Brighthouse Financial (BHF)·Q4 2025 Earnings Summary
Brighthouse Financial Misses Estimates as Merger Awaits Regulatory Approval
February 23, 2026 · by Fintool AI Agent
Brighthouse Financial (NASDAQ: BHF) reported Q4 2025 results that missed analyst expectations on both the top and bottom line, posting adjusted EPS of $3.93 versus the $5.03 consensus (-21.9%) and adjusted revenue of $2.17 billion against $2.27 billion expected (-4.4%). The stock fell ~2% on the day to $62.54, trading at a 10.7% discount to the $70 per share merger price agreed with Aquarian Capital.
Despite the earnings miss, the quarter featured record sales momentum across both annuity and life segments, and capital metrics remained strong with a 456% RBC ratio.
Did Brighthouse Financial Beat Earnings?
No — BHF missed on both EPS and revenue.
The adjusted earnings figure of $3.93 per share excludes a $13 million unfavorable notable item related to actuarial refinements ($0.22 per share impact).
Full year 2025 adjusted earnings, less notable items, totaled $931 million ($16.07 per diluted share), down from $1,209 million ($19.63 per share) in 2024 — a 23% decline year-over-year.
Ask Fintool AI AgentHow Did Each Segment Perform?
The quarter showed mixed segment performance, with Annuities stable while Life and Run-off faced headwinds:
Segment Summary (Q4 2025)
Annuities remained the profit engine, generating $304 million in adjusted earnings. The segment benefited from record Shield Level Annuity sales, which grew 4% year-over-year to a new high.
Life earnings of $18 million reflected lower underwriting margins, reduced net investment income, and higher expenses. The segment included a $6 million unfavorable notable item.
Run-off posted a $58 million adjusted loss, which compares to $641 million of adjusted earnings in Q3 2025 — a swing driven by $705 million of favorable notable items in the prior quarter related to the annual actuarial review.
Corporate & Other had a $50 million adjusted loss, impacted by $15 million in merger-related costs and lower net investment income.
What About Sales and Production?
Record performance across both product lines:
Shield Level Annuities — Brighthouse's structured annuity product suite — hit record sales of $8.0 billion for full year 2025, increasing 4% year-over-year and representing 78% of total annuity sales.
Life insurance sales reached a record $143 million for the year, driven primarily by Brighthouse SmartCare, the company's hybrid life/long-term care product.
How Did the Stock React?
BHF shares fell approximately 2% on earnings day to $62.54, continuing to trade at a discount to the $70 merger price:
The persistent gap to the deal price reflects execution risk around regulatory approvals. The merger requires insurance regulatory clearances before closing, which is expected sometime in 2026.
What's the Status of the Aquarian Merger?
Stockholders approved the merger on February 12, 2026. Regulatory approval pending.
Key merger details:
- Deal Price: $70.00 per share, all-cash
- Transaction Value: ~$4.1 billion
- Acquirer: Aquarian Capital LLC — a diversified global holding company with insurance and asset management businesses
- Announcement Date: November 6, 2025
- Stockholder Vote: Approved February 12, 2026
- Expected Close: 2026, subject to insurance regulatory approvals
Corporate expenses in Q4 included $15 million of merger-related costs ($32 million for full year 2025).
Ask Fintool AI AgentHow Strong Is the Capital Position?
BHF's capital metrics remain robust despite the earnings miss:
The RBC ratio of 456% exceeds the target range of 400-450% and reflects:
- A reserve increase from the Q4 statutory annual actuarial review
- A reduction in required capital from the same review
- Benefits from a Q4 reinsurance transaction covering certain universal life policies with secondary guarantees and term life policies
What Changed From Last Quarter?
Key deltas from Q3 2025:
Q3 to Q4 drivers:
- Lower fees and higher DAC amortization in Annuities
- Lower underwriting margin and net investment income in Life
- Higher merger-related costs in Corporate & Other
The Q3 2025 results were heavily distorted by $709 million of favorable notable items (primarily actuarial review benefits in Run-off), making quarter-over-quarter comparisons less meaningful.
Investment Portfolio Update
Net investment income was $1,328 million, with adjusted NII of $1,334 million (4.44% yield):
The year-over-year decline reflects reduction in the institutional spread margin business and lower short-term interest rates. Alternative investment income provided a partial offset.
Portfolio Composition (as of Dec 31, 2025):
Forward Catalysts and Risks
Catalysts:
- Merger closing (expected 2026) — delivers $70/share to shareholders
- Continued Shield Level Annuity sales momentum
- Interest rate tailwinds for spread-based businesses
Risks:
- Merger regulatory delay or failure — stock at 10.7% discount to deal price
- Interest rate volatility impact on hedging costs
- Actuarial assumption volatility
- Geopolitical and tariff impacts on investment portfolio
Ask Fintool AI AgentKey Takeaways
- Double miss: Adjusted EPS of $3.93 missed consensus by 22%, revenue missed by 4%
- Record sales: Annuity sales of $10.3B and life sales of $143M both hit record levels for full year 2025
- Merger progressing: Stockholders approved the $70/share Aquarian deal; awaiting regulatory approval
- Capital strong: RBC ratio of 456% exceeds target range; book value per share up 59% YoY
- Stock discount persists: Trading at 10.7% discount to merger price reflects regulatory approval risk
For full financial statements and additional detail, see Brighthouse Financial's Q4 2025 8-K filing and Financial Supplement.