Principal Financial Posts Third-Quarter Operating Earnings of $2.22 Per Share, Below Estimates
Key Facts
Principal Financial reported third-quarter results on October 26, posting operating earnings of $2.22 per share under the company’s non-GAAP measure, compared with analysts’ estimate of $2.45, according to Investing.com. Revenue was $4.27 billion, below the consensus estimate of $4.3 billion, the same source said. Net income attributable to the company, meanwhile, rose to $631.9 million from $213.8 million in the same quarter a year earlier. Non-GAAP operating earnings were $481.8 million, compared with $473.7 million a year earlier. The results thus showed a contrast between year-over-year growth in operating earnings and a shortfall against market estimates for revenue and earnings per share.
On a per-share basis, non-GAAP operating earnings rose 6% to $2.22 from $2.10 in the third quarter of 2025. Excluding significant variances, operating earnings per share increased 7% to $2.49 from $2.32. The company reported both measures in its results, placing the year-over-year comparison alongside the analyst estimate it missed. Assets under management totaled $785 billion, little changed from $784.3 billion a year earlier. At the same time, assets under supervision rose 3% to $1.8403 trillion from $1.7925 trillion. The difference between the two asset measures highlights stability in the company’s managed assets and growth in the total assets it oversees.
Assets under management, however, recorded net outflows of $10.7 billion in the quarter, after inflows of $0.4 billion in the same period of 2025, according to the company’s disclosure. This figure refers to managed-asset flows and does not represent the company’s overall net cash flow. In the Retirement and Income Solutions segment, pretax operating earnings fell 4% to $297.8 million from $310.3 million. The company attributed the decline mainly to lower variable investment income and the effects of an actuarial assumption review conducted in the third quarter of 2025. The segment’s weakness was therefore tied to specific factors in investment income and the actuarial comparison, rather than a broad increase in operating expenses.
In Investment Management, operating revenue after pass-through expenses fell 2% to $436.1 million from $444 million in the same quarter a year earlier. The company said the $7.9 million decline was mainly due to lower management fees. Pressure was greater in the International Pension segment, where pretax operating earnings fell 38% to $62.4 million from $100.2 million. Net revenue also declined to $144.1 million from $187.9 million. The company attributed part of the revenue decline to unfavorable returns on “encaje” reserves in this business, identifying another segment-specific factor behind the weaker results.
On capital returns, Principal Financial returned $429 million to shareholders in the third quarter, including $250 million in share repurchases and $179 million in regular dividends. Chief Executive Diana Strable said, “We grew earnings per share... and returned $429 million to shareholders,” adding that the company was “confident in our ability to achieve our 2026 outlook.” The distribution combined share buybacks and cash dividends, while Strable’s remarks reflected management’s confidence in its annual outlook. PFG shares closed at $110.13 on October 26, according to EL7 data. The trading data provided did not include the session’s opening, high or low prices.
The company had said results would be released after U.S. markets closed on October 26 and scheduled a review call for the following day with Strable and Chief Financial Officer Joel Beitz. The results and 2026 outlook conference call is scheduled for October 27 at 10 a.m. Eastern time, according to the investor relations page. The call is expected to give management an opportunity to present the results and discuss its outlook for the year, which Strable said the company is confident it can achieve. The follow-up comes after a quarter that combined year-over-year growth in operating earnings per share with net outflows from managed assets and mixed segment performance. The call remains the next scheduled development in the company’s results disclosures.