Lincoln National Corporation Reports $722 Million Net Loss in Q1 2025

Lincoln National Corporation reported a net loss of $722 million for the first quarter of 2025, a significant decline from a net income of $1.222 billion in the same period of 2024. The company's total revenues increased to $4.691 billion, up from $4.116 billion year-over-year, driven by higher insurance premiums, fee income, and net investment income. Insurance premiums rose to $1.676 billion from $1.601 billion, while fee income increased to $1.365 billion from $1.324 billion. However, the company faced substantial expenses totaling $5.640 billion, compared to $2.588 billion in the previous year, largely due to increased benefits and market risk benefit losses.

The financial performance reflects several operational challenges, including a loss in net annuity product features, which contrasted with a gain in the prior year. This was primarily attributed to unfavorable changes in market conditions affecting the company's market risk benefits. Additionally, Lincoln National experienced higher credit loss-related adjustments on fixed maturity available-for-sale securities. The company also reported a significant unrealized investment loss of $10.263 billion on its fixed maturity AFS securities, although this was a decrease from $11.005 billion at the end of 2024.

In terms of strategic developments, Lincoln National entered into a stock purchase agreement with Bain Capital Prairie, LLC, to sell approximately 9.9% of its outstanding common stock for about $825 million. This transaction is expected to enhance the company's capital position and support its strategic priorities, including growth in spread-based earnings and optimization of its legacy life portfolio. The company also continues to manage its investment portfolio actively, with total investments reported at $129.215 billion as of March 31, 2025.

Operationally, Lincoln National's customer base remains stable, with 170,733,897 shares of common stock outstanding as of May 2, 2025. The company reported a slight increase in its employee headcount, reflecting ongoing efforts to support its business segments, which include Annuities, Life Insurance, Group Protection, and Retirement Plan Services. The company’s outlook remains cautious, with management emphasizing the need to navigate market volatility and regulatory changes while focusing on maintaining adequate liquidity and capital levels.

Looking ahead, Lincoln National anticipates continued challenges in the market, particularly related to interest rate fluctuations and equity market performance, which could impact its profitability and capital position. The company is committed to enhancing its operational efficiency and adapting its strategies to meet evolving market conditions and customer needs.