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Athene Holding Ltd. (ATH-PA)·Q2 2025 Earnings Summary

Executive Summary

  • Record fee-related earnings of $627M (+21% YoY) and spread-related earnings of $821M, driving Adjusted Net Income of $1,179M ($1.92 per share) for Q2 2025; total revenues rose to $6,814M .
  • AUM reached $840B and fee-generating AUM $638B, supported by $61B total inflows and $21B organic inflows at Athene, with a strong contribution from funding agreements issuance .
  • Blended net spread declined to 1.22% (from 1.26% in Q1), as higher cost of funds on new business and lower floating-rate income offset strong alternative returns; management reiterated mid-single-digit SRE growth for 2025 and tracking to the high end of the 15–20% FRE growth guide for 2025 .
  • Catalyst watch: Bridge Investment Group expected to contribute ~$100M to FRE in 2026; Q2 capital solutions fees hit a record $216M, and management highlighted expansion into stable value products and the potential opening of the 401(k) channel for private assets .

What Went Well and What Went Wrong

What Went Well

  • Record FRE of $627M, with 21% YoY management fee growth and record capital solutions fees of $216M; FRE margin expanded ~200 bps YoY .
    • Quote: “Record FRE $627,000,000… record ACS fees of $216,000,000” .
  • Strong Athene organic inflows of $21B (second-highest on record), driven by $12B funding agreements and $7B retail annuities; net invested assets +18% YoY to $275B .
    • Quote: “Athene had another excellent quarter with $21,000,000,000 of organic inflows…” .
  • AUM scaled to $840B with $61B inflows; origination volume of $81B produced excess spread at scale, underpinning durable growth .
    • Quote: “We originated eighty one billion dollars of assets… generating excess spread” .

What Went Wrong

  • Blended net spread compressed to 1.22% (vs. 1.26% in Q1 and 1.24% YoY), reflecting higher net cost of funds on new business and lower floating-rate income; management guided net spread to decline through year-end before stabilizing .
  • GAAP diluted EPS of $0.99 was lower vs. Q4 2024 and impacted by a $257M impairment in asset management (unrealized net losses from investment activities) .
  • Capital markets monetizations remained cyclically light, limiting principal investing income despite some flagship realizations .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Total Revenues ($USD Millions)$5,283 $5,548 $6,814
Net Income Attributable to Common ($USD Millions)$1,462 $418 $605
Diluted EPS ($USD)$2.39 $0.68 $0.99
Adjusted Net Income (ANI) ($USD Millions)$1,360 $1,119 $1,179
ANI per Share ($USD)$2.22 $1.82 $1.92
Fee-Related Earnings (FRE) ($USD Millions)$554 $559 $627
Spread-Related Earnings (SRE) ($USD Millions)$841 $804 $821
Net Spread (%)1.37% 1.26% 1.22%
Average Net Invested Assets ($USD Millions)$244,796 $255,505 $268,703

Segment breakdown:

Asset ManagementQ4 2024Q1 2025Q2 2025
Management Fees ($USD Millions)$742 $770 $816
Capital Solutions Fees ($USD Millions)$160 $154 $216
Fee-Related Performance Fees ($USD Millions)$53 $54 $63
FRE Margin (%)58.0% 57.2% 57.3%
Retirement ServicesQ4 2024Q1 2025Q2 2025
Fixed Income & Other NII ($USD Millions)$2,912 $2,914 $3,179
Alternative NII ($USD Millions)$269 $315 $319
Cost of Funds ($USD Millions)$2,116 $2,210 $2,470
Net Investment Spread ($USD Millions)$1,094 $1,048 $1,060
Net Spread (%)1.37% 1.26% 1.22%

KPIs:

KPIQ4 2024Q1 2025Q2 2025
Total AUM ($USD Billions)$751 $785 $840
Fee-Generating AUM ($USD Billions)$569 $595 $638
Total Inflows ($USD Billions)$33 $43 $61
Asset Management Inflows ($USD Billions)$19 $18 $40
Athene Gross Organic Inflows ($USD Billions)$14 $26 $21

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
FRE growth (YoY)FY 202515–20%Tracking to high end of range Maintained; bias higher
SRE growth (YoY)FY 2025Mid-single-digitMid-single-digit reiterated Maintained
SRE growth (YoY)FY 2026~10%Expect ~10% YoY next year (from Q3 commentary) Maintained
Net Spread trajectoryH2 2025 → 2026N/ADecline through 2025; stabilize thereafter New color; trajectory clarified
Bridge contribution to FREFY 2025 / FY 2026N/AModest in 2025; ~$100M in 2026 New item; additive
Dividends (AGM common)Commencing Q1 2025$1.85 annualIncreased to $2.04 annual Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Origination scale and qualityRobust origination; maintaining excess spread; CLOs at tight spreads $81B originated with excess spread vs Treasuries; stable spreads QoQ, modest widening in July Accelerating scale; disciplined risk
Funding agreements issuanceRecord issuance in Q1; diversified channels (FABN, FHLB) $12B funding agreements in Q2; third-strongest quarter Sustained strength
Stable value and new productsPreparing capabilities; expanding channels (APAC, retail) Inaugural quarter of stable value activity; management prioritizing product innovation Emerging growth vector
Europe/UK expansion (Athora / PIC)N/A in Q4; strategic partnerships noted Expect Athora PIC to be accretive; building GBP origination ecosystem Strategic optionality rising
401(k) access to private assetsN/AOn cusp of serving 401(k) channel; regulatory clarity awaited Potential structural demand
AI infrastructure financingN/AHighlighted ~$3T investment need; ~$800B private credit opportunity New secular tailwind
Spread/macro dynamicsCost of funds rising; net spread compressed Net spread down to 1.22%; set to decline through year-end, then stabilize Near-term pressure; path to stabilization

Management Commentary

  • “Record FRE $627,000,000… record ACS fees of $216,000,000” underscoring asset management momentum .
  • “Athene had another excellent quarter with $21,000,000,000 of organic inflows… FA issuance… second quarter of record volumes” highlighting liability origination strength .
  • “Blended net spread in Q2 was 122 basis points versus 126 basis points in the prior quarter” with new business spreads ~130 bps in H1, consistent with long-term returns .
  • “Tracking to the higher end of our 15% to 20% FRE guide” for 2025; “mid single digit” SRE growth reiterated .
  • Strategic vector: “PIC is the opportunity to create a massive pound based origination ecosystem… excited to enter the UK market in real size and scale” .

Q&A Highlights

  • Spread dynamics and profitability: Net spread expected to decline through 2025 as COVID-era business runs off, then stabilize; new asset spreads ~130 bps in H1 supported by proprietary origination .
  • UK expansion via Athora PIC: Management expects accretive impact over time and plans to build GBP origination capabilities to support PIC and clients .
  • Capital solutions and private credit trading: Broader transparency and liquidity tools expected to expand the ecosystem over 12–24 months, supporting fee growth .
  • 401(k) channel: Anticipated regulatory clarity could open target date and managed platforms; early experiments underway, potentially a large long-term demand source .
  • Monetizations: Realizations likely to improve with risk appetite, but management’s purchase-price discipline provides more exit optionality regardless of IPO conditions .

Estimates Context

  • Wall Street consensus estimates via S&P Global for Athene Holding Ltd. under ATH-PA were not available for EPS/EBITDA; consensus coverage is focused on Apollo’s consolidated metrics. As such, estimate comparisons are unavailable for ATH-PA. Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Earnings quality: Combined FRE and SRE at record levels with margin discipline (FRE margin 57.3%); expect FRE growth skewed to high end of the 15–20% guide in 2025 .
  • Liability origination: Funding agreements and retail annuity channels continue to drive Athene inflows ($21B in Q2), supporting net invested asset growth .
  • Near-term pressure, medium-term stabilization: Net spread compression (1.22%) likely persists through 2025 before stabilizing; watch cost of funds mix and floating-rate dynamics .
  • Strategic catalysts: Bridge Integration (2026 FRE +$100M), UK PIC transaction, and stable value/401(k) channel expansion create multi-year growth options .
  • Origination edge: $81B origination at excess spreads amid tight public markets is a durable competitive advantage underpinning SRE and fee momentum .
  • Ratings strength: AM Best affirmed Athene A+/aa- with stable outlook, supporting liability sourcing and institutional confidence .
  • Trading stance: Near term, focus on spread trajectory and inflow mix (funding agreements vs retail); medium term, upside from new products and geographic expansion as origination scales .