The Top 5 Analyst Questions From Brighthouse Financial’s Q2 Earnings Call

August 14, 2025 at 01:38 AM EDT

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Brighthouse Financial’s second quarter results were met with a negative market reaction, as both revenue and non-GAAP earnings fell short of Wall Street expectations. Management attributed the underperformance primarily to lower alternative investment income and a higher average severity of insurance claims, which reduced underwriting margins. CEO Eric Steigerwalt described the period as one of “continued focus and execution on our strategic priorities,” but acknowledged headwinds, particularly in the company’s alternative investment portfolio and fluctuating mortality experience. The company also emphasized ongoing efforts to manage expenses and maintain a strong capital position, with CFO Ed Spehar noting, “second quarter adjusted earnings were approximately $60 million below our quarterly average run rate expectations.”

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Brighthouse Financial (BHF) Q2 CY2025 Highlights:

Revenue: $2.15 billion vs analyst estimates of $2.18 billion (2.9% year-on-year decline, 1.3% miss)
Adjusted EPS: $3.43 vs analyst expectations of $4.39 (21.8% miss)
Adjusted Operating Income: $269 million (12.5% margin, 39.3% year-on-year decline)
Market Capitalization: $2.69 billion

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Brighthouse Financial’s Q2 Earnings Call

Tom Gallagher (Evercore ISI) asked about the timing and risk of statutory charges in the upcoming actuarial review. CFO Ed Spehar said the review is ongoing and results will be communicated after completion, emphasizing it is too early for specifics.
Jamminder Singh Bhullar (JPMorgan) pushed for clarity on the resumption of share buybacks and Brighthouse’s long-term independence. CEO Eric Steigerwalt said buybacks are historically routine but paused for now, and stressed confidence in the company's stand-alone strategy and operational capabilities.
Wilma Burdis (Raymond James) questioned the disconnect between statutory losses and capital strength, as well as the company’s appetite for sustained new sales. Spehar clarified that hedging gains offset statutory losses, and Steigerwalt indicated no change to new business strategy.
Taylor Scott (Barclays) sought more disclosure on capital within Brighthouse’s reinsurance subsidiary and the accuracy of cash flow projections. Spehar stated cash flow testing supports appropriate capitalization, but there is no excess capital for valuation boosts.
Ryan Krueger (KBW) asked about the potential for balance sheet impacts from the hedging transition. Spehar and Steigerwalt downplayed the likelihood of material day-one effects, describing the change as more incremental than transformative.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will closely watch (1) the completion and operational impact of Brighthouse’s revised hedging strategy for its major annuity lines, (2) progress on capital efficiency initiatives such as reinsurance and any resumed share buybacks, and (3) continued sales performance in annuity and life products amidst industry competition. Updates on regulatory developments and the company’s evolving approach to capital management will also be key markers of execution.

Brighthouse Financial currently trades at $47, up from $46.18 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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The Top 5 Analyst Questions From Brighthouse Financial’s Q2 Earnings Call

Brighthouse Financial (BHF) Q2 CY2025 Highlights:

Our Top 5 Analyst Questions From Brighthouse Financial’s Q2 Earnings Call

Catalysts in Upcoming Quarters

High-Quality Stocks for All Market Conditions

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