Executive Summary

Q4 adjusted operating EPS was $1.40 (vs. $1.63 in Q4’23) on $2.01B total revenue, as strong Wealth Solutions and Investment Management were outweighed by elevated Health Solutions loss ratios; adjusted EPS ex-notables was $1.50 .
Management expects a material improvement in Stop Loss profitability in 2025 driven by a 21% net effective rate increase on January renewals and tightened risk selection, targeting a 5–15% improvement in the January 2025 cohort’s loss ratio .
2025 setup: ~$750M excess capital generation before growth investments, buybacks weighted to 2H, with “mid-$8s” implied EPS before ~$50M of 2025 growth investments (slightly below $8 after) and ROE guided to 12–13% with a path back to 14–16% long-term .
OneAmerica retirement business closed Jan 2, 2025; reaffirmed ~$200M revenue and ~$75M operating earnings benefit in 2025; expect flows volatility and ~90% retention embedded in plan .
Potential stock catalysts: Stop Loss margin recovery cadence, execution on OneAmerica integration/retention, sustained IM net flows vs. known divested outflows, and capital deployment pacing (2H-weighted buybacks) .

What Went Well and What Went Wrong

What Went Well
- Wealth Solutions: Revenue growth and margin expansion above targets; FY adjusted operating earnings rose to $820M (+30% Y/Y) and TTM adjusted operating margin reached 39.9% (41.4% ex-notables) .
- Investment Management: Four consecutive quarters of net inflows and FY organic growth of 4.4%; Q4 pretax AOEBIT $66M (ex-Allianz NCI), with sustained fee yield strength and margin expansion ahead of plan .
- Capital & Strategy: Returned $800M to shareholders in 2024; invested in Sconset Re to extend leadership in third-party insurance asset management; closed OneAmerica, adding scale and capabilities .
- Quote: “We delivered strong revenue growth, margin expansion and commercial momentum in our Wealth Solutions and Investment Management businesses” – CEO Heather Lavallee .
What Went Wrong
- Health Solutions (Stop Loss): Q4 pretax AOEBIT loss of $(102)M; Stop Loss loss ratio spiked to 115.4% (Q3: 93.4%; Q2: 83.2%) due to underpricing and higher claim frequency/severity .
- Consolidated EPS impact: Q4 adjusted operating EPS declined to $1.40 (vs. $1.63 in Q4’23) despite strong fee businesses; net income fell to $93M (vs. $118M in Q4’23) .
- Outlook headwinds: 2025 prepayment income guided ~$25M lower Y/Y; Wealth margins expected to moderate from 2024 highs amid lower spread income and investment in growth/implementation .

Financial Results

Quarterly progression (QoQ) – income statement highlights

Metric	Q2 2024	Q3 2024	Q4 2024
Total Revenues ($M)	$2,033	$1,956	$2,010
Net Income to Common ($M)	$201	$98	$93
Adjusted Operating EPS ($)	$2.18	$1.90	$1.40
Adjusted Operating EPS ex-notables ($)	$2.27	$2.12	$1.50

Year-over-year (YoY) reference point

Metric	Q4 2023	Q4 2024
Total Revenues ($M)	$1,819	$2,010
Net Income to Common ($M)	$118	$93
Adjusted Operating EPS ($)	$1.63	$1.40
Adjusted Operating EPS ex-notables ($)	$1.97	$1.50

Segment pretax adjusted operating earnings (AOEBIT)

Segment AOEBIT ($M)	Q2 2024	Q3 2024	Q4 2024
Wealth Solutions	$214	$211	$210
Health Solutions	$60	$23	$(102)
Investment Management (ex-Allianz NCI)	$50	$55	$66
Corporate	$(53)	$(59)	$(27)

Key KPIs and margins

KPI	Q2 2024	Q3 2024	Q4 2024
Wealth TTM Adjusted Operating Margin (%)	37.1%	37.9%	39.9%
Wealth Client Assets ($M)	$580,567	$608,493	$612,205
IM Net Inflows ($B)	4.8	3.8	3.4
IM AUM ($M)	$336,390	$340,520	$339,358
Health Stop Loss Loss Ratio (%)	83.2%	93.4%	115.4%
Health Total Aggregate Loss Ratio (%)	72.9%	77.7%	94.5%
Health Annualized In-force Premiums & Fees ($M)	$3,870	$3,864	$3,856

Estimates (S&P Global) vs actuals

Wall Street consensus via S&P Global was unavailable at the time of this analysis due to data access limits. As a result, we cannot present beat/miss vs estimates for Q4 2024. Values not shown are unavailable from S&P Global at this time.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Return on Equity	FY 2025	Long-term target 14–16% (framework)	12–13% for 2025; path back to 14–16% longer term	Lowered near-term; long-term unchanged
Implied Operating EPS	FY 2025	N/A	“Mid‑$8s” before ~$50M growth investments; slightly < $8 after	New disclosure
Excess Capital Generation	FY 2025	“Significantly increase in 2025” (prior commentary)	~ $750M before growth investments	Quantified
Capital Return Mix	FY 2025	$800M in 2024 actual	~50% of capital generated in 2025; buybacks 2H‑weighted	New year mix
Prepayment Income	FY 2025	N/A	Down ~ $25M Y/Y (timing, not economic)	Headwind
Stop Loss (pricing/margins)	2025 cohort	N/A	Net effective +21% rate on Jan renewals; 5–15% loss ratio improvement expected	Improvement actions
OneAmerica contribution	FY 2025	~$200M revenue; ~$75M operating earnings (prior stated)	Reaffirmed ~$200M revenue and ~$75M operating earnings; retention ~90% assumption	Reaffirmed
Dividend	Q1 2025	$0.45 in Q3’24 announced increase	$0.45 per share declared for Q1’25	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3)	Current Period (Q4)	Trend
Stop Loss repricing & risk selection	Underpricing in 2024; prioritizing margin over growth; targeting 2x rate on Jan’25 renewals	Achieved +21% net effective rate on Jan’25; expect 5–15% loss ratio improvement; focus on known claims risk selection	Improving trajectory, still elevated loss ratios near term
OneAmerica integration	Announced acquisition; $75M earnings, $200M revenue expected in 2025	Closed Jan 2; integration underway; 90% retention assumption; pipelines strong; some flow volatility expected	On plan
Capital return & FCF	Return $800M in 2024; 2025 excess capital to increase	~ $750M excess capital generation 2025; ~50% return in 2025; 2H‑weighted buybacks	Healthy FCF; staged capital returns
Investment Management flows & fee yield	Three straight quarters of positive net flows; margin expansion; insurance channel growth	Four quarters of positive flows; 2024 net inflows $12.5B; expect ~$6.8B divested outflows in 2H’25; fee yields sustainable	Positive organic, offset by known divested outflows
Technology/Leave management	Building leave mgmt capability; launch planned	~$50M 2025 investment; breakeven 2026; positive earnings 2027+	Investment phase
Prepayment income	Below LT expectations	Guide ~ $25M lower Y/Y in 2025; timing effect	Modest headwind

Management Commentary

CEO Heather Lavallee: “We delivered strong revenue growth, margin expansion and commercial momentum in our Wealth Solutions and Investment Management businesses… offset by higher loss ratios in Health Solutions… We expect improved profitability in our Stop Loss business in 2025.”
CFO Michael Katz on 2025 EPS/ROE: “Think about our 90% free cash flow generation… to get at EPS of approximately in the mid‑8s… slightly less than $8 [after growth investments]… 2025 at the high end of 12–13% ROE; journey back to 14–16% long‑term.”
CFO Michael Katz on Stop Loss actions: “We achieved a net effective rate increase of 21% for the January 2025 cohort… expect to improve the loss ratio… by 5% to 15%.”
CEO Heather Lavallee on OneAmerica: “This strategic move adds $60B in assets… and nearly $4B of spread-based assets… We… expect $200M in revenue and $75M in incremental operating earnings from OneAmerica in 2025.”

Q&A Highlights

ROE and EPS framing: 2025 ROE guided 12–13% (high end likely), with implied mid‑$8s EPS before ~$50M growth investments; path back to 14–16% long‑term .
Buybacks: Weighted to 2H 2025 due to growth investments and debt retirement sequencing; plan to return ~50% of 2025 capital generation .
Stop Loss underwriting: Confidence in reserves and in improved risk selection (focus on known claims), with much higher pricing on underperforming cases .
OneAmerica retention: Assumes ~90% plan retention in modeling; same recordkeeping platform should aid transition .
IM divested outflows: Expect ~$6.8B in 2H’25 from Venerable; growth elsewhere outpacing at higher fee yield .

Estimates Context

Wall Street consensus (S&P Global) was unavailable at time of analysis due to data access limits. Consequently, we cannot determine beat/miss vs consensus for Q4 2024. Management did not provide explicit quarterly guidance for revenues/EPS; near‑term framing was via capital generation, ROE, EPS implications, and segment-level drivers .

Key Takeaways for Investors

Core fee engines (Wealth/IM) are executing: WS margins near 40% TTM and IM margins expanding; both delivered above-plan results in 2024, positioning 2025 well if market beta holds .
Health headwinds are being addressed: Jan’25 Stop Loss rates +21% and tightened underwriting should drive 5–15% LR improvement on the key cohort; watch non‑January repricing cadence and claim trends .
2025 math: ~ $750M excess capital generation pre‑investments, ~50% returned, buybacks 2H‑skewed; implied mid‑$8s EPS before ~$50M growth investments and slightly below $8 after .
OneAmerica: Integration underway, ~$200M revenue and ~$75M operating earnings expected in 2025; model ~90% retention and some flow volatility .
IM flows vs known outflows: Continued organic inflows with sustainable fee yields, but ~$6.8B divested outflows expected in 2H’25; net effect matters for reported AUM/margins optics .
Wealth margin moderation likely from 2024 highs due to lower spread income and growth investments; secular fee growth intact with strong sales pipeline and participant growth .
Near-term trading: Stock likely most sensitive to evidence of Stop Loss LR normalization and confirmation of 2H buyback ramp; medium-term re-rating depends on achieving EPS/ROE trajectory and successful OneAmerica integration .

References: All figures and statements are sourced from Voya’s Q4 2024 8‑K press release and investor supplement, Q4 2024 earnings call transcript, Q3 and Q2 2024 press releases, and related press announcements as cited in brackets.

Voya Financial, Inc. (VOYA)·Q4 2024 Earnings Summary