October 30, 2025 Reinsurance

Lincoln Financial Reports 2025 Third Quarter Results

Business Wire

RADNOR, Pa.--(BUSINESS WIRE)--
Lincoln Financial (NYSE: LNC) today reported financial results for the third quarter ended September 30, 2025.

Strong financial performance in the quarter demonstrates broadening of momentum and balanced growth across all business segments.

Third quarter net income available to common stockholders was $411 million, or $2.12 per diluted share.

Third quarter adjusted operating income available to common stockholders was $397 million, or $2.04 per diluted share.

The difference between net income and adjusted operating income was primarily attributable to the non-economic impact of changes in market risk benefits and a change in the fair value of an embedded derivative related to the Fortitude Re reinsurance transaction.

The annual assumption review resulted in a $50 million unfavorable impact to net income and a $2 million favorable impact to adjusted operating income in the quarter.

"This quarter’s results underscore the broad-based momentum across Lincoln as we advance our strategic priorities," said Ellen Cooper, Chairman, President and CEO of Lincoln Financial. "Annuities delivered year-over-year earnings growth driven by higher account balances and an increase in spread income. Life Insurance posted solid results supported by stable mortality and operational efficiencies, while Group Protection continued to execute its profitable growth strategy with another quarter of increased premiums year over year. Retirement Plan Services also reported strong performance, attributable to higher account balances. Across the enterprise, sales were robust and well-balanced, with each business delivering results aligned to its targeted strategies.

"We continue to see opportunities to invest in the business to drive sustained growth. Our disciplined focus on maintaining capital flexibility, increasing profitability, and leveraging operational efficiencies positions us to deliver long-term shareholder value."

Business Highlights

Our 2025 third-quarter results reflected broad-based execution across our four businesses as they continued to deliver on their respective strategic priorities. The segment operating results presented below do not include the impacts of our annual assumption review. See the segment discussions that follow for additional information.

Retail Solutions

Annuities delivered operating income of $318 million, up 6% compared to the prior-year quarter, primarily driven by favorable equity markets, higher spread income, and favorable tax items. Annuities recorded $174 billion in ending account balances, net of reinsurance, a record high, and sales of $4.5 billion, up 32% year over year. Each product category continued to generate over $1 billion of sales. Spread-based products accounted for more than 60% of total sales in the quarter.

Life Insurance delivered operating income of $54 million, a $40 million increase from the prior-year quarter, driven by stable mortality, higher investment income, and lower net G&A expenses. Alternative investment income returns were essentially in line with our annual target. Our increased emphasis on risk-sharing products drove strong growth across executive benefits and other life products, resulting in total sales of $298 million—more than doubling compared to the prior-year quarter.

Workplace Solutions

Group Protection delivered operating income of $110 million, in line with the prior-year quarter, as favorable life experience was offset by unfavorable long-term disability resolutions. Premiums were 5% higher year over year, resulting from robust prior-year sales and strong persistency. Sales of $116 million in the quarter were 38% higher year over year, driven by disciplined growth across market segments and products.

Retirement Plan Services reported operating income of $46 million in the quarter, up 5% year over year, driven primarily by favorable equity markets and spread expansion, partially offset by stable value outflows. Net inflows were $0.8 billion, compared to $0.7 billion in the year-ago quarter. Total deposits were $5.0 billion in the quarter, up 20% over the prior-year quarter, and first-year sales of $2.4 billion were up almost 50% year over year.

Earnings Summary

(in millions, except per share data)	For the Three Months Ended					For the Nine Months Ended
	9/30/2024			9/30/25		9/30/24		9/30/25
Net income (loss)	$	(528	)	$	445	$	1,588	$	423
Net income (loss) available to common stockholders — diluted		(562	)		411		1,511		343
Net income (loss) per diluted share available to common stockholders⁽¹⁾	$	(3.29	)	$	2.12	$	8.75	$	1.87
Adjusted income (loss) from operations		392			431		971		1,183
Adjusted income (loss) from operations available to common stockholders		358			397		891		1,103
Adjusted income (loss) from operations per diluted share available to common stockholders	$	2.06		$	2.04	$	5.16	$	6.01

⁽¹⁾In periods where a net loss is presented, basic shares are used in the diluted EPS and adjusted diluted EPS calculations, as using diluted shares would result in a lower loss per share.

Reconciliation of Net Income (Loss) to Adjusted Income (Loss) from Operations⁽¹⁾

(in millions)	For the Three Months Ended						For the Nine Months Ended
	9/30/24			9/30/25			9/30/24			9/30/25
Net income (loss) available to common stockholders — diluted	$	(562	)	$	411		$	1,511		$	343
Less:
Preferred stock dividends declared		(34	)		(34	)		(80	)		(80	)
Adjustment for deferred units of LNC stock in our deferred compensation plans		—			—			3			—
Net income (loss)		(528	)		445			1,588			423
Less:
Net annuity product features, pre-tax⁽¹⁾		(381	)		410			1,319			(277	)
Net life insurance product features, pre-tax		(125	)		(22	)		(253	)		(37	)
Credit loss-related adjustments, pre-tax		(88	)		(38	)		(124	)		(91	)
Investment gains (losses), pre-tax		(105	)		(35	)		(416	)		(218	)
Changes in the fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans, pre-tax⁽¹⁾		(446	)		(191	)		(51	)		(266	)
Gains (losses) on other non-financial assets - sale of subsidiaries/businesses, pre-tax⁽¹⁾		(2	)		—			582			—
Other items, pre-tax⁽¹⁾		(19	)		(105	)		(238	)		(65	)
Income tax benefit (expense) related to the above pre-tax items		246			(5	)		(202	)		194
Adjusted income (loss) from operations	$	392		$	431		$	971		$	1,183
Adjusted income (loss) from operations available to common stockholders	$	358		$	397		$	891		$	1,103

⁽¹⁾ Refer to the full reconciliation at the back of this release for footnotes.

Variable Investment Income

Alternative Investment Income, after-tax⁽¹⁾	For the Three Months Ended										For the Nine Months Ended
(in millions)	9/30/24		12/31/24		3/31/25		6/30/25		9/30/25		9/30/24		9/30/25
Annuities	$	3	$	3	$	2	$	3	$	2	$	6	$	7
Life Insurance		73		76		55		74		75		157		204
Group Protection		1		1		1		1		2		3		4
Retirement Plan Services		2		2		1		2		1		3		4
Other Operations		—		1		—		—		—		—		—
Consolidated	$	79	$	83	$	59	$	80	$	80	$	169	$	219

⁽¹⁾ Excludes alternative investment income on investments supporting our modified coinsurance and coinsurance with funds withheld agreements as we have limited economic interest in those investments.

Prepayment Income, after-tax	For the Three Months Ended										For the Nine Months Ended
(in millions)	9/30/24		12/31/24		3/31/25		6/30/25		9/30/25		9/30/24		9/30/25
Annuities	$	—	$	2	$	—	$	3	$	3	$	1	$	6
Life Insurance		3		1		1		—		1		5		2
Group Protection		1		1		—		1		—		—		1
Retirement Plan Services		—		1		—		—		1		1		1
Other Operations		—		—		—		—		—		—		—
Consolidated	$	4	$	5	$	1	$	4	$	5	$	7	$	10

Items Impacting Segment and Other Operations Results

	For the Three Months Ended September 30, 2025
(in millions)	Annuities			Life Insurance			Group Protection		Retirement Plan Services		Other Operations
After-tax impacts:
Alternative investment income compared to return target⁽¹⁾	$	—		$	(2	)	$	—	$	—	$	—
Prepayment income⁽²⁾		3			1			—		1		—
Annual assumption review		(8	)		(29	)		39		—		—
Tax items		—			—			—		—		—
Other		—			—			—		—		—
Total impact	$	(5	)	$	(30	)	$	39	$	1	$	—


	For the Three Months Ended September 30, 2024
(in millions)	Annuities		Life Insurance		Group Protection			Retirement Plan Services		Other Operations
After-tax impacts:
Alternative investment income compared to return target⁽¹⁾	$	1	$	6	$	—		$	—	$	—
Prepayment income⁽²⁾		—		3		1			—		—
Annual assumption review		1		8		(1	)		—		—
Tax items		—		—		—			—		—
Other		—		—		—			—		—
Total impact	$	2	$	17	$	—		$	—	$	—

⁽¹⁾Alternative investment income comparison to return target assumes a 10% annual return on the alternative investment portfolio.

⁽²⁾ Prepayment income is actual income reported in the quarter.

Capital and Liquidity

	As of or For the Three Months Ended
(in millions, except percent and per share data)	9/30/24		12/31/24		3/31/25		6/30/25		9/30/25
Holding company available liquidity⁽¹⁾	$	459	$	463	$	466	$	466	$	461
RBC ratio⁽²⁾	>420%			433%	>420%		>420%		>420%
Book value per share (BVPS), including AOCI	$	46.97	$	42.60	$	41.96	$	44.91	$	49.56
Book value per share, excluding AOCI⁽³⁾	$	62.67	$	72.06	$	67.04	$	67.95	$	69.66
Adjusted book value per share⁽³⁾	$	70.04	$	72.34	$	73.19	$	72.77	$	74.23

⁽¹⁾ Holding company available liquidity presented as of 9/30/24 and 12/31/24 does not include the $300 million prefunding of a 2025 maturity.

⁽²⁾ The RBC ratio is calculated annually as of December 31, but is reported in the March statutory reporting, and as such, the quarterly ratios presented for 9/30/24, 3/31/25, 6/30/25 and 9/30/25 are considered estimates based on information known at the time of reporting.

⁽³⁾ Refer to the reconciliation to book value per share, including AOCI, at the back of this release.

Annuities

(in millions, except ROA data)	As of or For the Three Months Ended																	As of or For the Nine Months Ended
	9/30/24			12/31/24			3/31/25			6/30/25			9/30/25			Change		9/30/24			9/30/25			Change
Total operating revenues	$	1,195		$	1,223		$	1,198		$	1,214		$	1,270		6.3	%	$	3,673		$	3,682		0.2	%
Total operating expenses		836			864			858			876			902		7.9	%		2,645			2,636		(0.3	)%
Income (loss) from operations before taxes		359			359			340			338			368		2.5	%		1,028			1,046		1.8	%
Federal income tax expense (benefit)		58			56			50			51			58		0.0	%		171			160		(6.4	)%
Income (loss) from operations	$	301		$	303		$	290		$	287		$	310		3.0	%	$	857		$	886		3.4	%
Income (loss) from operations, excluding impact of annual assumption review	$	300		$	303		$	290		$	287		$	318		6.0	%	$	856		$	894		4.4	%
Total sales	$	3,375		$	3,689		$	3,789		$	4,019		$	4,467		32.4	%	$	10,038		$	12,274		22.3	%
Net flows	$	(1,637	)	$	(1,891	)	$	(1,676	)	$	(1,162	)	$	(1,143	)	30.2	%	$	(4,584	)	$	(3,981	)	13.2	%
Average account balances, net of reinsurance	$	161,680		$	165,424		$	163,688		$	159,806		$	170,318		5.3	%	$	158,245		$	164,735		4.1	%
Return on average account balances (bps)		74			73			71			72			73					72			72
Return on average account balances (bps), excluding impact of annual assumption review		74			73			71			72			75					72			72

Income from operations was $310 million for the third quarter, compared to $301 million in the prior-year quarter. The annual assumption review had an $8 million unfavorable impact on income from operations in the current quarter, compared to a $1 million favorable impact in the third quarter of 2024.

Not including the impact of the annual assumption review, income from operations was $318 million, up 6% compared to the prior-year quarter, primarily driven by favorable equity markets, higher spread income, and favorable tax items.

Total sales were $4.5 billion in the quarter, increasing 32% compared to the prior year. Spread-based products comprised more than 60% of total sales.

Net outflows were approximately $1.1 billion in the quarter, compared to net outflows of $1.6 billion in the prior-year quarter, driven by strong sales momentum.

Average account balances, net of reinsurance, were $170 billion, increasing 5% over the prior-year quarter, primarily due to growth in RILA.

Life Insurance

(in millions)	As of or For the Three Months Ended																As of or For the Nine Months Ended
	9/30/24			12/31/24			3/31/25			6/30/25		9/30/25			Change		9/30/24			9/30/25			Change

Total operating revenues	$	1,589		$	1,608		$	1,587		$	1,602	$	1,610		1.3	%	$	4,640		$	4,798		3.4	%
Total operating expenses		1,568			1,634			1,619			1,568		1,586		1.1	%		4,719			4,772		1.1	%
Income (loss) from operations before taxes		21			(26	)		(32	)		34		24		14.3	%		(79	)		26		132.9	%
Federal income tax expense (benefit)		(1	)		(11	)		(16	)		2		(1	)	0.0	%		(31	)		(14	)	54.8	%
Income (loss) from operations	$	22		$	(15	)	$	(16	)	$	32	$	25		13.6	%	$	(48	)	$	40		183.3	%
Income (loss) from operations, excluding the impact of annual assumption review	$	14		$	(15	)	$	(16	)	$	32	$	54		285.7	%	$	(56	)	$	69		223.2	%
Average account balances, net of reinsurance	$	44,055		$	44,746		$	44,390		$	45,651	$	48,534		10.2	%	$	43,188		$	46,192		7.0	%
Total sales	$	122		$	119		$	97		$	121	$	298		144.3	%	$	319		$	516		61.8	%

Income from operations was $25 million, compared to $22 million in the prior-year quarter. The third quarter 2025 annual assumption review had a $29 million unfavorable impact on income from operations, compared to a favorable impact of $8 million in the prior-year quarter.

Not including the impact of the annual assumption review, income from operations was $54 million, compared to $14 million in the third quarter of 2024, driven by stable mortality, higher investment income, and lower net G&A expenses.

Total sales were $298 million, up 144% compared to the prior-year quarter, as our focus on risk-sharing products resulted in strong growth in our executive benefits and other life products.

Average account balances, net of reinsurance, were $49 billion, up 10% versus the prior-year quarter.

Group Protection

(in millions, except margin data)	As of or For the Three Months Ended																	As of or For the Nine Months Ended
	9/30/24			12/31/24			3/31/25			6/30/25			9/30/25			Change		9/30/24			9/30/25			Change
Total operating revenues	$	1,432		$	1,418		$	1,521		$	1,538		$	1,507		5.2	%	$	4,299		$	4,566		6.2	%
Total operating expenses		1,295			1,282			1,393			1,319			1,319		1.9	%		3,896			4,030		3.4	%
Income (loss) from operations before taxes		137			136			128			219			188		37.2	%		403			536		33.0	%
Federal income tax expense (benefit)		28			29			27			46			39		39.3	%		85			113		32.9	%
Income (loss) from operations	$	109		$	107		$	101		$	173		$	149		36.7	%	$	318		$	423		33.0	%
Income (loss) from operations, excluding the impact of annual assumption review	$	110		$	107		$	101		$	173		$	110		0.0	%	$	319		$	384		20.4	%
Insurance premiums	$	1,288		$	1,274		$	1,371		$	1,386		$	1,352		5.0	%	$	3,871		$	4,109		6.1	%
Total sales	$	84		$	467		$	157		$	187		$	116		38.1	%	$	389		$	460		18.3	%
Total loss ratio		71.4	%		71.0	%		72.4	%		65.9	%		68.3	%				72.2	%		68.9	%
Total loss ratio, excluding the impact of the annual assumption review		71.3	%		71.0	%		72.4	%		65.9	%		72.2	%				72.1	%		70.2	%
Operating margin⁽¹⁾		8.4	%		8.4	%		7.4	%		12.5	%		11.0	%				8.2	%		10.3	%
Operating margin, excluding the impact of annual assumption review		8.5	%		8.4	%		7.4	%		12.5	%		8.1	%				8.2	%		9.3	%

⁽¹⁾Operating margin is calculated by dividing income (loss) from operations by insurance premiums.

Income from operations was $149 million in the quarter, 37% higher than the prior-year quarter. The annual assumption review had a $39 million favorable impact on income from operations in the current quarter, compared to a $1 million unfavorable impact in the prior-year quarter. The reported operating margin was 11.0%, compared to 8.4% in the third quarter of 2024.

Not including the impact of the annual assumption review, income from operations was $110 million, in line with the prior-year quarter, as more favorable life experience was offset by unfavorable long-term disability resolutions, and the operating margin was 8.1%, 40 basis points lower than the prior-year quarter.

Insurance premiums were $1.4 billion in the quarter, increasing 5% year over year due to robust prior-year sales and strong persistency.

Sales increased 38% year over year, driven by disciplined growth across market segments and products.

The reported total loss ratio was 68.3%, 310 basis points lower than the prior-year quarter. Not including the impact of the annual assumption review, the total loss ratio was 72.2% compared to 71.3% in the prior-year quarter.

Retirement Plan Services

(in millions, except ROA data)	As of or For the Three Months Ended															As of or For the Nine Months Ended
	9/30/24		12/31/24			3/31/25			6/30/25			9/30/25		Change		9/30/24		9/30/25			Change
Total operating revenues	$	335	$	337		$	327		$	331		$	343	2.4	%	$	984	$	1,001		1.7	%
Total operating expenses		286		288			289			289			290	1.4	%		847		867		2.4	%
Income (loss) from operations before taxes		49		49			38			42			53	8.2	%		137		134		(2.2	)%
Federal income tax expense (benefit)		5		6			4			5			7	40.0	%		17		18		5.9	%
Income (loss) from operations	$	44	$	43		$	34		$	37		$	46	4.5	%	$	120	$	116		(3.3	)%

Deposits	$	4,180	$	3,473		$	4,115		$	3,594		$	5,008	19.8	%	$	11,265	$	12,717		12.9	%
Net flows	$	651	$	(732	)	$	(2,184	)	$	(585	)	$	755	16.0	%	$	845	$	(2,014	)	NM
Average account balances	$	110,550	$	113,711		$	113,075		$	111,734		$	119,259	7.9	%	$	106,595	$	115,014		7.9	%
Return on average account balances (bps)		16		15			12			13			15				15		14

Income from operations was $46 million in the quarter, up 5% compared to the prior year, primarily resulting from favorable equity markets and spread expansion, partially offset by stable value outflows.

Net inflows were $0.8 billion, primarily due to continued strength in first-year sales.

Total deposits were $5.0 billion, up 20% over the prior-year quarter. First-year sales of $2.4 billion were up almost 50% year over year.

Average account balances were $119 billion, increasing 8% from the prior year, driven by favorable equity markets.

Other Operations

(in millions)	As of or For the Three Months Ended																	As of or For the Nine Months Ended
	9/30/24			12/31/24			3/31/25			6/30/25			9/30/25			Change		9/30/24			9/30/25			Change
Total operating revenues	$	52		$	42		$	52		$	41		$	50		(3.8	)%	$	118		$	143		21.2	%
Total operating expenses		157			160			164			157			177		12.7	%		466			499		7.1	%
Income (loss) from operations before taxes		(105	)		(118	)		(112	)		(116	)		(127	)	(21.0	)%		(348	)		(356	)	(2.3	)%
Federal income tax expense (benefit)		(21	)		(23	)		(17	)		(25	)		(28	)	(33.3	)%		(72	)		(74	)	(2.8	)%
Income (loss) from operations⁽¹⁾	$	(84	)	$	(95	)	$	(95	)	$	(91	)	$	(99	)	(17.9	)%	$	(276	)	$	(282	)	(2.2	)%

⁽¹⁾Income (loss) from operations does not include preferred dividends.

Unrealized Gains and Losses

The company reported a net unrealized loss of $7.9 billion (pre-tax) on its available-for-sale securities as of September 30, 2025, compared to a net unrealized loss of $7.0 billion (pre-tax) as of September 30, 2024. The year-over-year increase was primarily due to higher Treasury rates.

The tables attached to this release define and reconcile the non-GAAP measures adjusted income (loss) from operations, adjusted income (loss) from operations available to common stockholders, book value per share excluding AOCI, and adjusted book value per share to net income (loss), net income (loss) available to common stockholders, and book value per share including AOCI, calculated in accordance with GAAP.

This press release contains statements that are forward-looking, and actual results may differ materially. Please see the Forward-looking Statements – Cautionary Language at the end of this release for factors that may cause actual results to differ materially from the company’s current expectations.

For other financial information, please refer to the company’s third quarter 2025 statistical supplement and third quarter 2025 earnings supplement, which are available in the investor relations section of its website http://www.lincolnfinancial.com/investor.

Conference Call Information

Lincoln Financial will discuss the company’s third quarter results with the investment community in a call beginning at 8:00 a.m. Eastern Time on Thursday, October 30, 2025.

The call will be broadcast live through the company’s website at www.lincolnfinancial.com/webcast. Please log on to the webcast at least 15 minutes prior to the start of the call to download and install any necessary streaming media software. A replay of the call will be available by 10:30 a.m. Eastern Time on October 30, 2025, at www.lincolnfinancial.com/webcast.

About Lincoln Financial

Lincoln Financial helps people confidently plan for their vision of a successful financial future. As of December 31, 2024, approximately 17 million customers trust our guidance and solutions across four core businesses – annuities, life insurance, group protection, and retirement plan services. As of September 30, 2025, the company had $347 billion in end-of-period account balances, net of reinsurance. Headquartered in Radnor, PA., Lincoln Financial is the marketing name for Lincoln National Corporation (NYSE: LNC) and its affiliates. Learn more at LincolnFinancial.com.

Non-GAAP Measures

Management believes that the use of the non-GAAP financial measures adjusted income (loss) from operations, adjusted income (loss) from operations available to common stockholders (or adjusted operating income (loss)) and adjusted income (loss) from operations per diluted share available to common stockholders is helpful to investors in evaluating the company’s performance.

Management believes that excluding the following items from adjusted income (loss) from operations enhances understanding of the underlying trends and long-term performance of the company’s business. Management excludes “net annuity product features” as this adjustment primarily represents the difference between the valuation of reserves and the valuation of derivatives utilized for hedging our variable annuity and indexed annuity products, which can fluctuate significantly from period to period based on changes in equity markets and interest rates. This difference is due to the hedge focus on managing risks to statutory capital as opposed to the GAAP reserves. Management excludes “net life insurance product features” for similar reasons. In addition, management excludes “credit loss-related adjustments” and “investment gains (losses)” as the timing of changes in allowances or sales of credit-impaired investments depends largely on market credit cycles and can vary considerably from period to period and the timing of other sales of investments that would result in gains or losses is driven by market conditions, including interest rates, and other factors. Management excludes “changes in the fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans” as this adjustment represents the economics of investments in underlying funds withheld portfolios supporting reinsurance agreements that have been transferred to third-party reinsurers, which is not indicative of our ongoing results.

Finally, management excludes from adjusted income (loss) from operations certain additional items (as set forth in the definition below) that are not necessarily indicative of current operating fundamentals or future performance of the business segments, and, in most instances, decisions regarding these items do not necessarily relate to the operations of the individual segments. Management believes excluding these items better explains the results of the company’s ongoing businesses in a manner that allows for enhanced understanding of underlying trends, company performance and business fundamentals.

Management also believes that the use of the non-GAAP financial measures book value per share, excluding accumulated other comprehensive income (“AOCI”), and adjusted book value per share enables investors to analyze the amount of our net worth that is attributable to our business operations. Book value per share, excluding AOCI is useful to investors because it eliminates the effect of items that can fluctuate significantly from period to period, primarily based on changes in interest rates. Adjusted book value per share is useful to investors because it eliminates the effect of items that can fluctuate significantly from period to period, primarily based on changes in equity markets and interest rates.

For the historical periods, reconciliations of non-GAAP measures used in this press release to the most directly comparable GAAP measure may be included in this Appendix to the press release and/or are included in the Statistical Supplements for the corresponding periods contained in the Earnings section of the Investor Relations page on our website: http://www.lincolnfinancial.com/investor.

Definitions of Non-GAAP Measures Used in this Press Release

Adjusted income (loss) from operations, adjusted income (loss) from operations available to common stockholders, book value per share, excluding AOCI, and adjusted book value per share, as used in the press release, are non-GAAP financial measures and do not replace GAAP net income (loss), net income (loss) available to common stockholders, and book value per share, including AOCI, the most directly comparable GAAP measures.

Adjusted Income (Loss) from Operations

Adjusted income (loss) from operations is GAAP net income (loss) excluding the following items, as applicable:

Items related to annuity product features, which include changes in market risk benefits (“MRBs”), changes in the fair value of the related hedge instruments inclusive of income allocated to support the cost of hedging or future benefits, and changes in the fair value of the embedded derivative liabilities and the associated index options for our indexed annuity products (collectively, “net annuity product features”);
Items related to life insurance product features, which include changes in the fair value of derivatives we hold as part of VUL hedging, changes in reserves resulting from benefit ratio unlocking associated with the impact of capital markets, and changes in the fair value of the embedded derivative liabilities of our IUL contracts and the associated index options we hold to hedge them (collectively, “net life insurance product features”);
Credit loss-related adjustments on fixed maturity AFS securities, mortgage loans on real estate and reinsurance-related assets (“credit loss-related adjustments”);
Changes in the fair value of equity securities and certain other investments, the impact of certain derivatives, and realized gains (losses) on sales, disposals and impairments of financial assets (collectively, “investment gains (losses)”);
Changes in the fair value of reinsurance-related embedded derivatives, trading securities and mortgage loans on real estate electing the fair value option (“changes in the fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans”);
Income (loss) from the initial adoption of new accounting standards, accounting policy changes and new regulations, including changes in tax law;
Income (loss) from reserve changes, net of related amortization, on business sold through reinsurance;
Losses from the impairment of intangible assets and gains (losses) on other non-financial assets;
Income (loss) from discontinued operations;
Other items, which include the following: certain legal and regulatory accruals; severance expense related to initiatives that realign the workforce; transaction, integration and other costs related to mergers and acquisitions including the acquisition or divestiture, through reinsurance or other means, of businesses or blocks of business, and certain other corporate initiatives; mark-to-market adjustment related to the LNC stock component of our deferred compensation plans (“deferred compensation mark-to-market adjustment”); gains (losses) on modification or early extinguishment of debt; and impacts from settlement or curtailment of defined benefit obligations; and
Income tax benefit (expense) related to the above pre-tax items, including the effect of tax adjustments such as changes to deferred tax valuation allowances.

Adjusted Income (Loss) from Operations Available to Common Stockholders

Adjusted income (loss) from operations available to common stockholders is defined as after-tax adjusted income (loss) from operations less preferred stock dividends.

Book Value Per Share, Excluding AOCI

Book value per share, excluding AOCI, is calculated based upon a non-GAAP financial measure.

It is calculated by dividing (a) stockholders’ equity, excluding AOCI and preferred stock, by (b) common shares outstanding.
Book value per share is the most directly comparable GAAP measure.

Adjusted Book Value Per Share

Adjusted book value per share is calculated based upon a non-GAAP financial measure.

It is calculated by dividing (a) stockholders’ equity, excluding AOCI, preferred stock, changes in MRBs, guaranteed living benefit (“GLB”) and guaranteed death benefit (“GDB”) hedge instruments gains (losses), and the difference between amounts recognized in net income (loss) on reinsurance-related embedded derivatives and the underlying asset portfolios (“reinsurance-related embedded derivatives and portfolio gains (losses)”) by (b) common shares outstanding.
Book value per share is the most directly comparable GAAP measure.

Other Definitions

Holding Company Available Liquidity

Holding company available liquidity consists of cash and invested cash, excluding cash held as collateral, and certain short-term investments that can be readily converted into cash, net of commercial paper outstanding.

Sales

Sales as reported consist of the following:

Annuities and Retirement Plan Services – deposits from new and existing customers;
Universal life insurance (“UL”), indexed universal life insurance (“IUL”), variable universal life insurance (“VUL”) – first-year commissionable premiums plus 5% of excess premiums received;
MoneyGuard^® linked-benefit products – MoneyGuard^® (UL) and MoneyGuard Market Advantage^® (VUL), 150% of commissionable premiums;
Executive Benefits – insurance and corporate-owned UL and VUL, first-year commissionable premiums plus 5% of excess premium received, and single premium bank-owned UL and VUL, 15% of single premium deposits;
Term – 100% of annualized first-year premiums; and
Group Protection – annualized first-year premiums from new policies.


Lincoln National Corporation
Reconciliation of Net Income (Loss) to Adjusted Income (Loss) from Operations and
Average Stockholders' Equity to Adjusted Average Stockholders' Equity

	For the						For the
(in millions, except per share data)	Three Months Ended						Nine Months Ended
	September 30,						September 30,
		2025			2024			2025			2024

Net Income (Loss) Available to Common Stockholders – Diluted	$	411		$	(562	)	$	343		$	1,511
Less:
Preferred stock dividends declared		(34	)		(34	)		(80	)		(80	)
Adjustment for deferred units of LNC stock in our deferred compensation plans		—			—			—			3
Net Income (Loss)		445			(528	)		423			1,588
Less:
Net annuity product features, pre-tax ⁽¹⁾		410			(381	)		(277	)		1,319
Net life insurance product features, pre-tax		(22	)		(125	)		(37	)		(253	)
Credit loss-related adjustments, pre-tax		(38	)		(88	)		(91	)		(124	)
Investment gains (losses), pre-tax		(35	)		(105	)		(218	)		(416	)
Changes in the fair value of reinsurance-related embedded derivatives, trading securities and certain mortgage loans, pre-tax ⁽²⁾		(191	)		(446	)		(266	)		(51	)
Gains (losses) on other non-financial assets – sale of subsidiaries/businesses, pre-tax ⁽³⁾		—			(2	)		—			582
Other items, pre-tax ^{(4)(5)(6)(7)(8)}		(105	)		(19	)		(65	)		(238	)
Income tax benefit (expense) related to the above pre-tax items		(5	)		246			194			(202	)
Total adjustments		14			(920	)		(760	)		617
Adjusted Income (Loss) from Operations	$	431		$	392		$	1,183		$	971
Add:
Preferred stock dividends declared		(34	)		(34	)		(80	)		(80	)
Adjusted Income (Loss) from Operations Available to Common Stockholders	$	397		$	358		$	1,103		$	891

Earnings (Loss) Per Common Share – Diluted ⁽⁹⁾
Net income (loss)	$	2.12		$	(3.29	)	$	1.87		$	8.75
Adjusted income (loss) from operations		2.04			2.06			6.01			5.16

Stockholders’ Equity, Average
Stockholders' equity	$	10,000		$	8,481		$	9,034		$	7,816
Less:
Preferred stock		986			986			986			986
AOCI		(4,116	)		(3,526	)		(4,379	)		(3,800	)
Stockholders’ equity, excluding AOCI and preferred stock		13,130			11,021			12,427			10,630
Changes in MRBs		3,002			2,410			2,717			2,288
GLB and GDB hedge instruments gains (losses)		(3,654	)		(2,767	)		(3,326	)		(2,623	)
Reinsurance-related embedded derivatives and portfolio gains (losses)		(245	)		(455	)		(203	)		(462	)
Adjusted average stockholders' equity	$	14,027		$	11,833		$	13,239		$	11,427

⁽¹⁾		For the three months ended September 30, 2025 and 2024, includes changes in MRBs of $337 million and $(666) million, respectively; changes in the fair value of the related hedge instruments inclusive of income allocated to support the cost of hedging or future benefits of $30 million and $188 million, respectively; and changes in the fair value of the embedded derivative liabilities and the associated index options for our indexed annuity products of $43 million and $97 million, respectively. For the nine months ended September 30, 2025 and 2024, includes changes in MRBs of $(33) million and $1,354 million, respectively; changes in the fair value of the related hedge instruments inclusive of income allocated to support the cost of hedging or future benefits of $(307) million and $(350) million, respectively; and changes in the fair value of the embedded derivative liabilities and the associated index options for our indexed annuity products of $63 million and $315 million, respectively.
⁽²⁾		Includes primarily changes in the fair value of the embedded derivative related to the fourth quarter 2023 reinsurance transaction.
⁽³⁾		Relates to the sale of our wealth management business, which provided approximately $650 million of statutory capital benefit.
⁽⁴⁾		Includes certain legal accruals of $(9) million for the three and nine months ended September 30, 2025; and $(114) million for the nine months ended September 30, 2024, primarily related to the settlement of cost of insurance litigation in the first quarter of 2024.
⁽⁵⁾		Includes severance expense related to initiatives to realign the workforce of $(5) million and $(16) million for the three months ended September 30, 2025 and 2024, respectively, and $(13) million and $(72) million for the nine months ended September 30, 2025 and 2024, respectively.
⁽⁶⁾		Includes transaction, integration and other costs related to mergers, acquisitions, divestitures and certain other corporate initiatives consisting of $(55) million of transaction costs related to restructuring certain captive reinsurance subsidiaries and $(22) million related to Life Insurance segment persistency optimization for the three months ended September 30, 2025; $(2) million related to the sale of our wealth management business for the three months ended September 30, 2024; for the nine months ended September 30, 2025, includes $(55) million of transaction costs related to restructuring certain captive reinsurance subsidiaries, $(22) million related to Life Insurance segment persistency optimization, $(20) million related to the sale of our wealth management business and $(18) million primarily related to the Bain Capital transaction; for the nine months ended September 30, 2024, includes $(39) million primarily related to the sale of our wealth management business.
⁽⁷⁾		Includes deferred compensation mark-to-market adjustment of $(14) million and $(1) million for the three months ended September 30, 2025 and 2024, respectively, and $(22) million and $(13) million for the nine months ended September 30, 2025 and 2024, respectively.
⁽⁸⁾		Includes gains on early extinguishment of debt of $94 million for the nine months ended September 30, 2025.
⁽⁹⁾		In periods where a net loss or adjusted loss from operations is presented, basic shares are used in the diluted EPS and adjusted EPS calculations, as the use of diluted shares would result in a lower loss per share.


Lincoln National Corporation
Reconciliation of Book Value per Share

	As of the Three Months Ended
	9/30/24			12/31/24			3/31/25			6/30/25			9/30/25
Book Value Per Common Share
Book value per share	$	46.97		$	42.60		$	41.96		$	44.91		$	49.56
Less:
AOCI		(15.70	)		(29.46	)		(25.08	)		(23.04	)		(20.10	)
Book value per share, excluding AOCI		62.67			72.06			67.04			67.95			69.66
Less:
Changes in MRBs		12.56			18.51			12.42			15.05			16.42
GLB and GDB hedge instruments gains (losses)		(16.17	)		(17.91	)		(17.43	)		(18.89	)		(19.40	)
Reinsurance-related embedded derivatives and portfolio gains (losses)		(3.76	)		(0.88	)		(1.14	)		(0.98	)		(1.59	)
Adjusted book value per share	$	70.04		$	72.34		$	73.19		$	72.77		$	74.23


Lincoln National Corporation
Digest of Earnings

	For the						For the
(in millions, except per share data)	Three Months Ended						Nine Months Ended
	September 30,						September 30,
		2025			2024			2025			2024

Revenues	$	4,555		$	4,111		$	13,290		$	13,380

Net Income (Loss)	$	445		$	(528	)	$	423		$	1,588
Preferred stock dividends declared		(34	)		(34	)		(80	)		(80	)
Adjustment for deferred units of LNC stock in our deferred compensation plans ⁽¹⁾		—			—			—			3
Net Income (Loss) Available to Common Stockholders – Diluted	$	411		$	(562	)	$	343		$	1,511

Net Income (Loss) Per Common Share – Basic	$	2.15		$	(3.29	)	$	1.90		$	8.85
Net Income (Loss) Per Common Share – Diluted ⁽²⁾	$	2.12		$	(3.29	)	$	1.87		$	8.75

Average Shares – Basic		190,826,396			170,773,438			179,845,834			170,482,264
Average Shares – Diluted		194,304,105			172,848,870			182,851,283			172,767,554

⁽¹⁾		We exclude deferred units of LNC stock that are antidilutive from our diluted earnings per share calculation.
⁽²⁾		In periods where a net loss or adjusted loss from operations is presented, basic shares are used in the diluted EPS and adjusted diluted EPS calculations, as the use of diluted shares would result in a lower loss per share.

FORWARD-LOOKING STATEMENTS – CAUTIONARY LANGUAGE

Certain statements made in this press release and in other written or oral statements made by Lincoln or on Lincoln’s behalf are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). A forward-looking statement is a statement that is not a historical fact and, without limitation, includes any statement that may predict, forecast, indicate or imply future results, performance or achievements. Forward-looking statements may contain words like: “anticipate,” “believe,” “estimate,” “expect,” “project,” “shall,” “will” and other words or phrases with similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, trends in Lincoln’s businesses, prospective services or products, future performance or financial results and the outcome of contingencies, such as legal proceedings. Lincoln claims the protection afforded by the safe harbor for forward-looking statements provided by the PSLRA.

Forward-looking statements are subject to risks and uncertainties. Actual results could differ materially from those expressed in or implied by such forward-looking statements due to a variety of factors, including:

Weak general economic and business conditions that may affect demand for our products, account balances, investment results, guaranteed benefit liabilities, premium levels and claims experience;
Adverse global capital and credit market conditions that may affect our ability to raise capital, if necessary, and may cause us to realize impairments on investments and certain intangible assets, including goodwill and the valuation allowance against deferred tax assets, which may reduce future earnings and/or affect our financial condition and ability to raise additional capital or refinance existing debt as it matures;
The inability of our subsidiaries to pay dividends to the holding company in sufficient amounts, which could harm the holding company’s ability to meet its obligations;
Legislative, regulatory or tax changes, both domestic and foreign, that affect: the cost of, or demand for, our subsidiaries’ products; the required amount of reserves and/or surplus; our ability to conduct business; our affiliate reinsurance arrangements; and restrictions on the payment of revenue sharing and 12b-1 distribution fees;
Changes in tax law or the interpretation of or application of existing tax laws that could impact our tax costs and the products that we sell;
The impact of regulations adopted by the Securities and Exchange Commission (“SEC”), the Department of Labor or other federal or state regulators or self-regulatory organizations that could adversely affect our distribution model and sales of our products and result in additional disclosure and other requirements related to the sale and delivery of our products;
The impact of new and emerging rules, laws and regulations relating to privacy, cybersecurity and artificial intelligence that may lead to increased compliance costs, reputation risk and/or changes in business practices;
Increasing scrutiny and evolving expectations and regulations regarding ESG matters that may adversely affect our reputation and our investment portfolio;
Actions taken by reinsurers to raise rates on in-force business;
Declines in or sustained low interest rates causing a reduction in investment income, the interest margins of our businesses and demand for our products;
Rapidly increasing or sustained high interest rates that may negatively affect our profitability, value of our investment portfolio and capital position and may cause policyholders to surrender annuity and life insurance policies, thereby causing realized investment losses;
The impact of the implementation of the provisions of the European Market Infrastructure Regulation relating to the regulation of derivatives transactions;
The initiation of legal or regulatory proceedings against us, and the outcome of any legal or regulatory proceedings, such as: adverse actions related to present or past business practices common in businesses in which we compete; adverse decisions in significant actions including, but not limited to, actions brought by federal and state authorities and class action cases; new decisions that result in changes in law; and unexpected trial court rulings;
A decline or continued volatility in the equity markets causing a reduction in the sales of our subsidiaries’ products; a reduction of asset-based fees that our subsidiaries charge on various investment and insurance products; and an increase in liabilities related to guaranteed benefit riders, which are accounted for as market risk benefits, of our subsidiaries’ variable annuity products;
Ineffectiveness of our risk management policies and procedures, including our various hedging strategies;
A deviation in actual experience regarding future policyholder behavior, mortality, morbidity, interest rates or equity market returns from the assumptions used in pricing our subsidiaries’ products and in establishing related insurance reserves, which may reduce future earnings;
Changes in accounting principles that may affect our consolidated financial statements;
Lowering of one or more of our debt ratings issued by nationally recognized statistical rating organizations and the adverse effect such action may have on our ability to raise capital and on our liquidity and financial condition;
Lowering of one or more of the insurer financial strength ratings of our insurance subsidiaries and the adverse effect such action may have on the premium writings, policy retention, and profitability of our insurance subsidiaries and liquidity;
Significant credit, accounting, fraud, corporate governance or other issues that may adversely affect the value of certain financial assets, as well as counterparties to which we are exposed to credit risk, requiring that we realize losses on financial assets;
Interruption in or failure of the telecommunication, information technology or other operational systems of the company or the third parties on whom we rely or failure to safeguard the confidentiality or privacy of sensitive data on such systems, including from cyberattacks or other breaches in security of such systems;
The effect of acquisitions and divestitures, including the inability to realize the anticipated benefits of acquisitions and dispositions of businesses and potential operating difficulties and unforeseen liabilities relating thereto, as well as the effect of restructurings, product withdrawals and other unusual items;
The inability to realize or sustain the benefits we expect from, greater than expected investments in, and the potential impact of efforts related to, our strategic initiatives;
The adequacy and collectability of reinsurance that we have obtained;
Pandemics, acts of terrorism, war or other man-made and natural catastrophes that may adversely impact liabilities for policyholder claims and adversely affect our businesses and the cost and availability of reinsurance;
Competitive conditions, including pricing pressures, new product offerings and the emergence of new competitors, that may affect the level of premiums and fees that our subsidiaries can charge for their products;
The unknown effect on our subsidiaries’ businesses resulting from evolving market preferences and the changing demographics of our client base; and
The unanticipated loss of key management or wholesalers.

The risks and uncertainties included here are not exhaustive. Our most recent Form 10-K, as well as other reports that we file with the SEC, include additional factors that could affect our businesses and financial performance. Moreover, we operate in a rapidly changing and competitive environment. New risk factors emerge from time to time, and it is not possible for management to predict all such risk factors.

Further, it is not possible to assess the effect of all risk factors on our businesses or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. In addition, Lincoln disclaims any obligation to correct or update any forward-looking statements to reflect events or circumstances that occur after the date of this press release.

The reporting of Risk-Based Capital (“RBC”) measures is not intended for the purpose of ranking any insurance company or for use in connection with any marketing, advertising or promotional activities.