorable conditions in Q2 2024.

FX and ESR Volatility Risk

Q2 2024 briefly mentioned FX impacts with favorable effects on yields and exposure from yen-denominated debt; Q4 2024 noted FX impacts and the ongoing transition to the ESR framework without deep discussion of volatility risk. " " "

In Q1 2025, Aflac provided a detailed discussion on FX and ESR volatility risk, outlining a comprehensive hedging strategy involving put options, forward contracts, and structured debt to manage volatility, highlighting enhanced risk management measures. " " " "

Emergent emphasis. The current period features a more detailed discussion and proactive hedging compared to earlier periods.

Earnings Volatility from Remeasurement

In Q2 2024, remeasurement gains were highlighted with quantified benefits on reserve ratios; Q4 2024 elaborated on significant gains from unlocking assumptions along with caution for future volatility. " "

In Q1 2025, remeasurement gains are discussed with a focus on their timing (concentrated in Q3) and as part of routine adjustments reflecting favorable post-COVID claims utilization patterns, clarifying the source of volatility. "

Stable with evolving nuances. The topic remains, but the timing and context of gains are now more clearly delineated, suggesting improved predictability.

Expanded Agent Network in Japan

Q4 2024 detailed an aggressive expansion, citing over 600 new agents hired in 2023–2024 to drive third-sector sales; Q2 2024 did not specifically mention network expansion. "

Q1 2025 again emphasizes expanding the agent network with ongoing hiring of agents and mainstay associates to support sales growth, particularly for third-sector products. "

Re-emerging focus. Although missing in Q2 2024, the strategy reappears in Q1 2025 with renewed emphasis and clear plans for further expansion.

Product Profitability Concerns

Q2 2024 discussed the TSUMITAS product with lower IRRs on a GAAP basis but attractive post‐reinsurance returns; Q4 2024 similarly noted new business strain impacting IRRs but offset by effective reinsurance structures. " " " "

Q1 2025 did not explicitly revisit these concerns, implying that emphasis on product profitability issues—such as lower IRR and reinsurance dependence—has diminished or been resolved in favor of focusing on sales growth and strong market performance. " "

Less emphasized in Q1 2025. The detailed discussion on lower IRRs and reinsurance dependence has been scaled down, suggesting either resolution or a shift in focus.

Increased Competitive Pressure

Q2 2024 provided clear insights into increased competition in Japan’s third sector with competitors launching low-priced products; Q4 2024 had indirect mentions through product innovation and strategic positioning. " "

In Q1 2025, there is renewed discussion of competitive pressures, particularly in the medical insurance market, with Aflac reaffirming its historic leadership and outlining strategies to retain its #1 market share despite growing rivalry. " "

Consistently acknowledged. Although the emphasis fluctuates, the topic remains central with a continued commitment to defending market leadership.

Commercial Real Estate Market Challenges

Q2 2024 discussed a sizable loan watch list, foreclosures, and increased CECL reserves due to distressed property valuations; Q4 2024 provided extensive commentary on the depressed market, raising CECL reserves by $40M and noting significant challenges. " " "

In Q1 2025, the discussion remains focused on commercial real estate challenges with a more modest increase in CECL reserves ($2M) and two loan foreclosures, reflecting ongoing market difficulties but with less dramatic adjustments. "

Consistent challenge. While the market remains distressed, the scale of adjustments in Q1 2025 appears smaller, suggesting either stabilization or a more measured outlook.

Market Leadership in Japan's Third Sector

Q2 2024 established Aflac as the #1 most sold policy company with a value-driven strategy; Q4 2024 reinforced its strong metrics with high premium persistency, sales growth, and significant contributions to earnings from the Japan segment. " " "

In Q1 2025, Aflac continues to highlight its leadership in Japan’s third sector by emphasizing its dominant market share in cancer and medical insurance, supported by decades of expertise and plans for further expansion. "

Strong and consistent. The reaffirmation of market leadership remains a key, highly positive theme across periods, with ongoing strategic investments and product innovations supporting this position.