Aflac's net earnings went from $29 million to $1,019 million and diluted EPS from $0.05 to $1.98 — but the underlying insurance business earned almost exactly what it earned a year ago. Pretax adjusted earnings, the measure the company's own CODM uses to run the segments, came in at $1,122 million against $1,123 million in Q1 2025: flat to within a rounding error. The entire headline swing is the reversal of a $963 million net investment loss booked in the prior-year quarter into a $49 million gain this quarter, a $1,012 million mark-to-market whipsaw that says more about rates and the yen than about underwriting. What the quarter actually reveals is a supplemental insurer whose premium base keeps shrinking while its per-share numbers keep rising — because management is retiring shares faster than the book runs off.
- Consolidated Balance Sheet
1-1. Asset composition
| Item | Dec 31, 2025 ($M) | Mar 31, 2026 ($M) | Change % |
|---|---|---|---|
| Cash and cash equivalents | 6,245 | 5,654 | -9.5% |
| Fixed maturity AFS (incl. consolidated VIEs) | 64,121 | 63,228 | -1.4% |
| Fixed maturity held-to-maturity | 16,120 | 15,752 | -2.3% |
| Equity securities | 887 | 851 | -4.1% |
| Commercial mortgage and other loans, net | 9,765 | 9,770 | +0.1% |
| Other investments | 6,622 | 7,937 | +19.9% |
| Total investments and cash | 103,760 | 103,192 | -0.5% |
| Deferred policy acquisition costs | 9,034 | 8,976 | -0.6% |
| Total assets | 116,470 | 116,280 | -0.2% |
The balance sheet barely moved in aggregate, but the composition inside it did. The single largest mover was "other investments," up 19.9% to $7,937 million — a $1,315 million reallocation that lines up with the $1,321 million of net cash the company put into that bucket in the investing section of the cash flow statement. Against that, the traditional bond book shrank: available-for-sale fixed maturities fell 1.4% and held-to-maturity 2.3%. This is Aflac moving money down the liquidity curve in search of yield.
