Aflac (AFL) Financials

Aflac’s latest results show improved earnings and capital strength, but quarterly performance remains heavily influenced by investment gains and uneven operating cash flow. In Q2 2026, revenue increased to $4.12 billion from $3.91 billion in Q2 2025, while net income rose to $825 million from $599 million. Diluted EPS increased to $1.63 from $1.11, although results declined sequentially from Q1 2026.

• Earnings improved year over year: Q2 2026 net income increased approximately 38% from Q2 2025, and first-quarter net income rose to $1.02 billion from $29 million in the restated Q1 2025 period.
• Shareholder returns remain substantial: Aflac repurchased $984 million of common stock in Q2 2026 and paid $299 million in dividends. The quarterly dividend increased to $0.61 per share from $0.58 in 2025 and $0.50 in 2024.
• Share count continues to decline: Q2 diluted weighted-average shares fell to approximately 506 million from 538 million in Q2 2025 and 567 million in Q2 2024, supporting per-share results.
• Capital position strengthened: Total common equity increased to $30.3 billion at June 30, 2026, from $27.2 billion a year earlier, while total liabilities declined to $85.6 billion from $97.5 billion.
• Debt is manageable relative to the balance sheet: Long-term debt was $8.7 billion in Q2 2026, below the $8.9 billion reported a year earlier and well below the company’s total assets and equity base.
• First-half operating cash flow improved modestly: Operating cash flow totaled approximately $1.08 billion in the first half of 2026, compared with $988 million in the first half of 2025.
• Investment gains remain a major earnings driver: Q2 2026 net realized and unrealized investment gains were $831 million, up from $660 million in Q2 2025 but below $1.01 billion in Q1 2026. This creates meaningful quarter-to-quarter earnings volatility.
• The investment portfolio has contracted: Trading account securities declined to $78.4 billion in Q2 2026 from $86.3 billion in Q2 2025, while total assets fell to $116.0 billion from $124.7 billion.
• Premium growth has weakened: Q2 premiums earned fell to $3.25 billion from $3.47 billion a year earlier and $3.31 billion in Q1 2026. Premiums have generally remained below 2023 and early-2024 levels.
• Cash conversion was weak in the latest quarter: Q2 2026 operating cash flow was only $112 million, down from $399 million in Q2 2025 and $968 million in Q1 2026. The company also spent more on share repurchases and dividends than it generated from operations during the quarter.

Across the available periods, Aflac’s balance sheet has become stronger than it was in 2023 and early 2024: total common equity rose from $19.8 billion in Q1 2023 to $30.3 billion in Q2 2026, while long-term debt has remained broadly controlled. However, the income statement shows that investment-market movements can materially outweigh changes in insurance premiums and claims.

For investors, the key factors to monitor are whether premium growth stabilizes, whether operating cash flow becomes more consistent, and how much future earnings depend on realized and unrealized investment gains. The data also includes several restated and calculated periods, so comparisons should be treated as directional rather than perfectly uniform.