Aflac Incorporated — Second Quarter 2026 Earnings Summary

Financial Performance

• Total revenues for the quarter were $4.1 billion, a 1.0% decrease year over year from $4.2 billion in Q2 2025.
• Net earnings were $825 million ($1.63 per diluted share), a 37.7% increase from $599 million ($1.11 per diluted share) in Q2 2025.
• Adjusted earnings were $883 million, a 7.7% decrease from $957 million in Q2 2025; adjusted earnings per diluted share decreased 1.7% to $1.75.
• Net earnings for the first six months of 2026 were $1.8 billion ($3.61 per diluted share), compared to $628 million ($1.16 per diluted share) in the same period of 2025.
• Adjusted earnings for the first six months were $1.8 billion ($3.50 per diluted share), compared to $1.9 billion ($3.43 per diluted share) in 2025.
• Annualized return on average shareholders' equity was 10.9%; annualized adjusted return on equity excluding foreign currency remeasurement was 16.6%.
• Shareholders' equity was $30.3 billion at June 30, 2026, compared to $27.2 billion at June 30, 2025.
• The company returned $1.3 billion to shareholders, consisting of $983 million in share repurchases and $309 million in dividends.
• Net investment losses were $153 million ($0.30 per share) in Q2 2026, compared to $421 million ($0.78 per share) in Q2 2025.

Guidance and Future Outlook

• Management stated the company is pursuing more profitable growth and the tactical, opportunistic deployment of capital.
• The Board set a path to extend the record of 43 consecutive years of dividend increases in 2026.
• The company intends to continue a balanced approach of investing in growth and driving long-term value.

Business Segments and Product Lines

• Aflac Japan:
  • Total net earned premiums were ¥245.1 billion ($1.5 billion), a 3.7% decrease in yen terms and 12.7% decrease in dollar terms.
  • Total adjusted revenues were ¥344.6 billion ($2.2 billion), a 3.6% decrease in yen terms and 12.6% decrease in dollar terms.
  • Pretax adjusted earnings were ¥118.2 billion ($741 million), a 3.4% increase in yen terms but a 2.1% decrease on a currency-neutral basis.
  • Pretax adjusted profit margin was 34.3% for the quarter.
  • New annualized premium sales decreased 5.6% to ¥19.6 billion ($123 million), reflecting a high prior-year baseline for Miraito, offset by growth in Tsumitasu and the new Anshin Palette medical insurance product.
• Aflac U.S.:
  • Total net earned premiums were $1.5 billion, a 2.3% increase year over year.
  • Total adjusted revenues were $1.8 billion, a 2.5% increase year over year.
  • Pretax adjusted earnings were $370 million, a 4.6% decrease year over year, primarily driven by higher benefits.
  • Pretax adjusted profit margin was 20.9% for the quarter.
  • New sales increased 2.6% to $349 million, benefiting from group voluntary benefits and network dental and vision products.
• Corporate and Other:
  • Total adjusted revenues were $291 million, a 13.4% decrease year over year.
  • Pretax adjusted earnings were a loss of $10 million, compared to a $20 million gain in the prior year.

Market and Competitive Landscape

• Aflac is the No. 1 provider of supplemental health insurance products in the U.S.
• Aflac Life Insurance Japan is the leading provider of cancer and medical insurance in Japan in terms of policies in force.
• The company was included in the World's Most Ethical Companies by Ethisphere for 20 consecutive years (2026) and Fortune's World's Most Admired Companies for 25 years (2026).
• The average yen/dollar exchange rate in Q2 2026 was 159.45, 9.3% weaker than the 144.60 rate in Q2 2025, negatively impacting reported results.

Risks and Challenges

• Significant exposure to foreign currency fluctuations, particularly the yen/dollar exchange rate, which can suppress reported results when the yen weakens.
• Risks include difficult global capital market conditions, inflation, defaults, credit downgrades, and interest rate volatility.
• Concentration of business in Japan and limited availability of acceptable yen-denominated investments.
• Operational risks include potential interruptions in telecommunication or IT systems, data security breaches, and the impact of the unauthorized network access incident in June 2025.
• Regulatory risks include changes in laws, extensive regulation, and potential worker misclassification allegations.

Management Commentary and Tone

• Chairman and CEO Daniel P. Amos stated the company delivered "solid earnings" reflecting the execution of strategy to drive long-term value.
• Management highlighted successful product initiatives in Japan, including Anshin Palette, Miraito, and Tsumitasu.
• In the U.S., the focus remains on meeting evolving employer and employee needs with supplemental health products.
• Management expressed confidence in extending the dividend increase record and maintaining a balanced capital deployment approach.

Other Key Points

• The Board of Directors declared a third-quarter dividend of $0.61 per share, payable on September 1, 2026, to shareholders of record on August 19, 2026.
• Adjusted book value excluding foreign currency remeasurement was $20.7 billion ($41.22 per share) at June 30, 2026, compared to $23.0 billion ($42.97 per share) in 2025.
• The company became a signatory of the Principles for Responsible Investment (PRI) in 2021.
• Aflac will webcast its Q2 2026 earnings conference call on August 7, 2026, at 8:00 a.m. ET.