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The call conveyed a broadly positive outlook: strong sequential and year-over-year earnings growth (25% EPS growth), rising AUM (9% YoY to $1.1T), solid net inflows and Wealth advisory momentum, a robust balance sheet (RBC ~475%, $1.2B holding liquidity), and a compelling strategic rationale for the CoreBridge merger with projected expense synergies (~$500M) and 10%+ EPS accretion by 2028. Key headwinds include meaningful AB net outflows ($7.1B in Q1), alternatives returns materially below prior guidance (forcing a downward revision on full-year alt returns), fee-rate pressure from mix shifts, and typical execution and accounting uncertainties tied to the merger (PGAAP impacts). On balance, the positives (organic growth, profitability, capital return plans, balance-sheet strength, and merger upside) outweigh the negatives (flows and alternatives performance), supporting a confident but execution-dependent outlook.
Management reaffirmed strong 2026 targets and provided merger-era guidance: Q1 non‑GAAP operating earnings were $472M ($1.62/share; $1.68/share after notable items), up 25% YoY, and they expect 2026 EPS growth to exceed the high end of their 12–15% target; consolidated AUM was $1.1T (▲9% YoY) and pro forma AUMA with CoreBridge would be ~$1.5T across ~12M customers. They forecast the merger to be immediately accretive with at least $500M of expense synergies and 10%+ EPS accretion on a run‑rate basis by 2028 (plus potential revenue synergies), target 15%+ ROE, and project >$5B annual earnings power and >$4B annual holding‑company cash flow; pro forma GAAP book value is >$30B, statutory capital >$25B, pro forma leverage ~26% and combined NAIC RBC ≈475%. Operational cadence guidance included $1.8B target cash generation for 2026, $1.2B holding‑company liquidity today, $223M returned to shareholders in Q1 (including $147M buybacks) with a 60–70% payout target, $1.3B net inflows in the quarter (Wealth advisory inflows $2B), total sales +10% YoY, private markets AUM $85B (▲13% YoY), AB Q1 earnings $140M (▲11%) with AUM +7% but $7.1B net outflows, AB pipeline ~$28B and at least $100B of CoreBridge assets expected to move to AB over time; alternatives returns were revised down (Q1 annualized 3.5%, Q2 projected 2–3%, full‑year now expected below prior 8–9% guidance).
Non-GAAP operating EPS of $1.62 ($1.68 after notable items), up 25% year over year; consolidated non-GAAP operating earnings of $472 million and net income of $621 million ($2.14/share). Management expects 2026 EPS growth to exceed the high end of the 12%–15% target range.
Total AUM/AUA of $1.1 trillion at quarter-end, up 9% year over year; higher average AUM versus 2025 expected to be a near-term tailwind for earnings.
Total sales increased 10% year over year; $1.3 billion of net inflows in the quarter; Wealth Management had $2.0 billion of advisory net inflows and delivered a 13% trailing 12-month organic growth rate.
AB earnings grew 11% year over year, driven by higher base fees and increased ownership; base fees benefited from a 7% YoY increase in AUM; AB raised full-year performance fee forecast from $95 million to $115 million.
Private markets AUM grew 13% YoY to $85 billion; AB reported a record institutional pipeline of nearly $28 billion and management expects AB to receive at least $100 billion of incremental assets from the CoreBridge merger over the next few years.
Combined NAIC RBC ratio of approximately 475%; pro forma GAAP book value > $30 billion and pro forma statutory capital > $25 billion; holding company liquidity of $1.2 billion (above $500 million target); adjusted debt-to-capital ratio 24.5%, down 40 bps sequentially.
Returned $223 million to shareholders in Q1, including $147 million of buybacks; reiterated 60%–70% payout ratio target for 2026 and plans to be active in buyback windows with ASR backstop if needed.
Planned merger to create a combined company with ~12 million customers, $1.5 trillion AUMA, ~ $540 billion retirement/institutional AUM, expected at least $500 million of expense synergies, immediate EPS accretion and 10%+ run-rate accretion by 2028, and projection of >$5 billion annual earnings power and >$4 billion of holding company cash flow.
Retirement NIM increased 3% sequentially; ex-alts and ex-MVA spreads improved ~1 basis point sequentially and excluding alts NIM spread improved ~5 bps, indicating stabilization in spreads.
Mortality experience improved (benefit ratio ~83%, the lowest in the past year), helping earnings; private credit represents 18% of general account with ~95% investment-grade assets and stress tests indicate RBC would remain above 400% even under a severe stress scenario.
Hello, everyone.
Thank you for joining us and welcome to the Equitable Holdings, Inc. Q1 2026 Earnings and Conference Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Erik James Bass, Chief Strategy Officer and Head of Investor Relations. Erik, please go ahead.
Thank you. Good morning, and welcome to Equitable Holdings’ first quarter 2026 earnings call. Materials for today's call can be found on our website at ir.equitableholdings.com. Before we begin, I would like to note that some of the information we present today is forward-looking and subject to certain SEC rules and regulations regarding disclosure. Our results may differ materially from those expressed in or indicated by such forward-looking statements. Please refer to the Safe Harbor language on Slide 2 of our presentation for additional information. Joining me on today's call are Mark Pearson, President and Chief Executive Officer of Equitable Holdings, Inc.; Robin Matthew Raju, our Chief Financial Officer; Nicholas Burritt Lane, President of Equitable Financial; Onur Erzan, President of AllianceBernstein; and Tom Simioni, Chief Financial Officer of AllianceBernstein. During this call, we will be discussing certain financial measures that are not based on generally accepted accounting principles, also known as non-GAAP measures.
Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures and re...