01—Abstract
Summary
Summary of the 10-K filed February 21, 2025. Cited figures are marked; the original filing is the authoritative source.
MetLife (MET) reported a stronger 2024 versus 2023, with net income available to common shareholders of $4.2 billiona (diluted EPS $5.94) compared with $1.4 billion a year earlier, driven mainly by favorable investment gains/losses, derivative results and market risk benefit remeasurement.
Adjusted earnings available to common shareholders, the company's preferred management measure, rose to $5.8 billionb from $5.5 billion, with Asia (up $339 million on a reported basis) and Group Benefits and RIS as the largest contributors. Total revenues increased to $71.0 billion from $66.9 billion, supported by higher net investment income ($21.3 billion) and premium growth in Group Benefits and Latin America. Management set higher medium-term targets under its New Frontier five-year strategy, raising the adjusted return on equity target to 15%-17% (from 13%-15%), targeting double-digit adjusted EPS growth in the near term, and lowering the direct expense ratio target.
The company returned about $21 billionc to shareholders from 2020 through 2024, repurchased $3.2 billion of stock in 2024, and expects roughly $25 billion of free cash flow over the next five years. Holding company liquid assets were $5.1 billion, above the stated $3.0-$4.0 billion target.
Key risks include exposure to interest rate movements (the 10-year Treasury sensitivity table shows material swings in adjusted earnings), elevated Level 3 fair value assets, long-term care and variable annuity guarantee liabilities, asbestos-related litigation, a pending Malaysia sale that was called off, the pending PineBridge acquisition, and a sizable regulatory and litigation backdrop including the New York False Claims Act suit. Statutory capital remains well above regulatory thresholds, with the Statement-Based Combined RBC ratio above 360%d.
02—Key points
Key Highlights
- Net income available to common shareholders rose to $4.2 billion ($5.94 diluted EPS) from $1.4 billion in 2023; adjusted earnings available to common shareholders increased 5% to $5.8 billion.
- Raised adjusted return on equity target to 15%-17% from 13%-15% and set a new target of double-digit adjusted EPS growth in the near term under the New Frontier strategy.
- Lowered the full-year direct expense ratio target to 12.1% near term and 11.3% over the New Frontier period, from 12.3%.
- Returned approximately $21.0 billion to shareholders over 2020-2024 and expects about $25.0 billion of free cash flow over the next five years; repurchased $3.2 billion of common stock in 2024 with $1.9 billion authorization remaining.
- Holding company liquid assets were $5.1 billion at year-end 2024, above the $3.0-$4.0 billion target range.
- Pending $1.0 billion PineBridge Investments acquisition (cash at closing plus contingent payments) expected to close in 2025, while the Malaysia divestiture was mutually abandoned in February 2025.
- Statement-Based Combined RBC ratio exceeded 360% at year-end 2024 (versus 380% in 2023), indicating ample statutory capital, though the ratio declined year over year.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 21, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $70.99B$66.91B | +6.1% |
| Operating Expenses | $13.02B$12.71B | +2.4% |
| Operating Income | $6.00B$5.72B | +4.8% |
| Interest Expense | $738.00M$740.00M | −0.3% |
| Net Income | $4.44B$1.60B | +177.4% |
| EPS (Basic) | $5.98$1.82 | +228.6% |
| EPS (Diluted) | $5.94$1.81 | +228.2% |
| Shares Outstanding (Basic) | 706.40M757.70M | −6.8% |
| Shares Outstanding (Diluted) | 711.10M762.30M | −6.7% |
05—Questions
Frequently Asked Questions
Why did MetLife's net income rise so sharply in 2024?
Net income available to common shareholders increased to $4.2 billion from $1.4 billion, mainly because 2023 included large impairments on investments disposed of in the November 2023 reinsurance transaction. The 2024 results also benefited from lower net investment losses (about $1.6 billion favorable change), a smaller net derivative loss, and favorable market risk benefit remeasurement, partly offset by higher interest credited to policyholders.
How does adjusted earnings differ from GAAP net income, and which should investors focus on?
Adjusted earnings exclude market volatility items such as net investment gains (losses), net derivative gains (losses), and market risk benefit remeasurement, as well as divested business effects and accounting asymmetries. Management uses it to evaluate segments and set compensation. Investors should review both: adjusted earnings shows underlying operating trends ($5.8 billion in 2024), while GAAP results capture volatility that can be material in any given period.
What are the main sources of interest rate risk for MetLife?
The company's fixed maturity portfolio ($281 billion at fair value), mortgage loans, derivatives, and long-duration liabilities are sensitive to rates. The filing's scenario analysis shows that a 50 basis point decline in rates through 2027 would reduce adjusted earnings by about $35 million in 2025 and $159 million in 2027, while a rise would increase them by $40 million and $170 million. Management uses derivatives and product design to mitigate these effects, but reinvestment and spread compression risks remain.
What is MetLife's capital return and balance sheet flexibility outlook?
MetLife expects holding company cash to remain within its $3.0-$4.0 billion target and anticipates free cash flow of about $25 billion over five years. The free cash flow ratio to adjusted earnings was 79% in 2024, within its 65%-75% two-year average target range on a normalized basis. Dividends from subsidiaries ($5.5 billion in 2024) fund common dividends ($1.5 billion) and buybacks, and the company states it does not expect material liquidity deficiencies.
What legal and regulatory matters could affect MetLife's results?
Key matters include a large volume of asbestos-related claims (57,760 pending at year-end 2024, with the recorded liability increased to $406 million), a New York False Claims Act qui tam suit over unclaimed property that survived dismissal in October 2024, a 2018 material weakness related to group annuity reserves that drew regulatory inquiries, and ongoing scrutiny of reserves and asset adequacy. The company estimates reasonably possible losses above accruals of $0 to $125 million for matters where an estimate can be made.
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