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Athene Holding Ltd. (ATH-PA)·Q3 2025 Earnings Summary

Executive Summary

  • Strong Q3 with record fee and spread engine at the parent and solid Athene operating KPIs: Athene total revenues rose to $8.00B (+49% q/q, +23% y/y) and Net income available to AHL common stockholder reached $1.22B (+143% q/q, +111% y/y), while Spread Related Earnings (SRE) increased to $872M (+6% q/q, +2% y/y) and net spread ticked up to 1.24% .
  • Management guided Q4 SRE ex-notables to ~$880M and net spread ~1.25%, and sees full-year 2025 SRE growth ~8%, above the mid-single-digit target (positive estimate trajectory into 2026 with 10% SRE growth expected) .
  • Flows remained robust: gross organic inflows of $22.6B led by Retail ($10.0B) and Funding Agreements ($9.7B); net flows were $12.0B despite seasonally heavier maturities elevating outflows (core outflows annualized 13.1%) .
  • Key catalysts: clarity on SRE trajectory into Q4, stable-to-improving net spread despite tight public spreads, continued strong retail and funding agreement inflows, and risk management actions reducing rate sensitivity at Athene to the lowest in a decade .

What Went Well and What Went Wrong

  • What Went Well

    • Origination and demand backbone: “Origination is the lifeblood of our business,” with ~$75B originated in Q3 and stable spreads, supporting Athene’s asset supply and SRE resilience .
    • Clear near-term outlook: “We estimate that SRE in Q4 will be approximately $880 million… [and] full year SRE… approximately 8%,” exceeding the prior mid-single-digit target, bolstering visibility .
    • Risk management progress: Athene “significantly reduced… floating rate” exposure; SRE sensitivity to a 25 bp short-rate move now ~$10–15M vs. $30–40M previously (lowest in ~a decade), improving earnings stability .

  • What Went Wrong

    • Tight spread environment: Management acknowledged tight AAA/CLO and IG markets, which have pressured net spread vs. prior-year levels (Q3’25 net spread 1.24% vs. 1.44% in Q3’24) despite operational offsets .
    • Elevated outflows from maturities: Maturity-driven outflows rose to $5.53B (7.9% annualized), lifting core outflows to 13.1% annualized in Q3 and tempering net flows vs. Q2 .
    • Alternatives below LT bogey: Alternatives returned ~10% annualized in Q3 (management LT target 11%), with a ~$37M shortfall vs LT expectation; management expects improvement as cash drag diminishes and Athora deployment advances .

Financial Results

  • Income statement and spread metrics
MetricQ3 2024Q1 2025Q2 2025Q3 2025
Total Revenues ($USD Millions)$6,522 $4,186 $5,359 $7,998
Net Income Available to AHL Common ($USD Millions)$580 $420 $503 $1,223
Spread Related Earnings (SRE) ($USD Millions)$855 $804 $820 $872
SRE ex-Notable Items ($USD Millions)$830 $826 $820 $847
Net Spread (%)1.44% 1.26% 1.22% 1.24%
Net Investment Spread (%)1.83% 1.65% 1.58% 1.60%
Alternative Net Investment Income ($USD Millions)$236 $315 $319 $321
Net Investment Earned Rate (%)5.12% 5.06% 5.21% 5.34%
Cost of Funds (%)3.34% 3.46% 3.68% 3.79%
  • Balance sheet and assets/liabilities
KPIQ3 2024Q1 2025Q2 2025Q3 2025
Average Net Invested Assets ($USD Millions)$237,810 $255,505 $268,703 $280,607
Net Invested Assets ($USD Millions)$242,663 $262,367 $275,040 $286,174
Net Reserve Liabilities ($USD Millions)$225,899 $241,666 $254,572 $266,451
Total Assets ($USD Millions)———$429,915 (9/30/25)
  • Flows by channel (organic inflows/outflows)
Flows ($USD Millions)Q3 2024Q2 2025Q3 2025
Retail Inflows$9,209 $7,256 $10,046
Flow Reinsurance Inflows$944 $2,031 $2,542
Funding Agreements Inflows$9,570 $11,707 $9,724
Other Inflows— $237 $304
Gross Organic Inflows$20,017 $21,232 $22,616
Gross Outflows$(8,158) $(7,230) $(10,638)
Net Flows$11,859 $14,002 $11,978
Core Outflows (Annualized %)10.4% 8.7% 13.1%

Notes:

  • SRE and spread metrics exclude market volatility and certain non-operating items per company definitions .
  • Management highlighted Athene’s cash at $11.0B (3.8% of net invested assets) as of Q3-end 2025 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
SRE ex-Notables ($)Q4 2025Not provided~$880M New
Net Spread (%)Q4 2025Not provided~1.25% New
SRE Growth (y/y)FY 2025Mid-single-digit target (qualitative) ~8% (above target) Raised/Above prior target
SRE Growth (y/y)FY 202610% target (LT plan) 10% expected (reaffirmed) Maintained
Alternatives Return (annualized)Q3 2025Prelim: ~$325M pre-tax (~10%) [10/2] Actual: $321M (9.88% annualized) In-line/slight delta
Preferred DividendsQ4 2025Regular quarterly cadenceSeries A: $0.396875; B: $0.3515625; D: $0.3046875; E: $0.484375 (per depositary share) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1–Q2 2025)Current Period (Q3 2025)Trend
Net spread trajectoryNet spread 1.26% (Q1), 1.22% (Q2); SRE ex-notables $826M (Q1), $820M (Q2) Net spread 1.24%; SRE ex-notables $847M; Q4 guide ~1.25% and ~$880M Stabilizing to modestly improving
Alternatives returns9.86% annualized in Q2 vs 11% LT ~9.88% in Q3; ~$37M below 11% LT; expect improvement as cash drag eases and Athora deployment progresses Slight positive bias
Flows/inflows mixStrong retail and funding agreements; $21.2B gross inflows in Q2 $22.6B gross inflows; Retail $10.0B; Funding $9.7B; Flow reins $2.5B Robust and diversified
Rate sensitivityNoted exposure to net floatersReduced floaters; 25 bp sensitivity now ~$10–15M vs $30–40M (lowest in ~a decade) Improved resilience
Origination capacitySustained platform growth~$75B origination in Q3 with stable spreads; supports asset supply and pricing discipline Scaling and steady
Regulatory discourse—Management rebutted “private letter ratings arbitrage” systemic risk concerns; emphasized IG mix and rating diversity Proactive engagement

Management Commentary

  • Strategic and growth backdrop: “We believe origination is the lifeblood of our business… $75 [billion] of origination… spreads stable q/q… The growth flywheel is spinning.” — CEO Marc Rowan .
  • Near-term earnings visibility: “We estimate that SRE in Q4 will be approximately $880 million… [driving] full year SRE… approximately 8%… above the mid single digit target.” — CEO Marc Rowan; CFO Martin Kelly .
  • Risk management actions: “We took hedging actions to further reduce… floating rate [exposure]… SRE sensitivity on net floaters… now approximately $10–15 million versus $30–40 million previously.” — CFO Martin Kelly .
  • Athene’s competitive position: “Athene’s core earnings power is very strong… [new business] in line with our mid-teens ROE target… investment-grade origination.” — CFO Martin Kelly .

Q&A Highlights

  • Origination targets: While running ahead of plan, management is not revising 5-year origination targets this early; momentum supports 2026 FRE growth >20% largely from existing strategies .
  • Wealth/traditional AM partnerships: Expect greater private asset exposure via partnerships (e.g., daily NAV capability), potentially adding privates to existing mutual funds/ETFs at scale, a multi-billion channel expansion .
  • Ratings/systemic risk: Management refuted concerns about “private letter ratings” arbitrage, citing Athene’s high IG mix and multiple NRSRO coverage; stressed underwriting discipline across cycles .
  • SRE pathway: 2025 SRE trending above plan; 2026 SRE +10% contemplated with diminishing prepayment headwinds and portfolio optimization .
  • Alternatives path to LT return: AAA near LT target; cash drag expected to ease; Athora deployment (e.g., PIC) anticipated to be accretive .

Estimates Context

  • Wall Street (S&P Global) consensus for Athene’s EPS/Revenue is not available due to Athene’s structure (subsidiary with listed preferreds). We attempted to retrieve quarterly consensus, but only actuals were available and no estimate counts — indicating Street estimates are not maintained at this entity level (analysts typically model APO consolidated metrics including SRE/ANI) .
  • Implication: Post-result estimate adjustments are more relevant at APO (parent) where management reiterated 20%+ FRE growth for 2026 and 10% SRE growth for 2026, which may drive Street revisions at that level .

Key Takeaways for Investors

  • SRE visibility has improved with a clear Q4 guide (~$880M) and 2025 growth (~8%) exceeding prior targets; guidance and reduced rate sensitivity are supportive for multiples on the parent and credit-tight environments .
  • Net spread stabilized despite tight public spreads via origination depth, strategic capital fees, and disciplined liability management; watch for sustained 1.20–1.25% range into early 2026 .
  • Flows remain strong and diversified (Retail, Funding Agreements, Flow Reinsurance), underpinning asset growth; maturity-driven outflows can create lumpiness but net inflows remain healthy .
  • Alternatives modestly below LT bogey due to cash drag should improve as deployment normalizes and Athora capital is put to work; AAA performance is on track .
  • Risk posture continues to improve (lowest rate sensitivity in ~a decade) with ongoing focus on senior, IG assets and durable origination platforms, which should cushion cyclical pressures .
  • Catalysts: Nov/Dec fixed-income session for Athene, confirmation of Q4 SRE/NS, continued retail sales momentum, funding agreement activity, and progress on traditional AM partnerships that could scale private asset distribution .

Appendix: Other Q3 2025 Disclosures

  • Preferred dividends declared for payment on Dec 30, 2025: Series A $0.396875; Series B $0.3515625; Series D $0.3046875; Series E $0.484375 per depositary share .
  • Pre-earnings preliminary estimate (Oct 2): Alternative net investment income of ~$325M pre-tax (~10% annualized) vs. actual $321M (~9.88%); near in-line outcome .

Sources:

  • Athene Q3 2025 Financial Supplement furnished via 8-K (Nov 10, 2025) .
  • Apollo Q3 2025 8-K/PPT and Earnings Call (substantial Athene detail and guidance) .
  • Athene press release: Preferred dividends (Oct 28, 2025) .
  • Athene preliminary alt NII 8-K (Oct 2, 2025) .