Prudential Q3 Adjusted Operating EPS Falls 6.9% to $3.77 as Japan Sales Suspension Weighs
Prudential Financial's third-quarter adjusted operating income fell 6.9% to $3.77 per share, as the sales suspension at Prudential of Japan weighed on results and more than offset gains at its PGIM asset manager and steady U.S. businesses.
After-tax adjusted operating income dropped 8.5% to $1.321 billion from $1.444 billion a year earlier, according to the earnings release Prudential filed with an 8-K on Tuesday. Net income slipped 3.0% to $1.388 billion, or $3.96 per share, from $1.431 billion, or $4.01.
"Our third quarter results demonstrate the discipline and consistency with which we are executing across Prudential," Chairman and CEO Andy Sullivan said in the release. He pointed to announced sales of Prudential of Brazil, Prudential of Mexico and the company's South Africa insurance business, and to the completed sales of its businesses in Indonesia and Kenya.
Japan drags
Japan Businesses, the renamed former International Businesses segment that no longer includes Brazil and Mexico, posted pretax adjusted operating income of $559 million, down 25.5% from $750 million. Prudential cited the Prudential of Japan sales suspension, including higher expenses and less favorable underwriting results, along with lower net investment spread results.
Japan annualized new business premiums on a constant exchange rate basis fell 35.9% to $291 million from $454 million, according to the financial highlights in the release.
PGIM and U.S. businesses
PGIM's pretax adjusted operating income rose 7.8% to $263 million from $244 million. Third-party net inflows were $9.0 billion, which Sullivan said was the highest level in 10 quarters, while total PGIM assets under management were $1.465 trillion.
U.S. Businesses earned $1.173 billion before taxes on an adjusted operating basis, down 1.3% from $1.188 billion:
- Retirement: $620 million, down 2.7%, on total sales of $8.2 billion that included $3.9 billion of retail annuity sales. Sullivan said retail annuity sales reached their highest quarterly level since 2013.
- Group Insurance: $101 million, up 12.2%, with year-to-date sales of $682 million, up 22.9%.
- Individual Life: $199 million, up 30.1%, helped by a reserve refinement.
- U.S. Legacy Products: $253 million, down 17.9%, as the traditional variable annuity block continued to run off.
Corporate & Other posted an adjusted operating loss of $349 million, versus a $353 million loss.
Capital and book value
Prudential returned $741 million to shareholders in the quarter, including $250 million of share repurchases and $491 million of dividends, compared with $731 million a year earlier. It paid dividends of $1.40 per share.
Book value per share fell 6.4% to $84.88, while adjusted book value per share rose 3.2% to $102.39. Parent company highly liquid assets were $4.0 billion, and total assets under management were $1.616 trillion.
The 8-K also furnished the company's quarterly financial supplement. Management will discuss results on a conference call Wednesday, Nov. 4, at 11:00 a.m. ET.
By the numbers
- Adjusted operating EPS: $3.77, down 6.9%
- Net income per share: $3.96, versus $4.01
- Japan adjusted operating income: $559 million, down 25.5%
- PGIM adjusted operating income: $263 million, up 7.8%
- Capital returned: $741 million
- Adjusted book value per share: $102.39, up 3.2%
Sources
- Prudential Financial Form 8-K with third-quarter 2026 earnings release and quarterly financial supplement, filed Nov. 3, 2026 (accession 0001137774-26-000219)
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