MetLife (NYSE:MET) used its fourth-quarter and full-year 2025 earnings call to highlight progress under its “New Frontier” strategy, pointing to growth across key businesses, continued expense discipline, and expanded capital and reinsurance activity. Management also provided a detailed set of near-term targets for 2026 following a recent re-segmentation that added MetLife Investment Management as a standalone reporting segment.
Fourth-quarter and full-year results
MetLife reported fourth-quarter adjusted earnings of $1.6 billion, or $2.49 per share. Excluding notable items, adjusted EPS was $2.58, up 24% from $2.08 in the prior-year quarter, which management described as the company’s highest single-quarter EPS on an ex-notable basis. Adjusted premiums, fees, and other revenues (PFOs) rose 8% to $12.8 billion, and rose 29% to $18.6 billion when retained pension risk transfer (PRT) deals were included.
Net income was approximately $800 million in the fourth quarter and $3.2 billion for the full year. CFO John McCallion said the gap between net income and adjusted earnings was mostly driven by net derivative losses tied to rising long-term interest rates, favorable equity markets, and a stronger U.S. dollar, noting the company uses derivatives to hedge economic exposures that offset elsewhere in the financial statements or emerge over time.
McCallion also said two notable items reduced fourth-quarter adjusted earnings by $61 million in aggregate, or $0.09 per share: the Mexico VAT impact discussed previously and higher asbestos litigation reserves recorded in corporate and other.
Strategic progress under “New Frontier”
CEO Michel Khalaf said the company advanced its four strategic priorities over the past year with “a greater emphasis on growth,” while deploying capital and improving operating efficiency.
- Group Benefits: The business added approximately $600 million of new adjusted PFOs in 2025, with higher-margin voluntary PFOs rising 10% year-over-year.
- Retirement platform: MetLife seeded a sidecar, Chariot Re, entered the U.S. retail retirement market via flow reinsurance, and originated more than $14 billion of PRT sales—its highest annual total.
- Asset management: MetLife closed its acquisition of PineBridge Investments and established MetLife Investment Management as a new segment. At year-end, MIM had $742 billion of assets under management, up from roughly $600 billion a year earlier.
- International growth: Asia constant-currency sales increased 18% in 2025, aided by Japan, while Latin America constant-currency sales rose 12%, led by Mexico.
Segment performance and key operating trends
Group Benefits delivered fourth-quarter adjusted earnings (ex notable items) of $465 million, up 12% year-over-year, driven by favorable underwriting in life and dental and partially offset by weaker disability results. McCallion said the group life mortality ratio was 81.1% in the quarter and 83.1% for the year, below the company’s 2025 target range of 84%–89%, reflecting improvement in working-age mortality trends. Dental repricing returned the product to target profitability, though disability results were below expectations due to higher average severity and higher incidence in the quarter. Management said life mortality trends are expected to remain favorable in 2026, and it expects 7%–9% adjusted earnings growth in Group Benefits in 2026.
Retirement and Income Solutions (RIS) posted fourth-quarter adjusted earnings of $454 million, up 18% year-over-year, primarily due to higher variable investment income. RIS recorded record 2025 sales of $42 billion, including more than $14 billion of PRT and $11 billion of U.K. longevity transactions (including $7 billion in the fourth quarter). Management said RIS outlook is increasingly driven by retained exposures net of reinsurance, with average retained liability exposures expected to grow 3%–5% in 2026 and adjusted earnings expected between $1.6 billion and $1.8 billion.
Asia reported fourth-quarter adjusted earnings of $444 million, essentially flat year-over-year (up 1% in constant currency). Management said volume growth and favorable expense margins were partially offset by less favorable underwriting compared with the year-ago period, which included positive reserve refinements worth roughly $30 million. Sales rose 18% on a constant-currency basis in both the quarter and full year, primarily driven by Japan and Korea, and general account AUM at amortized cost increased 7% in constant currency.
Latin America generated fourth-quarter adjusted earnings of $227 million, up 13% reported (up 4% in constant currency), driven by volume growth. The segment’s adjusted PFOs rose 25% reported (16% constant currency), and sales were up 26% in constant currency, with strength cited in Mexico and Brazil. Khalaf said the segment’s momentum makes it “not hard to see a pathway to $1 billion in annual adjusted earnings over the near term.” For 2026, management guided to 6%–8% adjusted earnings growth, including a roughly $50 million impact from the Mexico VAT change, expected mostly in the first half.
EMEA delivered fourth-quarter adjusted earnings of $97 million, up 64% on both a reported and constant-currency basis, driven by volume growth and favorable underwriting margins. Sales increased 24% in constant currency, led by Turkey and the U.K. The company expects a quarterly earnings run rate of $90 million to $100 million in 2026, then mid- to high-single-digit growth in 2027 and 2028.
MetLife Investment Management (MIM), reported as a standalone segment for the first time, posted adjusted earnings of $60 million in the fourth quarter versus $16 million in the prior-year quarter. McCallion said the year-over-year change was primarily driven by the transition to general account market fees as part of becoming a business segment. For 2026, MetLife expects MIM revenues to rise about 30% (largely from the PineBridge combination) and adjusted earnings of $240 million to $280 million, followed by 15%–20% annual growth in 2027 and 2028. Management targets an operating margin of approximately 32% by 2028.
Investments, expenses, and capital management
Variable investment income (VII) totaled $497 million in the fourth quarter, driven by private equity returns of 2.8%, while real estate and other funds returned 1.1%. For the full year, VII was $1.5 billion, below the company’s $1.7 billion target, with management attributing much of the shortfall to real estate and other funds. Total VII assets were approximately $19 billion at year-end, with about 45% in Asia, 30% in RIS, and 25% in corporate and other.
MetLife’s direct expense ratio fell to 11.7% for 2025, which management said was ahead of target and benefited from the adoption of AI tools and other technology used to reengineer processes. For 2026, the company expects PineBridge to add 50 basis points to the direct expense ratio, with a 2026 target of 12.1%, while maintaining its 2029 target of 11.3%.
On capital, Khalaf said MetLife deployed close to $4 billion to support organic new business in 2025 and returned about $4.4 billion to shareholders through repurchases ($2.9 billion) and dividends ($1.5 billion). The company also funded about $1.2 billion of acquisitions and business investments, including PineBridge and Mesirow, investments in Chariot Re, and an increased stake in PNB MetLife in India. MetLife executed reinsurance transactions including two deals with Chariot Re totaling about $11 billion of liabilities and a Talcott risk transfer totaling $10 billion of liabilities.
At quarter-end, holding company cash and liquid assets totaled $3.6 billion, within MetLife’s $3 billion to $4 billion target buffer. The company repurchased another $200 million of shares in January and said it expects 2026 repurchases to be in line with 2025.
2026 outlook and themes raised in Q&A
For 2026, management reiterated near-term targets that include double-digit adjusted EPS growth, adjusted ROE of 15%–17%, and a two-year average free cash flow ratio of 65%–75% of adjusted earnings. MetLife expects variable investment income of approximately $1.6 billion pre-tax and guided to a corporate and other adjusted loss of $500 million to $700 million after tax. The company maintained its effective tax rate range of 24%–26%.
In the Q&A, MetLife discussed Group Benefits renewal dynamics, with management citing robust early indications for persistency and renewals, particularly in dental after pricing actions, and described disability as showing strength in early 1/1 sales despite weaker fourth-quarter disability experience. On Japan, management said customers may delay purchases of foreign-currency products during periods of significant macro volatility, but stated its value proposition remains solid; it also said fourth-quarter surrender trends were somewhat higher sequentially, driven by yen depreciation, while full-year 2025 surrenders were down versus 2024, and 2026 guidance assumes a return to long-term surrender assumptions.
Management also addressed a reporting change to adjusted earnings, excluding non-cash real estate depreciation to better reflect recurring cash flows and returns; McCallion said the change increased fourth-quarter adjusted earnings by $57 million and is expected to add about $200 million annually, mostly benefiting corporate and other.
About MetLife (NYSE:MET)
MetLife, Inc is a global provider of insurance, annuities and employee benefit programs. Headquartered in New York City, the company offers a range of risk protection and retirement solutions to individuals, employers and institutional clients. Its core businesses include life insurance, group benefits, retirement products such as annuities, and supplemental health products including dental and disability coverage.
In addition to traditional life and group insurance, MetLife provides workplace benefits and voluntary products distributed through employer-sponsored programs.
