Genworth Financial Q4 Earnings Call Highlights

• Enact drove results — Genworth reported Q4 net income of $2 million and adjusted operating income of $8 million as Enact contributed $146 million to AOI, but the benefit was largely offset by heavy losses in the LTC closed block (Q4 LTC adjusted operating loss ~ $159 million), leaving the closed block with sizable full‑year losses.

• Genworth is prioritizing capital returns and liquidity: it repurchased $245 million of stock in 2025 (about $828 million since May 2022, cutting shares ~24%), expects $175–$225 million in buybacks for 2026, and anticipates receiving roughly $405 million from Enact in 2026 as a key funding source.

• CareScout is being scaled as the growth engine — the network expanded to ~790 providers with 3,255 matches in 2025, the Seniorly acquisition closed, Care Assurance launched in 40 states, and the company targets ~7,500 matches and at least $25 million in services revenue for 2026 while investing $50–$55 million in the platform.

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Genworth Financial (NYSE:GNW) reported fourth-quarter 2025 net income of $2 million and adjusted operating income (AOI) of $8 million, as strong results from its majority-owned mortgage insurance business Enact were largely offset by losses in the company’s long-term care (LTC) closed block.

Management also highlighted continued capital returns to shareholders, ongoing investment in its CareScout growth platform, and progress in long-term care in-force actions. Executives provided initial 2026 outlook items tied to Enact cash inflows, share repurchases, and CareScout Services match and revenue targets.

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CEO Tom McInerney said fourth-quarter results were “driven primarily by strong performance from Enact,” which contributed $146 million to Genworth’s AOI. That was “partially offset by a loss of $114 million in our closed block, primarily from LTC,” he said.

CFO Jerome Upton said the closed block’s fourth-quarter adjusted operating loss was driven by LTC, which posted an adjusted operating loss of $159 million. Upton attributed the LTC result to a liability remeasurement loss related to actual experience versus expected (A/E) and the net unfavorable impact of assumption updates. He said unfavorable LTC A/E of $124 million pre-tax was “driven primarily by higher claims and lower terminations in the capped cohorts.”

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Within the closed block, Upton said life insurance and annuities produced AOI of $13 million and $32 million, respectively, “both reflecting the favorable impacts of assumption updates.” Corporate and other posted an adjusted operating loss of $24 million, which he said reflected “continued investment in CareScout and ongoing holding company debt service,” partially offset by favorable tax items.

For the full year, Upton reported 2025 AOI of $144 million, driven by Enact. Enact contributed $558 million of AOI to Genworth in 2025, and Genworth’s share of Enact’s book value (including AOCI) increased to $4.4 billion at year-end 2025 from $4.1 billion at year-end 2024, according to Upton.

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The closed block segment posted an adjusted operating loss of $317 million for 2025. Upton said LTC’s adjusted operating loss of $326 million was “primarily driven by a remeasurement loss, including unfavorable A/E and cash flow assumption updates in the capped cohorts.” He added that since adopting LDTI, the closed block has experienced A/E losses driven by short-term experience relative to long-term assumptions, averaging about $75 million per quarter in 2025—a level that “could continue” in 2026, though seasonal patterns can affect quarterly results.

McInerney said Genworth ended the quarter with $234 million of cash and liquid assets at the holding company. Upton noted that when evaluating holding company liquidity for capital allocation and the buffer to debt service targets, the company excludes about $127 million held for future obligations, including advanced cash payments from subsidiaries.

Enact remained a key funding source. McInerney said Genworth received $407 million from Enact in 2025, which supported share repurchases and investments in CareScout. Upton said Genworth received $127 million from Enact in the fourth quarter and reiterated that the full-year proceeds were “basically in line with our expectations.”

Management emphasized continued share repurchases. McInerney said Genworth repurchased $245 million of shares in 2025 and, since May 2022 through February 20, has repurchased about $828 million of stock, reducing shares outstanding by about 24% (from 511 million to 388 million). Upton added that the company repurchased $94 million in the fourth quarter at an average price of $8.66 per share and repurchased an additional $38 million through February 20, 2026.

Genworth also reduced debt. Upton said the company retired about $7 million of principal in 2025 for $6 million in cash, bringing holding company debt to $783 million. He said cash interest coverage on debt service was approximately 8x.

McInerney positioned CareScout as Genworth’s “long-term growth strategy,” describing it as a consumer-focused platform intended to help families “understand, find, and fund the quality long-term care they need,” combining services and insurance products with investment in technology and AI.

In CareScout Services, McInerney said the CareScout Quality Network (CQN) expanded to roughly 790 home care providers with more than 1,000 locations, covering 97% of the U.S. population aged 65 and older. He said the company facilitated 925 matches between LTC policyholders and home care providers in the fourth quarter, ending 2025 with 3,255 matches—above its original 2,500 target and updated 3,000 estimate—representing a threefold increase versus 2024.

McInerney said the company closed the acquisition of Seniorly in the fourth quarter and that integration was progressing well, expanding CareScout’s reach into the direct-to-consumer market and adding senior living options. He said credentialing of major national senior living providers is underway and expected to be complete by the end of 2026.

Genworth also launched Care Assurance, CareScout’s standalone LTC insurance product, in the fourth quarter. McInerney said it is live in 40 states with four more pending approval, and that the company plans to launch worksite and association group offerings later in 2026. He said the product was designed and priced “for the long-term,” and will be differentiated by services such as access to the CQN, wellness tools, and care planning support.

Upton said Genworth resegmented reporting in the quarter, placing LTC, life, and annuity businesses under a new “closed block” segment following the launch of CareScout Care Assurance and the formal cessation of LTC sales in Genworth Life Insurance Company (GLIC). He emphasized the change is “presentation only” and does not change the economics of the products.

On LTC in-force actions, McInerney said Genworth secured $100 million of gross incremental LTC premium approvals in the fourth quarter and $209 million for full-year 2025, with average premium increases of 35.6% and 38%, respectively. He said the company is in the 13th year of a Multi-Year Rate Action Plan (MYRAP) that has achieved $34.5 billion in net present value since 2012, driven primarily by benefit reductions and premium increases.

Upton said benefit reductions and premium increases remain the most effective tools for mitigating tail risk in LTC. He said about 61% of policyholders offered a benefit reduction have elected to take one, and he cited reduced exposure to certain features, including a decline in exposure to 5% compound benefit inflation options to less than 36% from 57% in 2014, and lifetime benefits to 11% of policies. He also said CareScout initiatives, including the Quality Network and the Live Well, Age Well program, are expected to provide additional savings over time, though the company will monitor progress before incorporating impacts into assumptions.

McInerney also updated investors on the AXA litigation. He said a U.K. High Court judgment in July was favorable, and that an appeal hearing is set for July 21–23, with a decision expected roughly three to six months after the hearing. If the ruling is upheld, he said Genworth expects total recoveries of about $750 million, subject to exchange rates, and that recoveries are not included in capital allocation plans but would be deployed in line with priorities if received.

Looking ahead, Upton said Enact expects to return about $500 million of capital to shareholders in 2026, and based on Genworth’s roughly 81% ownership stake, Genworth expects to receive around $405 million for the year.

Upton said Genworth expects to allocate $175 million to $225 million to share repurchases in 2026, depending on market conditions, business performance, holding company cash, and share price. For CareScout Services, he said the company is targeting about 7,500 matches in 2026, including home care and assisted living, and provided a first revenue outlook: at least $25 million in services revenue for 2026. He also said Genworth plans to invest $50 million to $55 million in CareScout Services in 2026, while incremental investment in CareScout Insurance is expected to be “much lower” than 2025 after an $85 million investment to launch and fund regulatory capital and startup costs.

McInerney closed by reiterating confidence in Genworth’s three strategic priorities—leveraging Enact performance, scaling CareScout, and actively managing the closed block—and said the company is focused on continued execution in 2026.

Genworth Financial (NYSE: GNW) is a leading financial security company offering a broad range of insurance products. Based in Richmond, Virginia, Genworth provides individuals and families with solutions designed to protect against long-term care expenses, secure life insurance needs and support homeownership through private mortgage insurance. With operations spanning the United States, Canada and Australia, the company serves both retail and institutional clients through a diversified portfolio of risk management services.

The company’s Private Mortgage Insurance (PMI) segment offers coverage to lenders and consumers in the US, Canada and Australia, enabling homebuyers to purchase properties with lower down payments.

The article “Genworth Financial Q4 Earnings Call Highlights” was originally published by MarketBeat.