10-QPeriod: Q2 FY2023

AMERIPRISE FINANCIAL INC Quarterly Report for Q2 Ended Jun 30, 2023

Filed August 8, 2023For Securities:AMP

Summary

Ameriprise Financial, Inc. (AMP) reported solid results for the second quarter of 2023. Total revenues increased by 11% year-over-year to $3.88 billion, primarily driven by a significant 64% increase in Net Investment Income, bolstered by rising interest rates and growth in banking and certificate products. This was partially offset by a decrease in Management and Financial Advice Fees, largely due to net outflows in the Asset Management segment and market depreciation. Net income saw a substantial 45% increase to $890 million, or $8.21 per diluted share. The company also demonstrated strong capital management, repurchasing approximately $1.6 billion in common stock during the quarter and announcing an additional $3.5 billion repurchase authorization. The Advice & Wealth Management segment was a key driver of growth, with adjusted operating earnings increasing 49% year-over-year, benefiting from higher short-term interest rates and increased deposit balances.

Financial Highlights

32 data points
Beta

Revenue

$4.01B

Net Income

$890.00M

22.2% Net Margin

EPS (Diluted)

$8.21

Total Assets

$169.78B

Cash & Equivalents

$8.73B

Free Cash Flow

$561.00M

Financial Statements
Beta
Revenue$4.01B
Operating Expenses$2.75B
Net Income$890.00M
EPS (Basic)$8.36
EPS (Diluted)$8.21
Shares Outstanding (Basic)106.40M
Shares Outstanding (Diluted)108.40M

Key Highlights

  • 1Total net revenues increased 11% to $3.88 billion, driven by higher net investment income and distribution fees.
  • 2Net income surged by 45% to $890 million, translating to diluted earnings per share of $8.21.
  • 3Net investment income rose significantly by 524% for the quarter, benefiting from rising interest rates and growth in banking and certificate products.
  • 4Advice & Wealth Management segment adjusted operating earnings increased 49% to $731 million, showcasing strong client engagement and profitability.
  • 5The company repurchased approximately $1.6 billion of common stock in Q2 2023 and announced a new $3.5 billion repurchase authorization, indicating confidence in future performance and commitment to shareholder returns.
  • 6Total AUM and AUA increased by 9% to $1.28 trillion, reflecting positive market appreciation and client inflows across key segments.
  • 7Despite a 10% decrease in Asset Management net revenues due to outflows and market conditions, the segment's adjusted operating earnings remained solid at $162 million.

Frequently Asked Questions

Ameriprise Financial's net income increased by 45% to $890 million in the second quarter of 2023, compared to $614 million in the same period of the prior year. This translates to a significant improvement in diluted earnings per share from $5.37 to $8.21.

The significant increase in Net Investment Income was primarily driven by the favorable impact of rising interest rates on the company's investment portfolio yield, including portfolio repositioning. Additionally, growth in Ameriprise Bank customer deposits and certificate products, alongside higher average invested assets, also contributed to this increase.

The Advice & Wealth Management segment demonstrated strong performance, with adjusted operating earnings increasing by 49% year-over-year to $731 million. This growth was largely attributed to higher short-term interest rates benefiting bank cash deposits and certificate products, as well as continued net inflows into advisory wrap accounts.

Ameriprise Financial remains committed to returning capital to shareholders. The company repurchased approximately $1.6 billion of its common stock during the second quarter of 2023 and announced an additional $3.5 billion share repurchase authorization. The company also continues to pay regular quarterly dividends.