MetLife (MET) Q2 2024 earnings summary

Executive summary

• Net income rose to $912 million ($1.28 per share), up sharply from $370 million in the prior year, driven by higher adjusted earnings and the absence of prior-year reinsurance-related losses.

• Adjusted earnings increased 9% to $1.6 billion ($2.28 per share), up 18% per share year-over-year, supported by favorable underwriting, volume growth, and higher variable investment income.

• Group Benefits posted record adjusted earnings of $533 million, up 43% year-over-year, with low mortality ratio and strong sales growth.

• The company’s diversified business model, disciplined capital allocation, and strong recurring cash flow supported long-term value creation.

• Segment reorganization in late 2023 resulted in six reporting segments, with no impact on prior period consolidated results.

Financial highlights

• Total revenues for Q2 2024 were $17.8 billion, up from $16.6 billion in Q2 2023.

• Net investment income rose to $5.2 billion, supported by higher interest rates and variable investment income.

• Adjusted return on equity was 17.3%, exceeding the 13%-15% target range.

• Direct expense ratio improved to 11.9%, below the 12.3% annual target.

• Book value per share declined 5% to $33.30; book value excluding AOCI other than FCTA down 1% to $53.12.

Outlook and guidance

• Expectation for full-year direct expense ratio to be 12.3% or below.

• RIS investment spreads anticipated to remain within the 115-140 basis point range in Q3, stabilizing in Q4 as interest rate caps mature.

• Full-year Asia sales expected to be flat year-over-year, with strong performance in the rest of Asia offsetting Japan’s challenges.

• VII returns projected to improve in the second half of the year; quarterly target for variable investment income is $375 million.

• Management expects continued impact from global economic and market volatility, including inflation, interest rate changes, and geopolitical risks.