Voya Financial, Inc.

Adjusted operating earnings were $140 million, or $1.51 per diluted share. That included an approximate $0.90 per share impact from alternative investment performance below expectations and severance actions. Retirement adjusted operating earnings were $190 million; fee-based revenue rose 10% year over year; margins were 38%; and defined contribution net flows were $8.1 billion. Investment management adjusted operating earnings rose 12% year over year to $57 million, with net inflows of $1.2 billion. Employee benefits adjusted operating earnings were $22 million, and the company released $8 million of reserves in stop loss. Voya generated about $150 million of excess capital in the quarter, $350 million year to date, and cash conversion was above 100%. Management said 2026 cash generation remains on track to exceed 2025 levels and that at least $100 million of buybacks are planned for the third quarter.

Heather Hamilton Lavallee framed the quarter as solid operationally, with strong commercial momentum in retirement and investment management, stabilizing and improving margins in employee benefits, and growth in wealth management. She emphasized that the second-quarter cost actions and a more constructive macro backdrop should support higher earnings in the second half. Her tone was confident but measured, repeatedly stressing disciplined execution, capital return, and organic growth.

Michael Katz said the quarter's EPS was pulled down by alternative investment performance and severance, but noted the severance expense savings should fully offset upfront costs by year-end. He highlighted retirement's resilient core spread income, 10% year-over-year fee-based revenue growth, 38% margins, and $8.1 billion of net flows, plus investment management's $1.2 billion of net inflows and 12% earnings growth. In employee benefits, he pointed to an $8 million reserve release, favorable early 2026 claims experience, and a 5-point improvement in aggregate loss ratios over 12 months. He also said cash conversion was above 100%, 2026 cash generation should exceed 2025, and the company ended the quarter with about $200 million of excess capital after repurchasing $150 million of shares.

Analysts focused on stop loss margins, whether the 2026 book is improving enough to return to target margins in 2027, and the timing of any reserve changes. Management said the third quarter is unlikely to be the right time to update the 2026 loss pick, with the fourth quarter more likely, and stressed that early 2026 claims are running better than 2024 and 2025 with lower severity and frequency. Questions also centered on retirement and investment-management flows: Voya said retirement full-service outflows tied to OneAmerica should moderate, while investment-management retail flows were pressured by overseas redemptions but are expected to improve as those headwinds fade. Analysts also pressed on expenses and benefit sales; management said severance was a deliberate operating-efficiency action, and that pricing discipline in employee benefits is intended to rebuild margins even if growth is more selective.