Prudential Financial's Third-Quarter Adjusted Operating Income Falls to $1.32 Billion as the Prudential of Japan Sales Suspension Cuts Japan Earnings 25%

Prudential Financial, Inc. has reported results for the third quarter of 2026, the three months ended September 30. The earnings release, filed with the U.S. Securities and Exchange Commission as Exhibit 99.1, is dated November 3, 2026, with a call the next day. The company reports net income, which follows U.S. accounting rules, and adjusted operating income, which excludes certain market and one-off items. Percentages and differences that are not in the release are calculated here and labelled. Note that the company has recast its segments in this report, so comparisons use the recast prior-year figures.

The headline numbers

After-tax adjusted operating income was $1.321 billion, or $3.77 per share, against $1.444 billion, or $4.05, a year earlier. That is a decline of about 8.5% in total and about 6.9% per share, calculated here, with the smaller per-share decline implying a lower share count. Net income attributable to Prudential Financial was $1.388 billion, or $3.96 per share, against $1.431 billion, or $4.01. Pre-tax adjusted operating income was $1,646 million against $1,829 million.

Segment results

Pre-tax adjusted operating income by segment was as follows, with prior-year figures in brackets. PGIM, the asset manager, earned $263 million ($244 million). U.S. Businesses earned $1,173 million ($1,188 million). Japan Businesses earned $559 million ($750 million). Corporate and Other lost $349 million (a loss of $353 million). Adding the four lines, $263 million plus $1,173 million plus $559 million less $349 million, gives $1,646 million, calculated here, matching the total. The prior-year lines sum to $1,829 million in the same way.

Within U.S. Businesses, Retirement earned $620 million ($637 million), Group Insurance $101 million ($90 million), Individual Life $199 million ($153 million) and U.S. Legacy Products $253 million ($308 million). Those four sum to $1,173 million, calculated here.

The Japan effect

The biggest change is in Japan. Pre-tax adjusted operating income there fell from $750 million to $559 million, a decline of about 25% calculated here. The release says the fall was mainly due to the Prudential of Japan sales suspension. Constant-dollar sales in Japan were $291 million, down 36%. Separate reporting says Japan's Financial Services Agency barred Prudential Life from new sales until January 31 after an employee fraud scandal; this article relies on the release for the earnings effect and does not describe the scandal itself.

The release also says the former International Businesses segment is now called Japan Businesses. Brazil and Mexico operations were moved to Divested and Run-off Businesses within Corporate and Other, and the 40% stake in a business called Habitat was moved to Retirement. These recasts mean the Japan Businesses segment now consists only of Japan.

PGIM

PGIM's assets under management were $1.465 trillion, essentially flat from a year earlier, and total net inflows in the quarter were $7.4 billion, including $9.0 billion from third-party clients. Total assets under management for the company were $1.616 trillion against $1.612 trillion. The release's figures show PGIM profit rising by about 8%, calculated here, from $244 million to $263 million.

Items between adjusted operating income and net income

Net income is higher than adjusted operating income in this quarter, by $67 million after tax, calculated here. The release lists notable items in net income, including $368 million of pre-tax net realized investment losses and related charges, of which $184 million were net credit-related losses, and $32 million of pre-tax losses from changes in market risk benefits. These were offset by $295 million of pre-tax earnings from divested and run-off businesses and $104 million of pre-tax gains from market experience updates. The release as used here does not give the after-tax effect of each item.

Capital and book value

Prudential returned $741 million to shareholders, comprising $250 million of share repurchases and $491 million of dividends, against $731 million a year earlier. The dividend was $1.40 per common share, which the release says is a yield of over 5% on adjusted book value. Parent company highly liquid assets were $4.0 billion against $3.9 billion.

Book value moved in opposite directions on the two measures. GAAP book value per share fell to $84.88 from $90.69, a decline of about 6% calculated here. Adjusted book value per share rose to $102.39 from $99.25, an increase of about 3%. The difference arises because adjusted book value excludes accumulated other comprehensive income and similar market-driven items, as the company defines it, so the release's two measures should be read together.

What the release does not say

The release as used here does not give an outlook, does not state the length of the Japanese suspension beyond the reference to it, and does not provide a forecast for when sales may recover. It also gives no after-tax split for each notable item. This article does not predict the recovery. Readers who want the exact definitions of adjusted operating income and the segment recasts should read the full release, and anyone making a financial decision should consult a licensed adviser. This article is general information and not investment advice.