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Voya Financial, Inc. (VOYA)·Q2 2025 Earnings Summary

Executive Summary

  • VOYA delivered solid Q2 2025 results: adjusted operating EPS of $2.46 and diluted GAAP EPS of $1.66, with after-tax adjusted operating earnings of $240M; Retirement drove gains while Employee Benefits improved on favorable claims, partially offset by higher Corporate incentive compensation .
  • Key beats vs S&P Global consensus: EPS $2.40–$2.46 actual vs $2.06 consensus (+$0.34–$0.40); revenue $1.981B actual vs $1.945B consensus (+$0.04B); consistency of beats from the prior quarter maintained [GetEstimates]* .
  • Strategic catalysts: surpassed $1T total assets across Retirement and Investment Management; Blue Owl private markets partnership (CITs, target-date integration), Edward Jones selling agreement, and on-track OneAmerica integration; management reaffirmed H2 2025 $200M share repurchases and guided to >$700M excess capital generation for FY 2025 .
  • Narrative to watch: continued margin recovery in Stop Loss (2024 cohort loss ratio lowered to 91%; 2025 cohort held at 87%), expected Retirement outflows in Q3 tied to a planned surrender, and $50M strategic spend to insource Leave Management to support bundling growth .

What Went Well and What Went Wrong

What Went Well

  • Retirement momentum: pre-tax adjusted operating earnings rose to $235M (from $214M), with defined contribution net flows of ~$12B in Q2 and total client assets up 30% YoY to $757B, buoyed by OneAmerica onboarding and recordkeeping wins .
  • Investment Management organic growth: net inflows of ~$1.8B in Q2 across institutional and retail, with TTM adjusted operating margin improving to 28.0% (ex-notables 28.7%) on disciplined expense control .
  • Claims performance: Employee Benefits delivered positive claim development in Stop Loss and favorable Group Life underwriting gains, lifting pre-tax adjusted operating earnings to $69M from $60M .
  • CEO quotes: “We are encouraged by another solid quarter… Retirement and Investment Management delivered strong earnings and net flows… Employee Benefits saw positive claim development” — Heather Lavallee .

What Went Wrong

  • Corporate drag: pre-tax adjusted operating loss widened to $(67)M (vs $(53)M), primarily due to incentive compensation tied to strong business performance .
  • GAAP revenue down YoY: total revenues were $1.981B vs $2.033B in Q2 2024, largely reflecting lower consolidated investment entities income and premiums; GAAP net income to common fell to $162M vs $201M .
  • Employee Benefits TTM margin and net revenue still depressed vs prior year due to prior-period Stop Loss development (TTM adjusted operating margin 3.7% vs 19.1% prior; net revenue down 13.8% YoY) .
  • Analyst concern: management remains “cautious” on medical cost trend (cell/gene therapy, younger cancer) and is prioritizing margin over growth; 2025 cohort loss ratio pick held at 87% amid uncertainty .

Financial Results

Consolidated Results vs Prior Year and Prior Quarter

MetricQ2 2024Q1 2025Q2 2025
Total Revenues ($USD Billions)$2.033 $1.969 $1.981
Net Income to Common ($USD Millions)$201 $139 $162
Diluted EPS (GAAP)$1.96 $1.42 $1.66
Adjusted Operating Earnings (After-tax, $USD Millions)$223 $195 $240
Adjusted Operating EPS (Diluted)$2.18 $2.00 $2.46
Adj. Operating EPS ex Notables (Diluted)$2.27 $2.15 $2.40

Segment Breakdown – Adjusted Operating Earnings Before Income Taxes ($USD Millions)

SegmentQ2 2024Q1 2025Q2 2025
Retirement$214 $207 $235
Investment Management$50 $41 $51
Employee Benefits$60 $46 $69
Corporate$(53) $(62) $(67)
Consolidated$271 $232 $289

KPIs and Operating Metrics

KPIQ2 2024Q1 2025Q2 2025
Retirement Total Client Assets ($USD Billions)$580.567 $694.180 $757.244
Investment Mgmt Net Flows ($USD Billions)$4.151 $7.310 $1.567
Stop Loss Reported Loss Ratio (%)83% 75% 80%
Group Life Loss Ratio (Interest Adjusted, %)79.3% 90.3% 74.3%
Employee Benefits Annualized In-force Premiums & Fees ($USD Billions)$3.870 $3.677 $3.649

Results vs Wall Street Consensus (S&P Global)

MetricQ2 2024 Consensus*Q2 2024 ActualQ1 2025 Consensus*Q1 2025 ActualQ2 2025 Consensus*Q2 2025 Actual
EPS (Diluted, $)2.1483*2.27 1.5136*2.15 2.0584*2.40–2.46
Revenue ($USD Billions)1.8716*2.033 1.9316*1.969 1.9462*1.981

Values retrieved from S&P Global.*

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Share RepurchasesH2 2025Target ~$200M (prior commentary) Reaffirmed ~$200M in H2 2025 Maintained
Excess Capital GenerationFY 2025YTD ~90% of AOE Plan to generate >$700M FY excess capital Raised/Clarified
Stop Loss 2024 Cohort Loss Ratio2024 Policy Year93% reserve pick (prior) Lowered to 91% on better claims; ~95% complete Lowered
Stop Loss 2025 Cohort Loss Ratio2025 Policy Year87% reserve pick (Q1) Held at 87%; ~15% complete Maintained
Retirement Net Flows (Q3 outlook)Q3 2025Not disclosedExpect outflows due to large planned surrender New disclosure
Employee Benefits Strategic SpendFY 2025~$50M investment in Leave capability On plan, modestly higher in H2 Maintained/Timing
DividendsQ3 2025Prior common dividend cadenceDeclared $0.45 common; preferred dividends detailed Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Stop Loss margin recoveryHigher loss ratios in 2024; actions on rate/underwriting 2024 cohort lowered to 91%; 2025 cohort held at 87%; cautious on medical inflation/cell-gene/cancer Improving, cautious backdrop
Retirement growth & integrationOneAmerica close; strong DC flows; client assets +21% YoY ~$12B DC net inflows; $757B client assets; nearing 10M participant accounts; expect Q3 outflows (planned) Strong growth; near-term outflow
Investment Mgmt flows & fee yieldPositive net inflows; margin expansion; ~27 bps fee yield ~$1.8B net inflows; ~27 bps fee rate stable; breadth across channels/products Broad-based strength
Capital deployment$800M returned FY 2024; debt retired Q1 >$700M excess capital plan FY 2025; H2 $200M buybacks; well-positioned for OneAmerica earn-out Supportive to equity holders
Private markets in DCNo major public mentionBlue Owl partnership for CITs/target date integration; regulatory-aware; risk-adjusted net-of-fee focus Expanding offering
Distribution partnershipsBuilding channelsEdward Jones selling agreement executed; broad advisor support Channel expansion
Participant behaviorElevated surrenders priorShift toward fixed from variable in Q2; normalization vs prior years; product mix aiding retention Improving retention mix
Leave ManagementInvestment plannedInsourcing Leave; on plan for 1/1/26 launch; >50% of RFPs bundling Leave Strategic capability build

Management Commentary

  • “We achieved a major milestone, surpassing $1 trillion in total assets across Retirement and Investment Management… nearly 10 million participant accounts in Retirement.” — Heather Lavallee, CEO .
  • “Adjusted operating earnings per share of $2.46… we added approximately $200M of excess capital in the quarter… have generated ~$400M year-to-date.” — Michael Katz, CFO .
  • “We reduced the [Stop Loss] IBNR… reserve levels from 93% to 91%… 2025 cohort held at 87%… prioritizing margin over growth.” — Michael Katz, CFO .
  • “Partnership with Blue Owl… develop CITs embedded in target date funds… broaden access to private markets for retirement participants.” — Heather Lavallee, Jay Kaduson, Matt Toms .
  • “Expect outflows in the third quarter driven by a large planned surrender… on pace for one of our strongest years, growing DC assets by >$100B in 2025.” — Michael Katz, CFO .

Q&A Highlights

  • Stop Loss trajectory: lowered 2024 cohort to 91%; 2025 cohort held at 87%; management remains cautious given first-dollar medical inflation and specialty pharma; underwriting focused on known claims and risk selection; margin prioritized over growth .
  • Capital return & earn-out: reaffirmed ~$200M H2 buybacks; sufficient capital to address OneAmerica earn-out (~mid-2026) while maintaining balanced deployment and growth investments (wealth management, retirement roll-ups, automation/AI) .
  • Blue Owl and product roadmap: co-creating CITs/target-date solutions with private strategies; fee discipline and net-of-fee return focus; regulatory sensitivity acknowledged .
  • Voluntary benefits: improved loss ratio to 47% in Q2, but guidance still ~50% in H2 due to seasonal reserves; bundling Leave driving RFP access; deliberate product/admin enhancements to boost participation and retention .
  • Investment Management flows: ~$1.8B Q2 net inflows amid volatility; fee yield ~27 bps held stable; broad momentum across institutional/retail and product suites .

Estimates Context

  • Q2 2025: EPS beat — $2.40–$2.46 actual vs $2.06 consensus (+$0.34–$0.40); revenue beat — $1.981B actual vs $1.946B consensus (+$0.04B) [GetEstimates]* .
  • Track record: Q1 2025 beat — $2.15 actual vs $1.51 consensus; Q2 2024 beat — $2.27 actual vs $2.15 consensus; revenue consistently above consensus in recent quarters [GetEstimates]* .
  • Implications: Consensus likely to recalibrate higher for Retirement-driven earnings power and improved claims in Employee Benefits; watch for near-term adjustments reflecting expected Q3 Retirement outflows (planned surrender) and timing of Leave investments .

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Retirement engine is robust: strong organic flows, OneAmerica integration, and distribution expansion (Edward Jones) support durable fee growth and spread resilience; expect a temporary Q3 outflow from a planned surrender without altering full-year trajectory .
  • Margin repair in Employee Benefits is progressing: 2024 Stop Loss cohort reserve lowered to 91%, voluntary loss ratio improving; near-term earnings carry slight uncertainty as 2025 cohort seasons and $50M Leave spend ramps .
  • Capital deployment remains shareholder-friendly: >$700M excess capital targeted for FY 2025 and ~$200M H2 buybacks reaffirmed; balance sheet strength and facility flexibility (P-Caps) underpin resilience across market environments .
  • Strategic product catalysts: Blue Owl partnership positions VOYA to lead in private-market access within DC target-date constructs, potentially enhancing fee mix and participant outcomes longer term .
  • Watch list for Q3/H2: Retirement outflows from planned surrender, medical cost trend and specialty pharma impacts on Stop Loss, progress on Leave insourcing, and execution against buyback plan .
  • Valuation drivers: sustained beat cadence vs consensus, improving TTM margins in core segments, and expanding AUM/AUA base post-$1T milestone create a supportive backdrop for estimate revisions and multiple stability .
  • Actionable: Bias to accumulate on dips tied to Q3 outflow headlines; reassess risk if Stop Loss loss ratios fail to converge to targets by late 2025 or if Leave execution materially overruns planned spend .
Notes: 
- Citations in brackets reference company documents (press release, 8-K, investor supplement) and the Q2 2025 earnings call transcript. 
- S&P Global consensus values marked with * and disclosed under “Estimates Context”.