• Full Year Non-GAAP Operating Earnings: $2 billion or $5.93 per share, up 29% year-over-year.
• Adjusted Non-GAAP Operating EPS: $6.18, up 20% compared to the prior year.
• Assets Under Management and Administration: Increased 10% year-over-year, exceeding $1 trillion.
• Cash Flow to Holding Company: $1.5 billion, at the high end of guidance range.
• Capital Deployment: $1.3 billion in 2024, equating to a 66% payout ratio.
• Run Rate Expense Saves: Achieved $100 million, targeting $150 million by 2027.
• Incremental Net Investment Income: $80 million generated, targeting $110 million by 2027.
• Net Inflows: $7.1 billion in retirement and $4 billion in wealth management for the full year.
• AB Full Year Active Net Inflows: $4.3 billion.
• Private Markets AUM: Increased 14% to $70 billion.
• Fourth Quarter Non-GAAP Operating Earnings: $522 million or $1.57 per share, up 18% year-over-year.
• Fourth Quarter Adjusted Non-GAAP EPS: $1.65 per share, up 23% year-over-year.
• GAAP Net Income for the Quarter: $899 million.
• AB Fourth Quarter Earnings: Boosted by $66 million of fees from public alternative strategies.
• Protection Solutions Full Year Earnings: $239 million, excluding notable items.
• 2025 Cash Generation Forecast: $1.6 billion to $1.7 billion.
• 2025 EPS Growth Target: Consistent with 12% to 15% target.
• 2024 Value of New Business: Approximately $775 million.

• Warning! GuruFocus has detected 4 Warning Signs with RRX.

Release Date: February 06, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Equitable Holdings Inc (NYSE:EQH) reported a 29% year-over-year increase in full-year non-GAAP operating earnings per share, reaching $5.93.
• Assets under management and administration increased by 10% year-over-year, surpassing $1 trillion.
• The company generated $1.5 billion in cash flow to the holding company, with over 50% coming from asset and wealth management businesses.
• Equitable Holdings Inc (NYSE:EQH) achieved $100 million in run rate expense savings and is on track to meet or exceed a $150 million target by 2027.
• The company reported strong organic growth with $7.1 billion in net inflows in retirement and $4 billion in wealth management for the full year.

Negative Points

• The Protection Solutions segment experienced elevated net mortality due to two large claims with minimal reinsurance coverage.
• The company forecasts 2025 earnings for Protection Solutions to be at the lower end of the $200 million to $300 million range.
• Alternative investment income was below plan, reducing earnings by $27 million after tax in the fourth quarter.
• The Corporate and Other segment is expected to generate a full-year loss of approximately $400 million in 2025.
• Equitable Holdings Inc (NYSE:EQH) anticipates alternative returns in its investment portfolio to start the year in the 5% to 6% range, below the target range of 8% to 12%.

Q & A Highlights

Q: Do you view the Bermuda entity as a means to sustain the 60% to 70% payout ratio target, or could it lead to upside or free up existing capital? A: Robin Raju, CFO: The Bermuda entity supports consistent cash flow and provides optionality for reinsuring in-force business or supporting new business. It aligns with our strategy to generate capital and support future growth while maintaining economic discipline.

Q: How is Equitable thinking about a potential C-Corp conversion for AllianceBernstein? A: Jackie Marks, CFO of AllianceBernstein: Our analysis indicates that AB's current structure as a publicly traded partnership is in the best interest of our unitholders due to its attractive tax structure. A C-Corp conversion would lead to higher tax rates and significant earnings dilution.

Q: Can you provide more color on the guidance for Protection Solutions and thoughts on reinsurance? A: Robin Raju, CFO: We achieved $230 million of earnings on a normalized basis in 2024. We are guiding towards the lower range of $200 million to $300 million due to volatility in mortality. We are exploring expense management and reinsurance to mitigate volatility and will provide an update in the first half of 2025.

Q: What is the outlook for BlackRock's LifePath Paycheck products in 2025 and 2026? A: Nicholas Lane, Head of Retirement, Wealth Management, Protection Solutions: We expect similar inflows in 2025 as in 2024, with approximately $600 million from six plans. We see significant long-term opportunities in the $8 trillion 401(k) market for in-plan guaranteed solutions.

Q: How is Equitable addressing competition in the RILA market, and what are the expectations for growth? A: Nicholas Lane, Head of Retirement, Wealth Management, Protection Solutions: We remain bullish on the RILA market, expecting it to grow at 10% annually. We focus on value and maintain discipline in pricing, achieving targeted 15% IRRs. Our unique distribution model and business strategy provide a competitive advantage.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.