Lincoln National Corporation

Adjusted operating income available to common stockholders was $326 million, or $1.66 per diluted share. Net loss available to common stockholders was $211 million, or $1.10 per diluted share. Alternative investments returned 12.3% annualized in the quarter, or $129 million, which was about $19 million after tax above the 10% annualized target. Group Protection operating income was $112 million, up from $101 million, with margin at 8% versus 7.4% (a 60 basis point improvement). Retirement Plan Services operating income was $43 million, up 26% from $34 million. Life Insurance operating earnings were $41 million versus an operating loss of $16 million last year. Annuities operating income was $275 million versus $290 million last year. G&A expenses were $589 million, up modestly year over year. Holding company liquidity was approximately $1.2 billion, or $805 million net of $400 million of prefunding. The estimated RBC ratio remained above the 400% target and the 420% buffer level, and leverage improved to 25%. Forward looking commentary: management said second-quarter results should benefit from normalization of the unfavorable tax-related items and an additional fee day, plus continued growth in spread income. Retirement Plan Services expects second-quarter net outflows of $2 billion to $2.5 billion due to a small number of known plan terminations. Management also said it expects Group Protection premium growth to run in the 3% to 6% range over the medium term, while annuity results should remain influenced by market levels, fee days, tax normalization, and the mix shift toward spread-based products.

Ellen Cooper framed the quarter as evidence that Lincoln’s multi-year transformation is compounding into a more resilient earnings base. She emphasized three priorities: fortifying capital, optimizing the operating model, and driving profitable growth, with a repeated focus on competing beyond price, especially in annuities and group benefits. Her tone was confident and steady, but she noted results will not always be linear and that the company is intentionally prioritizing profitability, capital efficiency, and free cash flow over top-line volume.

Chris Neczypor highlighted another quarter of strong execution, with adjusted operating income up 16% year over year and free cash flow / capital generation tracking in line with expectations. He pointed to favorable underwriting in group and life, spread income growth in annuities and retirement, and a strong alternatives contribution; he also cited $326 million of adjusted operating income, $1.66 EPS, and $589 million of G&A expense. On capital, he said the company ended with $805 million of holdco liquidity net of prefunding, leverage improved to 25%, and RBC remained above the 420% buffer. He also noted 97% of the portfolio is investment grade and that alternatives returned 3.1% in the quarter, about 12% annualized, while warning that near-term alt returns could be volatile.

Analysts asked about holdco liquidity versus free cash flow, and management said the rise in holdco cash reflects ongoing upstreaming of subsidiary free cash flow, though dividends are typically taken later in the year and quarterly timing can vary with taxes and seasonality. On alternatives, management said it is too early to call second-quarter returns, but emphasized the portfolio’s lagged effect, size of about $4.2 billion, and heavy diversification across private equity, growth equity, real assets, and other strategies. Questions on disability focused on paid family leave and claim normalization; management said the new-state PFML impact will moderate and that disability is normalizing from record-low levels, while incidence remains favorable though not as strong as last year. Analysts also pressed on annuity competition and the merger of equals in the sector; management said it is seeing pockets of price competition, especially in MYGA and some RILA areas, but remains focused on differentiated features, distribution strength, and profitability rather than volume.