Net earnings (USD, millions)

Change in receivables and advance premiums (USD, millions)

Capitalization of deferred policy acquisition costs (USD, millions)

Amortization of deferred policy acquisition costs (USD, millions)

Increase in policy liabilities (USD, millions)

Change in income tax liabilities (USD, millions)

Net investment (gains) losses (USD, millions)

Other, net, operating activities (USD, millions)

Net cash provided (used) by operating activities (USD, millions)

Proceeds from available-for-sale fixed maturity securities (USD, millions)

Proceeds from equity securities (USD, millions)

Proceeds from held-to-maturity fixed maturity securities (USD, millions)

Proceeds from commercial mortgage and other loans (USD, millions)

Costs of available-for-sale fixed maturity securities acquired (USD, millions)

Costs of equity securities acquired (USD, millions)

Costs of commercial mortgage and other loans acquired (USD, millions)

Other investments, net, investing activities (USD, millions)

Settlement of derivatives, net, investing activities (USD, millions)

Cash received (pledged or returned) as collateral, net (USD, millions)

Other, net, investing activities (USD, millions)

Net cash provided (used) by investing activities (USD, millions)

Purchases of treasury stock (USD, millions)

Proceeds from borrowings (USD, millions)

Principal payments under debt obligations (USD, millions)

Dividends paid to shareholders (USD, millions)

Change in investment-type contracts, net (USD, millions)

Treasury stock reissued (USD, millions)

Other, net, financing activities (USD, millions)

Net cash provided (used) by financing activities (USD, millions)

Effect of exchange rate changes on cash and cash equivalents (USD, millions)

Net change in cash and cash equivalents (USD, millions)

Income taxes paid (USD, millions)

Interest paid (USD, millions)

Cash and cash equivalents, beginning of period (USD, millions)

Cash and cash equivalents, end of period (USD, millions)

e5f306ce982555ff1f8dce318e281c9d99b33b73eb5a0db007e4408aa0977c24

In Q4 2023, AFL reported **net earnings of $268 million** compared to **$1,569 million** in Q3 2023.  **[0000004977-23-000177_afl-20230930.htm:2]** **[0000004977-24-000053_afl-20231231.htm:133]**  However, the available documents focus on explaining the changes in Q4 2023 compared to Q4 2022 rather than providing a clear explanation for the sharp drop from Q3 to Q4 2023. They mention factors such as:

- **Net investment losses**: $511 million in Q4 2023, marginally lower than the previous year  **[0000004977-24-000006_aflex991-q42023.htm:1]**   
- **Decline in adjusted earnings**: A decrease of 10.4% to $732 million, influenced by a post-tax loss related to a reinsurance treaty  **[0000004977-24-000006_aflex991-q42023.htm:1]**   
- **Impact of foreign currency exchange**: A weaker yen/dollar that affected earnings per share by $0.02  **[0000004977-24-000006_aflex991-q42023.htm:1]**   
- **Reinsurance transaction**: A noneconomic loss of $151 million pretax  **[AFL_3371655_0]**   

**While these factors affected Q4 earnings relative to the fourth quarter of 2022, the documents do not provide a definitive explanation for the steep decline from Q3 2023**.

Why did net earnings fall so sharply in Q4 2023?

The steep decline in **total revenues in Q3 2024** was driven primarily by several factors. **Increased foreign exchange-related losses** played a significant role, as the strengthening of the yen by **12.9%** negatively impacted conversion of revenues to U.S. dollars.  **[0000004977-24-000167_afl-20240930.htm:85]** **[0000004977-24-000164_aflex991-q32024.htm:0]** **[20241030CL44518:0]**  Additionally, **net investment losses** totaling **$1.4 billion**—stemming from losses on derivatives and foreign currency activities, as well as a **$55 million impairment**—further contributed to the decline.  **[0000004977-24-000167_afl-20240930.htm:85]** **[0000004977-24-000164_aflex991-q32024.htm:0]** **[20241030CL44518:0]**  Finally, **lower net earned premiums in Aflac Japan**, which fell by **13.4%** due to the weaker yen/dollar exchange rate, also compounded the reduction in total revenues.  **[0000004977-24-000167_afl-20240930.htm:12]** 

What drove the steep decline in total revenues in Q3 2024?

The dramatic swing was primarily driven by **$1.4 billion in net losses from derivative and foreign currency activities**, along with an **increase in credit loss allowances of $141 million** and a **$55 million impairment loss** related to expected sales of investments with unrealized losses. These factors, although partially offset by slightly higher gains from sales and redemptions, collectively pushed the net investment result into a substantial loss in Q3 2024.  **[20241030CL44518:0]** **[0000004977-24-000164_aflex991-q32024.htm:0]** **[0000004977-24-000167_afl-20240930.htm:85]** **[0000004977-24-000167_afl-20240930.htm:18]** 

What caused the dramatic swing to a large investment loss in Q3 2024?

Basic EPS turned negative in Q3 2024 primarily due to **increased foreign exchange losses**, significant **net investment losses**, and a substantial decline in revenues. The yen strengthened by **12.9%**, which led to marked foreign exchange-related losses. Additionally, the company incurred **pretax net investment losses amounting to $1.4 billion**—including increased credit loss allowances and losses from derivative and foreign currency transactions—contrasting sharply with the gains seen in the previous period. These issues were compounded by a **40.4% decline in total revenues**, which further reduced net earnings and pushed basic EPS into negative territory.  **[0000004977-24-000167_afl-20240930.htm:85]** **[AFL_3405034_1]** 

Why did basic EPS turn negative in Q3 2024?

The rebound in **net investment gains** in Q1 2024 was primarily driven by a mix of improved derivative and foreign currency results, increased gains from sales and redemptions, better performance from equity securities, and minimal credit losses. Specifically, the company recorded **net gains of $703 million** from derivatives and foreign currency activities, saw a marked increase in gains from sales and redemptions (up to **$173 million**), and shifted from a loss in equity securities in Q1 2023 to a gain of **$76 million** in Q1 2024, while credit losses were almost negligible at **$(1) million** compared to **$(30) million** in the previous period.  **[0000004977-24-000086_afl-20240331.htm:14]** **[0000004977-24-000086_afl-20240331.htm:77]** 

What factors contributed to the rebound in net investment gains in Q1 2024?

10dc58d3eb225fef44cd7f4a83faf53b5d1e0e0e6f6ec7b5518779f702bad869

The increase to **6,060 million USD** in Q2 2024 is driven by several factors. First, the company strengthened its liquidity management, ensuring a higher cash reserve than the minimum **$1.8 billion** target to provide a robust capital buffer. Second, contributions from its major subsidiaries—through **dividends of 2,111 million USD** and **81 million USD in management fees**—boosted liquidity. Finally, adjustments in the investment portfolio, notably a reduction in fixed maturity securities available-for-sale, freed up additional cash. This combination of factors resulted in the significant jump in cash and cash equivalents.  **[0000004977-24-000140_afl-20240630.htm:116]** 

Why did Cash and cash equivalents jump to 6,060 in Q2 2024?

The decline of **total assets to 120,168 million** in Q2 2024 was primarily driven by a **decrease in investments and cash**, a **reduction in deferred policy acquisition costs**, and **slight changes in other assets**. Specifically, investments and cash fell by **5,931 million** due to a reduction in the fair value of fixed maturity securities available-for-sale, a drop in commercial mortgage and other loans, and changes in cash and cash equivalents. Additionally, deferred policy acquisition costs decreased by **582 million**, while other assets saw a minor decline. This combination of factors resulted in a total decrease of **6,556 million** in assets compared to FY 2023.  **[0000004977-24-000140_afl-20240630.htm:3]** 

What factors contributed to Total assets declining to 120,168 in Q2 2024?

The dip in total liabilities in Q2 2024 is explained by a significant reduction in policy liabilities. In particular, policy liabilities fell sharply—dropping by **17.5%**—with a notable **17.2%** decrease in Aflac Japan’s policy liabilities, which was a major contributor to the overall decline in total liabilities.  **[20240731CL73831:4]** **[0000004977-24-000140_afl-20240630.htm:115]** 

Why did Total liabilities dip to 94,121 in Q2 2024?

AFL’s Other investments increased to **$6,677 million** in Q1 2024 primarily due to expanded allocations in three key areas. **Higher short-term investments** rose from **$1,304 million** to **$3,341 million**, largely attributed to greater securities lending collateral and other short-term allocations.  **[0000004977-24-000086_afl-20240331.htm:24]**  Additionally, there was a rise in **limited partnerships**, moving from **$2,750 million** to **$2,838 million**, which included tax credit investments along with private equity and real estate funds.  **[0000004977-24-000086_afl-20240331.htm:24]**  Finally, **Real Estate Owned (REO)** saw an increase from **$227 million** to **$253 million**, reflecting additional investments or reclassifications.  **[0000004977-24-000086_afl-20240331.htm:24]**  This combination of changes drove the Other investments figure up in Q1 2024.  **[0000004977-24-000086_afl-20240331.htm:3]** **[0000004977-24-000086_afl-20240331.htm:24]** 

What drove Other investments up to 6,677 in Q1 2024?

b83236a6af565a1d454186a0a63800053df15206eac55daade6f5e2ed4dd032c

Net earned premiums, principally supplemental health insurance (USD, millions)

Net investment income (USD, millions)

Net investment gains (losses) (USD, millions)

Other income (loss) (USD, millions)

Total revenues (USD, millions)

Benefits and claims, excluding reserve remeasurement (USD, millions)

Reserve remeasurement (gains) losses (USD, millions)

Total benefits and claims, net (USD, millions)

Insurance commissions (USD, millions)

Insurance and other expenses (USD, millions)

Interest expense (USD, millions)

Total acquisition and operating expenses (USD, millions)

Total benefits and expenses (USD, millions)

Earnings before income taxes (USD, millions)

Income taxes (USD, millions)

Net earnings per share - Basic (USD)

Net earnings per share - Diluted (USD)

75313e2e4ba982900bed13a69c4f491c19b0f48b3e3345b2ffbb0dd9719b7421

0d0d3ea7db435ee12fe2147bf06af982a16b09c44d10c190967eaf1b9628441d

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from / Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

f8273b796524c2ee7fc8e31b127f44646e3c1ae367fea7d0a70e3b28223f42de

Total Revenue [USD, Millions]

Cost of Goods Sold (COGS) [USD, Millions]

Selling, General, and Administrative Expenses (SG&A) [USD, Millions]

Research and Development (R&D) [USD, Millions]

Depreciation and Amortization (D&A) [USD, Millions]

Interest Expense [USD, Millions]

Operating Income (EBIT) [USD, Millions]

Net Income [USD, Millions]

Earnings Per Share (EPS) - Basic [USD, Units]

Earnings Per Share (EPS) - Diluted [USD, Units]

100122090338aaa5b5270b5de563081d5505f2ccca58d3246dcedfe236a8f482

Aflac Japan

- Net Earned Premiums

- Net Investment Income

- Other Income

Aflac U.S.

Other Business Segments

Corporate and Other

Total Adjusted Revenues

Total Revenues

daed4e0884d16abbbe4923c85fe7657ed15daa8f63bbe48a2c23d83564ee8079

- Adjusted Net Investment Income

Total Revenue

f6ccc27d7c343adeecf7337b779b01dbeeac215ee5f85d60f1c6e73258ee7b2f

AFLAC (AFL)

Financials