John McCallion
Executive VP, CFO & Head of Investment Management
Hello, and thank you for joining, as I discuss MetLife’s results for the fourth quarter and the full year of 2025. The fourth quarter provided a strong close to the year, reflecting the earnings power of the firm through our diversified set of market-leading businesses. We executed on key priorities under the New Frontier strategy, further positioning MetLife to generate responsible growth and attractive returns with lower risk.
Also, you’ll notice that MetLife Investment Management is now a stand-alone business segment, reflecting the strategic importance of our asset management business, and we have combined the former MetLife Holdings segment largely into Corporate & Other.
Now let me start with the full year 2025. Net income was $3.2 billion. Our full year adjusted earnings were $5.9 billion. The primary difference between net income and adjusted earnings relates to net losses on derivatives, which are used to hedge certain economic exposures and generally have an economic offset elsewhere in the financial statements. On a per share basis, adjusted earnings excluding notable items, rose 10% to $8.89.
A few additional highlights for the full year. We saw strong volume growth across our businesses. This included recording $14.2 billion in pension risk transfer or PRT transactions in 2025. Expense discipline remained a key focus with the full year direct expense ratio of 11.7% beating our 2025 target of 12.1%, which excludes notable items and PRT transactions. Our free cash flow exceeded our 2-year average target ratio of 65% to 75% of adjusted earnings. And our full year adjusted return on equity was 15.9% within our target range of 15% to 17%.
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