Item 1. Financial Statements

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Item 1. Financial Statements

PRUDENTIAL FINANCIAL, INC.

Unaudited Interim Consolidated Statements of Financial Position

June 30, 2025 and December 31, 2024 (in millions, except share amounts)


	June 30, 2025		December 31, 2024
ASSETS
Fixed maturities, available-for-sale, at fair value (allowance for credit losses: 2025-$224; 2024-$331) (amortized cost: 2025-$356,073; 2024-$341,004)(1)	$	328,302	$	311,570

Fixed maturities, trading, at fair value (amortized cost: 2025-$14,696; 2024-$13,631)(1)	14,020		12,530
Assets supporting experience-rated contractholder liabilities, at fair value	4,282		3,707
Equity securities, at fair value (cost: 2025-$4,954; 2024-$7,043)(1)	7,434		9,417
Commercial mortgage and other loans (net of $554 and $574 allowance for credit losses; includes $726 and $702 of loans measured at fair value under the fair value option at June 30, 2025 and December 31, 2024, respectively)(1)	62,966		62,341
Policy loans	9,946		9,795
Other invested assets (net of $2 and $2 allowance for credit losses; includes $7,934 and $7,574 of assets measured at fair value at June 30, 2025 and December 31, 2024, respectively)(1)	27,256		26,351
Short-term investments (net of allowance for credit losses: 2025-$0; 2024-$0)	6,375		9,069
Total investments	460,581		444,780
Cash and cash equivalents(1)	16,638		18,497
Accrued investment income(1)	3,560		3,441
Deferred policy acquisition costs	21,222		20,448
Value of business acquired	450		435
Market risk benefit assets	2,188		2,331
Reinsurance recoverables and deposit receivables (net of $13 and $12 allowance for credit losses; includes $634 and $849 of embedded derivatives at fair value at June 30, 2025 and December 31, 2024, respectively)(2)	44,152		37,680
Income tax assets	839		866
Other assets (net of $1 and $2 allowance for credit losses; includes $0 and $0 of assets at fair value at June 30, 2025 and December 31, 2024, respectively)(1)(2)	14,561		13,737
Separate account assets	194,761		193,372
TOTAL ASSETS	$	758,952	$	735,587
LIABILITIES, MEZZANINE EQUITY AND EQUITY
LIABILITIES
Future policy benefits	$	270,133	$	268,912
Policyholders’ account balances	180,931		166,254
Market risk benefit liabilities	4,859		4,455
Policyholders’ dividends	957		718
Securities sold under agreements to repurchase	8,205		6,796
Cash collateral for loaned securities	9,167		9,621
Reinsurance and funds withheld payables (includes $27 and $(118) of embedded derivatives at fair value at June 30, 2025 and December 31, 2024, respectively)(2)	17,126		17,084

Short-term debt	1,373		953
Long-term debt	18,651		19,187
Other liabilities (includes $15 and $14 allowance for credit losses and $6,350 and $4,751 of derivatives at fair value at June 30, 2025 and December 31, 2024, respectively)(1)	17,915		16,679
Notes issued by consolidated variable interest entities (includes $195 and $60 measured at fair value under the fair value option at June 30, 2025 and December 31, 2024, respectively)(1)	1,758		1,430
Separate account liabilities	194,761		193,372
Total liabilities	725,836		705,461
COMMITMENTS AND CONTINGENT LIABILITIES (See Note 21)
MEZZANINE EQUITY
Redeemable noncontrolling interests	2,213		1,939
Total mezzanine equity	2,213		1,939
EQUITY
Preferred Stock ($0.01 par value; 10,000,000 shares authorized; none issued)	0		0
Common Stock ($0.01 par value; 1,500,000,000 shares authorized; 666,305,189 shares issued as of both June 30, 2025 and December 31, 2024)	6		6
Additional paid-in capital	25,927		25,901
Common Stock held in treasury, at cost (314,362,248 and 311,738,187 shares at June 30, 2025 and December 31, 2024, respectively)	(24,886)		(24,511)
Accumulated other comprehensive income (loss)(2)	(3,921)		(6,711)
Retained earnings	33,456		33,187
Total Prudential Financial, Inc. equity	30,582		27,872
Noncontrolling interests	321		315
Total equity	30,903		28,187
TOTAL LIABILITIES, MEZZANINE EQUITY AND EQUITY	$	758,952	$	735,587

(1)See Note 4 for details of balances associated with variable interest entities.

(2)See Note 20 for additional information regarding related party transactions.

See Notes to Unaudited Interim Consolidated Financial Statements

PRUDENTIAL FINANCIAL, INC.

Unaudited Interim Consolidated Statements of Operations

Three and Six Months Ended June 30, 2025 and 2024 (in millions, except per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
REVENUES
Premiums (includes $97, $(14), $98 and $(9) of gains (losses) from changes in estimates on deferred profit liability amortization for the three months ended June 30, 2025 and 2024 and the six months ended June 30, 2025 and 2024, respectively)(1)	$	6,982	$	7,820	$	13,982	$	23,357
Policy charges and fee income	1,249		1,085		2,406		2,141
Net investment income	5,226		4,849		10,356		9,613
Asset management and service fees(1)	982		1,001		1,966		2,000
Other income (loss)(1)	1,412		591		1,692		1,929
Realized investment gains (losses), net(1)	(1,699)		(166)		(2,429)		(474)
Change in value of market risk benefits, net of related hedging gains (losses)	(426)		(297)		(777)		(174)
Total revenues	13,726		14,883		27,196		38,392
BENEFITS AND EXPENSES
Policyholders’ benefits(1)	8,181		8,864		16,321		25,458
Change in estimates of liability for future policy benefits(1)	(175)		(176)		(225)		(193)
Interest credited to policyholders’ account balances	1,138		1,102		1,963		2,385
Dividends to policyholders	259		176		404		466
Amortization of deferred policy acquisition costs(1)	407		375		814		750

General and administrative expenses(1)	3,176		3,127		6,259		6,721
Total benefits and expenses	12,986		13,468		25,536		35,587
INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN EARNINGS OF JOINT VENTURES AND OTHER OPERATING ENTITIES	740		1,415		1,660		2,805
Total income tax expense (benefit)	195		264		402		553
INCOME (LOSS) BEFORE EQUITY IN EARNINGS OF JOINT VENTURES AND OTHER OPERATING ENTITIES	545		1,151		1,258		2,252
Equity in earnings of joint ventures and other operating entities, net of taxes	21		20		50		70


NET INCOME (LOSS)	566		1,171		1,308		2,322
Less: Income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests	33		(27)		68		(14)
NET INCOME (LOSS) ATTRIBUTABLE TO PRUDENTIAL FINANCIAL, INC.	$	533	$	1,198	$	1,240	$	2,336
EARNINGS PER SHARE
Basic earnings per share-Common Stock:
Net income (loss) attributable to Prudential Financial, Inc.	$	1.49	$	3.30	$	3.46	$	6.43
Diluted earnings per share-Common Stock:
Net income (loss) attributable to Prudential Financial, Inc.	$	1.48	$	3.28	$	3.44	$	6.40

(1)See Note 20 for additional information regarding related party transactions.

See Notes to Unaudited Interim Consolidated Financial Statements

PRUDENTIAL FINANCIAL, INC.

Unaudited Interim Consolidated Statements of Comprehensive Income

Three and Six Months Ended June 30, 2025 and 2024 (in millions)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
NET INCOME (LOSS)	$	566	$	1,171	$	1,308	$	2,322
Other comprehensive income (loss), before tax:
Foreign currency translation adjustments for the period	400		(353)		786		(847)
Net unrealized investment gains (losses)	(1,394)		(5,343)		(1,621)		(10,117)
Interest rate remeasurement of future policy benefits(1)	1,947		6,138		3,983		10,351
Gain (loss) from changes in non-performance risk on market risk benefits	5		56		172		(196)
Defined benefit pension and postretirement unrecognized periodic benefit (cost)	5		12		8		25
Total	963		510		3,328		(784)
Less: Income tax expense (benefit) related to other comprehensive income (loss)	143		293		538		156
Other comprehensive income (loss), net of taxes	820		217		2,790		(940)
Comprehensive income (loss)	1,386		1,388		4,098		1,382
Less: Comprehensive income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests	33		(27)		68		(14)
Comprehensive income (loss) attributable to Prudential Financial, Inc.	$	1,353	$	1,415	$	4,030	$	1,396

(1)See Note 20 for additional information regarding related party transactions.

See Notes to Unaudited Interim Consolidated Financial Statements

PRUDENTIAL FINANCIAL, INC.

Unaudited Interim Consolidated Statements of Equity

Three and Six Months Ended June 30, 2025 (in millions)


	Prudential Financial, Inc. Equity
	Common Stock		Additional Paid-in Capital		Retained Earnings		Common Stock Held In Treasury		Accumulated Other Comprehensive Income (Loss)		Total Prudential Financial, Inc. Equity		Noncontrolling Interests		Total Equity
Balance, December 31, 2024	$	6	$	25,901	$	33,187	$	(24,511)	$	(6,711)	$	27,872	$	315	$	28,187

Common Stock acquired							(251)				(251)				(251)
Contributions from noncontrolling interests													4		4
Distributions to noncontrolling interests													(21)		(21)
Consolidations (deconsolidations) of noncontrolling interests													13		13
Stock-based compensation programs			(30)				101				71				71
Dividends declared on Common Stock					(486)						(486)				(486)
Comprehensive income:
Net income (loss)					707						707		9		716
Other comprehensive income (loss), net of tax									1,970		1,970		0		1,970
Total comprehensive income (loss)					707				1,970		2,677		9		2,686
Balance, March 31, 2025	6		25,871		33,408		(24,661)		(4,741)		29,883		320		30,203
Common Stock acquired							(252)				(252)				(252)
Contributions from noncontrolling interests													1		1
Distributions to noncontrolling interests													(10)		(10)
Consolidations (deconsolidations) of noncontrolling interests													21		21
Stock-based compensation programs			56				27				83				83
Dividends declared on Common Stock					(485)						(485)				(485)
Comprehensive income:
Net income (loss)					533						533		(11)		522
Other comprehensive income (loss), net of tax									820		820		0		820
Total comprehensive income (loss)					533				820		1,353		(11)		1,342
Balance, June 30, 2025	$	6	$	25,927	$	33,456	$	(24,886)	$	(3,921)	$	30,582	$	321	$	30,903

Unaudited Interim Consolidated Statements of Equity—Continued

Three and Six Months Ended June 30, 2024 (in millions)


	Prudential Financial, Inc. Equity
	Common Stock		Additional Paid-in Capital		Retained Earnings		Common Stock Held In Treasury		Accumulated Other Comprehensive Income (Loss)		Total Prudential Financial, Inc. Equity		Noncontrolling Interests(1)		Total Equity
Balance, December 31, 2023	$	6	$	25,746	$	32,352	$	(23,780)	$	(6,504)	$	27,820	$	290	$	28,110

Common Stock acquired							(250)				(250)				(250)

Distributions to noncontrolling interests													(2)		(2)

Stock-based compensation programs			(5)				139				134				134
Dividends declared on Common Stock					(476)						(476)				(476)
Comprehensive income:
Net income (loss)					1,138						1,138		1		1,139
Other comprehensive income (loss), net of tax									(1,157)		(1,157)		0		(1,157)
Total comprehensive income (loss)					1,138				(1,157)		(19)		1		(18)
Balance, March 31, 2024	6		25,741		33,014		(23,891)		(7,661)		27,209		289		27,498
Common Stock acquired							(252)				(252)				(252)
Contributions from noncontrolling interests													4		4
Distributions to noncontrolling interests													(21)		(21)

Stock-based compensation programs			61				55				116				116
Dividends declared on Common Stock					(475)						(475)				(475)
Comprehensive income:
Net income (loss)					1,198						1,198		8		1,206
Other comprehensive income (loss), net of tax									217		217		0		217
Total comprehensive income (loss)					1,198				217		1,415		8		1,423
Balance, June 30, 2024	$	6	$	25,802	$	33,737	$	(24,088)	$	(7,444)	$	28,013	$	280	$	28,293

(1)Prior period amounts have been revised to conform to current period presentation.

See Notes to Unaudited Interim Consolidated Financial Statements

PRUDENTIAL FINANCIAL, INC.

Unaudited Interim Consolidated Statements of Cash Flows

Six Months Ended June 30, 2025 and 2024 (in millions)


	Six Months Ended June 30,
	2025		2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	1,308	$	2,322
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Realized investment (gains) losses, net(1)	2,429		474
Change in value of market risk benefits, net of related hedging (gains) losses	777		174
Policy charges and fee income	(1,009)		(1,128)
Interest credited to policyholders’ account balances	1,963		2,385
Depreciation and amortization	321		371
(Gains) losses on assets supporting experience-rated contractholder liabilities, net	38		(494)
Change in:
Deferred policy acquisition costs(1)	(657)		(514)
Future policy benefits and other insurance liabilities	89		3,651
Reinsurance related-balances(1)(2)	(1,253)		(789)
Income taxes	(635)		16
Derivatives, net	(1,590)		574
Other, net(1)(2)	(3,125)		(1,967)
Cash flows from (used in) operating activities	(1,344)		5,075
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from the sale/maturity/prepayment of:
Fixed maturities, available-for-sale	20,299		24,901

Fixed maturities, trading	1,445		1,898
Assets supporting experience-rated contractholder liabilities	733		744
Equity securities	4,621		3,092
Commercial mortgage and other loans	3,662		2,688
Policy loans	956		1,030
Other invested assets	1,519		808
Short-term investments	13,632		15,943
Payments for the purchase/origination of:
Fixed maturities, available-for-sale	(34,918)		(36,737)

Fixed maturities, trading	(2,693)		(3,033)
Assets supporting experience-rated contractholder liabilities	(1,024)		(840)
Equity securities	(2,470)		(1,779)
Commercial mortgage and other loans	(3,809)		(3,888)
Policy loans	(789)		(770)
Other invested assets	(1,586)		(1,902)
Short-term investments	(10,910)		(17,264)


Derivatives, net	113		(515)
Other, net(1)	(74)		40
Cash flows from (used in) investing activities	(11,293)		(15,584)
CASH FLOWS FROM FINANCING ACTIVITIES
Policyholders’ account deposits	19,940		17,531
Policyholders’ account withdrawals	(9,446)		(9,489)
Net change in securities sold under agreements to repurchase and cash collateral for loaned securities	955		1,445
Cash dividends paid on Common Stock	(972)		(955)
Net change in financing arrangements (maturities 90 days or less)	156		(496)
Common Stock acquired	(496)		(493)
Common Stock reissued for exercise of stock options	57		93
Proceeds from the issuance of debt (maturities longer than 90 days)	910		1,158
Repayments of debt (maturities longer than 90 days)	(1,194)		(750)
Proceeds from notes issued by consolidated VIEs	192		182
Repayments of notes issued by consolidated VIEs	0		(1)


Other, net(1)	546		320
Cash flows from (used in) financing activities	10,648		8,545
Effect of foreign exchange rate changes on cash balances	170		(368)
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS	(1,819)		(2,332)
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, BEGINNING OF YEAR	18,520		19,463
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, END OF PERIOD	$	16,701	$	17,131

PRUDENTIAL FINANCIAL, INC.

Unaudited Interim Consolidated Statements of Cash Flows

Six Months Ended June 30, 2025 and 2024 (in millions)


	Six Months Ended June 30,
	2025		2024

NON-CASH TRANSACTIONS DURING THE PERIOD
Treasury Stock shares issued for stock-based compensation programs	$	176	$	212


Significant pension risk transfer transactions:
Assets received, excluding Cash and cash equivalents	$	0	$	5,802
Liabilities assumed	0		9,990
Net cash received	$	0	$	4,188












Somerset Re reinsurance transaction(3):
Reinsurance recoverables under modified coinsurance, net	$	0	$	(578)
Unwind of Deferred policy acquisition costs ceded	0		284
Deferred reinsurance gain	0		363
Net cash received (paid)	$	0	$	69








Prismic Re International reinsurance transaction(3):
Net assets transferred, excluding Cash and cash equivalents	$	6,069	$	0
Deposit assets established for Policyholders’ account balances ceded	(6,366)		0
Unwind of Deferred policy acquisition costs ceded	219		0
Net cash received (paid)	$	(78)	$	0
RECONCILIATION TO THE UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Cash and cash equivalents	$	16,638	$	17,111
Restricted cash and restricted cash equivalents (included in “Other assets”)	63		20
Total cash, cash equivalents, restricted cash and restricted cash equivalents	$	16,701	$	17,131

(1)See Note 20 for additional information regarding related party transactions.

(2)Prior period amounts have been updated to conform to current period presentation.

(3)See Note 12 for additional information regarding the reinsurance agreements with Somerset Reinsurance Ltd. (“Somerset Re”) and Prismic Life Reinsurance International, Ltd. (“Prismic Re International”).

See Notes to Unaudited Interim Consolidated Financial Statements

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements

1. BUSINESS AND BASIS OF PRESENTATION

Prudential Financial, Inc. (“Prudential Financial”) and its subsidiaries (collectively, “Prudential” or the “Company”) provide a wide range of insurance, investment management, and other financial products and services to both individual and institutional customers throughout the United States and in many other countries. Principal products and services provided include life insurance, annuities, retirement solutions, mutual funds and investment management.

The Company’s principal operations consist of PGIM (the Company’s global investment management business), the U.S. Businesses (consisting of the Retirement Strategies, Group Insurance and Individual Life businesses), the International Businesses, the Closed Block division, and the Company’s Corporate and Other operations. The Closed Block division is accounted for as a divested business that is reported separately from the Divested and Run-off Businesses that are included within Corporate and Other operations. Divested and Run-off Businesses consist of businesses that have been, or will be, sold or exited, including businesses that have been placed in wind-down status that do not qualify for “discontinued operations” accounting treatment under U.S. GAAP. The Company’s Corporate and Other operations include corporate items and initiatives that are not allocated to business segments, as well as the Divested and Run-off Businesses described above.

Effective in the first quarter of 2025, consistent with changes to the Company’s internal management structure, the Company’s International Businesses are reflected as a single operating and reportable segment, which is how the chief operating decision maker (“CODM”) now assesses its performance and allocates resources. Prior to the first quarter of 2025, International Businesses consisted of the Life Planner and Gibraltar Life and Other operating segments, each of which was a reportable segment under U.S. GAAP. The change has been applied retrospectively and did not have any impact on the Company’s Unaudited Interim Consolidated Financial Statements contained herein or to any previously issued financial statements. See Note 19 for additional information regarding the Company’s segments.

Basis of Presentation

The Unaudited Interim Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) on a basis consistent with reporting interim financial information in accordance with instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”). The Unaudited Interim Consolidated Financial Statements include the accounts of Prudential Financial, entities over which the Company exercises control, including majority-owned subsidiaries and minority-owned entities such as limited partnerships in which the Company is the general partner, and variable interest entities (“VIEs”) in which the Company is considered the primary beneficiary. See Note 4 for additional information regarding the Company’s consolidated variable interest entities. Intercompany balances and transactions have been eliminated.

In the opinion of management, all adjustments necessary for a fair statement of the financial position and results of operations have been made. All such adjustments are of a normal, recurring nature. Interim results are not necessarily indicative of the results that may be expected for the full year. These financial statements should be read in conjunction with the Company’s Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The most significant estimates include those used in determining future policy benefits; policyholders’ account balances related to the fair value of embedded derivative instruments associated with the index-linked features of certain universal life and annuity products; market risk benefits (“MRBs”); the measurement of goodwill and any related impairment; the valuation of investments including derivatives, the measurement of allowance for credit losses, and the recognition of other-than-temporary impairments (“OTTI”); pension and other postretirement benefits; any provision for income taxes and valuation of deferred tax assets; and accruals for contingent liabilities, including estimates for losses in connection with unresolved legal and regulatory matters.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Out of Period Adjustments

In the first quarter of 2025, the Company recorded out of period adjustments resulting in a net charge of $150 million to “Income (loss) from operations before income taxes and equity in earnings of joint ventures and other operating entities” for the first quarter of 2025. The adjustments included an overstatement of “Reinsurance recoverables and deposit receivables” and an understatement of “Deferred policy acquisition costs.”

The impact of these adjustments, individually and in the aggregate, was not material to any previously reported quarterly or annual financial statements and is not expected to be material to the 2025 annual financial statements.

Revision of Previously Issued Financial Statements

The Company reclassified certain amounts in prior periods to conform to the current period presentation and recorded other adjustments, including the following:

As previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, during the fourth quarter of 2024, the Company identified an immaterial error in the application of adjusted operating income, which resulted in an overstatement thereof for indexed variable and fixed annuity products within the Retirement Strategies segment in the first three quarters of 2024. As a result, the Company voluntarily revised its historical adjusted operating income for the relevant periods, resulting in a decrease in pre-tax adjusted operating income of $47 million and $81 million for the three and six months ended June 30, 2024, respectively. See Note 19 for additional information regarding adjusted operating income.

As also previously disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, the Company corrected the prior period presentation for certain noncontrolling interests, primarily related to consolidated PGIM-managed funds, that contain redemption features that are at the option of the holder and outside of the Company’s control. These noncontrolling interests were previously reported within “Noncontrolling interests” and are now correctly presented as “Mezzanine equity” and totaled $1,372 million as of March 31, 2024 and $1,267 million as of June 30, 2024 within the Unaudited Interim Consolidated Statement of Equity.

2. SIGNIFICANT ACCOUNTING POLICIES AND PRONOUNCEMENTS

Recent Accounting Pronouncements

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. ASUs listed below include those that have been adopted during the current fiscal year and/or those that have been issued but not yet adopted as of June 30, 2025, and as of the date of this filing. ASUs not listed below were assessed and determined to be either not applicable or not material.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

ASUs issued but not yet adopted as of June 30, 2025


Standard	Description	Effective date and method of adoption	Effect on the financial statements or other significant matters
ASU 2024-03—Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (DISE)	This ASU requires public companies to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to financial statements.	Effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted and applied either prospectively or retrospectively.	The Company is currently assessing the impact of the ASU on the Company’s Consolidated Financial Statements and Notes to the Consolidated Financial Statements.
ASU 2023-09 Income Taxes (Topic 740) Improvements to Income Tax Disclosures	This ASU requires entities to provide additional information primarily related to the effective tax rate reconciliation and income taxes paid.	Effective for fiscal years beginning after December 15, 2024, and permits early adoption.	The ASU has no impact on the Company’s Consolidated Financial Statements but will result in expanded disclosures in the Notes to the Consolidated Financial Statements.

3. INVESTMENTS

Fixed Maturity Securities

The following tables set forth the composition of fixed maturity securities (excluding investments classified as trading), as of the dates indicated:


	June 30, 2025
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	24,626	$	665	$	4,921	$	0	$	20,370
Obligations of U.S. states and their political subdivisions	6,059		129		675		0		5,513
Foreign government securities	68,556		1,219		11,086		0		58,689
U.S. public corporate securities	112,147		1,575		10,524		12		103,186
U.S. private corporate securities(1)	47,182		874		2,303		70		45,683
Foreign public corporate securities	24,927		373		1,303		9		23,988
Foreign private corporate securities	40,352		1,498		2,673		132		39,045
Asset-backed securities(2)	18,230		171		69		1		18,331
Commercial mortgage-backed securities	9,918		67		404		0		9,581
Residential mortgage-backed securities(3)	4,076		25		185		0		3,916
Total fixed maturities, available-for-sale(1)	$	356,073	$	6,596	$	34,143	$	224	$	328,302

(1)Excludes notes with amortized cost of $15,220 million (fair value, $15,220 million), which have been offset with the associated debt under a netting agreement.

(2)Includes credit-tranched securities collateralized by loan obligations, home equity loans, auto loans, education loans and other asset types.

(3)Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	December 31, 2024
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	24,869	$	584	$	5,105	$	0	$	20,348
Obligations of U.S. states and their political subdivisions	6,590		132		618		0		6,104
Foreign government securities	63,523		1,837		7,881		0		57,479
U.S. public corporate securities	108,883		1,226		11,529		72		98,508
U.S. private corporate securities(1)	45,854		918		2,926		57		43,789
Foreign public corporate securities	23,165		248		1,421		10		21,982
Foreign private corporate securities	38,652		314		4,311		192		34,463
Asset-backed securities(2)	16,979		214		59		0		17,134
Commercial mortgage-backed securities	9,791		29		547		0		9,273
Residential mortgage-backed securities(3)	2,698		15		223		0		2,490
Total fixed maturities, available-for-sale(1)	$	341,004	$	5,517	$	34,620	$	331	$	311,570

(1)Excludes notes with amortized cost of $14,748 million (fair value, $14,748 million), which have been offset with the associated debt under a netting agreement.

(2)Includes credit-tranched securities collateralized by loan obligations, home equity loans, auto loans, education loans and other asset types.

(3)Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.

The following tables set forth the fair value and gross unrealized losses on available-for-sale fixed maturity securities without an allowance for credit losses aggregated by investment category and length of time that individual fixed maturity securities had been in a continuous unrealized loss position, as of the dates indicated:


	June 30, 2025
	Less Than Twelve Months				Twelve Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	5,174	$	213	$	9,803	$	4,708	$	14,977	$	4,921
Obligations of U.S. states and their political subdivisions	1,157		69		3,190		606		4,347		675
Foreign government securities	8,501		521		22,882		10,565		31,383		11,086
U.S. public corporate securities	20,645		856		47,399		9,658		68,044		10,514
U.S. private corporate securities	4,879		99		24,281		2,204		29,160		2,303
Foreign public corporate securities	4,519		129		7,894		1,173		12,413		1,302
Foreign private corporate securities	1,368		24		17,248		2,648		18,616		2,672
Asset-backed securities	2,538		36		732		32		3,270		68
Commercial mortgage-backed securities	282		1		6,123		403		6,405		404
Residential mortgage-backed securities	201		2		1,351		183		1,552		185
Total fixed maturities, available-for-sale	$	49,264	$	1,950	$	140,903	$	32,180	$	190,167	$	34,130

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	December 31, 2024
	Less Than Twelve Months				Twelve Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	6,667	$	334	$	10,161	$	4,771	$	16,828	$	5,105
Obligations of U.S. states and their political subdivisions	1,592		53		3,288		565		4,880		618
Foreign government securities	8,280		349		20,780		7,532		29,060		7,881
U.S. public corporate securities	25,420		1,036		48,152		10,485		73,572		11,521
U.S. private corporate securities	7,581		183		24,846		2,743		32,427		2,926
Foreign public corporate securities	5,751		170		8,084		1,246		13,835		1,416
Foreign private corporate securities	8,702		282		18,862		4,010		27,564		4,292
Asset-backed securities	1,488		11		1,015		48		2,503		59
Commercial mortgage-backed securities	1,092		8		6,432		539		7,524		547
Residential mortgage-backed securities	361		4		1,377		219		1,738		223
Total fixed maturities, available-for-sale	$	66,934	$	2,430	$	142,997	$	32,158	$	209,931	$	34,588

As of June 30, 2025 and December 31, 2024, the gross unrealized losses on fixed maturity available-for-sale securities without an allowance of $33,123 million and $33,437 million, respectively, related to “1” highest quality or “2” high quality securities based on the National Association of Insurance Commissioners (“NAIC”) or equivalent rating and $1,007 million and $1,151 million, respectively, related to other than high or highest quality securities based on NAIC or equivalent rating. As of June 30, 2025, the $32,180 million of gross unrealized losses of twelve months or more were concentrated in the finance, consumer non-cyclical and utility sectors within corporate securities, as well as in foreign government securities. As of December 31, 2024, the $32,158 million of gross unrealized losses of twelve months or more were concentrated in the finance, consumer non-cyclical and utility sectors within corporate securities, as well as in foreign government securities.

In accordance with its policy described in Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, the Company concluded that an adjustment to earnings for credit losses related to these fixed maturity securities was not warranted at June 30, 2025. This conclusion was based on detailed analysis of the underlying credit and cash flows for each security. Gross unrealized losses are primarily attributable to increases in interest rates, general credit spread widening and foreign currency exchange rate movements. As of June 30, 2025, the Company did not intend to sell these securities, and it was not more likely than not that the Company would be required to sell these securities before the anticipated recovery of the amortized cost basis.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The following table sets forth the amortized cost and fair value of fixed maturities by contractual maturities, as of the date indicated:


	June 30, 2025
	Amortized Cost		Fair Value
	(in millions)
Fixed maturities, available-for-sale:
Due in one year or less	$	16,168	$	16,105
Due after one year through five years	66,688		67,355
Due after five years through ten years	59,892		60,018
Due after ten years(1)	181,101		152,996
Asset-backed securities	18,230		18,331
Commercial mortgage-backed securities	9,918		9,581
Residential mortgage-backed securities	4,076		3,916
Total	$	356,073	$	328,302

(1)Excludes notes with amortized cost of $15,220 million (fair value, $15,220 million), which have been offset with the associated debt under a netting agreement.

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Asset-backed, commercial mortgage-backed and residential mortgage-backed securities are shown separately in the table above, as they do not have a single maturity date.

The following table sets forth the sources of fixed maturity proceeds and related investment gains (losses), as well as losses on write-downs and the allowance for credit losses of fixed maturities, for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Fixed maturities, available-for-sale:
Proceeds from sales(1)	$	4,191	$	8,323	$	9,103	$	14,074
Proceeds from maturities/prepayments	5,252		6,147		11,013		11,080
Gross investment gains from sales and maturities	126		201		408		595
Gross investment losses from sales and maturities	(233)		(910)		(540)		(1,270)
Write-downs recognized in earnings(2)	(57)		(4)		(176)		(9)
(Addition to) release of allowance for credit losses	27		(22)		107		(33)

(1)Excludes activity from non-cash related proceeds due to the timing of trade settlements of $183 million and $(253) million for the six months ended June 30, 2025 and 2024, respectively.

(2)Amounts represent write-downs on credit adverse securities and securities actively marketed for sale.

The following tables set forth the balance of and changes in the allowance for credit losses for fixed maturity securities, as of and for the periods indicated:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2025
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Securities		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	0	$	0	$	250	$	1	$	0	$	0	$	251
Additions to allowance for credit losses not previously recorded	0		0		1		0		0		0		1
Reductions for securities sold during the period	0		0		(6)		0		0		0		(6)
Additions (reductions) on securities with previous allowance	0		0		28		0		0		0		28
Write-downs charged against the allowance	0		0		(50)		0		0		0		(50)
Balance, end of period	$	0	$	0	$	223	$	1	$	0	$	0	$	224


	Three Months Ended June 30, 2024
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Securities		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	0	$	31	$	139	$	1	$	0	$	0	$	171
Additions to allowance for credit losses not previously recorded	0		0		13		0		0		0		13
Reductions for securities sold during the period	0		(30)		(8)		0		0		0		(38)
Additions (reductions) on securities with previous allowance	0		(1)		24		0		0		0		23
Balance, end of period	$	0	$	0	$	168	$	1	$	0	$	0	$	169


	Six Months Ended June 30, 2025
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Securities		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	0	$	0	$	331	$	0	$	0	$	0	$	331
Additions to allowance for credit losses not previously recorded	0		0		17		1		0		0		18
Reductions for securities sold during the period	0		0		(12)		0		0		0		(12)
Additions (reductions) on securities with previous allowance	0		0		31		0		0		0		31
Write-downs charged against the allowance	0		0		(144)		0		0		0		(144)
Balance, end of period	$	0	$	0	$	223	$	1	$	0	$	0	$	224

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	U.S. Treasury Securities and Obligations of U.S. States		Foreign Government Securities		U.S. and Foreign Corporate Securities		Asset-Backed Securities		Commercial Mortgage-Backed Securities		Residential Mortgage-Backed Securities		Total
	(in millions)
Fixed maturities, available-for-sale:
Balance, beginning of period	$	0	$	53	$	105	$	2	$	0	$	0	$	160
Additions to allowance for credit losses not previously recorded	0		0		59		0		0		0		59
Reductions for securities sold during the period	0		(30)		(20)		0		0		0		(50)
Additions (reductions) on securities with previous allowance	0		(23)		24		(1)		0		0		0
Balance, end of period	$	0	$	0	$	168	$	1	$	0	$	0	$	169

For additional information regarding the Company’s methodology for developing its allowance and expected losses, see Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

For the three months ended June 30, 2025, the net decrease in the allowance for credit losses on available-for-sale securities was primarily related to write-downs charged against the allowance due to settlements and security restructures within the consumer cyclical and consumer non-cyclical sectors within corporate securities, partially offset by net additions within the technology sector within corporate securities primarily due to adverse projected cash flows. For the three months ended June 30, 2024, the net decrease in the allowance for credit losses on available-for-sale securities was primarily related to a net release within foreign government securities, partially offset by net additions in the consumer cyclical and communications sectors within corporate securities due to adverse projected cash flows.

For the six months ended June 30, 2025, the net decrease in the allowance for credit losses on available-for-sale securities was primarily related to write-downs charged against the allowance due to security restructures and settlements within the communications, capital goods, and consumer non-cyclical sectors within corporate securities, partially offset by net additions within the technology sector within corporate securities primarily due to adverse projected cash flows. For the six months ended June 30, 2024, the net increase in the allowance for credit losses on available-for-sale securities was primarily related to net additions in the consumer cyclical and communications sectors within corporate securities due to adverse projected cash flows, partially offset by a net release within foreign government securities.

The Company did not have any fixed maturity securities purchased with credit deterioration as of both June 30, 2025 and December 31, 2024.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Assets Supporting Experience-Rated Contractholder Liabilities

The following table sets forth the composition of “Assets supporting experience-rated contractholder liabilities,” as of the dates indicated:


	June 30, 2025				December 31, 2024
	Amortized Cost or Cost		Fair Value		Amortized Cost or Cost		Fair Value
	(in millions)
Fixed maturities:
Corporate securities	$	69	$	67	$	68	$	67
Foreign government securities	642		635		544		539
Obligations of U.S. government authorities and agencies and obligations of U.S. states	239		236		207		220
Total fixed maturities(1)	950		938		819		826
Equity securities	2,162		3,344		1,763		2,881
Total assets supporting experience-rated contractholder liabilities(2)	$	3,112	$	4,282	$	2,582	$	3,707

(1)As a percentage of amortized cost, 99% of the portfolio was considered high or highest quality based on NAIC or equivalent ratings as of both June 30, 2025 and December 31, 2024.

(2)As a percentage of amortized cost, 100% of the portfolio consisted of public securities as of both June 30, 2025 and December 31, 2024.

The net change in unrealized gains (losses) from assets supporting experience-rated contractholder liabilities still held at period end, recorded within “Other income (loss),” was $253 million and $74 million during the three months ended June 30, 2025 and 2024, respectively, and $54 million and $373 million during the six months ended June 30, 2025 and 2024, respectively.

Fixed Maturities, Trading

The net change in unrealized gains (losses) from fixed maturities, trading still held at period end, recorded within “Other income (loss),” was $229 million and $(146) million during the three months ended June 30, 2025 and 2024, respectively, and $416 million and $(327) million during the six months ended June 30, 2025 and 2024, respectively.

Equity Securities

The net change in unrealized gains (losses) from equity securities still held at period end, recorded within “Other income (loss),” was $374 million and $212 million during the three months ended June 30, 2025 and 2024, respectively, and $145 million and $643 million during the six months ended June 30, 2025 and 2024, respectively.

Concentrations of Financial Instruments

The Company monitors its concentrations of financial instruments and mitigates credit risk by maintaining a diversified investment portfolio which limits exposure to any single issuer.

As of the dates indicated, the Company’s exposure to concentrations of credit risk of single issuers greater than 10% of the Company’s equity included securities of the U.S. government and certain U.S. government agencies and securities guaranteed by the U.S. government, as well as the securities disclosed below:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	June 30, 2025				December 31, 2024
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(in millions)
Investments in Japanese government and government agency securities:
Fixed maturities, available-for-sale	$	60,678	$	51,434	$	56,457	$	51,177
Fixed maturities, trading	19		19		18		18
Assets supporting experience-rated contractholder liabilities	562		548		472		462
Total	$	61,259	$	52,001	$	56,947	$	51,657


	June 30, 2025				December 31, 2024
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(in millions)
Investments in Brazilian government and government agency securities:
Fixed maturities, available-for-sale	$	3,568	$	3,125	$	2,753	$	2,251
Fixed maturities, trading	74		71		44		40
Short-term investments	2		2		2		2
Cash equivalents	109		109		228		228
Total	$	3,753	$	3,307	$	3,027	$	2,521

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Commercial Mortgage and Other Loans

The following table sets forth the composition of “Commercial mortgage and other loans,” as of the dates indicated:


	June 30, 2025				December 31, 2024
	Amount		% of Total		Amount		% of Total
	($ in millions)
Commercial mortgage and agricultural property loans by property type:
Office	$	7,065	11.3	%	$	7,867	12.7	%
Retail	5,441		8.7		5,552		9.0
Apartments/Multi-Family	18,729		29.9		17,522		28.3
Industrial	17,293		27.5		16,900		27.3
Hospitality	1,668		2.7		1,831		3.0
Self-Storage(1)	2,276		3.6		2,194		3.5
Health Care Senior Living(1)	1,858		3.0		1,858		3.0
Other(1)	565		0.9		334		0.6
Total commercial mortgage loans	54,895		87.6		54,058		87.4
Agricultural property loans	7,762		12.4		7,775		12.6
Total commercial mortgage and agricultural property loans	62,657		100.0	%	61,833		100.0	%
Allowance for credit losses	(508)				(528)
Total net commercial mortgage and agricultural property loans	62,149				61,305
Other loans:
Uncollateralized loans	368				595
Residential property loans	18				19
Other collateralized loans	477				468
Total other loans	863				1,082
Allowance for credit losses	(46)				(46)
Total net other loans	817				1,036
Total net commercial mortgage and other loans(2)	$	62,966			$	62,341

(1)Prior period amounts have been updated to conform to current period presentation.

(2)Includes loans which are carried at fair value under the fair value option and are collateralized primarily by apartment complexes. As of June 30, 2025 and December 31, 2024, the net carrying value of these loans was $726 million and $702 million, respectively.

As of June 30, 2025, the commercial mortgage and agricultural property loans were secured by properties geographically dispersed throughout the United States with the largest concentrations in California (28%), Texas (6%) and Florida (5%) and included loans secured by properties in Europe (6%), Mexico (2%), Japan (1%) and Australia (1%).

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The following tables set forth the balance of and changes in the allowance for credit losses for commercial mortgage and other loans, as of and for the periods indicated:


	Three Months Ended June 30, 2025
	Commercial Mortgage Loans		Agricultural Property Loans		Residential Property Loans		Other Collateralized Loans		Uncollateralized Loans		Total
	(in millions)
Allowance, beginning of period	$	460	$	123	$	0	$	34	$	15	$	632
Addition to (release of) allowance for expected losses	(11)		85		0		(2)		(1)		71
Write-downs charged against the allowance	0		(150)		0		0		0		(150)

Change in foreign exchange	1		0		0		0		0		1
Allowance, end of period	$	450	$	58	$	0	$	32	$	14	$	554


	Three Months Ended June 30, 2024
	Commercial Mortgage Loans		Agricultural Property Loans		Residential Property Loans		Other Collateralized Loans		Uncollateralized Loans		Total
	(in millions)
Allowance, beginning of period	$	492	$	21	$	0	$	0	$	1	$	514
Addition to (release of) allowance for expected losses	0		3		0		33		17		53

Change in foreign exchange	(3)		0		0		0		0		(3)
Allowance, end of period	$	489	$	24	$	0	$	33	$	18	$	564


	Six Months Ended June 30, 2025
	Commercial Mortgage Loans		Agricultural Property Loans		Residential Property Loans		Other Collateralized Loans		Uncollateralized Loans		Total
	(in millions)
Allowance, beginning of period	$	407	$	121	$	0	$	32	$	14	$	574
Addition to (release of) allowance for expected losses	42		87		0		0		0		129
Write-downs charged against the allowance	0		(150)		0		0		0		(150)

Change in foreign exchange	1		0		0		0		0		1
Allowance, end of period	$	450	$	58	$	0	$	32	$	14	$	554


	Six Months Ended June 30, 2024
	Commercial Mortgage Loans		Agricultural Property Loans		Residential Property Loans		Other Collateralized Loans		Uncollateralized Loans		Total
	(in millions)
Allowance, beginning of period	$	443	$	16	$	0	$	0	$	1	$	460
Addition to (release of) allowance for expected losses	47		8		0		33		17		105

Change in foreign exchange	(1)		0		0		0		0		(1)
Allowance, end of period	$	489	$	24	$	0	$	33	$	18	$	564

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

For the three months ended June 30, 2025, the net decrease to the allowance for credit losses on commercial mortgage and other loans was primarily related to a write-down against a loan-specific reserve within agricultural property loans. For the three months ended June 30, 2024, the net addition to the allowance for credit losses on commercial mortgage and other loans was primarily due to the establishment of general reserves for both the collateralized and uncollateralized loan portfolios.

For the six months ended June 30, 2025, the net decrease to the allowance for credit losses on commercial mortgage and other loans was primarily related to a write-down against a loan-specific reserve within agricultural property loans, partially offset by an increase in loan-specific reserves within the retail sector. For the six months ended June 30, 2024, the net addition to the allowance for credit losses on commercial mortgage and other loans was primarily due to the establishment of general reserves for new loan pools within both the collateralized and uncollateralized loan portfolios and increases in loan-specific reserves within the office sector.

The following tables set forth key credit quality indicators based upon the recorded investment gross of allowance for credit losses, as of the dates indicated:


	June 30, 2025
	Amortized Cost by Origination Year
	2025		2024		2023		2022		2021		Prior		Revolving Loans		Total
	(in millions)
Commercial mortgage loans
Loan-to-Value Ratio:
0%-59.99%	$	1,541	$	2,093	$	2,093	$	885	$	2,215	$	17,825	$	65	$	26,717
60%-69.99%	1,773		4,153		1,590		1,453		2,072		5,218		0		16,259
70%-79.99%	266		894		1,442		873		1,258		2,074		0		6,807
80% or greater	12		272		136		259		255		4,178		0		5,112
Total	$	3,592	$	7,412	$	5,261	$	3,470	$	5,800	$	29,295	$	65	$	54,895
Debt Service Coverage Ratio:
Greater than 1.2x	$	3,486	$	6,485	$	4,569	$	3,182	$	5,700	$	26,331	$	0	$	49,753
1.0 - 1.2x	106		738		542		257		42		1,316		65		3,066
Less than 1.0x	0		189		150		31		58		1,648		0		2,076
Total	$	3,592	$	7,412	$	5,261	$	3,470	$	5,800	$	29,295	$	65	$	54,895
Agricultural property loans
Loan-to-Value Ratio:
0%-59.99%	$	220	$	658	$	297	$	901	$	1,993	$	2,048	$	131	$	6,248
60%-69.99%	21		111		360		89		10		86		0		677
70%-79.99%	60		0		0		0		6		14		0		80
80% or greater	3		0		199		413		0		101		41		757
Total	$	304	$	769	$	856	$	1,403	$	2,009	$	2,249	$	172	$	7,762
Debt Service Coverage Ratio:
Greater than 1.2x	$	304	$	713	$	826	$	894	$	1,953	$	1,909	$	131	$	6,730
1.0 - 1.2x	0		52		25		451		42		203		41		814
Less than 1.0x	0		4		5		58		14		137		0		218
Total	$	304	$	769	$	856	$	1,403	$	2,009	$	2,249	$	172	$	7,762

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	December 31, 2024
	Amortized Cost by Origination Year
	2024		2023		2022		2021		2020		Prior		Revolving Loans		Total
	(in millions)
Commercial mortgage loans
Loan-to-Value Ratio:
0%-59.99%	$	2,122	$	1,492	$	1,183	$	2,295	$	1,378	$	16,652	$	36	$	25,158
60%-69.99%	4,726		2,287		1,013		2,192		846		5,113		0		16,177
70%-79.99%	809		1,326		953		1,327		446		2,293		0		7,154
80% or greater	48		135		482		216		281		4,407		0		5,569
Total	$	7,705	$	5,240	$	3,631	$	6,030	$	2,951	$	28,465	$	36	$	54,058
Debt Service Coverage Ratio:
Greater than 1.2x	$	6,771	$	4,563	$	3,283	$	5,929	$	2,795	$	25,790	$	0	$	49,131
1.0 - 1.2x	745		527		313		43		102		1,279		36		3,045
Less than 1.0x	189		150		35		58		54		1,396		0		1,882
Total	$	7,705	$	5,240	$	3,631	$	6,030	$	2,951	$	28,465	$	36	$	54,058
Agricultural property loans
Loan-to-Value Ratio:
0%-59.99%	$	657	$	371	$	877	$	2,004	$	679	$	1,491	$	122	$	6,201
60%-69.99%	87		555		125		10		53		43		0		873
70%-79.99%	0		0		0		6		0		3		0		9
80% or greater	0		6		521		0		71		42		52		692
Total	$	744	$	932	$	1,523	$	2,020	$	803	$	1,579	$	174	$	7,775
Debt Service Coverage Ratio:
Greater than 1.2x	$	688	$	864	$	932	$	1,967	$	739	$	1,384	$	122	$	6,696
1.0 - 1.2x	56		63		530		45		23		98		52		867
Less than 1.0x	0		5		61		8		41		97		0		212
Total	$	744	$	932	$	1,523	$	2,020	$	803	$	1,579	$	174	$	7,775

For additional information regarding the Company’s commercial mortgage and other loans credit quality monitoring process, see Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

The Company may grant loan modifications in its commercial mortgage and other loan portfolios to borrowers experiencing financial difficulties. These loan modifications may be in the form of principal forgiveness, interest rate reduction, other-than-insignificant payment delay, term extension or some combination thereof. The amount, timing and extent of modifications granted and subsequent performance are considered in determining any allowance for credit losses.

The following table sets forth the amortized cost basis of loan modifications made to borrowers experiencing financial difficulties during the periods indicated:


	Three Months Ended June 30,
	2025						2024
	Term Extension		Other Than Insignificant Delay in Payment		% of Amortized Cost		Term Extension		Other Than Insignificant Delay in Payment		% of Amortized Cost
	($ in millions)
Commercial mortgage loans(1)	$	0	$	0	0.0	%	$	178	$	0	0.3	%
Agricultural property loans	$	0	$	0	0.0	%	$	0	$	0	0.0	%

(1)Prior period amounts have been updated to conform to current period presentation.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30,
	2025						2024
	Term Extension		Other Than Insignificant Delay in Payment		% of Amortized Cost		Term Extension		Other Than Insignificant Delay in Payment		% of Amortized Cost
	($ in millions)
Commercial mortgage loans(1)	$	0	$	0	0.0	%	$	337	$	0	0.6	%
Agricultural property loans	$	0	$	0	0.0	%	$	0	$	0	0.0	%

(1)Prior period amounts have been updated to conform to current period presentation.

For the three and six months ended June 30, 2024, the modifications added less than one year to the weighted average life in the commercial mortgage loan portfolio.

The Company did not have any commitments to lend additional funds to borrowers experiencing financial difficulties on modified loans as of both June 30, 2025 and December 31, 2024.

The following tables set forth an aging of past due commercial mortgage and other loans based upon the recorded investment gross of allowance for credit losses, as well as the amount of commercial mortgage and other loans on non-accrual status, as of the dates indicated:


	June 30, 2025
	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due(1)(2)		Total Past Due		Total Loans		Non-Accrual Status(3)
	(in millions)
Commercial mortgage loans	$	54,680	$	0	$	0	$	215	$	215	$	54,895	$	251
Agricultural property loans	6,970		0		0		792		792		7,762		830
Residential property loans	18		0		0		0		0		18		0
Other collateralized loans	477		0		0		0		0		477		0
Uncollateralized loans	368		0		0		0		0		368		25
Total	$	62,513	$	0	$	0	$	1,007	$	1,007	$	63,520	$	1,106

(1)As of June 30, 2025, there were no loans in this category accruing interest.

(2)Includes loans for which no credit losses are expected due to U.S. agency guarantees.

(3)For additional information regarding the Company’s policies for accruing interest on loans, see Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.


	December 31, 2024
	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due(1)(2)		Total Past Due		Total Loans		Non-Accrual Status(3)
	(in millions)
Commercial mortgage loans	$	53,873	$	0	$	3	$	182	$	185	$	54,058	$	220
Agricultural property loans	7,012		0		21		742		763		7,775		767
Residential property loans	19		0		0		0		0		19		0
Other collateralized loans	468		0		0		0		0		468		0
Uncollateralized loans	595		0		0		0		0		595		25
Total	$	61,967	$	0	$	24	$	924	$	948	$	62,915	$	1,012

(1)As of December 31, 2024, there were no loans in this category accruing interest.

(2)Includes loans for which no credit losses are expected due to U.S. agency guarantees.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Loans on non-accrual status recognized interest of $1 million and less than $1 million for the three months ended June 30, 2025 and 2024, respectively, and $6 million and less than $1 million for the six months ended June 30, 2025 and 2024, respectively. Loans on non-accrual status that did not have a related allowance for credit losses were $423 million and $207 million as of June 30, 2025 and December 31, 2024, respectively.

The Company did not have any commercial mortgage and other loans purchased with credit deterioration as of both June 30, 2025 and December 31, 2024.

Other Invested Assets

The following table sets forth the composition of “Other invested assets,” as of the dates indicated:


	June 30, 2025		December 31, 2024
	(in millions)
LPs/LLCs:
Equity method:
Private equity	$	11,000	$	10,615
Hedge funds	3,079		3,143
Real estate-related	2,760		2,661
Subtotal equity method	16,839		16,419
Fair value:
Private equity	957		1,076
Hedge funds	2,073		2,080
Real estate-related	890		951
Subtotal fair value	3,920		4,107
Total LPs/LLCs	20,759		20,526
Real estate held through direct ownership(1)	1,796		1,743
Total alternative assets	22,555		22,269
Credit-like instruments(2)	1,279		933
Derivative instruments	1,780		1,597
Other(3)	1,642		1,552
Total other invested assets	$	27,256	$	26,351

(1)As of June 30, 2025 and December 31, 2024, real estate held through direct ownership had mortgage debt of $192 million and $185 million, respectively.

(2)Includes structured debt investments in feeder funds that are consolidated, resulting in the Company reporting the consolidated feeder funds’ proportionate share of the net assets of the master fund within “Other invested assets.”

(3)Primarily includes equity investments accounted for under the measurement alternative, tax advantaged investments, strategic investments made by investment management operations, leveraged leases and member and activity stock held in the Federal Home Loan Bank of New York. For additional information regarding the Company’s holdings in the Federal Home Loan Bank of New York, see Note 18 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Accrued Investment Income

The following table sets forth the composition of “Accrued investment income,” as of the dates indicated:


	June 30, 2025		December 31, 2024
	(in millions)
Fixed maturities	$	3,025	$	2,892
Equity securities	9		8
Commercial mortgage and other loans	224		228
Policy loans	246		236
Other invested assets	11		12
Short-term investments and cash equivalents	45		65
Total accrued investment income	$	3,560	$	3,441

Write-downs on accrued investment income were less than $1 million for both the three months ended June 30, 2025 and 2024, and $1 million and less than $1 million for the six months ended June 30, 2025 and 2024, respectively.

Net Investment Income

The following table sets forth “Net investment income” by investment type, for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Fixed maturities, available-for-sale(1)	$	3,885	$	3,703	$	7,658	$	7,295
Fixed maturities, trading	177		130		344		246
Assets supporting experience-rated contractholder liabilities	14		13		28		27
Equity securities	49		61		93		99
Commercial mortgage and other loans	691		642		1,383		1,253
Policy loans	123		119		247		241
Other invested assets	418		246		814		567
Short-term investments and cash equivalents	230		284		497		582
Gross investment income	5,587		5,198		11,064		10,310
Less: investment expenses	(361)		(349)		(708)		(697)
Net investment income	$	5,226	$	4,849	$	10,356	$	9,613

(1)Includes income on credit-linked notes which are reported on the same financial statement line as related surplus notes, as conditions are met for right to offset.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Realized Investment Gains (Losses), Net

The following table sets forth “Realized investment gains (losses), net” by investment type, for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Fixed maturities(1)	$	(137)	$	(735)	$	(201)	$	(717)
Commercial mortgage and other loans	(66)		(44)		(124)		(95)
Investment real estate	(1)		(8)		(11)		(6)
LPs/LLCs	6		4		5		23
Derivatives(2)	(1,345)		723		(1,794)		575
Ceded income (loss) on modified coinsurance assets(2)(3)	(156)		(110)		(319)		(259)
Other(2)	0		4		15		5
Realized investment gains (losses), net	$	(1,699)	$	(166)	$	(2,429)	$	(474)

(1)Excludes fixed maturity securities classified as trading.

(2)Prior period amounts have been updated to conform to current period presentation.

(3)Includes changes in the value of reinsurance payables and funds withheld payables, primarily reflecting the impact of net investment income on withheld assets that are ceded to certain reinsurance counterparties.

Net Unrealized Gains (Losses) on Investments within AOCI

The following table sets forth net unrealized gains (losses) on investments, as of the dates indicated:


	June 30, 2025		December 31, 2024
	(in millions)
Fixed maturity securities, available-for-sale with an allowance	$	3	$	6
Fixed maturity securities, available-for-sale without an allowance	(27,550)		(29,109)
Derivatives designated as cash flow hedges(1)	(597)		1,780
Derivatives designated as fair value hedges(1)	(168)		(64)
Other investments(2)	156		106
Net unrealized gains (losses) on investments	$	(28,156)	$	(27,281)

(1)For additional information regarding cash flow and fair value hedges, see Note 5.

(2)Includes net unrealized gains (losses) on certain joint ventures that are strategic in nature and are included in “Other assets.”

Repurchase Agreements and Securities Lending

In the normal course of business, the Company sells securities under agreements to repurchase and enters into securities lending transactions. The following table sets forth the composition of “Securities sold under agreements to repurchase,” as of the dates indicated:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	June 30, 2025								December 31, 2024
	Remaining Contractual Maturities of the Agreements								Remaining Contractual Maturities of the Agreements
	Overnight & Continuous		Up to 30 Days		30 to 90 Days		Total		Overnight & Continuous		Up to 30 Days		30 to 90 Days		Total
	(in millions)
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	7,715	$	0	$	0	$	7,715	$	6,450	$	0	$	0	$	6,450
U.S. public corporate securities	0		470		0		470		0		327		0		327
Foreign public corporate securities	0		20		0		20		0		19		0		19
Commercial mortgage-backed securities	0		0		0		0		0		0		0		0
Total securities sold under agreements to repurchase	$	7,715	$	490	$	0	$	8,205	$	6,450	$	346	$	0	$	6,796

The following table sets forth the composition of “Cash collateral for loaned securities” which represents the liability to return cash collateral received for the following types of securities loaned, as of the dates indicated:


	June 30, 2025						December 31, 2024
	Remaining Contractual Maturities of the Agreements						Remaining Contractual Maturities of the Agreements
	Overnight & Continuous		Up to 30 Days		Total		Overnight & Continuous		Up to 30 Days		Total
	(in millions)
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	0	$	0	$	0	$	1	$	0	$	1
Obligations of U.S. states and their political subdivisions	38		0		38		46		0		46
Foreign government securities	222		0		222		122		6		128
U.S. public corporate securities	7,133		318		7,451		7,506		403		7,909
Foreign public corporate securities	1,118		65		1,183		1,181		118		1,299
Equity securities	273		0		273		238		0		238
Total cash collateral for loaned securities(1)	$	8,784	$	383	$	9,167	$	9,094	$	527	$	9,621

(1)The Company did not have any agreements with remaining contractual maturities greater than thirty days, as of the dates indicated.

4. VARIABLE INTEREST ENTITIES

In the normal course of its activities, the Company enters into relationships with various special-purpose entities and other entities that are deemed to be variable interest entities (“VIEs”). For additional information, see Note 4 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Consolidated Variable Interest Entities

The table below reflects the carrying amount and balance sheet caption in which the assets and liabilities of consolidated VIEs are reported. The liabilities primarily comprise obligations under debt instruments issued by the VIEs. The creditors of these VIEs do not have recourse to the Company in excess of the assets contained within the VIEs.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Consolidated VIEs for which the Company is the Investment Manager(1)				Other Consolidated VIEs
	June 30, 2025		December 31, 2024		June 30, 2025		December 31, 2024
	(in millions)
Fixed maturities, available-for-sale	$	1,623	$	1,250	$	757	$	716

Fixed maturities, trading	161		166		0		0
Equity securities	68		80		0		0
Commercial mortgage and other loans	722		681		403		490
Other invested assets	7,234		6,379		485		500
Cash and cash equivalents	315		308		6		0
Accrued investment income	4		6		3		3
Other assets	912		644		913		613
Total assets of consolidated VIEs	$	11,039	$	9,514	$	2,567	$	2,322
Other liabilities	$	332	$	218	$	183	$	1
Notes issued by consolidated VIEs(2)	1,728		1,392		30		38
Total liabilities of consolidated VIEs	$	2,060	$	1,610	$	213	$	39

(1)Total assets of consolidated VIEs reflect $4,153 million and $3,835 million as of June 30, 2025 and December 31, 2024, respectively, related to VIEs whose beneficial interests are wholly-owned by consolidated subsidiaries.

(2)Recourse is limited to the assets of the respective VIE and does not extend to the general credit of the Company. As of June 30, 2025, the maturities of these obligations were between 0 and 13 years.

Unconsolidated Variable Interest Entities

The Company has determined that it is not the primary beneficiary of certain VIEs for which it may or may not be the investment manager. The Company’s maximum exposure to loss resulting from its relationship with unconsolidated VIEs is limited to its investment in the VIEs, which was $1,523 million and $1,529 million as of June 30, 2025 and December 31, 2024, respectively. These investments are reflected in “Fixed maturities, available-for-sale,” “Fixed maturities, trading,” “Equity securities” and “Other invested assets.” There are no liabilities associated with these unconsolidated VIEs on the Company’s Unaudited Interim Consolidated Statements of Financial Position.

In addition, in the normal course of its activities, the Company will invest in structured investments including VIEs for which it is not the investment manager. These structured investments typically invest in fixed income investments and are managed by third parties and include asset-backed securities, commercial mortgage-backed securities and residential mortgage-backed securities. The Company’s maximum exposure to loss on these structured investments, both VIEs and non-VIEs, is limited to the amount of its investment. See Note 3 for details regarding the carrying amounts and classification of these assets. The Company has not provided material financial or other support that was not contractually required to these structures. The Company has determined that it is not the primary beneficiary of these structures due to the fact that it does not control these entities.

Limited Partnerships and Limited Liability Companies

In the normal course of its activities, the Company will invest in limited partnerships and limited liability companies (“LPs/LLCs”), which include hedge funds, private equity funds and real estate-related funds and may or may not be VIEs. The Company classifies these investments as “Other invested assets” and its maximum exposure to loss associated with these VIE and non-VIE entities is limited to the amount of its investment, which was $21,137 million and $21,847 million as of June 30, 2025 and December 31, 2024, respectively.

5. DERIVATIVES AND HEDGING

Types of Derivative and Hedging Instruments

The Company utilizes various derivatives and hedging instruments to manage certain of its risks. Commonly used derivative and non-derivative hedging instruments include, but are not necessarily limited to:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Interest rate contracts: futures, swaps, forwards, options, caps and floors
Equity contracts: futures, options and total return swaps
Foreign exchange contracts: futures, options, forwards, swaps, and foreign currency debt instruments
Credit contracts: single and index reference credit default swaps

Other types of financial contracts that the Company accounts for as derivatives are:

To-be-announced (“TBA”) forward contracts, loan commitments, embedded derivatives and synthetic guaranteed investment contracts (“GICs”).

For detailed information regarding these contracts and the related strategies, see Note 5 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Primary Risks Managed by Derivatives

The table below provides a summary of the gross notional amount and fair value of derivative contracts by the primary underlying risks they are utilized to manage, excluding embedded derivatives. Many derivative instruments contain multiple underlying risks. The fair value amounts below represent the value of derivative contracts prior to taking into account the netting effects of master netting agreements and cash collateral. These netting impacts resulted in total derivative assets of $1,785 million and $1,601 million as of June 30, 2025 and December 31, 2024, respectively, and total derivative liabilities of $6,350 million and $4,751 million as of June 30, 2025 and December 31, 2024, respectively, reflected in the Unaudited Interim Consolidated Statements of Financial Position.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


Primary Underlying Risk /Instrument Type	June 30, 2025									December 31, 2024
			Fair Value									Fair Value
Gross Notional			Assets			Liabilities			Gross Notional			Assets			Liabilities
	(in millions)
Derivatives Designated as Hedge Accounting Instruments:
Interest Rate
Interest Rate Swaps	$	4,567		$	27		$	(321)		$	4,260		$	11		$	(404)
Interest Rate Forwards	10			0			0			10			0			0
Foreign Currency
Foreign Currency Forwards	5,061			28			(260)			4,771			92			(197)
Currency/Interest Rate
Foreign Currency Swaps	32,665			1,195			(1,677)			31,301			2,652			(368)
Total Derivatives Designated as Hedge Accounting Instruments	$	42,303		$	1,250		$	(2,258)		$	40,342		$	2,755		$	(969)
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate
Interest Rate Swaps	$	247,298		$	10,150		$	(23,015)		$	228,392		$	11,272		$	(24,802)
Interest Rate Futures	10,422			66			(17)			9,773			6			(21)
Interest Rate Options	29,245			112			(1,262)			34,005			430			(1,583)
Interest Rate Forwards	2,813			25			(8)			2,544			9			(80)
Interest Rate Total Return Swaps	844			5			(2)			485			4			(2)
Foreign Currency
Foreign Currency Forwards	29,103			861			(1,028)			27,819			1,625			(1,181)
Currency/Interest Rate
Foreign Currency Swaps	7,766			406			(223)			7,525			658			(129)
Credit
Credit Default Swaps	4,679			87			0			4,027			90			0
Equity
Equity Futures	1,169			4			0			2,019			6			(7)
Equity Options	155,754			6,507			(5,819)			104,438			4,507			(3,790)
Equity Total Return Swaps	11,773			656			(875)			9,796			331			(327)
Other
Other(1)	1,250			0			0			1,250			0			0
Synthetic GICs	77,495			1			(15)			76,416			1			(1)
Total Derivatives Not Qualifying as Hedge Accounting Instruments	$	579,611		$	18,880		$	(32,264)		$	508,489		$	18,939		$	(31,923)
Total Derivatives(2)(3)	$	621,914		$	20,130		$	(34,522)		$	548,831		$	21,694		$	(32,892)

(1)“Other” primarily includes derivative contracts used to improve the balance of the Company’s tail longevity and mortality risk. Under these contracts, the Company’s gains (losses) are capped at the notional amount.

(2)Excludes embedded derivatives which contain multiple underlying risks. The fair value of these embedded derivatives was a net liability of $14,687 million (including the Prismic funds withheld related embedded derivative net liability of $45 million) and $11,783 million (including the Prismic funds withheld related embedded derivative net liability of $(91) million) as of June 30, 2025 and December 31, 2024, respectively, primarily included in “Policyholders’ account balances” and “Reinsurance and funds withheld payables.”

(3)Recorded in “Other invested assets” and “Other liabilities” on the Unaudited Interim Consolidated Statements of Financial Position.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

As of June 30, 2025, the following amounts were recorded on the Unaudited Interim Consolidated Statements of Financial Position related to the carrying amount of the hedged assets (liabilities) and cumulative basis adjustments included in the carrying amount for fair value hedges.


	June 30, 2025				December 31, 2024
Balance Sheet Line Item in which Hedged Item is Recorded	Carrying Amount of the Hedged Assets (Liabilities)		Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets (Liabilities)(1)		Carrying Amount of the Hedged Assets (Liabilities)		Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Assets (Liabilities)(1)

	(in millions)
Fixed maturities, available-for-sale, at fair value	$	333	$	15	$	216	$	11

Policyholders’ account balances	$	(1,578)	$	284	$	(1,510)	$	327
Future policy benefits	$	(2,470)	$	233	$	(2,280)	$	423

(1)There were no material fair value hedging adjustments for hedged assets and liabilities for which hedge accounting has been discontinued.

Most of the Company’s derivatives do not qualify for hedge accounting for various reasons. For example: (i) derivatives that economically hedge embedded derivatives do not qualify for hedge accounting because changes in the fair value of the embedded derivatives are already recorded in net income; (ii) derivatives that are utilized as macro hedges of the Company’s exposure to various risks typically do not qualify for hedge accounting because they do not meet the criteria required under portfolio hedge accounting rules; and (iii) synthetic GICs, which are product standalone derivatives, do not qualify as hedging instruments under hedge accounting rules.

Offsetting Assets and Liabilities

The following tables present recognized derivative instruments (excluding embedded derivatives), and repurchase and reverse repurchase agreements that are offset in the Unaudited Interim Consolidated Statements of Financial Position, and/or are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in the Unaudited Interim Consolidated Statements of Financial Position.


	June 30, 2025
	Gross Amounts of Recognized Financial Instruments		Gross Amounts Offset in the Statements of Financial Position		Net Amounts Presented in the Statements of Financial Position		Financial Instruments/ Collateral(1)		Net Amount
	(in millions)
Offsetting of Financial Assets:
Derivatives	$	19,989	$	(18,345)	$	1,644	$	(594)	$	1,050
Securities purchased under agreement to resell	18		0		18		(18)		0
Total Assets	$	20,007	$	(18,345)	$	1,662	$	(612)	$	1,050
Offsetting of Financial Liabilities:
Derivatives	$	34,507	$	(28,172)	$	6,335	$	(6,335)	$	0
Securities sold under agreement to repurchase	8,205		0		8,205		(8,205)		0
Total Liabilities	$	42,712	$	(28,172)	$	14,540	$	(14,540)	$	0

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	December 31, 2024
	Gross Amounts of Recognized Financial Instruments		Gross Amounts Offset in the Statements of Financial Position		Net Amounts Presented in the Statements of Financial Position		Financial Instruments/ Collateral(1)		Net Amount
	(in millions)
Offsetting of Financial Assets:
Derivatives	$	21,574	$	(20,093)	$	1,481	$	(696)	$	785
Securities purchased under agreement to resell	277		0		277		(277)		0
Total Assets	$	21,851	$	(20,093)	$	1,758	$	(973)	$	785
Offsetting of Financial Liabilities:
Derivatives	$	32,891	$	(28,141)	$	4,750	$	(4,403)	$	347
Securities sold under agreement to repurchase	6,796		0		6,796		(6,796)		0
Total Liabilities	$	39,687	$	(28,141)	$	11,546	$	(11,199)	$	347

(1)Amounts exclude the excess of collateral received/pledged from/to the counterparty.

For information regarding the rights of offset associated with the derivative assets and liabilities in the table above, see “—Counterparty Credit Risk” below. For securities purchased under agreements to resell and securities sold under agreements to repurchase, the Company monitors the value of the securities and maintains collateral, as appropriate, to protect against credit exposure. Where the Company has entered into repurchase and resale agreements with the same counterparty, in the event of default, the Company would generally be permitted to exercise rights of offset. For additional information regarding the Company’s accounting policy for securities repurchase and resale agreements, see Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Cash Flow, Fair Value and Net Investment Hedges

The primary derivative and non-derivative instruments used by the Company in its fair value, cash flow and net investment hedge accounting relationships are interest rate swaps, currency swaps, currency forwards, and foreign currency denominated debts. These instruments are only designated for hedge accounting in instances where the appropriate criteria are met. The Company does not use futures, options, credit, or equity derivatives in any of its fair value, cash flow or net investment hedge accounting relationships.

The following tables provide the financial statement classification and impact of derivatives used in qualifying and non-qualifying hedge relationships, including the offset of the hedged item in fair value hedge relationships.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2025
	Realized Investment Gains (Losses)		Change in Value of MRBs, Net of Related Hedging Gain (Loss)		Net Investment Income		Other Income (Loss)		Interest Expense		Interest Credited to Policyholders’ Account Balances		Policyholders’ Benefits		Change in AOCI(1)
	(in millions)
Derivatives Designated as Hedge Accounting Instruments:
Fair value hedges
Gains (losses) on derivatives designated as hedge instruments:
Interest Rate	$	(3)	$	0	$	0	$	0	$	0	$	7	$	(2)	$	0
Currency	0		0		0		0		0		0		109		0
Total gains (losses) on derivatives designated as hedge instruments	(3)		0		0		0		0		7		107		0
Gains (losses) on the hedged item:
Interest Rate	2		0		2		0		0		5		3		0
Currency	0		0		0		0		0		0		(110)		0
Total gains (losses) on hedged item	2		0		2		0		0		5		(107)		0
Amortization for gains (losses) excluded from assessment of the effectiveness

Currency	0		0		0		0		0		0		(3)		(34)
Total amortization for gains (losses) excluded from assessment of the effectiveness	0		0		0		0		0		0		(3)		(34)
Total gains (losses) on fair value hedges net of hedged item	(1)		0		2		0		0		12		(3)		(34)
Cash flow hedges
Interest Rate	0		0		(4)		0		0		0		0		2
Currency	0		0		0		0		0		0		0		(116)
Currency/Interest Rate	(14)		0		93		(344)		0		0		0		(2,142)
Total gains (losses) on cash flow hedges	(14)		0		89		(344)		0		0		0		(2,256)
Net investment hedges
Currency	0		0		0		0		0		0		0		(39)
Currency/Interest Rate	0		0		0		0		0		0		0		0
Total gains (losses) on net investment hedges	0		0		0		0		0		0		0		(39)
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	(215)		(271)		0		0		0		0		0		0
Currency	(413)		0		0		0		0		0		0		0
Currency/Interest Rate	(343)		0		0		(5)		0		0		0		0
Credit	52		0		0		0		0		0		0		0
Equity	2,484		(592)		0		0		0		0		0		0
Other	0		0		0		0		0		0		0		0
Embedded Derivatives(2)	(2,908)		0		0		0		0		0		0		0
Total gains (losses) on derivatives not qualifying as hedge accounting instruments	(1,343)		(863)		0		(5)		0		0		0		0
Total	$	(1,358)	$	(863)	$	91	$	(349)	$	0	$	12	$	(3)	$	(2,329)

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2025
	Realized Investment Gains (Losses)		Change in Value of MRBs, Net of Related Hedging Gain (Loss)		Net Investment Income		Other Income (Loss)		Interest Expense		Interest Credited to Policyholders’ Account Balances		Policyholders’ Benefits		Change in AOCI(1)
	(in millions)
Derivatives Designated as Hedge Accounting Instruments:
Fair value hedges
Gains (losses) on derivatives designated as hedge instruments:
Interest Rate	$	(6)	$	0	$	0	$	0	$	0	$	41	$	28	$	0
Currency	0		0		0		0		0		0		162		0
Total gains (losses) on derivatives designated as hedge instruments	(6)		0		0		0		0		41		190		0
Gains (losses) on the hedged item:
Interest Rate	4		0		7		0		0		(43)		(29)		0
Currency	0		0		0		0		0		0		(162)		0
Total gains (losses) on hedged item	4		0		7		0		0		(43)		(191)		0
Amortization for gains (losses) excluded from assessment of the effectiveness

Currency	0		0		0		0		0		0		(7)		(103)
Total amortization for gains (losses) excluded from assessment of the effectiveness	0		0		0		0		0		0		(7)		(103)
Total gains (losses) on fair value hedges net of hedged item	(2)		0		7		0		0		(2)		(8)		(103)
Cash flow hedges
Interest Rate	0		0		(7)		0		0		0		0		10
Currency	0		0		0		0		0		0		0		(142)
Currency/Interest Rate	8		0		189		(491)		0		0		0		(2,245)
Total gains (losses) on cash flow hedges	8		0		182		(491)		0		0		0		(2,377)
Net investment hedges
Currency	0		0		0		0		0		0		0		(55)
Currency/Interest Rate	0		0		0		0		0		0		0		0
Total gains (losses) on net investment hedges	0		0		0		0		0		0		0		(55)
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	(26)		(130)		0		0		0		0		0		0
Currency	(587)		0		0		(1)		0		0		0		0
Currency/Interest Rate	(370)		0		0		(5)		0		0		0		0
Credit	41		0		0		0		0		0		0		0
Equity	1,015		(390)		0		0		0		0		0		0
Other	0		0		0		0		0		0		0		0
Embedded Derivatives(2)	(1,651)		0		0		0		0		0		0		0
Total gains (losses) on derivatives not qualifying as hedge accounting instruments	(1,578)		(520)		0		(6)		0		0		0		0
Total	$	(1,572)	$	(520)	$	189	$	(497)	$	0	$	(2)	$	(8)	$	(2,535)

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2024
	Realized Investment Gains (Losses)		Change in Value of MRBs, Net of Related Hedging Gain (Loss)		Net Investment Income		Other Income (Loss)		Interest Expense		Interest Credited to Policyholders’ Account Balances		Policyholders’ Benefits		Change in AOCI(1)
	(in millions)
Derivatives Designated as Hedge Accounting Instruments:
Fair value hedges
Gains (losses) on derivatives designated as hedge instruments:
Interest Rate	$	1	$	0	$	0	$	0	$	0	$	(19)	$	(23)	$	0
Currency	0		0		0		0		0		0		1		0
Total gains (losses) on derivatives designated as hedge instruments	1		0		0		0		0		(19)		(22)		0
Gains (losses) on the hedged item:
Interest Rate	(1)		0		3		0		0		11		15		0
Currency	0		0		0		0		0		0		0		0
Total gains (losses) on hedged item	(1)		0		3		0		0		11		15		0

Amortization for gains (losses) excluded from assessment of the effectiveness
Currency	0		0		0		0		0		0		(3)		(19)
Total amortization for gains (losses) excluded from assessment of the effectiveness	0		0		0		0		0		0		(3)		(19)
Total gains (losses) on fair value hedges net of hedged item	0		0		3		0		0		(8)		(10)		(19)
Cash flow hedges
Interest Rate	(13)		0		(4)		0		0		0		0		11
Currency	0		0		0		0		0		0		0		9
Currency/Interest Rate	25		0		82		8		0		0		0		281
Total gains (losses) on cash flow hedges	12		0		78		8		0		0		0		301
Net investment hedges
Currency	0		0		0		0		0		0		0		2
Currency/Interest Rate	0		0		0		0		0		0		0		0
Total gains (losses) on net investment hedges	0		0		0		0		0		0		0		2
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	(371)		(451)		0		0		0		0		0		0
Currency	(13)		0		0		(3)		0		0		0		0
Currency/Interest Rate	66		0		0		0		0		0		0		0
Credit	4		0		0		0		0		0		0		0
Equity	591		(67)		0		0		0		0		0		0
Other	0		0		0		0		0		0		0		0
Embedded Derivatives(2)	435		0		0		0		0		0		0		0
Total gains (losses) on derivatives not qualifying as hedge accounting instruments	712		(518)		0		(3)		0		0		0		0
Total	$	724	$	(518)	$	81	$	5	$	0	$	(8)	$	(10)	$	284

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	Realized Investment Gains (Losses)		Change in Value of MRBs, Net of Related Hedging Gain (Loss)		Net Investment Income		Other Income (Loss)		Interest Expense		Interest Credited to Policyholders’ Account Balances		Policyholders’ Benefits		Change in AOCI(1)
	(in millions)
Derivatives Designated as Hedge Accounting Instruments:
Fair value hedges
Gains (losses) on derivatives designated as hedge instruments:
Interest Rate	$	6	$	0	$	0	$	0	$	0	$	(69)	$	(82)	$	0
Currency	0		0		0		0		0		0		(15)		0
Total gains (losses) on derivatives designated as hedge instruments	6		0		0		0		0		(69)		(97)		0
Gains (losses) on the hedged item:
Interest Rate	(6)		0		6		0		0		74		63		0
Currency	0		0		0		0		0		0		14		0
Total gains (losses) on hedged item	(6)		0		6		0		0		74		77		0

Amortization for gains (losses) excluded from assessment of the effectiveness
Currency	0		0		0		0		0		0		(5)		(9)
Total amortization for gains (losses) excluded from assessment of the effectiveness	0		0		0		0		0		0		(5)		(9)
Total gains (losses) on fair value hedges net of hedged item	0		0		6		0		0		5		(25)		(9)
Cash flow hedges
Interest Rate	(13)		0		(7)		0		0		0		0		1
Currency	0		0		0		0		0		0		0		24
Currency/Interest Rate	28		0		158		85		0		0		0		605
Total gains (losses) on cash flow hedges	15		0		151		85		0		0		0		630
Net investment hedges
Currency	0		0		0		0		0		0		0		13
Currency/Interest Rate	0		0		0		0		0		0		0		0
Total gains (losses) on net investment hedges	0		0		0		0		0		0		0		13
Derivatives Not Qualifying as Hedge Accounting Instruments:
Interest Rate	(1,033)		(1,412)		0		0		0		0		0		0
Currency	(39)		0		0		(1)		0		0		0		0
Currency/Interest Rate	172		0		0		1		0		0		0		0
Credit	56		0		0		0		0		0		0		0
Equity	2,040		(560)		0		0		0		0		0		0
Other	0		0		0		0		0		0		0		0
Embedded Derivatives(2)	(636)		0		0		0		0		0		0		0
Total gains (losses) on derivatives not qualifying as hedge accounting instruments	560		(1,972)		0		0		0		0		0		0
Total	$	575	$	(1,972)	$	157	$	85	$	0	$	5	$	(25)	$	634

(1)Excludes changes related to net investment hedges using non-derivative instruments of $(37) million and $(88) million for the three and six months ended June 30, 2025, respectively, and $61 million and $101 million for the three and six months ended June 30, 2024, respectively.

(2)Includes the Prismic funds withheld related embedded derivative realized gain (loss) of $11 million and $(136) million for the three and six months ended June 30, 2025, respectively, and $189 million and $472 million for the three and six months ended June 30, 2024, respectively.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Presented below is a rollforward of current period cash flow hedges in AOCI before taxes:


	(in millions)
Balance, December 31, 2024	$	1,780
Amount recorded in AOCI:
Interest Rate	3
Currency	(146)
Currency/Interest Rate	(2,538)
Total amount recorded in AOCI	(2,681)
Amount reclassified from AOCI to income:
Interest Rate	7
Currency	3
Currency/Interest Rate	294
Total amount reclassified from AOCI to income	304
Balance, June 30, 2025	$	(597)

The changes in fair value of cash flow hedges are deferred in AOCI and are included in “Net unrealized investment gains (losses)” in the Unaudited Interim Consolidated Statements of Comprehensive Income; these amounts are then reclassified to earnings when the hedged item affects earnings. Using June 30, 2025 values, it is estimated that a pre-tax gain of $264 million is expected to be reclassified from AOCI to earnings during the subsequent twelve months ending June 30, 2026.

The exposures the Company is hedging with these qualifying cash flow hedges include the variability of future cash flows from forecasted transactions denominated in foreign currencies, the purchases of invested assets, and the receipt or payment of variable interest on existing financial instruments. The maximum length of time over which the Company is hedging its exposure to the variability in future cash flows for forecasted transactions is 26 years.

There were no material amounts reclassified from AOCI into earnings relating to instances in which the Company discontinued cash flow hedge accounting because the forecasted transaction did not occur by the anticipated date or within the additional time period permitted by the authoritative guidance for the accounting for derivatives and hedging. In addition, there were no instances in which the Company discontinued fair value hedge accounting due to a hedged firm commitment no longer qualifying as a fair value hedge.

For net investment hedges, in addition to derivatives, the Company uses foreign currency denominated debt to hedge the risk of change in the net investment in a foreign subsidiary due to changes in exchange rates. For effective net investment hedges, the amounts, before applicable taxes, recorded in the cumulative translation adjustment within AOCI were $(76) million and $(142) million for the three and six months ended June 30, 2025, respectively, and $64 million and $113 million for the three and six months ended June 30, 2024, respectively.

Credit Derivatives

The following tables provide a summary of the notional and fair value of written credit protection, presented as assets (liabilities). The Company’s maximum amount at risk under these credit derivatives, assuming the value of the underlying referenced securities become worthless, is equal to the notional amounts. These credit derivatives have maturities of less than 10 years for index reference.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	June 30, 2025
	NAIC Rating Designation of Underlying Credit Obligation(1)
	NAIC 1				NAIC 2				NAIC 3				NAIC 4				NAIC 5				NAIC 6(2)				Total
	Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value
	(in millions)
Single name reference(3)	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0
Index reference(3)	0		0		0		0		4,053		45		0		0		0		0		626		42		4,679		87
Total	$	0	$	0	$	0	$	0	$	4,053	$	45	$	0	$	0	$	0	$	0	$	626	$	42	$	4,679	$	87


	December 31, 2024
	NAIC Rating Designation of Underlying Credit Obligation(1)
	NAIC 1				NAIC 2				NAIC 3				NAIC 4				NAIC 5				NAIC 6(2)				Total
	Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value		Gross Notional		Fair Value
	(in millions)
Single name reference(3)	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0
Index reference(3)	0		0		0		0		3,365		40		0		0		0		0		662		50		4,027		90
Total	$	0	$	0	$	0	$	0	$	3,365	$	40	$	0	$	0	$	0	$	0	$	662	$	50	$	4,027	$	90

(1)The NAIC rating designations are based on availability and the lowest ratings among Moody's Investors Service, Inc. (“Moody's”), Standard & Poor’s Rating Services (“S&P”) and Fitch Ratings Inc. (“Fitch”). If no rating is available from a rating agency, a NAIC 6 rating is used.

(2)The NAIC rating designation is due to approximately 4% and 4% of the index reference name rated as NAIC 6 as of June 30, 2025 and December 31, 2024, respectively.

(3)Single name credit default swaps may make reference to the credit of corporate debt, sovereign debt, and structured finance. Index reference NAIC designations are based on the lowest rated single name reference included in the index.

The Company has no exposure on purchased credit protection as of June 30, 2025 and December 31, 2024.

Counterparty Credit Risk

The Company is exposed to losses in the event of non-performance by counterparties to financial derivative transactions with a positive fair value. The Company manages credit risk by: (i) entering into derivative transactions with highly rated major financial institutions and other creditworthy counterparties governed by master netting agreements, as applicable; (ii) trading through central clearing and over-the-counter (“OTC”) parties; (iii) obtaining collateral, such as cash and securities, when appropriate; and (iv) setting limits on single party credit exposures which are subject to periodic management review.

Substantially all of the Company’s derivative agreements have zero thresholds which require daily full collateralization by the party in a liability position. In addition, certain of the Company’s derivative agreements contain credit-risk related contingent features; if the credit rating of one of the parties to the derivative agreement is to fall below a certain level, the party with positive fair value could request termination at the then fair value or demand immediate full collateralization from the party whose credit rating fell and is in a net liability position.

As of June 30, 2025, there were no net liability derivative positions with counterparties with credit risk-related contingent features. All derivatives have been appropriately collateralized by the Company or the counterparty in accordance with the terms of the derivative agreements.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

6. FAIR VALUE OF ASSETS AND LIABILITIES

Fair Value Measurement—Fair value represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative fair value guidance establishes a framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The level in the fair value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows:

Level 1—Fair value is based on unadjusted quoted prices in active markets that are accessible to the Company for identical assets or liabilities.

Level 2—Fair value is based on significant inputs, other than quoted prices included in Level 1, that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability through corroboration with observable market data. Level 2 inputs include quoted prices in active markets for similar assets and liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, and other market observable inputs.

Level 3—Fair value is based on at least one significant unobservable input for the asset or liability. The assets and liabilities in this category may require significant judgment or estimation in determining the fair value.

For a discussion of the Company’s valuation methodologies for assets and liabilities measured at fair value and the fair value hierarchy, see Note 6 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes in our valuation techniques during the period represented by these Unaudited Interim Consolidated Financial Statements.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Assets and Liabilities by Hierarchy Level—The tables below present the balances of assets and liabilities reported at fair value on a recurring basis, as of the dates indicated.


	June 30, 2025
	Level 1		Level 2		Level 3		Netting(1)		Total
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	0	$	20,370	$	0	$		$	20,370
Obligations of U.S. states and their political subdivisions	0		5,508		5				5,513
Foreign government securities	0		58,684		5				58,689
U.S. corporate public securities	0		103,096		90				103,186
U.S. corporate private securities(2)	0		40,990		4,693				45,683
Foreign corporate public securities	0		23,949		39				23,988
Foreign corporate private securities	0		37,207		1,838				39,045
Asset-backed securities(3)	0		14,920		3,411				18,331
Commercial mortgage-backed securities	0		8,734		847				9,581
Residential mortgage-backed securities	0		3,846		70				3,916
Subtotal	0		317,304		10,998				328,302
Assets supporting experience-rated contractholder liabilities:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	0		236		0				236

Foreign government securities	0		635		0				635
Corporate securities	0		67		0				67



Equity securities	1,813		1,531		0				3,344

Subtotal	1,813		2,469		0				4,282
Market risk benefit assets	0		0		2,188				2,188
Fixed maturities, trading	0		11,930		2,090				14,020
Equity securities	4,966		1,867		601				7,434
Commercial mortgage and other loans	0		463		263				726
Other invested assets(4)	339		19,789		978		(18,345)		2,761
Short-term investments	1,788		4,147		18				5,953
Cash equivalents	638		8,984		1				9,623
Reinsurance recoverables and deposit receivables	0		267		367				634

Separate account assets(5)(6)	10,202		157,364		252				167,818
Total assets	$	19,746	$	524,584	$	17,756	$	(18,345)	$	543,741
Market risk benefit liabilities	$	0	$	0	$	4,859	$		$	4,859
Policyholders’ account balances	0		0		15,289				15,289
Reinsurance and funds withheld payables	0		27		0				27
Other liabilities	236		34,271		15		(28,172)		6,350
Notes issued by consolidated VIEs	0		0		195				195
Total liabilities	$	236	$	34,298	$	20,358	$	(28,172)	$	26,720

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	December 31, 2024
	Level 1		Level 2		Level 3		Netting(1)		Total
	(in millions)
Fixed maturities, available-for-sale:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	0	$	20,348	$	0	$		$	20,348
Obligations of U.S. states and their political subdivisions	0		6,098		6				6,104
Foreign government securities	0		57,472		7				57,479
U.S. corporate public securities	0		98,442		66				98,508
U.S. corporate private securities(2)	0		39,848		3,941				43,789
Foreign corporate public securities	0		21,946		36				21,982
Foreign corporate private securities	0		32,675		1,788				34,463
Asset-backed securities(3)	0		15,654		1,480				17,134
Commercial mortgage-backed securities	0		8,420		853				9,273
Residential mortgage-backed securities	0		2,490		0				2,490
Subtotal	0		303,393		8,177				311,570
Assets supporting experience-rated contractholder liabilities:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	0		220		0				220

Foreign government securities	0		539		0				539
Corporate securities	0		67		0				67



Equity securities	1,522		1,359		0				2,881

Subtotal	1,522		2,185		0				3,707
Market risk benefit assets	0		0		2,331				2,331
Fixed maturities, trading	0		10,544		1,986				12,530
Equity securities	7,154		1,745		518				9,417
Commercial mortgage and other loans	0		469		233				702
Other invested assets(4)	10		21,683		953		(20,093)		2,553
Short-term investments	1,896		6,238		461				8,595
Cash equivalents	326		10,365		0				10,691
Reinsurance recoverables and deposit receivables	0		236		613				849

Separate account assets(5)(6)	8,441		157,999		232				166,672
Total assets	$	19,349	$	514,857	$	15,504	$	(20,093)	$	529,617
Market risk benefit liabilities	$	0	$	0	$	4,455	$		$	4,455
Policyholders’ account balances	0		0		12,746				12,746
Reinsurance and funds withheld payables	0		(118)		0				(118)
Other liabilities	28		32,863		1		(28,141)		4,751
Notes issued by consolidated VIEs	0		0		60				60
Total liabilities	$	28	$	32,745	$	17,262	$	(28,141)	$	21,894

(1)“Netting” amounts represent cash collateral of $(9,827) million and $(8,049) million as of June 30, 2025 and December 31, 2024, respectively, and the impact of offsetting asset and liability positions held with the same counterparty, subject to master netting agreements.

(2)Excludes notes with fair value of $15,220 million (carrying amount of $15,220 million) and $14,748 million (carrying amount of $14,748 million) as of June 30, 2025 and December 31, 2024, respectively, which have been offset with the associated debt under a netting agreement.

(3)Includes credit-tranched securities collateralized by loan obligations, home equity loans, auto loans, education loans and other asset types.

(4)Other invested assets excluded from the fair value hierarchy include certain hedge funds, private equity funds and other funds for which fair value is measured at net asset value (“NAV”) per share (or its equivalent) as a practical expedient. As of June 30, 2025 and December 31, 2024, the fair value of such investments was $5,173 million and $5,021 million, respectively.

(5)Separate account assets included in the fair value hierarchy exclude investments in entities that calculate NAV per share (or its equivalent) as a practical expedient. Such investments excluded from the fair value hierarchy include investments in real estate, hedge funds and other invested assets. As of June 30, 2025 and December 31, 2024, the fair value of such investments was $26,943 million and $26,700 million, respectively.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

(6)Separate account assets represent segregated funds that are invested for certain customers. Investment risks associated with market value changes are borne by the customers, except to the extent of minimum guarantees made by the Company with respect to certain accounts. Separate account liabilities are not included in the above table as they are reported at contract value and not fair value in the Company’s Unaudited Interim Consolidated Statements of Financial Position.

Quantitative Information Regarding Internally-Priced Level 3 Assets and Liabilities—The tables below present quantitative information regarding significant internally-priced Level 3 assets and liabilities.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	As of June 30, 2025
	Fair Value		Valuation Techniques	Unobservable Inputs	Minimum	Maximum	Weighted Average	Impact of Increase in Input on Fair Value(1)
	(in millions)
Assets:
Corporate securities(2)(3)	$	7,440	Discounted cash flow	Discount rate	0.96%	21.50%	10.04%	Decrease
			Market comparables	EBITDA multiple(4)	0.1X	9.4X	6.4X	Increase
			Liquidation	Liquidation value	28.34%	84.21%	63.25%	Increase
Asset backed securities	$	1,147	Discounted cash flow	Discount rate	2.03%	10.75%	4.00%	Decrease
				Liquidity premium	1.90%	1.90%	1.90%	Decrease
Commercial mortgage-backed securities	$	847	Discounted cash flow	Liquidity premium	0.90%	0.90%	0.90%	Decrease
Market risk benefit assets(6)	$	2,188	Discounted cash flow	Lapse rate(8)	1%	20%		Increase
				Spread over SOFR(9)	0.40%	1.82%		Increase
				Utilization rate(10)	37%	94%		Decrease
				Withdrawal rate	See table footnote (11) below.
				Mortality rate(12)	0%	16%		Increase
				Equity volatility curve	15%	25%		Decrease
Equity securities	$	195	Discounted cash flow	Discount rate(5)	0.16%	40.00%		Decrease
			Market comparables	EBITDA multiple(4)	6.8X	12.2X	9.3X	Increase
			Net Asset Value	Share price	$3	$1,809	$758	Increase
Commercial mortgage and other loans	$	263	Discounted cash flow	Spread	0.00%	2.41%	2.14%	Decrease
Reinsurance recoverables and deposit receivables	$	367	Discounted cash flow	Lapse rate(8)	1%	50%		Increase
				Spread over SOFR(9)	0.40%	1.82%		Increase
				Option Budget(13)	0%	6%		Decrease
Liabilities:
Market risk benefit liabilities(6)	$	4,859	Discounted cash flow	Lapse rate(8)	1%	20%		Decrease
				Spread over SOFR(9)	0.40%	1.82%		Decrease
				Utilization rate(10)	37%	94%		Increase
				Withdrawal rate	See table footnote (11) below.
				Mortality rate(12)	0%	16%		Decrease
				Equity volatility curve	15%	25%		Increase
Policyholders’ account balances(7)	$	15,239	Discounted cash flow	Lapse rate(8)	0%	80%		Decrease
				Spread over SOFR(9)	0.40%	1.82%		Decrease
				Mortality rate(12)	0%	23%		Decrease

				Option Budget(13)	(2)%	7%		Increase

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	As of December 31, 2024
	Fair Value		Valuation Techniques	Unobservable Inputs	Minimum	Maximum	Weighted Average	Impact of Increase in Input on Fair Value(1)
	(in millions)
Assets:
Corporate securities(2)(3)	$	6,763	Discounted cash flow	Discount rate	0.95%	20.00%	10.36%	Decrease
			Market comparables	EBITDA multiple(4)	3.0X	8.8X	7.6X	Increase
			Liquidation	Liquidation value	75.00%	75.00%	75.00%	Increase
Asset backed securities	$	529	Discounted cash flow	Discount rate	2.30%	10.70%	6.08%	Decrease
Commercial mortgage-backed securities	$	853	Discounted cash flow	Liquidity premium	1.00%	1.00%	1.00%	Decrease
Market risk benefit assets(6)	$	2,331	Discounted cash flow	Lapse rate(8)	1%	20%		Increase
				Spread over SOFR(9)	0.29%	1.71%		Increase
				Utilization rate(10)	37%	94%		Decrease
				Withdrawal rate	See table footnote (11) below.
				Mortality rate(12)	0%	16%		Increase
				Equity volatility curve	16%	25%		Decrease
Equity securities	$	209	Discounted cash flow	Discount rate(5)	0.16%	40.00%		Decrease
			Market comparables	EBITDA multiple(4)	5.5X	12.2X	6.0X	Increase
			Net Asset Value	Share price	$3	$1,810	$779	Increase
Reinsurance recoverables and deposit receivables	$	613	Discounted cash flow	Lapse rate(8)	1%	50%		Increase
				Spread over SOFR(9)	0.29%	1.71%		Increase
				Option Budget(13)	0%	6%		Decrease
Liabilities:
Market risk benefit liabilities(6)	$	4,455	Discounted cash flow	Lapse rate(8)	1%	20%		Decrease
				Spread over SOFR(9)	0.29%	1.71%		Decrease
				Utilization rate(10)	37%	94%		Increase
				Withdrawal rate	See table footnote (11) below.
				Mortality rate(12)	0%	16%		Decrease
				Equity volatility curve	16%	25%		Increase
Policyholders’ account balances(7)	$	12,741	Discounted cash flow	Lapse rate(8)	0%	80%		Decrease
				Spread over SOFR(9)	0.29%	1.73%		Decrease
				Mortality rate(12)	0%	23%		Decrease

				Option Budget(13)	(1)%	7%		Increase

(1)Conversely, the impact of a decrease in input would have the opposite impact on fair value as that presented in the table.

(2)Includes assets classified as fixed maturities, available-for-sale, assets supporting experience-rated contractholder liabilities and fixed maturities, trading.

(3)Excludes notes which have been offset with the associated debt under a netting agreement.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

(4)Represents multiple of earnings before interest, taxes, depreciation and amortization (“EBITDA”), and are amounts used when the Company has determined that market participants would use such multiples when valuing the investments.

(5)For these investments, a range of discount rates is typically used and is therefore a more meaningful representation of the unobservable inputs used in the valuation rather than weighted average.

(6)Market risk benefits primarily represent fair value for all living benefit guarantees including accumulation, withdrawal and income benefits. Since the valuation methodology for these assets and liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than weighted average, is a more meaningful representation of the unobservable inputs used in the valuation.

(7)Policyholders’ account balances primarily represent general account liabilities for the index-linked interest credited on certain of the Company’s life and annuity products that are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cash flow projection period, presenting a range, rather than a weighted average, is a more meaningful representation of the unobservable inputs used in the valuation.

(8)Lapse rates for contracts with living benefit guarantees are adjusted at the contract level based on the in-the-moneyness of the living benefit and reflect other factors, such as the applicability of any surrender charges. Lapse rates are reduced when contracts are more in-the-money. Lapse rates for contracts with index-linked crediting guarantees may be adjusted at the contract level based on the applicability of any surrender charges, product type, and market related factors such as interest rates. Lapse rates are also generally assumed to be lower for the period where surrender charges apply. For any given contract, lapse rates vary throughout the period over which cash flows are projected for the purposes of valuing these balances.

(9)The spread over the secured overnight financing rate (“SOFR”) swap curve represents the premium added to the proxy for the risk-free rate (SOFR) to reflect the Company’s estimates of rates that a market participant would use to value the living benefits in both the accumulation and payout phases and index-linked interest crediting guarantees as of June 30, 2025 and December 31, 2024, respectively. This spread includes an estimate of non-performance risk (“NPR”), which is the risk that the obligation will not be fulfilled by the Company. NPR is primarily estimated by utilizing the credit spreads associated with issuing funding agreements, adjusted for any illiquidity risk premium. In order to reflect the financial strength ratings of the Company, credit spreads associated with funding agreements, as opposed to credit spread associated with debt, are utilized in developing this estimate because funding agreements are insurance liabilities and are therefore senior to debt. Effective April 2023, the Company entered into an agreement with The Ohio National Life Insurance Company, now known as AuguStar Life Insurance Company (“AuguStar”), an affiliate of Constellation Insurance Holdings, Inc., to reinsure approximately $10 billion of account values of PDI traditional variable annuity contracts with guaranteed living benefits. See Note 12 for additional information regarding this transaction. As a result of this transaction, a ceded MRB asset balance was established to fair value the reinsurance reimbursements to the Company. The establishment of the fair value also required an estimate of NPR for AuguStar, which may differ from the Company’s; however, the NPR spreads for AuguStar were developed using a methodology similar to that of the Company.

(10)The utilization rate assumption estimates the percentage of contracts that will utilize the benefit during the contract duration, and begin lifetime withdrawals at various time intervals from contract inception. The remaining contractholders are assumed to either begin lifetime withdrawals immediately or never utilize the benefit. Utilization assumptions may vary by product type, tax status and age. The impact of changes in these assumptions is highly dependent on the product type, the age of the contractholder at the time of the sale, and the timing of the first lifetime income withdrawal. Range reflects the utilization rate for the vast majority of business with living benefits.

(11)The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. These assumptions vary based on the age of the contractholder, the tax status of the contract and the duration since the contractholder began lifetime withdrawals. As of both June 30, 2025 and December 31, 2024, the minimum withdrawal rate assumption is 78% and the maximum withdrawal rate assumption may be greater than 100%. The fair value of the liability will generally increase the closer the withdrawal rate is to 100% and decrease as the withdrawal rate moves further away from 100%.

(12)The range reflects the mortality rates for the vast majority of business with living benefits and other contracts, with policyholders ranging from 50 to 90 years old. While the majority of living benefits have a minimum age requirement, certain other contracts do not have an age restriction. This results in contractholders with mortality rates approaching 0% for certain benefits. Mortality rates may vary by product, age and duration. A mortality improvement assumption is also incorporated into the overall mortality table.

(13)Option budget estimates the expected long-term cost of options used to hedge exposures associated with equity price and interest rate changes. The level of option budget determines future costs of the options, which impacts the growth in account value and the valuation of embedded derivatives.

Interrelationships Between Unobservable Inputs*—*In addition to the sensitivities of fair value measurements to changes in each unobservable input in isolation, as reflected in the table above, interrelationships between these inputs may also exist, such that a change in one unobservable input may give rise to a change in another or multiple inputs. Examples of such interrelationships for significant internally-priced Level 3 assets and liabilities are as follows:

*Corporate Securities—*The rate used to discount future cash flows reflects current risk-free rates plus credit and liquidity spread requirements that market participants would use to value an asset. The discount rate may be influenced by many factors, including market cycles, expectations of default, collateral, term and asset complexity. Each of these factors can influence discount rates, either in isolation, or in response to other factors. During weaker economic cycles, as the expectations of default increase, credit spreads widen, which results in a decrease in fair value.

*Commercial Mortgage-backed Securities—*Interrelationships may exist between the prepayment rate, the default rate and/or loss severity, depending on specific market conditions. In stronger economic cycles, prepayment rates are generally driven by underlying property appreciation and subsequent cash-out refinances, while default rates and loss severity may be lower. During weaker economic cycles, prepayment rates may decline, while default rates and loss severity increase. Generally, a change in the assumption used for the probability of default would be accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for prepayment rates. The impact of these factors on average life and economics varies with the deal structure and tranche subordination.

Market Risk Benefits—The Company expects efficient benefit utilization and withdrawal rates to generally be correlated with lapse rates. However, behavior is generally highly dependent on the facts and circumstances surrounding the individual

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

contractholder, such as their liquidity needs or tax situation, which could drive lapse behavior independent of other contractholder behavior assumptions. To the extent more efficient contractholder behavior results in greater in-the-moneyness at the contract level, lapse rates may decline for those contracts. Similarly, to the extent that increases in equity volatility are correlated with overall declines in the capital markets, lapse rates may decline as contracts become more in-the-money.

Changes in Level 3 Assets and Liabilities—The following tables describe changes in fair values of Level 3 assets and liabilities as of the dates indicated, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods (excluding MRBs disclosed in Note 11). When a determination is made to classify assets and liabilities within Level 3, the determination is based on significance of the unobservable inputs in the overall fair value measurement. All transfers are based on changes in the observability of the valuation inputs, including the availability of pricing service information that the Company can validate. Transfers into Level 3 are generally the result of unobservable inputs utilized within valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company can validate.


	Three Months Ended June 30, 2025(6)
	Fair Value, beginning of period		Total realized and unrealized gains (losses)		Purchases		Sales		Issuances		Settlements		Other(1)		Transfers into Level 3(7)		Transfers out of Level 3(7)		Fair Value, end of period		Unrealized gains (losses) for assets still held(2)
	(in millions)
Fixed maturities, available-for-sale:

U.S. states	$	5	$	0	$	(1)	$	0	$	0	$	1	$	0	$	0	$	0	$	5	$	0
Foreign government	5		0		0		0		0		0		0		0		0		5		0
Corporate securities(3)	6,279		42		839		(121)		0		(408)		11		18		0		6,660		38
Structured securities(4)	3,217		(9)		1,502		(446)		0		(168)		191		199		(158)		4,328		(6)






Other assets:
Fixed maturities, trading	2,138		(14)		289		(10)		0		(86)		(183)		0		(44)		2,090		(31)
Equity securities	733		4		62		(35)		0		(1)		0		1		(163)		601		4
Commercial mortgage and other loans	263		0		0		0		0		0		0		0		0		263		0
Other invested assets	965		(3)		44		(30)		0		0		1		0		1		978		(3)
Short-term investments	462		0		15		(452)		0		(7)		(2)		1		1		18		0
Cash equivalents	1		0		1		0		0		(1)		0		0		0		1		0
Reinsurance recoverables and deposit receivables	381		5		(2)		0		0		(16)		(1)		0		0		367		(12)
Other assets	0		0		0		0		0		0		0		0		0		0		0
Separate account assets	253		16		25		(3)		0		(30)		0		1		(10)		252		15
Liabilities:
Policyholders’ account balances(5)	(11,938)		(2,978)		0		0		(371)		0		(2)		0		0		(15,289)		(169)
Other liabilities	(13)		(2)		0		0		0		0		0		0		0		(15)		(2)
Notes issued by consolidated VIEs	(67)		0		0		0		(124)		0		(4)		0		0		(195)		0

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2025
	Total realized and unrealized gains (losses)										Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)		Net investment income		Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)
	(in millions)
Fixed maturities, available-for-sale	$	(12)	$	0	$	0	$	46	$	(1)	$	(11)	$	0	$	0	$	43

Other assets:
Fixed maturities, trading	0		(28)		0		0		14		0		(31)		0		0
Equity securities	0		4		0		0		0		0		4		0		0
Commercial mortgage and other loans	0		0		0		0		0		0		0		0		0
Other invested assets	0		(2)		(1)		0		0		(1)		(2)		0		0
Short-term investments	0		0		0		0		0		0		0		0		0
Cash equivalents	0		0		0		0		0		0		0		0		0
Reinsurance recoverables and deposit receivables	5		0		0		0		0		(12)		0		0		0
Other assets	0		0		0		0		0		0		0		0		0
Separate account assets	0		0		16		0		0		0		0		15		0
Liabilities:
Policyholders’ account balances	(2,978)		0		0		0		0		(169)		0		0		0
Other liabilities	(2)		0		0		0		0		(2)		0		0		0
Notes issued by consolidated VIEs	0		0		0		0		0		0		0		0		0


	Six Months Ended June 30, 2025(6)
	Fair Value, beginning of period		Total realized and unrealized gains (losses)		Purchases		Sales		Issuances		Settlements		Other(1)		Transfers into Level 3(7)		Transfers out of Level 3(7)		Fair Value, end of period		Unrealized gains (losses) for assets still held(2)
	(in millions)
Fixed maturities, available-for-sale:

U.S. states	$	6	$	0	$	(1)	$	0	$	0	$	0	$	0	$	0	$	0	$	5	$	0
Foreign government	7		0		0		0		0		(2)		0		0		0		5		0
Corporate securities(3)	5,831		(26)		1,707		(471)		0		(602)		(30)		252		(1)		6,660		(32)
Structured securities(4)	2,333		9		2,328		(769)		0		(233)		(171)		1,064		(233)		4,328		12






Other assets:
Fixed maturities, trading	1,986		(35)		712		(271)		0		(338)		183		3		(150)		2,090		(39)
Equity securities	518		(13)		216		(58)		0		(1)		0		120		(181)		601		(19)
Commercial mortgage and other loans	233		0		0		0		30		0		0		0		0		263		0
Other invested assets	953		(4)		58		(31)		0		0		1		0		1		978		(3)
Short-term investments	461		0		23		(455)		0		(11)		(2)		1		1		18		0
Cash equivalents	0		0		2		0		0		(1)		0		0		0		1		0
Reinsurance recoverables and deposit receivables	613		1		21		0		0		(34)		(234)		0		0		367		(33)
Other assets	0		0		0		0		0		0		0		0		0		0		0
Separate account assets	232		8		85		(37)		0		(31)		0		5		(10)		252		5
Liabilities:
Policyholders’ account balances(5)	(12,746)		(1,543)		0		0		(996)		0		(4)		0		0		(15,289)		238
Other liabilities	(1)		(14)		0		0		0		0		0		0		0		(15)		(14)
Notes issued by consolidated VIEs	(60)		0		0		0		(131)		0		(4)		0		0		(195)		0

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2025
	Total realized and unrealized gains (losses)										Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)		Net investment income		Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)
	(in millions)
Fixed maturities, available-for-sale	$	(31)	$	0	$	0	$	18	$	(4)	$	(33)	$	0	$	0	$	13

Other assets:
Fixed maturities, trading	0		(34)		0		0		(1)		0		(39)		0		0
Equity securities	0		(13)		0		0		0		0		(19)		0		0
Commercial mortgage and other loans	0		0		0		0		0		0		0		0		0
Other invested assets	0		(3)		(1)		0		0		0		(3)		0		0
Short-term investments	0		0		0		0		0		0		0		0		0
Cash equivalents	0		0		0		0		0		0		0		0		0
Reinsurance recoverables and deposit receivables	1		0		0		0		0		(33)		0		0		0
Other assets	0		0		0		0		0		0		0		0		0
Separate account assets	0		0		8		0		0		0		0		5		0
Liabilities:
Policyholders’ account balances	(1,543)		0		0		0		0		238		0		0		0
Other liabilities	(14)		0		0		0		0		(14)		0		0		0
Notes issued by consolidated VIEs	0		0		0		0		0		0		0		0		0


	Three Months Ended June 30, 2024(6)
	Fair Value, beginning of period		Total realized and unrealized gains (losses)		Purchases		Sales		Issuances		Settlements		Other(1)		Transfers into Level 3(7)		Transfers out of Level 3(7)		Fair Value, end of period		Unrealized gains (losses) for assets still held(2)
	(in millions)
Fixed maturities, available-for-sale:

U.S. states	$	6	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	6	$	0
Foreign government	7		0		0		0		0		0		0		0		0		7		0
Corporate securities(3)	4,965		(43)		417		(28)		0		(221)		(141)		54		0		5,003		(51)
Structured securities(4)	2,612		(10)		327		(1)		0		(63)		(492)		(1)		(320)		2,052		(11)






Other assets:
Fixed maturities, trading	1,330		(7)		330		0		0		(70)		0		(2)		(61)		1,520		(6)
Equity securities	506		12		54		(12)		0		(1)		(3)		1		(1)		556		12
Commercial mortgage and other loans	0		0		0		0		0		0		0		0		0		0		0
Other invested assets	865		(39)		93		0		0		0		19		0		0		938		(40)
Short-term investments	32		3		2		0		0		(6)		(22)		0		0		9		2
Cash equivalents	0		0		4		0		0		0		0		0		0		4		0
Reinsurance recoverables and deposit receivables	303		14		59		0		0		(13)		0		0		0		363		1
Other assets	19		0		0		0		0		0		(19)		0		0		0		0
Separate account assets	338		(8)		80		(61)		0		(2)		0		0		(5)		342		(7)
Liabilities:
Policyholders’ account balances(5)	(9,864)		119		0		0		(469)		0		1		0		0		(10,213)		965
Other liabilities	(1)		0		0		0		0		0		0		0		0		(1)		0
Notes issued by consolidated VIEs	(405)		0		0		0		(17)		0		0		0		0		(422)		0

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2024
	Total realized and unrealized gains (losses)										Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)		Net investment income		Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)
	(in millions)
Fixed maturities, available-for-sale	$	(30)	$	0	$	0	$	(33)	$	10	$	(31)	$	0	$	0	$	(30)






Other assets:
Fixed maturities, trading	0		(7)		0		0		0		0		(6)		0		0
Equity securities	0		12		0		0		0		0		12		0		0
Commercial mortgage and other loans	0		0		0		0		0		0		0		0		0
Other invested assets	1		(40)		0		0		0		0		(40)		0		0
Short-term investments	3		0		0		0		0		2		0		0		0
Cash equivalents	0		0		0		0		0		0		0		0		0
Reinsurance recoverables and deposit receivables	14		0		0		0		0		1		0		0		0
Other assets	0		0		0		0		0		0		0		0		0
Separate account assets	0		0		(8)		0		0		0		0		(7)		0
Liabilities:
Policyholders’ account balances	119		0		0		0		0		965		0		0		0
Other liabilities	0		0		0		0		0		0		0		0		0
Notes issued by consolidated VIEs	0		0		0		0		0		0		0		0		0


	Six Months Ended June 30, 2024(6)
	Fair Value, beginning of period		Total realized and unrealized gains (losses)		Purchases		Sales		Issuances		Settlements		Other(1)		Transfers into Level 3(7)		Transfers out of Level 3(7)		Fair Value, end of period		Unrealized gains (losses) for assets still held(2)
	(in millions)
Fixed maturities, available-for-sale:

U.S. states	$	7	$	(1)	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	6	$	(1)
Foreign government	8		0		0		0		0		(1)		0		0		0		7		0
Corporate securities(3)	4,806		(89)		819		(33)		0		(508)		(154)		162		0		5,003		(101)
Structured securities(4)	1,297		(7)		1,592		(1)		0		(75)		(493)		59		(320)		2,052		(11)






Other assets:
Fixed maturities, trading	429		(5)		894		(22)		0		(116)		(1)		402		(61)		1,520		1
Equity securities	512		(7)		75		(16)		0		(5)		6		1		(10)		556		(10)
Commercial mortgage and other loans	0		0		0		0		0		0		0		0		0		0		0
Other invested assets	846		(47)		122		(2)		0		0		19		0		0		938		(47)
Short-term investments	29		1		7		0		0		(6)		(22)		0		0		9		0
Cash equivalents	4		0		4		0		0		0		(4)		0		0		4		0
Reinsurance recoverables and deposit receivables	224		51		114		0		0		(26)		0		0		0		363		25
Other assets	11		0		8		0		0		0		(19)		0		0		0		0
Separate account assets	1,094		(54)		136		(824)		0		(4)		0		0		(6)		342		(15)
Liabilities:
Policyholders’ account balances(5)	(7,752)		(1,376)		0		0		(1,087)		0		2		0		0		(10,213)		749
Other liabilities	(1)		0		0		0		0		0		0		0		0		(1)		0
Notes issued by consolidated VIEs	(778)		(8)		0		0		(27)		0		391		0		0		(422)		(8)

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	Total realized and unrealized gains (losses)										Unrealized gains (losses) for assets still held(2)
	Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)		Net investment income		Realized investment gains (losses), net		Other income (loss)		Interest credited to policyholders’ account balances		Included in other comprehensive income (losses)
	(in millions)
Fixed maturities, available-for-sale	$	(63)	$	0	$	0	$	(49)	$	15	$	(59)	$	0	$	0	$	(54)






Other assets:
Fixed maturities, trading	0		(6)		0		0		1		0		1		0		0
Equity securities	0		(7)		0		0		0		0		(10)		0		0
Commercial mortgage and other loans	0		0		0		0		0		0		0		0		0
Other invested assets	0		(47)		0		0		0		0		(47)		0		0
Short-term investments	0		0		0		0		1		0		0		0		0
Cash equivalents	0		0		0		0		0		0		0		0		0
Reinsurance recoverables and deposit receivables	51		0		0		0		0		25		0		0		0
Other assets	0		0		0		0		0		0		0		0		0
Separate account assets	0		0		(54)		0		0		0		0		(15)		0
Liabilities:
Policyholders’ account balances	(1,376)		0		0		0		0		749		0		0		0
Other liabilities	0		0		0		0		0		0		0		0		0
Notes issued by consolidated VIEs	0		(8)		0		0		0		0		(8)		0		0

(1)“Other” includes additional activity not allocated to the specific categories within the rollforward of Level 3 Assets and Liabilities.

(2)Unrealized gains or losses related to assets still held at the end of the period do not include amortization or accretion of premiums and discounts.

(3)Includes U.S. corporate public, U.S. corporate private, foreign corporate public and foreign corporate private securities.

(4)Includes asset-backed, commercial mortgage-backed and residential mortgage-backed securities.

(5)Issuances and settlements for Policyholders’ account balances are presented net in the rollforward.

(6)Excludes MRB assets of $2,188 million and $2,233 million and MRB liabilities of $4,859 million and $4,592 million for the periods ended June 30, 2025 and 2024, respectively. See Note 11 for additional information.

(7)Transfers into or out of Level 3 are generally reported at the value as of the beginning of the quarter in which the transfers occur for any such positions still held at the end of the quarter.

Derivative Fair Value Information

The following tables present the balances of certain derivative assets and liabilities measured at fair value on a recurring basis, as of the dates indicated, by the primary underlying risks they are used to manage. These tables include NPR and exclude embedded derivatives. The derivative assets and liabilities shown below are included in “Other invested assets” or “Other liabilities” in the tables contained within the sections “—Assets and Liabilities by Hierarchy Level” and “—Changes in Level 3 Assets and Liabilities,” above.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	As of June 30, 2025
	Level 1		Level 2		Level 3		Netting(1)		Total
	(in millions)
Derivative Assets:
Interest Rate	$	66	$	10,319	$	1	$		$	10,386
Currency	0		889		0				889
Credit	0		87		0				87
Currency/Interest Rate	0		1,601		0				1,601
Equity	273		6,893		1				7,167
Netting(1)							(18,345)		(18,345)
Total derivative assets	$	339	$	19,789	$	2	$	(18,345)	$	1,785
Derivative Liabilities:
Interest Rate	$	17	$	24,608	$	15	$		$	24,640
Currency	0		1,288		0				1,288
Credit	0		0		0				0
Currency/Interest Rate	0		1,900		0				1,900
Equity	219		6,475		0				6,694
Netting(1)							(28,172)		(28,172)
Total derivative liabilities	$	236	$	34,271	$	15	$	(28,172)	$	6,350


	As of December 31, 2024
	Level 1		Level 2		Level 3		Netting(1)		Total
	(in millions)
Derivative Assets:
Interest Rate	$	7	$	11,725	$	1	$		$	11,733
Currency	0		1,717		0				1,717
Credit	0		90		0				90
Currency/Interest Rate	0		3,310		0				3,310
Equity	3		4,841		0				4,844
Netting(1)							(20,093)		(20,093)
Total derivative assets	$	10	$	21,683	$	1	$	(20,093)	$	1,601
Derivative Liabilities:
Interest Rate	$	21	$	26,871	$	1	$		$	26,893
Currency	0		1,378		0				1,378
Credit	0		0		0				0
Currency/Interest Rate	0		497		0				497
Equity	7		4,117		0				4,124
Netting(1)							(28,141)		(28,141)
Total derivative liabilities	$	28	$	32,863	$	1	$	(28,141)	$	4,751

(1)“Netting” amounts represent cash collateral and the impact of offsetting asset and liability positions held with the same counterparty, subject to master netting agreements.

Changes in Level 3 Derivative Assets and Liabilities—The following tables provide a summary of the changes in fair value of Level 3 derivative assets and liabilities as of the dates indicated, as well as the portion of gains or losses included in income, attributable to unrealized gains or losses related to those assets and liabilities still held at the end of their respective periods.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2025
	Fair Value, beginning of period		Total realized and unrealized gains (losses)(1)		Purchases		Sales		Issuances		Settlements		Other		Transfers into Level 3(2)		Transfers out of Level 3(2)		Fair Value, end of period		Unrealized gains (losses) for assets still held(1)
	(in millions)
Net Derivative - Equity	$	1	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	1	$	0
Net Derivative - Interest Rate	(13)		(2)		0		0		0		0		0		0		0		(15)		(2)


	Six Months Ended June 30, 2025
	Fair Value, beginning of period		Total realized and unrealized gains (losses)(1)		Purchases		Sales		Issuances		Settlements		Other		Transfers into Level 3(2)		Transfers out of Level 3(2)		Fair Value, end of period		Unrealized gains (losses) for assets still held(1)
	(in millions)
Net Derivative - Equity	$	0	$	1	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	1	$	1
Net Derivative - Interest Rate	0		(15)		0		0		0		0		0		0		0		(15)		(15)


	Three Months Ended June 30, 2024
	Fair Value, beginning of period		Total realized and unrealized gains (losses)(1)		Purchases		Sales		Issuances		Settlements		Other		Transfers into Level 3(2)		Transfers out of Level 3(2)		Fair Value, end of period		Unrealized gains (losses) for assets still held(1)
	(in millions)
Net Derivative - Equity	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0
Net Derivative - Interest Rate	0		1		0		0		0		0		0		0		0		1		1


	Six Months Ended June 30, 2024
	Fair Value, beginning of period		Total realized and unrealized gains (losses)(1)		Purchases		Sales		Issuances		Settlements		Other		Transfers into Level 3(2)		Transfers out of Level 3(2)		Fair Value, end of period		Unrealized gains (losses) for assets still held(1)
	(in millions)
Net Derivative - Equity	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0	$	0
Net Derivative - Interest Rate	0		1		0		0		0		0		0		0		0		1		1

(1)Total realized and unrealized gains (losses) as well as unrealized gains (losses) for assets still held at the end of the period are recorded in “Realized investment gains (losses), net.”

(2)Transfers into or out of Level 3 are generally reported at the value as of the beginning of the quarter in which the transfers occur for any such positions still held at the end of the quarter.

Nonrecurring Fair Value Measurements—The following tables represent information for assets measured at fair value on a nonrecurring basis. The fair value measurement is nonrecurring as these assets are measured at fair value only when there is a triggering event (e.g., an evidence of impairment). Assets included in the table are those that were impaired during the respective reporting periods and that are still held as of the reporting date. The estimated fair values for these amounts were determined using significant unobservable inputs (Level 3).


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Gains (Losses):


Investment real estate	$	0	$	(3)	$	(12)	$	(3)
Investment in JV/LP and Other	$	0	$	0	$	0	$	(7)

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	June 30, 2025		December 31, 2024
	(in millions)
Carrying value after measurement as of period end:


Investment real estate(1)	$	46	$	73
Investment in JV/LP and Other(1)	$	0	$	128

(1)Reported carrying values for 2025 include values as of the measurement periods of March 31, 2025 for “Investment real estate.” Reported carrying values for 2024 include values as of the measurement periods of March 31, 2024 for “Investment in JV/LP and Other” and June 30, 2024 and September 30, 2024 for “Investment real estate.”

Fair Value Option

The fair value option allows the Company to elect fair value as an alternative measurement for selected financial assets and financial liabilities not otherwise reported at fair value. Such elections have been made by the Company to help mitigate volatility in earnings that result from different measurement attributes. Electing the fair value option also allows the Company to achieve consistent accounting for certain assets and liabilities. Changes in fair value are reflected in “Realized investment gains (losses), net” for commercial mortgage and other loans and “Other income (loss)” for other assets and notes issued by consolidated VIEs. Changes in fair value due to instrument-specific credit risk are estimated using changes in credit spreads and quality ratings for the period reported. Interest income on commercial mortgage and other loans is included in “Net investment income.” Interest income on these loans is recorded based on the effective interest rate as determined at the closing of the loan.

The following tables present information regarding assets and liabilities where the fair value option has been elected.


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Liabilities:
Notes issued by consolidated VIEs:
Changes in fair value	$	0	$	0	$	0	$	8


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Commercial mortgage and other loans:
Interest income	$	9	$	1	$	17	$	3
Notes issued by consolidated VIEs:
Interest expense	$	2	$	3	$	2	$	11


	June 30, 2025		December 31, 2024
	(in millions)
Commercial mortgage and other loans(1):
Fair value as of period end	$	726	$	702
Aggregate contractual principal as of period end	$	723	$	697
Other invested assets:
Fair value as of period end	$	26	$	19


Notes issued by consolidated VIEs:
Fair value as of period end	$	195	$	60
Aggregate contractual principal as of period end	$	195	$	60

(1)As of June 30, 2025, for loans for which the fair value option has been elected, none of the loans were 90 days or more past due.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Fair Value of Financial Instruments

The tables below present the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value. The financial instruments presented below are reported at carrying value on the Company’s Unaudited Interim Consolidated Statements of Financial Position. In some cases, as described below, the carrying amount equals or approximates fair value.


	June 30, 2025
	Fair Value								Carrying Amount(1)
	Level 1		Level 2		Level 3		Total		Total
	(in millions)
Assets:


Commercial mortgage and other loans	$	0	$	17	$	60,278	$	60,295	$	62,240
Policy loans	10		0		9,936		9,946		9,946
Other invested assets	0		93		0		93		93
Short-term investments	402		20		0		422		422
Cash and cash equivalents	6,544		471		0		7,015		7,015
Accrued investment income	0		3,560		0		3,560		3,560
Reinsurance recoverables and deposit receivables	0		9		5,653		5,662		5,662
Other assets	63		3,023		2		3,088		3,088
Total assets	$	7,019	$	7,193	$	75,869	$	90,081	$	92,026
Liabilities:
Policyholders’ account balances—investment contracts	$	0	$	33,863	$	47,878	$	81,741	$	86,081
Securities sold under agreements to repurchase	0		8,205		0		8,205		8,205
Cash collateral for loaned securities	0		9,167		0		9,167		9,167
Reinsurance and funds withheld payables(2)	0		10,357		(21)		10,336		10,336
Short-term debt	0		1,015		349		1,364		1,373
Long-term debt(3)	534		16,800		536		17,870		18,651
Notes issued by consolidated VIEs	0		0		1,563		1,563		1,563
Other liabilities	0		6,866		31		6,897		6,897
Separate account liabilities—investment contracts	0		22,311		18,144		40,455		40,455
Total liabilities	$	534	$	108,584	$	68,480	$	177,598	$	182,728

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	December 31, 2024
	Fair Value								Carrying Amount(1)
	Level 1		Level 2		Level 3		Total		Total
	(in millions)
Assets:


Commercial mortgage and other loans	$	0	$	17	$	58,446	$	58,463	$	61,639
Policy loans	8		0		9,787		9,795		9,795
Other invested assets	0		95		0		95		95
Short-term investments	453		21		0		474		474
Cash and cash equivalents	7,352		454		0		7,806		7,806
Accrued investment income	0		3,441		0		3,441		3,441
Reinsurance recoverables and deposit receivables	0		8		5,782		5,790		5,790
Other assets	23		3,062		1		3,086		3,086
Total assets	$	7,836	$	7,098	$	74,016	$	88,950	$	92,126
Liabilities:
Policyholders’ account balances—investment contracts	$	0	$	31,405	$	43,466	$	74,871	$	79,571
Securities sold under agreements to repurchase	0		6,796		0		6,796		6,796
Cash collateral for loaned securities	0		9,621		0		9,621		9,621
Reinsurance and funds withheld payables(2)	0		10,489		(35)		10,454		10,454
Short-term debt	0		521		439		960		953
Long-term debt(3)	524		17,185		423		18,132		19,187
Notes issued by consolidated VIEs	0		0		1,370		1,370		1,370
Other liabilities	0		6,886		32		6,918		6,918
Separate account liabilities—investment contracts	0		21,144		18,677		39,821		39,821
Total liabilities	$	524	$	104,047	$	64,372	$	168,943	$	174,691

(1)Carrying values presented herein differ from those in the Company’s Unaudited Interim Consolidated Statements of Financial Position because certain items within the respective financial statement captions are not considered financial instruments or are out of scope under authoritative guidance relating to disclosures of the fair value of financial instruments.

(2)Includes contracts reinsured through coinsurance with funds withheld agreement with Prismic Re with a fair value of $7,731 million (carrying amount of $7,731 million) and $7,887 million (carrying amount of $7,887 million), a portion of which relates to insurance contracts as of June 30, 2025 and December 31, 2024, respectively. See Note 12 for additional information regarding the reinsurance arrangement with Prismic Re.

(3)Excludes debt with fair value of $15,220 million (carrying amount of $15,220 million) and $14,748 million (carrying amount of $14,748 million) as of June 30, 2025 and December 31, 2024, respectively, which have been offset with the associated notes under a netting agreement.

7. DEFERRED POLICY ACQUISITION COSTS, DEFERRED SALES INDUCEMENTS AND VALUE OF BUSINESS ACQUIRED

Deferred Policy Acquisition Costs (“DAC”)

The following tables show a rollforward for the lines of business that contain material DAC balances, along with a reconciliation to the Company’s total DAC balance:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2025
	Retirement Strategies		Individual Life				International Businesses		Total
	Individual Variable		Term Life		Variable/ Universal Life
	(in millions)
Balance, BOP	$	3,713	$	2,215	$	4,878	$	9,304	$	20,110
Capitalization	327		95		326		603		1,351
Amortization expense	(236)		(104)		(117)		(344)		(801)
Other adjustments(1)	17		0		5		(214)		(192)
Foreign currency adjustment	0		0		0		330		330
Balance, EOP	$	3,821	$	2,206	$	5,092	$	9,679	20,798
Other businesses									424
Total DAC balance									$	21,222

(1)Includes the impact of the reinsurance transaction with Prismic Re International in International Businesses. See Note 12 for additional information.


	Six Months Ended June 30, 2024
	Retirement Strategies		Individual Life				International Businesses(1)		Total
	Individual Variable		Term Life		Variable/ Universal Life
	(in millions)
Balance, BOP	$	3,676	$	2,237	$	5,364	$	9,351	$	20,628
Capitalization	193		90		338		561		1,182
Amortization expense	(190)		(104)		(121)		(334)		(749)
Other adjustments(2)	0		(2)		(280)		(50)		(332)
Foreign currency adjustment	0		0		0		(462)		(462)
Balance, EOP	$	3,679	$	2,221	$	5,301	$	9,066	20,267
Other businesses									297
Total DAC balance									$	20,564

(1)Prior period amounts have been updated to conform to current presentation.

(2)Includes the impact of the reinsurance transaction with Somerset Re in Individual Life (Universal Life). See Note 12 for additional information.

Deferred Sales Inducements (“DSI”)

The following table shows a rollforward of DSI balances for variable annuity products within Individual Retirement Strategies, which is the only line of business that contains a material DSI balance, along with a reconciliation to the Company’s total DSI balance:


	Six Months Ended June 30,
	2025		2024
	(in millions)
Balance, BOP	$	376	$	410
Capitalization	1		1
Amortization expense	(16)		(17)


Balance, EOP	361		394
Other businesses	28		31
Total DSI balance	$	389	$	425

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Value of Business Acquired (“VOBA”)

The following table shows a rollforward of VOBA balances for the acquisition of the Star and Edison Businesses for International Businesses, along with a reconciliation to the Company’s total VOBA balance:


	Six Months Ended June 30,
	2025		2024
	(in millions)
Balance, BOP	$	421	$	511

Amortization expense	(20)		(21)

Foreign currency adjustment	35		(59)
Balance, EOP	436		431
Other businesses(1)	14		15
Total VOBA balance	$	450	$	446

(1)Represents Aoba Life business.

The following table provides estimated future amortization for the periods indicated:


	2025 (July - December)		2026		2027		2028		2029		Thereafter		Total
	(in millions)
Estimated future VOBA amortization	$	22	$	40	$	36	$	33	$	29	$	290	$	450

8. SEPARATE ACCOUNTS

The Company issues variable annuity and variable life insurance contracts through its separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contractholder. Most variable annuity and variable life insurance contracts are offered with both separate and general account options. See Note 10 for additional information.

The assets supporting the variable portion of variable annuity and variable life insurance contracts are carried at fair value and reported as “Separate account assets” with an equivalent amount reported as “Separate account liabilities.” The liabilities related to the net amount at risk are reflected within “Future policy benefits” or “Market risk benefit liabilities” (or “assets,” if applicable). Amounts assessed against the contractholders for mortality, administration, and other services are included within revenue in “Policy charges and fee income” and changes in liabilities for minimum guarantees are generally included in “Policyholders’ benefits” or “Change in value of market risk benefits, net of related hedging gains (losses).”

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Separate Account Assets

The aggregate fair value of assets, by major investment asset category, supporting separate accounts is as follows:


	June 30, 2025		December 31, 2024
	(in millions)
Asset Type:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	4,500	$	4,674
Obligations of U.S. states and their political subdivisions	2,444		2,224
Foreign government bonds	105		93
U.S. corporate securities	11,820		11,440
Foreign corporate securities	3,056		3,010
Asset-backed securities	1,935		1,283
Mortgage-backed securities	13,327		14,144
Mutual funds:
Equity	89,861		90,180
Fixed Income	32,399		33,828
Other	6,198		5,439
Equity securities	5,196		4,845
Commercial mortgage and other loans	55		54
Other invested assets	19,552		19,352
Short-term investments	1,450		1,137
Cash and cash equivalents	2,863		1,669
Total	$	194,761	$	193,372

For the periods ended June 30, 2025 and December 31, 2024, there were no transfers of assets, other than cash, from the general account to a separate account; therefore, no gains or losses were recorded.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Separate Account Liabilities

The balances of and changes in separate account liabilities as of and for the periods ended are as follows:


	Six Months Ended June 30, 2025
			Retirement Strategies
	PGIM		Institutional		Individual		Group Insurance		Individual Life		Total
	(in millions)
Balance, BOP	$	28,645	$	9,308	$	86,974	$	25,126	$	46,891	$	196,944
Deposits	5,132		202		279		126		1,968		7,707
Investment performance	1,148		361		4,486		1,163		2,644		9,802

Policy charges	(33)		(4)		(1,007)		(137)		(615)		(1,796)
Surrenders and withdrawals	(3,499)		(377)		(6,885)		(25)		(549)		(11,335)
Benefit payments	(1,827)		(254)		(52)		(145)		(270)		(2,548)
Net transfers (to) from general account	(110)		(141)		(30)		13		(259)		(527)
Other	(172)		147		3		243		66		287

Balance, EOP	$	29,284	$	9,242	$	83,768	$	26,364	$	49,876	$	198,534
Other businesses(1)											(3,773)
Total separate account liabilities											$	194,761

Cash surrender value(2)	$	29,284	$	9,242	$	82,960	$	26,271	$	46,195	$	193,952

(1)Primarily represents activity from the Company’s Divested and Run-off Businesses as well as the impact of intercompany eliminations. There are no associated cash surrender charges.

(2)“Cash surrender value” represents the amount of the contractholder's account balances distributable at the balance sheet date less certain surrender charges. There are no cash surrender charges for the PGIM and Institutional Retirement Strategies segments.


	Six Months Ended June 30, 2024
			Retirement Strategies
	PGIM		Institutional		Individual		Group Insurance		Individual Life		Total
	(in millions)
Balance, BOP	$	32,648	$	11,011	$	94,130	$	25,021	$	39,223	$	202,033
Deposits	10,873		105		294		289		1,613		13,174
Investment performance	(972)		(94)		5,249		366		4,334		8,883

Policy charges	(57)		(5)		(1,123)		(120)		(566)		(1,871)
Surrenders and withdrawals	(9,886)		(878)		(6,815)		(339)		(516)		(18,434)
Benefit payments	(1,745)		(270)		(46)		(144)		(208)		(2,413)
Net transfers (to) from general account	13		(45)		(42)		6		(251)		(319)
Other	(458)		84		3		(532)		46		(857)

Balance, EOP	$	30,416	$	9,908	$	91,650	$	24,547	$	43,675	200,196
Other businesses(1)											(3,337)
Total separate account liabilities											$	196,859

Cash surrender value(2)	$	30,416	$	9,908	$	90,583	$	24,442	$	40,129	$	195,478

(1)Primarily represents activity from the Company’s Divested and Run-off Businesses as well as the impact of intercompany eliminations. There are no associated cash surrender charges.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

9. LIABILITY FOR FUTURE POLICY BENEFITS

Liability for Future Policy Benefits primarily consists of the following sub-components, which are discussed in greater detail below:

Benefit Reserves;
Deferred Profit Liability (“DPL”); and
Additional Insurance Reserves (“AIR”)

In 2025, the Company recognized a favorable impact to net income attributable to its annual reviews and update of assumptions and other refinements for Liability for Future Policy Benefits. The impact was favorable for direct and assumed Benefit Reserves and DPL, net of the impact of flooring these liabilities at zero for each issue year cohort, primarily due to updates to mortality assumptions in Individual Life Insurance, partially offset by unfavorable updates for morbidity in Long-Term Care (“LTC”) and mortality in Institutional Retirement Strategies. Additionally, there was a favorable impact for direct and assumed AIR, primarily due to offsetting impacts from updated policyholder behavior assumptions and mortality assumptions on universal life policies.

In 2024, the Company recognized a favorable impact to net income attributable to its annual reviews and update of assumptions and other refinements for Liability for Future Policy Benefits. The impact was favorable for direct and assumed Benefit Reserves and DPL, net of the impact of flooring these liabilities at zero for each issue year cohort, primarily due to updates to mortality assumptions in Institutional Retirement Strategies and LTC, partially offset by unfavorable updates to policyholder behavior assumptions on certain life policies in International Businesses. Additionally, there was an unfavorable impact for direct and assumed AIR, primarily due to updates to policyholder behavior assumptions on universal life policies with secondary guarantees in Individual Life.

Benefit Reserves

The balances of and changes in Benefit Reserves as of and for the periods indicated consist of the three tables presented below: Present Value of Expected Net Premiums rollforward, Present Value of Expected Future Policy Benefits rollforward, and Net Liability for Future Policy Benefits.


	Six Months Ended June 30, 2025
	Present Value of Expected Net Premiums
	Retirement Strategies		Individual Life		International Businesses			Corporate and Other
	Institutional		Term Life				Long-Term Care			Total
	(in millions)
Balance, BOP	$	72,526	$	10,724	$	45,851		$	2,854		$	131,955
Effect of cumulative changes in discount rate assumptions, BOP	14,545		578		2,599			132			17,854
Balance at original discount rate, BOP	87,071		11,302		48,450			2,986			149,809
Effect of assumption update	169		(241)		(1,072)			8			(1,136)
Effect of actual variances from expected experience and other activity	(79)		(100)		(467)			41			(605)
Adjusted balance, BOP	87,161		10,961		46,911			3,035			148,068
Issuances	8,991		406		1,477			0			10,874
Net premiums / considerations collected	(3,445)		(692)		(3,455)			(155)			(7,747)
Interest accrual	1,745		264		730			71			2,810
Foreign currency adjustment	8,819		0		2,193			0			11,012
Other adjustments	0		3		73			0			76
Balance at original discount rate, EOP	103,271		10,942		47,929			2,951			165,093
Effect of cumulative changes in discount rate assumptions, EOP	(15,153)		(384)		(2,984)			(86)			(18,607)
Balance, EOP	$	88,118	$	10,558	$	44,945		$	2,865		$	146,486
Other businesses, EOP											109
Total balance, EOP											$	146,595

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2025
	Present Value of Expected Future Policy Benefits
	Retirement Strategies		Individual Life		International Businesses			Corporate and Other
	Institutional		Term Life				Long-Term Care			Total
	(in millions)
Balance, BOP	$	151,484	$	18,996	$	135,485		$	11,178		$	317,143
Effect of cumulative changes in discount rate assumptions, BOP	20,182		1,134		17,834			1,548			40,698
Balance at original discount rate, BOP	171,666		20,130		153,319			12,726			357,841
Effect of assumption update	322		(392)		(1,013)			14			(1,069)
Effect of actual variances from expected experience and other activity	(120)		(137)		(563)			18			(802)
Adjusted balance, BOP	171,868		19,601		151,743			12,758			355,970
Issuances	8,991		406		1,477			0			10,874
Interest accrual	3,541		470		2,365			306			6,682
Benefit payments	(7,426)		(784)		(4,208)			(176)			(12,594)
Foreign currency adjustment	8,902		0		7,245			0			16,147
Other adjustments	30		(1)		171			0			200
Balance at original discount rate, EOP	185,906		19,692		158,793			12,888			377,279
Effect of cumulative changes in discount rate assumptions, EOP	(19,578)		(797)		(23,521)			(1,572)			(45,468)
Balance, EOP	$	166,328	$	18,895	$	135,272		$	11,316		$	331,811
Other businesses, EOP											1,704
Total balance, EOP											$	333,515


	Six Months Ended June 30, 2025
	Net Liability for Future Policy Benefits - Benefit Reserves
	Retirement Strategies		Individual Life		International Businesses			Corporate and Other
	Institutional		Term Life				Long-Term Care			Total
	(in millions)
Balance, EOP, pre-flooring	$	78,210	$	8,337	$	90,326		$	8,450		$	185,323
Flooring impact, EOP	106		0		80			0			186
Balance, EOP, post-flooring	78,316		8,337		90,406			8,450			185,509
Less: Reinsurance recoverables	5,039		576		341			0			5,956
Balance after reinsurance recoverables, EOP, post-flooring	$	73,277	$	7,761	$	90,065		$	8,450		$	179,553
Other businesses, EOP(1)											1,538
Total balance after reinsurance recoverables, EOP											$	181,091

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	Present Value of Expected Net Premiums
	Retirement Strategies		Individual Life		International Businesses(2)			Corporate and Other
	Institutional		Term Life				Long-Term Care			Total
	(in millions)
Balance, BOP	$	71,407	$	11,274	$	55,431		$	3,286		$	141,398
Effect of cumulative changes in discount rate assumptions, BOP	11,869		228		1,218			16			13,331
Balance at original discount rate, BOP	83,276		11,502		56,649			3,302			154,729
Effect of assumption update	41		21		(863)			(276)			(1,077)
Effect of actual variances from expected experience and other activity	429		(131)		(1,347)			95			(954)
Adjusted balance, BOP	83,746		11,392		54,439			3,121			152,698
Issuances	11,192		418		1,788			0			13,398
Net premiums / considerations collected	(12,908)		(692)		(3,622)			(157)			(17,379)
Interest accrual	1,384		264		782			76			2,506
Foreign currency adjustment	(898)		0		(3,494)			0			(4,392)
Other adjustments	0		(3)		82			0			79
Balance at original discount rate, EOP	82,516		11,379		49,975			3,040			146,910
Effect of cumulative changes in discount rate assumptions, EOP	(15,077)		(590)		(2,579)			(128)			(18,374)
Balance, EOP	$	67,439	$	10,789	$	47,396		$	2,912		$	128,536
Other businesses, EOP											89
Total balance, EOP											$	128,625


	Six Months Ended June 30, 2024
	Present Value of Expected Future Policy Benefits
	Retirement Strategies		Individual Life		International Businesses(2)			Corporate and Other
	Institutional		Term Life				Long-Term Care			Total
	(in millions)
Balance, BOP	$	141,135	$	19,852	$	158,858		$	12,139		$	331,984
Effect of cumulative changes in discount rate assumptions, BOP	14,751		334		7,918			603			23,606
Balance at original discount rate, BOP	155,886		20,186		166,776			12,742			355,590
Effect of assumption update	(481)		21		(513)			(394)			(1,367)
Effect of actual variances from expected experience and other activity	483		(149)		(1,362)			95			(933)
Adjusted balance, BOP	155,888		20,058		164,901			12,443			353,290
Issuances	11,192		418		1,789			0			13,399
Interest accrual	3,003		470		2,371			303			6,147
Benefit payments	(6,317)		(795)		(5,069)			(155)			(12,336)
Foreign currency adjustment	(908)		0		(11,173)			0			(12,081)
Other adjustments	(63)		(10)		162			0			89
Balance at original discount rate, EOP	162,795		20,141		152,981			12,591			348,508
Effect of cumulative changes in discount rate assumptions, EOP	(20,163)		(1,108)		(16,763)			(1,445)			(39,479)
Balance, EOP	$	142,632	$	19,033	$	136,218		$	11,146		$	309,029
Other businesses, EOP											1,656
Total balance, EOP											$	310,685

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	Net Liability for Future Policy Benefits - Benefit Reserves
	Retirement Strategies		Individual Life		International Businesses(2)			Corporate and Other
	Institutional		Term Life				Long-Term Care			Total
	(in millions)
Balance, EOP, pre-flooring	$	75,194	$	8,243	$	88,821		$	8,233		$	180,491
Flooring impact, EOP	46		0		44			0			90
Balance, EOP, post-flooring	75,240		8,243		88,865			8,233			180,581
Less: Reinsurance recoverables	5,098		671		345			0			6,114
Balance after reinsurance recoverables, EOP, post-flooring	$	70,142	$	7,572	$	88,520		$	8,233		$	174,467
Other businesses, EOP(1)											1,506
Total balance after reinsurance recoverables, EOP											$	175,973

(1)Reflects balance after reinsurance recoverables of $58 million and $63 million at June 30, 2025 and 2024, respectively.

(2)Prior period amounts have been updated to conform to current period presentation.

The following tables provide supplemental information related to the balances of and changes in Benefit Reserves included in the disaggregated tables above, on a gross (direct and assumed) basis, as of and for the period indicated:


	Six Months Ended June 30, 2025

	Retirement Strategies			Individual Life			International Businesses				Corporate and Other
	Institutional			Term Life						Long-Term Care
	($ in millions)
Undiscounted expected future gross premiums	$	178,217		$	22,958		$	107,923			$	6,588
Discounted expected future gross premiums (at original discount rate)	$	111,292		$	15,586		$	84,598			$	4,427
Discounted expected future gross premiums (at current discount rate)	$	94,675		$	15,086		$	79,680			$	4,308
Undiscounted expected future benefits and expenses	$	302,365		$	30,430		$	260,920			$	29,531
Weighted-average duration of the liability in years (at original discount rate)	8			10			17				16
Weighted-average duration of the liability in years (at current discount rate)	8			9			14				15
Weighted-average interest rate (at original discount rate)	4.76		%	5.12		%	2.99		%		4.91		%
Weighted-average interest rate (at current discount rate)	5.45		%	5.37		%	4.05		%		5.87		%


	Six Months Ended June 30, 2024

	Retirement Strategies			Individual Life			International Businesses(1)				Corporate and Other
	Institutional			Term Life						Long-Term Care
	($ in millions)
Undiscounted expected future gross premiums	$	133,585		$	22,965		$	110,571			$	6,823
Discounted expected future gross premiums (at original discount rate)	$	89,770		$	15,208		$	87,022			$	4,521
Discounted expected future gross premiums (at current discount rate)	$	71,759		$	14,451		$	83,062			$	4,339
Undiscounted expected future benefits and expenses	$	255,559		$	31,103		$	254,271			$	29,860
Weighted-average duration of the liability in years (at original discount rate)	9			10			18				17
Weighted-average duration of the liability in years (at current discount rate)	8			9			16				16
Weighted-average interest rate (at original discount rate)	4.72		%	5.15		%	3.02		%		4.91		%
Weighted-average interest rate (at current discount rate)	5.56		%	5.53		%	3.61		%		5.77		%

(1)Prior period amounts have been updated to conform to current period presentation.

For additional information regarding observable market information and the techniques used to determine the interest rate assumptions seen above, see Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

For non-participating traditional and limited-payment products, if a cohort is in a loss position where the liability for future policy benefits plus the present value of expected future gross premiums are determined to be insufficient to provide for the present value of expected future policy benefits and non-level claim settlement expenses, then the liability for future policy benefits is adjusted at that time, and thereafter, such that all changes, both favorable and unfavorable, in expected benefits resulting from both actual experience deviations and changes in future assumptions are recognized immediately as a gain or loss respectively.

For both the first six months of 2025 and 2024, there was an immaterial impact to net income for non-participating traditional and limited-payment products, where net premiums exceeded gross premiums for certain issue-year cohorts.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Deferred Profit Liability

The balances of and changes in DPL as of and for the period indicated are as follows:


	Six Months Ended June 30, 2025
	Deferred Profit Liability
	Retirement Strategies		International Businesses
	Institutional				Total
	(in millions)
Balance, BOP, post-flooring	$	5,670	$	9,354		$	15,024
Less: Flooring impact, BOP	0		2			2
Balance, BOP, pre-flooring	5,670		9,352			15,022
Effect of assumption update	(73)		(58)			(131)
Effect of actual variances from expected experience and other activity	30		2			32
Adjusted balance, BOP	5,627		9,296			14,923
Profits deferred	85		1,265			1,350
Interest accrual	116		172			288
Amortization	(288)		(1,055)			(1,343)
Foreign currency adjustment	26		353			379
Other adjustments	0		25			25
Balance, EOP, pre-flooring	5,566		10,056			15,622
Flooring impact, EOP	0		3			3
Balance, EOP, post-flooring	5,566		10,059			15,625
Less: Reinsurance recoverables	376		45			421
Balance after reinsurance recoverables, EOP, post-flooring	$	5,190	$	10,014		15,204
Other businesses						165
Total balance after reinsurance recoverables, EOP						$	15,369


	Six Months Ended June 30, 2024
	Deferred Profit Liability
	Retirement Strategies		International Businesses(1)
	Institutional				Total
	(in millions)
Balance, BOP, post-flooring	$	5,615	$	9,259		$	14,874
Less: Flooring impact, BOP	0		2			2
Balance, BOP, pre-flooring	5,615		9,257			14,872
Effect of assumption update	370		(288)			82
Effect of actual variances from expected experience and other activity	(30)		(46)			(76)
Adjusted balance, BOP	5,955		8,923			14,878
Profits deferred	89		1,346			1,435
Interest accrual	118		157			275
Amortization	(292)		(1,062)			(1,354)
Foreign currency adjustment	(2)		(492)			(494)
Other adjustments	0		17			17
Balance, EOP, pre-flooring	5,868		8,889			14,757
Flooring impact, EOP	0		2			2
Balance, EOP, post-flooring	5,868		8,891			14,759
Less: Reinsurance recoverables	401		39			440
Balance after reinsurance recoverables, EOP, post-flooring	$	5,467	$	8,852		14,319
Other businesses						154
Total balance after reinsurance recoverables, EOP						$	14,473

(1)Prior period amounts have been updated to conform to current period presentation.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Additional Insurance Reserves

AIR represents the additional liability for annuitization, death, or other insurance benefits, including guaranteed minimum death benefits (“GMDB”) and guaranteed minimum income benefits (“GMIB”) contract features, that are above and beyond the contractholder's account balance for certain long-duration life contracts.

The following table shows a rollforward of AIR balances for variable and universal life products within Individual Life, which is the only line of business that contains a material AIR balance, for the period indicated, along with a reconciliation to the Company’s total AIR balance:


	Six Months Ended June 30,
	2025		2024
	(in millions)
Balance, including amounts in AOCI, BOP, post-flooring	$	16,376	$	14,308
Flooring impact and amounts in AOCI	632		843
Balance, excluding amounts in AOCI, BOP, pre-flooring	17,008		15,151
Effect of assumption update	(39)		153
Effect of actual variances from expected experience and other activity	74		150
Adjusted balance, BOP	17,043		15,454
Assessments collected(1)	517		591
Interest accrual	291		262
Benefits paid	(210)		(168)
Other adjustments	37		13
Balance, excluding amounts in AOCI, EOP, pre-flooring	17,678		16,152
Flooring impact and amounts in AOCI	(514)		(1,659)
Balance, including amounts in AOCI, EOP, post-flooring	17,164		14,493
Less: Reinsurance recoverables	10,097		7,026
Balance after reinsurance recoverables, including amounts in AOCI, EOP	7,067		7,467
Other businesses	118		63
Total balance after reinsurance recoverables	$	7,185	$	7,530

(1)Represents the portion of gross assessments required to fund the future policy benefits.


	Six Months Ended June 30,
	2025		2024
Weighted-average duration of the liability in years (at original discount rate)	21		22
Weighted-average interest rate (at original discount rate)	3.41	%	3.40	%

Future Policy Benefits Reconciliation

The following table presents the reconciliation of the ending balances from above rollforwards, Benefit Reserves, DPL, and AIR including other liabilities, gross of related reinsurance recoverable, to the total liability for Future Policy Benefits on the Company's Consolidated Statement of Financial Position as of the periods indicated:


	Six Months Ended June 30,
	2025		2024
	(in millions)
Benefit reserves, EOP, post-flooring	$	187,106	$	182,150
Deferred Profit Liability EOP, post-flooring	15,790		14,913
Additional insurance reserves, including amounts in AOCI, EOP, post-flooring	17,282		14,556
Subtotal of amounts disclosed above	220,178		211,619
Other Future Policy Benefits reserves(1)	49,955		50,711
Total Future Policy Benefits	$	270,133	$	262,330

(1)Primarily represents balances for which disaggregated rollforward disclosures are not required, including Closed Block liabilities, unpaid claims and claims expenses, and incurred but not reported and in course of settlement claim liabilities.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Revenue and Interest Expense

The following tables present revenue and interest expense related to Benefit Reserves, DPL, and AIR in the Company's Consolidated Statement of Operations as of the periods indicated:


	Six Months Ended June 30, 2025
	Revenues(1)
	Retirement Strategies		Individual Life				International Businesses		Other Businesses		Total
	Institutional		Term Life		Variable/Universal Life
	(in millions)
Benefit reserves	$	3,725	$	964	$	0	$	5,441	$	276	$	10,406
Deferred profit liability	132		0		0		(352)		(3)		(223)
Additional insurance reserves	0		0		1,321		0		35		1,356
Total	$	3,857	$	964	$	1,321	$	5,089	$	308	$	11,539


	Six Months Ended June 30, 2024
	Revenues(1)
	Retirement Strategies		Individual Life				International Businesses(2)		Other Businesses		Total
	Institutional		Term Life		Variable/Universal Life
	(in millions)
Benefit reserves	$	13,223	$	922	$	0	$	5,727	$	273	$	20,145
Deferred profit liability	(254)		0		0		(124)		(7)		(385)
Additional insurance reserves	0		0		1,622		0		0		1,622
Total	$	12,969	$	922	$	1,622	$	5,603	$	266	$	21,382


	Six Months Ended June 30, 2025
	Interest Expense
	Retirement Strategies		Individual Life				International Businesses		Other Businesses		Total
	Institutional		Term Life		Variable/Universal Life
	(in millions)
Benefit reserves	$	1,796	$	205	$	0	$	1,635	$	259	$	3,895
Deferred profit liability	116		0		0		172		2		290
Additional insurance reserves	0		0		291		1		0		292
Total	$	1,912	$	205	$	291	$	1,808	$	261	$	4,477


	Six Months Ended June 30, 2024
	Interest Expense
	Retirement Strategies		Individual Life				International Businesses(2)		Other Businesses		Total
	Institutional		Term Life		Variable/Universal Life
	(in millions)
Benefit reserves	$	1,619	$	206	$	0	$	1,589	$	253	$	3,667
Deferred profit liability	118		0		0		157		2		277
Additional insurance reserves	0		0		262		1		0		263
Total	$	1,737	$	206	$	262	$	1,747	$	255	$	4,207

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

(1)Represents gross premiums for benefit reserves, gross premiums, excluding impact of foreign currency adjustments for DPL and gross assessments for AIR.

(2)Prior period amounts have been updated to conform to current period presentation.

10. POLICYHOLDERS’ ACCOUNT BALANCES

The balances of and changes in policyholders' account balances as of and for the periods ended are as follows:


	Six Months Ended June 30, 2025
	Retirement Strategies									Group Insurance			Individual Life			International Businesses			Total
	Institutional			Individual Variable			Individual Fixed			Life/Disability			Variable/Universal Life
	($ in millions)
Balance, beginning of period	$	19,088		$	34,085		$	12,020		$	4,974		$	27,596		$	54,270		$	152,033
Deposits	4,806			3,869			2,538			483			1,373			4,971			18,040
Interest credited	404			349			183			67			199			686			1,888
Acquisitions and dispositions	0			0			0			0			0			0			0
Policy charges	(5)			(34)			(24)			(168)			(1,024)			(296)			(1,551)
Surrenders and withdrawals	(2,855)			(556)			(455)			(842)			(933)			(672)			(6,313)
Benefit payments	(323)			(38)			(69)			0			(109)			(1,159)			(1,698)
Net transfers (to) from separate account	0			41			0			(13)			307			0			335
Change in market value and other adjustments(1)	0			917			60			0			495			(10)			1,462
Foreign currency adjustment	0			0			0			0			0			1,585			1,585
Balance, end of period	$	21,115		$	38,633		$	14,253		$	4,501		$	27,904		$	59,375		$	165,781


Closed Block Division																			4,293
Unearned revenue reserve, unearned expense credit, and additional interest reserve																			6,429
Other(2)																			4,428
Total Policyholders' account balance																			$	180,931
Weighted-average crediting rate	4.02		%	1.92		%	2.78		%	2.81		%	1.44		%	2.42		%	2.38		%
Net amount at risk(3)	$	0		$	0		$	0		$	74,475		$	408,334		$	30,967		$	513,776
Cash surrender value(4)	$	21,115		$	37,231		$	12,529		$	3,668		$	24,053		$	52,544		$	151,140

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	Retirement Strategies									Group Insurance			Individual Life			International Businesses(5)			Total
	Institutional			Individual Variable			Individual Fixed			Life/Disability			Variable/Universal Life
	($ in millions)
Balance, beginning of period	$	17,738		$	23,765		$	7,095		$	5,293		$	27,439		$	51,399		$	132,729
Deposits	3,466			3,755			2,815			491			1,224			4,255			16,006
Interest credited	356			224			105			75			379			1,068			2,207
Acquisitions and Dispositions	0			0			0			0			0			(336)			(336)
Policy charges	(6)			(12)			0			(164)			(1,023)			(305)			(1,510)
Surrenders and withdrawals	(2,514)			(442)			(338)			(849)			(821)			(1,036)			(6,000)
Benefit payments	(292)			(38)			(37)			0			(69)			(1,257)			(1,693)
Net transfers (to) from separate account	0			49			0			(6)			285			0			328
Change in market value and other adjustments(1)	1			1,171			125			0			75			(25)			1,347
Foreign currency adjustment	0			0			0			0			0			(2,301)			(2,301)
Balance, end of period	$	18,749		$	28,472		$	9,765		$	4,840		$	27,489		$	51,462		$	140,777


Closed Block Division																			4,424
Unearned revenue reserve, unearned expense credit, and additional interest reserve																			5,622
Other(2)																			4,168
Total Policyholders' account balance																			$	154,991
Weighted-average crediting rate	3.90		%	1.71		%	2.49		%	2.96		%	2.76		%	4.15		%	3.23		%
Net amount at risk(3)	$	0		$	0		$	0		$	74,276		$	389,142		$	24,055		$	487,473
Cash surrender value(4)	$	18,749		$	26,972		$	8,193		$	3,794		$	23,664		$	45,343		$	126,715

(1)Primarily relates to changes in the value of embedded derivative instruments associated with the indexed options of certain products.

(2)Includes $5,004 million and $5,268 million of Full Service account balances reinsured to Great-West as of June 30, 2025 and 2024, respectively.

(3)The net amount at risk calculation includes both general account and separate account balances.

(4)Cash surrender value represents the amount of the contractholder's account balances distributable at the balance sheet date less certain surrender charges. There are no cash surrender charges for the Institutional Retirement Strategies segment.

(5)Prior period amounts have been updated to conform to current period presentation.

“Policyholders’ account balances” for Institutional Retirement Strategies, International Businesses and Corporate and Other includes the Company’s Funding Agreement Notes Issuance Program (“FANIP”), which totaled $7,801 million and $5,436 million at June 30, 2025 and 2024, respectively. Under this program, which has a maximum authorized amount of $15 billion of medium-term notes and $6 billion of commercial paper, Delaware statutory trusts issue short-term commercial paper and/or medium-term notes to investors that are secured by funding agreements issued to the trusts by PICA. The outstanding commercial paper and notes have fixed or floating interest rates that range from 0.0% to 5.6% and original maturities ranging from zero months to ten years. Included in the amounts at June 30, 2025 and 2024 are funding agreements that secure the medium-term note liability, which are carried at amortized cost, of $4,742 million and $3,474 million, respectively, and short-term note liability of $2,834 million and $1,994 million, respectively, and Retail Note liability of $257 million and $0 million, respectively.

“Policyholders’ account balances” for Institutional Retirement Strategies also includes collateralized funding agreements issued to the Federal Home Loan Bank of New York (“FHLBNY”) totaling $2,628 million as of both June 30, 2025 and 2024. These obligations, which are carried at amortized cost, have fixed interest rates that range from 1.925% to 4.510% and original maturities of seven years.

The Company issues variable life and universal life insurance contracts which may also include a “no-lapse guarantee” where the Company contractually guarantees to the contractholder a death benefit even when the account value drops to zero, as long as the “no-lapse guarantee” premium is paid.

The net amount at risk is generally defined as the current death benefit in excess of the current account balance at the balance sheet date. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to,

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

the assumptions used in the original pricing of these products, including contractholder mortality, contract lapses, and premium pattern, as well as interest rate and equity market returns.

The Company also issues annuity contracts that provide certain death benefit and/or living benefit guarantees and are accounted for as MRBs. See Note 11 for additional information, including the net amount at risk associated with these guarantees.

The balance of account values by range of guaranteed minimum crediting rates and the related range of difference, in basis points (“bps”), between rates being credited to policyholders and the respective guaranteed minimums are as follows:


	June 30, 2025
Range of Guaranteed Minimum Crediting Rate(1)	At guaranteed minimum		1 - 50 bps above guaranteed minimum		51 - 150 bps above guaranteed minimum		Greater than 150 bps above guaranteed minimum		Total
	(in millions)
Retirement Strategies - Institutional
Less than 1.00%	$	614	$	0	$	0	$	0	$	614
1.00% - 1.99%	1,552		0		0		0		1,552
2.00% - 2.99%	75		0		0		0		75
3.00% - 4.00%	3,513		0		0		0		3,513
Greater than 4.00%	4,732		0		0		0		4,732
Total	$	10,486	$	0	$	0	$	0	$	10,486
Retirement Strategies - Individual Variable
Less than 1.00%	$	448	$	204	$	407	$	0	$	1,059
1.00% - 1.99%	104		377		1		0		482
2.00% - 2.99%	20		4		4		0		28
3.00% - 4.00%	1,605		1		9		0		1,615
Greater than 4.00%	77		0		0		0		77
Total	$	2,254	$	586	$	421	$	0	$	3,261
Retirement Strategies - Individual Fixed
Less than 1.00%	$	0	$	4	$	18	$	1,118	$	1,140
1.00% - 1.99%	428		65		215		52		760
2.00% - 2.99%	536		454		550		15		1,555
3.00% - 4.00%	3,113		29		11		3		3,156
Greater than 4.00%	78		0		0		0		78
Total	$	4,155	$	552	$	794	$	1,188	$	6,689
Group Insurance - Life / Disability
Less than 1.00%	$	0	$	0	$	0	$	712	$	712
1.00% - 1.99%	0		0		0		2		2
2.00% - 2.99%	44		0		0		0		44
3.00% - 4.00%	1,442		6		51		7		1,506
Greater than 4.00%	3		0		0		0		3
Total	$	1,489	$	6	$	51	$	721	$	2,267
Individual Life - Variable / Universal Life
Less than 1.00%	$	0	$	0	$	0	$	354	$	354
1.00% - 1.99%	341		0		2,072		1,602		4,015
2.00% - 2.99%	284		1,565		2,737		432		5,018
3.00% - 4.00%	5,611		1,953		1,305		45		8,914
Greater than 4.00%	5,302		0		0		0		5,302
Total	$	11,538	$	3,518	$	6,114	$	2,433	$	23,603
International Businesses
Less than 1.00%	$	3,932	$	23	$	0	$	0	$	3,955
1.00% - 1.99%	16,450		32		0		0		16,482
2.00% - 2.99%	7,926		280		26		0		8,232
3.00% - 4.00%	8,743		0		0		0		8,743
Greater than 4.00%	16,833		0		0		0		16,833
Total	$	53,884	$	335	$	26	$	0	$	54,245

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	June 30, 2024
Range of Guaranteed Minimum Crediting Rate(1)	At guaranteed minimum		1 - 50 bps above guaranteed minimum		51 - 150 bps above guaranteed minimum		Greater than 150 bps above guaranteed minimum		Total
	(in millions)
Retirement Strategies - Institutional
Less than 1.00%	$	503	$	0	$	0	$	0	$	503
1.00% - 1.99%	1,519		0		0		0		1,519
2.00% - 2.99%	608		0		0		0		608
3.00% - 4.00%	4,674		0		0		0		4,674
Greater than 4.00%	2,118		0		0		0		2,118
Total	$	9,422	$	0	$	0	$	0	$	9,422
Retirement Strategies - Individual Variable
Less than 1.00%	$	618	$	651	$	254	$	0	$	1,523
1.00% - 1.99%	187		118		2		0		307
2.00% - 2.99%	24		5		4		0		33
3.00% - 4.00%	1,811		7		9		0		1,827
Greater than 4.00%	90		0		0		0		90
Total	$	2,730	$	781	$	269	$	0	$	3,780
Retirement Strategies - Individual Fixed
Less than 1.00%	$	0	$	4	$	10	$	707	$	721
1.00% - 1.99%	482		96		234		79		891
2.00% - 2.99%	548		461		563		16		1,588
3.00% - 4.00%	1,036		76		8		2		1,122
Greater than 4.00%	90		0		0		0		90
Total	$	2,156	$	637	$	815	$	804	$	4,412
Group Insurance - Life / Disability
Less than 1.00%	$	0	$	0	$	0	$	921	$	921
1.00% - 1.99%	0		0		0		0		0
2.00% - 2.99%	27		0		0		0		27
3.00% - 4.00%	1,448		0		0		62		1,510
Greater than 4.00%	72		0		0		0		72
Total	$	1,547	$	0	$	0	$	983	$	2,530
Individual Life - Variable / Universal Life
Less than 1.00%	$	0	$	0	$	0	$	324	$	324
1.00% - 1.99%	247		0		1,678		1,848		3,773
2.00% - 2.99%	31		1,480		2,837		448		4,796
3.00% - 4.00%	4,300		3,897		1,342		28		9,567
Greater than 4.00%	5,433		0		0		0		5,433
Total	$	10,011	$	5,377	$	5,857	$	2,648	$	23,893
International Businesses(2)
Less than 1.00%	$	15,646	$	40	$	83	$	2,560	$	18,329
1.00% - 1.99%	10,445		82		0		0		10,527
2.00% - 2.99%	4,755		293		32		0		5,080
3.00% - 4.00%	5,852		0		0		0		5,852
Greater than 4.00%	7,103		0		0		0		7,103
Total	$	43,801	$	415	$	115	$	2,560	$	46,891

(1)Excludes contracts without minimum guaranteed crediting rates, such as funds with indexed-linked crediting options and Japan variable products.

(2)Prior period amounts have been updated to conform to current period presentation.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Unearned Revenue Reserve (“URR”)

The balance of and changes in URR as of and for the periods ended are as follows:


	Six Months Ended June 30, 2025
	Individual Life		International Businesses
	Variable/ Universal Life				Total
	(in millions)
Balance, beginning of period	$	5,245	$	505		$	5,750
Unearned revenue	432		98			530
Amortization expense	(126)		(14)			(140)
Other adjustments	0		0			0
Foreign currency adjustment	0		30			30
Balance, end of period	$	5,551	$	619		6,170
Other						64
Total unearned revenue reserve balance						$	6,234


	Six Months Ended June 30, 2024
	Individual Life		International Businesses(1)
	Variable/ Universal Life				Total
	(in millions)
Balance, beginning of period	$	4,613	$	454		$	5,067
Unearned revenue	436		80			516
Amortization expense	(118)		(11)			(129)
Other adjustments	0		(57)			(57)
Foreign currency adjustment	0		(34)			(34)
Balance, end of period	$	4,931	$	432		5,363
Other						53
Total unearned revenue reserve balance						$	5,416

(1)Prior period amounts have been updated to conform to current period presentation.

11. MARKET RISK BENEFITS

The following table shows a rollforward of MRB balances for annuity products within Individual Retirement Strategies, which is the only line of business that contains a material MRB balance, along with a reconciliation to the Company’s total net MRB positions as of the following dates:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2025
	Retirement Strategies
	Individual Variable		Individual Fixed		Total
	(in millions)
Balance, BOP	$	2,740	$	0	$	2,740
Effect of cumulative changes in NPR	672		0		672
Balance, BOP, before effect of changes in NPR	3,412		0		3,412
Attributed fees collected	525		6		531
Claims paid	(41)		0		(41)
Interest accrual	94		0		94
Actual in force different from expected	40		2		42
Effect of changes in interest rates	389		(7)		382
Effect of changes in equity markets	(494)		(2)		(496)
Effect of assumption update and other refinements	112		151		263
Issuances	35		17		52



Other adjustments	12		3		15
Balance, EOP, before effect of changes in NPR	4,084		170		4,254
Effect of cumulative changes in NPR	(838)		(7)		(845)
Balance, EOP	3,246		163		3,409
Less: Reinsured MRBs	777		0		777
Balance, EOP, net of reinsurance	$	2,469	$	163	2,632
Other businesses					39
Total net MRB balance					$	2,671

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
	Retirement Strategies
	Individual Variable		Individual Fixed		Total
	(in millions)
Balance, BOP	$	4,038	$	0	$	4,038
Effect of cumulative changes in NPR	1,137		0		1,137
Balance, BOP, before effect of changes in NPR	5,175		0		5,175
Attributed fees collected	569		0		569
Claims paid	(42)		0		(42)
Interest accrual	130		0		130
Actual in force different from expected	(6)		0		(6)
Effect of changes in interest rates	(909)		0		(909)
Effect of changes in equity markets	(1,165)		0		(1,165)
Effect of assumption update and other refinements(1)	88		0		88
Issuances	29		0		29



Other adjustments(1)	20		0		20
Balance, EOP, before effect of changes in NPR	3,889		0		3,889
Effect of cumulative changes in NPR	(942)		0		(942)
Balance, EOP	2,947		0		2,947
Less: Reinsured MRBs	635		0		635
Balance, EOP, net of reinsurance	$	2,312	$	0	2,312
Other businesses					47
Total net MRB balance					$	2,359

(1)Prior period amounts have been updated to conform to current presentation.

In both 2025 and 2024, the Company recognized an unfavorable impact to net income attributable to the actuarial assumption update for direct and assumed MRBs, primarily due to updates to policyholder behavior assumptions.

The Company issues certain variable annuity insurance contracts where the Company contractually guarantees to the contractholder a return of no less than (1) total deposits made to the contract adjusted for any partial withdrawals plus a minimum return, and/or (2) the highest anniversary contract value on a specified date adjusted for any withdrawals. These guarantees include benefits that are payable in the event of death, annuitization or at specified dates during the accumulation period and withdrawal and income benefits payable during specified periods.

The Company also issues indexed annuity contracts for which the return is tied to the return of specific indices where the Company contractually guarantees to the contractholder a return of no less than total deposits made to the contract adjusted for any partial withdrawals upon death. In certain of these indexed annuity contracts, the Company also contractually guarantees to the contractholder withdrawal benefits payable during specific periods.

For guarantees of benefits that are payable in the event of death, the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, contract lapses and contractholder mortality.

For guarantees of benefits that are payable at annuitization, the net amount at risk is generally defined as the present value of the minimum guaranteed annuity payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, timing of annuitization, contract lapses and contractholder mortality.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

For guarantees of benefits that are payable at withdrawal, the net amount at risk is generally defined as the present value of the minimum guaranteed withdrawal payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance.

For guarantees of accumulation balances, the net amount at risk is generally defined as the guaranteed minimum accumulation balance minus the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including equity market returns, interest rates, market volatility and contractholder behavior.

The following tables present accompanying information to the rollforward tables above.


	June 30, 2025
	Retirement Strategies
	Individual Variable		Individual Fixed
	($ in millions)
Net amount at risk(1)	$	8,736	$	401
Weighted-average attained age of contractholders	72		67


	June 30, 2024
	Retirement Strategies
	Individual Variable		Individual Fixed
	($ in millions)
Net amount at risk(1)	$	9,358	N/A
Weighted-average attained age of contractholders	71		N/A

(1)For contracts with multiple benefit features, the highest net amount at risk for each contract is included.

The tables below reconcile MRB asset and liability positions as of the following dates:


	June 30, 2025
	Retirement Strategies
	Individual Variable		Individual Fixed		Other Businesses		Total
	(in millions)
Direct and assumed	$	1,291	$	1	$	1	$	1,293
Ceded	894		0		1		895
Total MRB assets	$	2,185	$	1	$	2	$	2,188

Direct and assumed	$	4,537	$	164	$	41	$	4,742
Ceded	117		0		0		117
Total MRB liabilities	$	4,654	$	164	$	41	$	4,859

Net liability	$	2,469	$	163	$	39	$	2,671

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	June 30, 2024
	Retirement Strategies
	Individual Variable		Individual Fixed		Other Businesses		Total
	(in millions)
Direct and assumed	$	1,441	$	0	$	11	$	1,452
Ceded	780		0		1		781
Total MRB assets	$	2,221	$	0	$	12	$	2,233

Direct and assumed	$	4,388	$	0	$	59	$	4,447
Ceded	145		0		0		145
Total MRB liabilities	$	4,533	$	0	$	59	$	4,592

Net liability	$	2,312	$	0	$	47	$	2,359

12. REINSURANCE

The Company participates in reinsurance with third parties primarily to provide additional capacity for future growth, limit the maximum net loss potential arising from large risks and acquire or dispose of businesses.

Effective October 2024, the Company entered into an agreement with Wilton Reassurance Company and Wilton Reinsurance Bermuda Limited (collectively, “Wilton Re”) to reinsure certain guaranteed universal life policies issued by Pruco Life Insurance Company (“Pruco Life”) and Pruco Life Insurance Company of New Jersey (“PLNJ”), both of which are wholly-owned subsidiaries of Prudential Financial. These policies represented approximately 40% of the Company’s remaining statutory reserves on its in-force guaranteed universal life block of business as of September 30, 2024, following the close of the reinsurance transaction with Somerset Reinsurance Ltd. (“Somerset Re”), as discussed below. The transaction is structured on a coinsurance basis and follows reinsurance accounting. As a result of the transaction, the Company recognized a $980 million deferred reinsurance loss at inception that is amortized into income over the estimated remaining life of the reinsured policies.

Effective January 2024, the Company entered into an agreement with Somerset Re to reinsure certain guaranteed universal life policies issued by Pruco Life and PLNJ, both of which are wholly-owned subsidiaries of Prudential Financial. These policies represented approximately 30% of the Company’s statutory reserves on its in-force guaranteed universal life block of business as of December 31, 2023. This transaction is structured on a modified coinsurance basis and follows reinsurance accounting. As a result of the transaction, the Company recognized a $363 million deferred reinsurance gain at inception that is amortized into income over the estimated remaining life of the reinsured policies. The reinsurance payables, which represent the Company’s obligations under the modified coinsurance arrangement, are netted with the reinsurance recoverables in the Unaudited Interim Consolidated Statements of Financial Position. Separately, effective September 2019, Prudential Annuities Life Assurance Corporation (“PALAC”), a previously wholly-owned subsidiary of Prudential Financial, entered into an agreement with Somerset Re, to coinsure business, on a quota share funds withheld basis, related to fixed indexed annuities. This agreement was subsequently novated from PALAC to Pruco Life effective October 2021, in connection with the sale of PALAC effective April 2022. Under this reinsurance agreement, which is accounted for under the deposit method of accounting, the Company cedes to Somerset Re its quota share of the insurance liabilities with respect to the reinsured contracts.

Effective September 2023, the Company entered into an agreement with Prismic Life Reinsurance, Ltd. (“Prismic Re”), a wholly-owned subsidiary of Prismic Life Holding Company LP (“Prismic”), to reinsure approximately $9 billion of reserves, representing approximately 70% of the in-force structured settlement annuities business previously issued by PICA, 90% of which is on a coinsurance with funds withheld basis and 10% of which is on a coinsurance basis. The reinsurance of the structured settlement annuities that provide periodic payments for the lifetime of the annuitant follows reinsurance accounting. The reinsurance of structured settlement annuities that provide payments for a guaranteed period of time and do not include life contingency risk follows deposit accounting. Separately, effective March 2025, the Company entered into an agreement with Prismic Life Reinsurance International, Ltd. (“Prismic Re International”), a wholly-owned subsidiary of Prismic, to reinsure

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

approximately $7 billion of reserves for certain USD-denominated Japanese whole life policies originated by the Company’s Japanese affiliates. The transaction is structured on a coinsurance basis and is accounted for under the deposit method of accounting as the reinsured policies do not include life contingency risk and are accounted for as investment contracts.

Effective April 2023, the Company entered into an agreement with The Ohio National Life Insurance Company, now known as AuguStar, an affiliate of Constellation Insurance Holdings, Inc., to reinsure approximately $10 billion of account values of PDI traditional variable annuity contracts with guaranteed living benefits issued by Pruco Life, a wholly-owned subsidiary of Prudential Financial. This block represents approximately 10% of the Company’s remaining legacy in-force traditional variable annuity block by account value. The Company ceded 100% of separate account liabilities under modified coinsurance and 100% of general account liabilities under coinsurance of its Pruco Life issued PDI traditional variable annuity contracts. The general account liabilities associated with PDI’s guaranteed living and death benefits and the corresponding reinsurance of those liabilities are accounted for as market risk benefits.

Effective April 2022, in connection with the sale of the Full Service Retirement business, the Company entered into separate agreements with external counterparties, Great-West and Great-West Life & Annuity Insurance Company of New York, now known as Empower Annuity Insurance Company of America and Empower Life & Annuity Insurance Company of New York (collectively, “Empower”), respectively, to reinsure a portion of its Full Service Retirement business. The Company ceded 100% of separate account liabilities under modified coinsurance and 100% of general account liabilities under coinsurance of its Full Service Retirement business. The Company’s Full Service Retirement business consists of market value and stable value separate accounts as well as general account products, including stable value accumulation funds and a stable value wrap product known as a synthetic guaranteed investment contract. The majority of these products are considered investment contracts as they do not contain significant insurance risk; therefore, the reinsurance of such products are accounted for under the deposit method of accounting. The reinsurance agreement offers the policyholders the opportunity to novate their contracts from the Company to Empower and any such novated contracts shall cease to be reinsured under this agreement.

Effective April 2022, in connection with the sale of the PALAC legal entity, now known as Fortitude Life Insurance and Annuity Company (“FLIAC”), the Company entered into a reinsurance agreement with FLIAC under which the Company assumed all of FLIAC’s indexed variable annuities under modified coinsurance. The reinsurance of the indexed variable annuities transfers all significant risks, including mortality risk, embedded in the reinsured contracts. As a result of the agreement, reinsurance recoverables includes the assumed modified coinsurance receivable, which reflects the value of the invested assets retained by FLIAC and the associated asset returns. The Company also assumed via coinsurance all of FLIAC’s fixed indexed annuities with a guaranteed lifetime withdrawal income feature, which are accounted for under the deposit method of accounting. The reinsurance agreement offers the policyholders the opportunity to novate their contracts from FLIAC to the Company and any such novated contracts shall cease to be reinsured under this agreement.

Effective April 2015, the Company entered into an agreement with Union Hamilton Reinsurance, Ltd. (“Union Hamilton”) an external counterparty, to reinsure approximately 50% of the Prudential Premier® Retirement Variable Annuity with Highest Daily Lifetime Income (“HDI”) v.3.0 business, a guaranteed benefit feature. This reinsurance agreement covered most new HDI v.3.0 variable annuity business issued between April 1, 2015 and December 31, 2016 on a quota share basis, with Union Hamilton’s cumulative quota share amounting to $2.9 billion of new rider premiums as of December 31, 2016. Reinsurance on business subject to this agreement remains in force for the duration of the underlying annuity contracts. New sales subsequent to December 31, 2016 are not covered by this external reinsurance agreement. This reinsurance agreement is accounted for as market risk benefits.

In January 2013, the Company acquired the Hartford Life Business through reinsurance transactions with three subsidiaries of Hartford Financial Services Group, Inc. (“Hartford Financial”). Under the related agreements, the Company provided reinsurance for approximately 700,000 life insurance policies with net retained face amount in force of approximately $141 billion. The Company acquired the general account business through a coinsurance arrangement and, for certain types of general account policies, a modified coinsurance arrangement. The Company acquired the separate account business through a modified coinsurance arrangement. In May 2018, Hartford Financial sold a group of operating subsidiaries, which included two of the Company’s counterparties to these reinsurance arrangements, to Talcott Resolution Life Insurance Company (“Talcott Resolution”). Talcott Resolution was acquired by Sixth Street in July 2021. There was no impact to the terms, rights or obligations of the Company, or operation of these reinsurance arrangements, as a result of these changes in control of such counterparties.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Since 2011, the Company has entered into a number of reinsurance agreements to assume pension liabilities in the United Kingdom. Under these arrangements, the Company assumes the longevity risk, and in some arrangements, also the investment risk associated with the pension benefits of certain specified beneficiaries. The Company also obtains collateral from its counterparties to mitigate counterparty default risk.

In 2006, the Company acquired the variable annuity business of The Allstate Corporation (“Allstate”) through a reinsurance transaction. The reinsurance arrangements with Allstate include a coinsurance arrangement associated with the general account liabilities assumed and a modified coinsurance arrangement associated with the separate account liabilities assumed. The reinsurance payables, which represent the Company’s obligations under the modified coinsurance arrangement, are netted with the reinsurance recoverables in the Unaudited Interim Consolidated Statements of Financial Position. During the fourth quarter of 2021, Allstate sold the two counterparties to the aforementioned variable annuity reinsurance transaction to third parties. There was no impact to the terms, rights or obligations of the Company, or operation of these reinsurance arrangements, as a result of this change in control of such counterparties.

For the domestic business, life and disability reinsurance is accomplished through various plans of reinsurance, primarily yearly renewable term, per person excess, excess of loss, and coinsurance. On policies sold since 2000, the Company has reinsured a significant portion of the individual life mortality risk. Placement of reinsurance is accomplished primarily on an automatic basis with some specific risks reinsured on a facultative basis. The Company is authorized and has historically retained up to $30 million per life, but reduced its operating retention limit to $20 million per life in 2013 and then down to $10 million per life for new business starting in 2020. Retention in excess of the operating limit is on an exception basis.

The international business primarily uses reinsurance to obtain experience with respect to certain new product offerings and to a lesser extent, to mitigate mortality risk for certain protection products and for capital management purposes.

Reinsurance amounts included in the Unaudited Interim Consolidated Statements of Operations for “Premiums,” “Policy charges and fee income,” “Change in value of market risk benefits, net of related hedging gains (losses),” “Policyholders’ benefits” and “Change in estimates of liability for future policy benefits,” are as follows:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Direct premiums	$	5,824	$	6,851	$	11,846	$	21,673
Reinsurance assumed	1,757		1,545		3,351		2,996
Reinsurance ceded	(599)		(576)		(1,215)		(1,312)
Premiums	$	6,982	$	7,820	$	13,982	$	23,357

Direct policy charges and fee income	$	1,146	$	949	$	2,329	$	1,813
Reinsurance assumed	290		299		579		599
Reinsurance ceded	(187)		(163)		(502)		(271)
Policy charges and fee income	$	1,249	$	1,085	$	2,406	$	2,141

Direct change in value of market risk benefits, net of related hedging gains (losses)	$	(471)	$	(339)	$	(838)	$	(189)
Reinsurance assumed	39		8		11		79
Reinsurance ceded	6		34		50		(64)
Change in value of market risk benefits, net of related hedging gains (losses)	$	(426)	$	(297)	$	(777)	$	(174)

Direct policyholders’ benefits	$	7,034	$	7,961	$	14,294	$	23,826
Reinsurance assumed	2,074		1,938		4,044		3,781
Reinsurance ceded	(927)		(1,035)		(2,017)		(2,149)
Policyholders’ benefits	$	8,181	$	8,864	$	16,321	$	25,458

Direct change in estimates of liability for future policy benefits	$	(17)	$	(213)	$	(64)	$	(67)
Reinsurance assumed	(10)		63		(10)		58
Reinsurance ceded	(148)		(26)		(151)		(184)
Change in estimates of liability for future policy benefits	$	(175)	$	(176)	$	(225)	$	(193)

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Reinsurance recoverables and deposit receivables are as follows:


	June 30, 2025		December 31, 2024
	(in millions)
Reinsurance recoverables:
Prismic Re(1)	$	5,443	$	5,506
FLIAC	1,429		1,442
Other	39		39
Individual and group annuities	6,911		6,987
Wilton Re	7,690		7,478
Somerset Re(2)	1,687		1,591
Hartford Life Business(3)	2,018		2,033
Other	8,271		7,996
Life insurance	19,666		19,098
Other reinsurance	415		401
Total reinsurance recoverables	26,992		26,486
Deposit receivables:
Prismic Re(1)	3,481		3,578
Prismic Re International	6,391		0
Somerset Re(4)	2,556		2,795
Empower	4,732		4,821

Total deposit receivables	17,160		11,194
Total reinsurance recoverables and deposit receivables(5)	$	44,152	$	37,680

(1)The Company has also recorded funds withheld payables related to the reinsurance agreement with Prismic Re of $7,776 million and $7,796 million as of June 30, 2025 and December 31, 2024, respectively.

(2)Represents reinsurance recoverables of $8,088 million and $7,979 million as of June 30, 2025 and December 31, 2024, respectively that are netted with reinsurance payables of $6,401 million and $6,388 million as of June 30, 2025 and December 31, 2024, respectively, related to the reinsurance agreement with Somerset Re in which the Company reinsured a portion of its in-force guaranteed universal life block of business under modified coinsurance.

(3)The Company has also recorded reinsurance payables related to the Hartford Life Business acquisition of $1,335 million and $1,387 million as of June 30, 2025 and December 31, 2024, respectively.

(4)The Company has also recorded funds withheld payables related to the reinsurance agreement with Somerset Re of $2,609 million and $2,595 million as of June 30, 2025 and December 31, 2024, respectively.

(5)Net of $13 million and $12 million of allowance for credit losses as of June 30, 2025 and December 31, 2024, respectively.

Excluding the reinsurance recoverables associated with the counterparties separately identified within the reinsurance recoverables table above, four major reinsurance companies account for approximately 60% of the Company’s remaining reinsurance recoverables as of June 30, 2025. The Company periodically reviews the financial condition of its reinsurers, amounts recoverable therefrom, and unearned reinsurance premium, in order to reduce its exposure to loss from reinsurer insolvencies. Any expected credit losses are reflected in the current expected credit loss (“CECL”) allowance, after considering any collateral the Company obtained in the form of a trust, letter of credit, or funds withheld arrangement. See Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for additional details regarding CECL.

13. CLOSED BLOCK

On December 18, 2001, the date of demutualization, The Prudential Insurance Company of America (“PICA”) established a closed block for certain in-force participating insurance policies and annuity products, along with corresponding assets used for the payment of benefits and policyholders’ dividends on these products, (collectively the “Closed Block”), and ceased offering these participating products. The recorded assets and liabilities were allocated to the Closed Block at their historical carrying amounts. The Closed Block forms the principal component of the Closed Block division. For additional information regarding the Closed Block, see Note 16 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

As of June 30, 2025 and December 31, 2024, the Company recognized a policyholder dividend obligation of $1,729 million and $2,096 million, respectively, to Closed Block policyholders for the excess of actual cumulative earnings over expected cumulative earnings. Additionally, accumulated net unrealized investment gains (losses) were reflected as a policyholder dividend obligation of $(1,514) million and $(2,096) million at June 30, 2025 and December 31, 2024, respectively, with a corresponding amount reported in AOCI.

As of June 30, 2025, the Closed Block has sufficient funds to make guaranteed policy benefit payments and there is no expectation that assets outside of the Closed Block will be needed to fund future payments. The excess of Closed Block liabilities over Closed Block assets as of the end of the reporting period shown in the table below is a reasonable measure of the margin in the reported liabilities compared to best estimate liabilities assuming the current dividend scale. Closed Block liabilities and assets designated to the Closed Block, as well as maximum future earnings to be recognized from these liabilities and assets, are as follows:


	June 30, 2025		December 31, 2024
	(in millions)
Closed Block liabilities
Future policy benefits	$	41,927	$	42,464
Policyholders’ dividends payable	695		688
Policyholders’ dividend obligation	215		0
Policyholders’ account balances	4,293		4,359
Other Closed Block liabilities	3,292		3,346
Total Closed Block liabilities	50,422		50,857
Closed Block assets
Fixed maturities, available-for-sale, at fair value	29,154		28,570
Fixed maturities, trading, at fair value	647		647
Equity securities, at fair value	1,475		1,642
Commercial mortgage and other loans	7,628		7,652
Policy loans	3,280		3,348
Other invested assets	4,521		4,929
Short-term investments	346		520
Total investments	47,051		47,308
Cash and cash equivalents	368		400
Accrued investment income	402		403
Other Closed Block assets	299		367
Total Closed Block assets	48,120		48,478
Excess of reported Closed Block liabilities over Closed Block assets	2,302		2,379
Portion of above representing accumulated other comprehensive income (loss):
Net unrealized investment gains (losses)	(1,666)		(2,299)
Allocated to policyholder dividend obligation	1,514		2,096
Future earnings to be recognized from Closed Block assets and Closed Block liabilities	$	2,150	$	2,176

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Information regarding the policyholder dividend obligation is as follows:


	Six Months Ended June 30, 2025
	(in millions)
Balance, December 31, 2024	$	0

Impact from earnings allocable to policyholder dividend obligation	(367)
Change in net unrealized investment gains (losses) allocated to policyholder dividend obligation	582
Balance, June 30, 2025	$	215

Closed Block revenues and benefits and expenses are as follows for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Revenues
Premiums	$	444	$	433	$	862	$	842
Net investment income	511		506		1,003		1,019
Realized investment gains (losses), net	(199)		(174)		(255)		(299)
Other income (loss)	190		43		156		207
Total Closed Block revenues	946		808		1,766		1,769
Benefits and Expenses
Policyholders’ benefits	616		604		1,217		1,188
Interest credited to policyholders’ account balances	28		29		56		59
Dividends to policyholders	249		162		377		437
General and administrative expenses	64		67		142		134
Total Closed Block benefits and expenses	957		862		1,792		1,818
Closed Block revenues, net of Closed Block benefits and expenses, before income taxes	(11)		(54)		(26)		(49)
Income tax expense (benefit)	(31)		(73)		(66)		(88)
Closed Block revenues, net of Closed Block benefits and expenses and income taxes	$	20	$	19	$	40	$	39

14. INCOME TAXES

The Company uses a full-year projected effective tax rate approach to calculate year-to-date taxes. The projected effective tax rate is the ratio of projected “Total income tax expense” divided by projected “Income before income taxes and equity in earnings of joint ventures and other operating entities.” In addition, certain items impacting total income tax expense are recorded in the periods in which they occur. In determining the year-to-date income tax provision, the Company considers the realizability of deferred tax assets, including those associated with unrealized investment losses, and has determined based upon the weight of available evidence that no valuation allowance is necessary related to unrealized investment losses. The interim period tax expense (or benefit) is the difference between the year-to-date income tax provision and the amounts reported for the previous interim periods of the fiscal year. Taxes attributable to joint ventures and other operating entities are recorded within “Equity in earnings of joint ventures and other operating entities, net of taxes.”

The Company’s income tax provision, on a consolidated basis, amounted to an income tax expense of $402 million, or 24.2% of income (loss) before income taxes and equity in earnings of joint ventures and other operating entities, in the first six months of 2025, compared to an income tax expense of $553 million, or 19.7%, in the first six months of 2024. The Company’s current and prior effective tax rates differ from the U.S. statutory rate of 21% primarily due to non-taxable investment income, tax credits, foreign earnings taxed at higher rates than the U.S. statutory rate, and the items discussed below.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Foreign Tax Credit Regulations. The Treasury Department and the IRS published Final Regulations in the Federal Register (Treasury Decision 9959) on January 4, 2022, which affect the creditability of certain foreign taxes for U.S. federal income tax purposes. The Final Regulations created uncertainty as to whether a U.S. foreign tax credit could be claimed for taxes the Company paid to Brazil. The ability to claim a foreign tax credit for taxes paid to Brazil impacted the benefit of the election made pursuant to Internal Revenue Code Section 952 to subject earnings from the Company’s insurance operations in Brazil to tax in the U.S. in the tax year earned, net of related foreign tax credits. The Company continues to assume that the election does not apply in tax years post 2021.

On August 7, 2023, the IRS issued Notice 2023-55 which provides temporary relief to taxpayers in determining whether a foreign tax is eligible for a U.S. foreign tax credit for tax years 2022 and 2023. Subsequently, on December 11, 2023 the IRS issued Notice 2023-80 which extended that relief to taxable years ending before the date that a notice or other guidance withdrawing or modifying the temporary relief is issued and abolished certain changes that the Final Regulations had made to the creditability of a tax paid in lieu of a generally imposed foreign income tax. As a result of this guidance, the Company claimed a U.S. foreign tax credit in 2024 for taxes paid to Brazil related to the 2023 tax year and will continue to claim a U.S. foreign tax credit for taxes paid to Brazil in future tax years. This contributed to the Company’s Brazil operations not being subject to Global Intangible Low Taxed Income (GILTI) in 2024.

GILTI. The GILTI provision applies a minimum U.S. tax to earnings of consolidated foreign subsidiaries in excess of a 10% deemed return on tangible assets of foreign subsidiaries by imposing the U.S. tax rate to 50% of earnings of such foreign affiliates and provides for a partial foreign tax credit for foreign income taxes. In years that the PFI consolidated federal income tax return reports a net operating loss or has a loss attributable to U.S. sources of operations, including as a result of loss carrybacks, the GILTI provision would limit the amount of deductions or credits permissible against GILTI. These limitations did not have a material impact in 2023 or 2024.

On July 20, 2020, the U.S. Treasury and the Internal Revenue Service issued Final Regulations (Treasury Decision 9902) pursuant to Internal Revenue Code Section 951A which allow an annual election to exclude from the U.S. tax return certain GILTI amounts when the taxes paid by a foreign affiliate exceed 18.9% (90% of U.S. statutory rate of 21%) of the GILTI amount for that foreign affiliate (the “high-tax exception”). These regulations are effective for the 2021 taxable year with an election to apply to any taxable year beginning after 2017. In many of the countries in which the Company operates, including Japan and Brazil, there are differences between local tax rules used to determine the tax base and the U.S. tax principles used to determine GILTI. Also, the Company’s Japan affiliates have a different tax year than the U.S. calendar tax year used to determine GILTI. Therefore, while many of the countries, including Japan and Brazil, have a statutory tax rate above the 18.9% threshold, separate affiliates may not meet the 18.9% threshold each year and, as such, may not qualify for this annual exclusion. The Company made the high-tax exception election for the 2024 tax year and anticipates to make the high-tax exception election for the 2025 tax year for its foreign affiliates that meet the 18.9% threshold. The Company reflected the impact of the election in its full year projected effective tax rate used to calculate year-to-date taxes for the first six months of 2024 and 2025, respectively.

Tax Law Change. H.R.1, also referred to as the “One Big Beautiful Bill Act” (the “Tax Act of 2025”), was enacted into law on July 4, 2025. The legislation introduces changes to the U.S. international tax regime, including a reduction in the Section 250 deduction for GILTI (now referred to as Net CFC Tested Income (“NCFCTI”)) from 50% to 40% beginning in 2026, resulting in an increase to the corporate tax rate on NCFCTI from 10.5% to 12.6%. The legislation also reduces the foreign tax credit haircut related to NCFCTI from 20% to 10% and makes changes to the related expense allocation. While the Company is currently evaluating the impact of the Tax Act of 2025 on its future consolidated financial statements and related disclosures, the Company does not anticipate that the provisions of the Tax Act of 2025 will have a material impact on its effective tax rate and deferred tax positions beginning in the third quarter of 2025.

In March 2025, Japan enacted a 4% Special Defense Corporation Tax, effective for tax years beginning on or after April 1, 2026, that raises the corporate income tax rate for the Company’s Japan insurance companies from 28.00% to 28.93%. As a result, a tax expense of approximately $36 million was reflected in the financial statements for the first quarter of 2025.

Tax Audit and Unrecognized Tax Benefits. It is possible the Company will pay the unrecognized tax benefit attributable to the Section 952 election of approximately $122 million for prior period audit cycles within the next 12 months as it pursues resolution of the matter. The payment will have no impact on the effective tax rate. The Company cannot predict with reasonable accuracy whether there will be any significant changes within the next twelve months to its total unrecognized tax benefits related to tax years for which the statute of limitations has not expired.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

15. SHORT-TERM AND LONG-TERM DEBT

Short-term Debt

The table below presents the Company’s short-term debt as of the dates indicated:


	June 30, 2025			December 31, 2024
	($ in millions)
Commercial paper:
Prudential Financial	$	25		$	25
Prudential Funding, LLC	500			496
Subtotal commercial paper	525			521

Current portion of long-term debt:
Senior Notes	499			0
Surplus notes	348			347
Mortgage debt	1			85

Subtotal current portion of long-term debt	848			432

Subtotal	1,373			953
Less: assets under set-off arrangements(1)	0			0
Total short-term debt(2)	$	1,373		$	953
Supplemental short-term debt information:
Portion of commercial paper borrowings due overnight	$	125		$	310
Daily average commercial paper outstanding for the quarter ended	$	1,551		$	1,823
Weighted average maturity of outstanding commercial paper, in days	5			15
Weighted average interest rate on outstanding commercial paper	4.33		%	4.61		%

(1)The surplus notes have corresponding assets where rights to set-off exist, thereby reducing the amount of surplus notes included in short-term debt.

(2)Includes Prudential Financial debt of $524 million and $25 million at June 30, 2025 and December 31, 2024, respectively.

Prudential Financial and certain subsidiaries have access to external sources of liquidity, including membership in the FHLBNY, a funding agreement facility with the Federal Agricultural Mortgage Company (“Farmer Mac”), commercial paper programs and contingent financing facilities in the form of facility agreements. The Company also maintains syndicated, unsecured committed credit facilities as an alternative source of liquidity. At June 30, 2025, no amounts were drawn on these syndicated, unsecured committed credit facilities. For additional information regarding these sources of liquidity, see Note 18 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Long-term Debt

The table below presents the Company’s long-term debt as of the dates indicated:


	June 30, 2025		December 31, 2024
	(in millions)
Fixed-rate obligations:

Surplus notes subject to set-off arrangements(1)(2)	$	15,220	$	14,748
Senior notes	10,610		10,245
Mortgage debt(3)	125		69
Floating-rate obligations:
Line of credit	255		255


Mortgage debt(3)	66		31
Junior subordinated notes(4)	7,595		8,587
Subtotal	33,871		33,935
Less: assets under set-off arrangements(1)	15,220		14,748
Total long-term debt(5)	$	18,651	$	19,187

(1)The surplus notes have corresponding assets where rights to set-off exist, thereby reducing the amount of surplus notes included in long-term debt.

(2)Amount includes $7.2 billion of surplus notes used to finance Guideline AXXX reserves for business reinsured to Somerset Re in March 2024. See Note 12 for additional information.

(3)Includes $158 million and $100 million of debt denominated in foreign currency at June 30, 2025 and December 31, 2024, respectively.

(4)Includes Prudential Financial debt of $7,552 million and $8,548 million at June 30, 2025, and December 31, 2024, respectively. Also includes subsidiary debt of $43 million and $39 million denominated in foreign currency at June 30, 2025, and December 31, 2024, respectively.

(5)Includes Prudential Financial debt of $18,162 million and $18,793 million at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025 and December 31, 2024, the Company was in compliance with all debt covenants related to the borrowings in the table above.

Senior Notes

In August 2024, the Company recommenced sales of InterNotes® Retail Notes under its shelf registration statement. These notes support the Company’s Institutional Retirement Strategies business through the purchase of funding agreements on which the segment will earn investment spread. As of June 30, 2025, the outstanding balance of the InterNotes® Retail Notes was $485 million of which $253 million was utilized for Institutional Retirement Strategies, as described above.

In March 2025, the Company issued $750 million in aggregate principal amount of 5.200% medium-term notes due in March 2035.

Junior Subordinated Notes

In May 2025, the Company redeemed, in full, $1.0 billion in aggregate principal amount of 5.375% junior subordinated notes due in 2045.

16. EMPLOYEE BENEFIT PLANS

Pension and Other Postretirement Plans

The Company has funded and non-funded non-contributory defined benefit pension plans (“Pension Benefits”), which cover substantially all of its employees. For some employees, benefits are based on final average earnings and length of service (the “traditional formula”), while benefits for other employees are based on an account balance that takes into consideration age, length of service and earnings during their career (the “cash balance formula”).

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The Company provides certain health care and life insurance benefits for its retired employees, their beneficiaries and covered dependents (“Other Postretirement Benefits”). The health care plan is contributory; the life insurance plan is non-contributory. Substantially all of the Company’s U.S. employees may become eligible to receive certain other postretirement benefits if they retire after age 55 with at least 10 years of service or under certain circumstances after age 50 with at least 20 years of continuous service.

Net periodic (benefit) cost included in “General and administrative expenses” includes the following components:


	Three Months Ended June 30,
	Pension Benefits				Other Postretirement Benefits
	2025		2024		2025		2024
	(in millions)
Components of net periodic (benefit) cost:
Service cost	$	47	$	51	$	2	$	2
Interest cost	141		135		14		13
Expected return on plan assets	(249)		(239)		(18)		(19)
Amortization of prior service cost	0		(1)		(17)		(17)
Amortization of actuarial (gain) loss, net	21		23		2		2
Settlements	0		1		0		0

Special termination benefits	0		1		0		0
Net periodic (benefit) cost	$	(40)	$	(29)	$	(17)	$	(19)

	Six Months Ended June 30,
	Pension Benefits				Other Postretirement Benefits
	2025		2024		2025		2024
	(in millions)
Components of net periodic (benefit) cost:
Service cost	$	94	$	103	$	3	$	4
Interest cost	282		270		28		26
Expected return on plan assets	(498)		(477)		(36)		(38)
Amortization of prior service cost	0		(1)		(34)		(34)
Amortization of actuarial (gain) loss, net	42		45		5		4
Settlements	(1)		1		0		0

Special termination benefits	0		1		0		0
Net periodic (benefit) cost	$	(81)	$	(58)	$	(34)	$	(38)

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

17. EQUITY

The changes in the number of shares of Common Stock issued, held in treasury and outstanding, are as follows for the periods indicated:


	Common Stock
	Issued	Held In Treasury	Outstanding
	(in millions)
Balance, December 31, 2024	666.3	311.7	354.6
Common Stock issued	0.0	0.0	0.0
Common Stock acquired	0.0	4.6	(4.6)
Stock-based compensation programs(1)	0.0	(1.9)	1.9
Balance, June 30, 2025	666.3	314.4	351.9

(1)Represents net shares issued from treasury pursuant to the Company’s stock-based compensation programs.

In December 2024, Prudential Financial’s Board of Directors (the “Board”) authorized the Company to repurchase at management’s discretion up to $1.0 billion of its outstanding Common Stock during the period from January 1, 2025 through December 31, 2025. As of June 30, 2025, 4.6 million shares of the Company’s Common Stock were repurchased under this authorization at a total cost of $500 million.

The timing and amount of share repurchases are determined by management based upon market conditions and other considerations, and such repurchases may be executed in the open market, through derivative, accelerated repurchase and other negotiated transactions and through plans complying with Rule 10b5-1(c) under the Securities Exchange Act of 1934 (the “Exchange Act”), as amended. Numerous factors could affect the timing and amount of any future repurchases under the share repurchase authorization, including, but not limited to: compliance with laws, increased capital needs of the Company due to changes in regulatory capital requirements, opportunities for growth and acquisitions, and the effect of adverse market conditions.

Dividends declared per share of Common Stock are as follows for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Dividends declared per share of Common Stock	$	1.35	$	1.30	$	2.70	$	2.60

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Accumulated Other Comprehensive Income (Loss)

AOCI represents the cumulative OCI items that are reported separate from net income and detailed on the Unaudited Interim Consolidated Statements of Comprehensive Income. The balance of and changes in each component of AOCI as of and for the six months ended June 30, 2025 and 2024, are as follows:


	Accumulated Other Comprehensive Income (Loss) Attributable to Prudential Financial, Inc.
	Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses)(1)		Interest rate remeasurement of Liability for Future Policy Benefits		Gains (Losses) from Changes in Non-performance Risk on Market Risk Benefits		Pension and Postretirement Unrecognized Net Periodic Benefit (Cost)		Total Accumulated Other Comprehensive Income (Loss)
	(in millions)
Balance, December 31, 2024	$	(3,615)	$	(18,687)	$	17,306	$	532	$	(2,247)	$	(6,711)
Change in OCI before reclassifications	806		(2,132)		3,983		172		(5)		2,824
Amounts reclassified from AOCI	(20)		511		0		0		13		504
Income tax benefit (expense)	80		604		(1,187)		(36)		1		(538)
Balance, June 30, 2025	$	(2,749)	$	(19,704)	$	20,102	$	668	$	(2,238)	$	(3,921)


	Accumulated Other Comprehensive Income (Loss) Attributable to Prudential Financial, Inc.
	Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses)(1)		Interest rate remeasurement of Liability for Future Policy Benefits		Gains (Losses) from Changes in Non-performance Risk on Market Risk Benefits		Pension and Postretirement Unrecognized Net Periodic Benefit (Cost)		Total Accumulated Other Comprehensive Income (Loss)
	(in millions)
Balance, December 31, 2023	$	(2,686)	$	(11,213)	$	8,547	$	900	$	(2,052)	$	(6,504)
Change in OCI before reclassifications	(827)		(10,584)		10,351		(196)		11		(1,245)
Amounts reclassified from AOCI	(20)		467		0		0		14		461
Income tax benefit (expense)	(81)		2,526		(2,606)		42		(37)		(156)
Balance, June 30, 2024	$	(3,614)	$	(18,804)	$	16,292	$	746	$	(2,064)	$	(7,444)

(1)Includes cash flow hedges of $(597) million and $1,780 million as of June 30, 2025 and December 31, 2024, respectively, and $1,499 million and $869 million as of June 30, 2024 and December 31, 2023, respectively, and fair value hedges of $(168) million and $(64) million as of June 30, 2025 and December 31, 2024, respectively, and $(70) million and $(60) million as of June 30, 2024 and December 31, 2023, respectively.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Reclassifications out of Accumulated Other Comprehensive Income (Loss)


	Three Months Ended June 30,				Six Months Ended June 30,				Affected line item in Unaudited Interim Consolidated Statements of Operations
	2025		2024		2025		2024
	(in millions)
Amounts reclassified from AOCI(1)(2):
Foreign currency translation adjustment:
Foreign currency translation adjustments	$	8	$	7	$	20	$	20	Realized investment gains (losses), net


Net unrealized investment gains (losses):
Cash flow hedges—Interest rate	(4)		(17)		(7)		(20)		(3)
Cash flow hedges—Currency	(4)		2		(3)		4		(3)
Cash flow hedges—Currency/Interest rate	(265)		114		(294)		271		(3)
Fair value hedges—Currency	(3)		(3)		(7)		(5)		(3)
Net unrealized investment gains (losses) on available-for-sale securities	(137)		(735)		(200)		(717)		Realized investment gains (losses), net
Total net unrealized investment gains (losses)	(413)		(639)		(511)		(467)		(4)
Amortization of defined benefit items:
Prior service cost	17		18		34		35		(5)
Actuarial gain (loss)	(23)		(25)		(47)		(49)		(5)
Total amortization of defined benefit items	(6)		(7)		(13)		(14)
Total reclassifications for the period	$	(411)	$	(639)	$	(504)	$	(461)

(1)All amounts are shown before tax.

(2)Positive amounts indicate gains/benefits reclassified out of AOCI. Negative amounts indicate losses/costs reclassified out of AOCI.

(3)See Note 5 for additional information regarding cash flow and fair value hedges.

(4)See table below for additional information regarding unrealized investment gains (losses), including the impact on deferred policy acquisition and other costs, future policy benefits and policyholders’ dividends.

(5)See Note 16 for additional information regarding employee benefit plans.

Net Unrealized Investment Gains (Losses)

Net unrealized investment gains (losses) on available-for-sale fixed maturity securities and certain other invested assets and other assets are included in the Company’s Unaudited Interim Consolidated Statements of Financial Position as a component of AOCI. Changes in these amounts include reclassification adjustments to exclude from “Other comprehensive income (loss)” those items that are included as part of “Net income (loss)” for a period that had been part of “Other comprehensive income (loss)” in earlier periods. The amounts for the periods indicated below, split between amounts related to available-for-sale fixed maturity securities on which an allowance for credit losses has been recorded, and all other net unrealized investment gains (losses), are as follows:

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Net Unrealized Investment Gains (Losses) on Available-for-Sale Fixed Maturity Securities on Which an Allowance for Credit Losses has been Recorded		Net Unrealized Gains (Losses) on All Other Investments(1)		Reinsurance Recoverables		Future Policy Benefits, Policyholders’ Account Balances and Reinsurance Payables		Policyholders’ Dividends		Income Tax Benefit (Expense)		Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses)
	(in millions)
Balance, December 31, 2024	$	6	$	(27,287)	$	(269)	$	981	$	2,096	$	5,786	$	(18,687)
Net investment gains (losses) on investments arising during the period	4		(1,390)								708		(678)
Reclassification adjustment for (gains) losses included in net income	(7)		518								(261)		250

Impact of net unrealized investment (gains) losses					81		(245)		(582)		157		(589)
Balance, June 30, 2025	$	3	$	(28,159)	$	(188)	$	736	$	1,514	$	6,390	$	(19,704)

(1)Includes cash flow and fair value hedges. See Note 5 for additional information.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

18. EARNINGS PER SHARE

A reconciliation of the numerators and denominators of the basic and diluted per share computations of Common Stock based on the consolidated earnings of Prudential Financial for the periods indicated is as follows:


	Three Months Ended June 30,
	2025					2024
	Income		Weighted Average Shares	Per Share Amount		Income		Weighted Average Shares	Per Share Amount
	(in millions, except per share amounts)
Basic earnings per share
Net income (loss)	$	566				$	1,171
Less: Income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests	33					(27)
Less: Dividends and undistributed earnings allocated to participating unvested share-based payment awards	6					14
Net income (loss) attributable to Prudential Financial available to holders of Common Stock	$	527	353.1	$	1.49	$	1,184	358.8	$	3.30
Effect of dilutive securities and compensation programs
Add: Dividends and undistributed earnings allocated to participating unvested share-based payment awards—Basic	$	6				$	14
Less: Dividends and undistributed earnings allocated to participating unvested share-based payment awards—Diluted	6					14
Stock options			0.1					0.2
Deferred and long-term compensation programs			1.7					1.5
Diluted earnings per share
Net income (loss) attributable to Prudential Financial available to holders of Common Stock	$	527	354.9	$	1.48	$	1,184	360.5	$	3.28


	Six Months Ended June 30,
	2025					2024
	Income		Weighted Average Shares	Per Share Amount		Income		Weighted Average Shares	Per Share Amount
	(in millions, except per share amounts)
Basic earnings per share
Net income (loss)	$	1,308				$	2,322
Less: Income (loss) attributable to noncontrolling interests and redeemable noncontrolling interests	68					(14)
Less: Dividends and undistributed earnings allocated to participating unvested share-based payment awards	16					29
Net income (loss) attributable to Prudential Financial available to holders of Common Stock	$	1,224	353.7	$	3.46	$	2,307	358.9	$	6.43
Effect of dilutive securities and compensation programs
Add: Dividends and undistributed earnings allocated to participating unvested share-based payment awards—Basic	$	16				$	29
Less: Dividends and undistributed earnings allocated to participating unvested share-based payment awards—Diluted	16					29
Stock options			0.1					0.3
Deferred and long-term compensation programs			1.7					1.3
Diluted earnings per share
Net income (loss) attributable to Prudential Financial available to holders of Common Stock	$	1,224	355.5	$	3.44	$	2,307	360.5	$	6.40

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Unvested share-based payment awards that contain nonforfeitable rights to dividends are participating securities and included in the computation of earnings per share pursuant to the two-class method. Under this method, earnings attributable to Prudential Financial are allocated between Common Stock and the participating awards, as if the awards were a second class of stock. During periods of net income available to holders of Common Stock, the calculation of earnings per share excludes the income attributable to participating securities in the numerator and the dilutive impact of these securities from the denominator. In the event of a net loss available to holders of Common Stock, undistributed earnings are not allocated to participating securities and the denominator excludes the dilutive impact of these securities as they do not share in the losses of the Company. Undistributed earnings allocated to participating unvested share-based payment awards for the three months ended June 30, 2025 and 2024, as applicable, were based on 3.9 million and 4.0 million of such awards, respectively, and for the six months ended June 30, 2025 and 2024, as applicable, were based on 3.9 million and 4.1 million of such awards, respectively, weighted for the period they were outstanding.

Stock options and shares related to deferred and long-term compensation programs that are considered antidilutive are excluded from the computation of diluted earnings per share. Stock options are considered antidilutive based on application of the treasury stock method or in the event of a net loss available to holders of Common Stock. Shares related to deferred and long-term compensation programs are considered antidilutive in the event of a net loss available to holders of Common Stock. For the periods indicated, the number of stock options and shares related to deferred and long-term compensation programs that were considered antidilutive and were excluded from the computation of diluted earnings per share, weighted for the portion of the period they were outstanding, are as follows:


	Three Months Ended June 30,
	2025			2024
	Shares	Exercise Price Per Share		Shares	Exercise Price Per Share
	(in millions, except per share amounts, based on weighted average)
Antidilutive stock options based on application of the treasury stock method	0.2	$	108.68	0.0	N/A
Antidilutive stock options due to net loss available to holders of Common Stock	0.0			0.0
Antidilutive shares based on application of the treasury stock method	0.0			0.0
Antidilutive shares due to net loss available to holders of Common Stock	0.0			0.0
Total antidilutive stock options and shares	0.2			0.0


	Six Months Ended June 30,
	2025			2024
	Shares	Exercise Price Per Share		Shares	Exercise Price Per Share
	(in millions, except per share amounts, based on weighted average)
Antidilutive stock options based on application of the treasury stock method	0.1	$	108.68	0.1	$	110.42
Antidilutive stock options due to net loss available to holders of Common Stock	0.0			0.0
Antidilutive shares based on application of the treasury stock method	0.0			0.0
Antidilutive shares due to net loss available to holders of Common Stock	0.0			0.0
Total antidilutive stock options and shares	0.1			0.1

19. SEGMENT INFORMATION

Segments

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

exited, including businesses that have been placed in wind-down status that do not qualify for “discontinued operations” accounting treatment under U.S. GAAP. The Company’s Corporate and Other operations include corporate items and initiatives that are not allocated to business segments, as well as the Divested and Run-off Businesses described above. For additional information regarding these segments, see Note 23 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Effective in the first quarter of 2025, consistent with changes to the Company’s internal management structure, the Company’s International Businesses are reflected as a single operating and reportable segment, which is consistent with how the CODM now assesses its performance and allocates resources. Prior to the first quarter of 2025, International Businesses consisted of the Life Planner and Gibraltar Life and Other operating segments, each of which was a reportable segment under U.S. GAAP. The change has been applied retrospectively and did not have any impact on the Company’s Unaudited Interim Consolidated Financial Statements contained herein or to any previously issued financial statements.

Segment Accounting Policies. The accounting policies of the segments are the same as those described in Note 2 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. Results for each segment include earnings on attributed equity established at a level which management considers necessary to support each segment’s risks. Operating expenses specifically identifiable to a particular segment are allocated to that segment as incurred.

Following an annual review of its internal expense allocations, the Company implemented an allocation update that will impact segment results; however, there will be no impact to the Company’s consolidated results. Effective in the first quarter of 2025, operating expenses not identifiable to a specific segment that are incurred in connection with the generation of segment revenues are generally allocated using a proportional allocation measure such as headcount, segment-level support or other financial measures. Prior to the first quarter of 2025, these expenses were generally allocated based upon the segment’s historical percentage of general and administrative expenses.

Adjusted Operating Income

The Company analyzes the operating performance of each segment using “adjusted operating income.” Adjusted operating income does not equate to “Income (loss) before income taxes and equity in earnings of joint ventures and other operating entities” or “Net income (loss)” as determined in accordance with U.S. GAAP but is the measure of segment profit or loss used by the chief executive officer, who is the Company’s CODM, and is the measure of segment performance presented below. The CODM uses adjusted operating income to (1) evaluate segment performance; (2) allocate resources and capital, predominantly during the annual budgeting and planning processes; and (3) consider variances to pre-established targets during the compensation process. Adjusted operating income is not a substitute for income determined in accordance with U.S. GAAP, and the Company’s definition of adjusted operating income may differ from that used by other companies. The Company, however, believes that the presentation of adjusted operating income as measured for management purposes enhances the understanding of results of operations by highlighting the results from ongoing operations and the underlying profitability factors of its businesses.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Adjusted operating income is calculated by adjusting each segment’s “Income (loss) before income taxes and equity in earnings of joint ventures and other operating entities” for the following items which are important to an understanding of overall results of operations, and are described in greater detail below:

Realized investment gains (losses), net, and related charges and adjustments;
Change in value of market risk benefits, net of related hedging gains (losses);
Market experience updates;
Divested and Run-off Businesses;
Equity in earnings of joint ventures and other operating entities and earnings attributable to noncontrolling interests; and
Other adjustments.

For additional information regarding these reconciling items, see Note 23 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Reconciliation of select financial information

The tables below present certain financial information that is regularly provided to the CODM for the Company’s segments, including revenues and significant benefits and expenses, on an adjusted operating income basis, as well as assets by segment, and the reconciliation of the segment totals to amounts reported in the Unaudited Interim Consolidated Financial Statements. Prior periods have been updated to reflect the adoption of ASU 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2025
			Retirement Strategies
Select revenues and significant benefits and expenses, on an adjusted operating income basis, by segment	PGIM		Institutional Retirement Strategies		Individual Retirement Strategies (1)		Group Insurance		Individual Life(1)		International Businesses		Corporate and Other(3)		Total Adjusted Operating Income		Total Reconciling Items		Total GAAP Revenues and Pre-tax Income
(in millions)
Revenues:
Premiums	$	0	$	2,126	$	17	$	1,349	$	232	$	2,709	$	(7)	$	6,426	$	556	$	6,982
Policy charges and fee income	0		5		273		184		531		92		(15)		1,070		179		1,249
Net investment income	59		1,248		682		133		697		1,451		330		4,600		626		5,226
Asset management fees, commissions and other income	984		128		349		21		33		147		(252)		1,410		(1,141)		269
Total revenues	1,043		3,507		1,321		1,687		1,493		4,399		56		13,506		220		13,726
Benefits and expenses:
Policyholders' benefits	0		2,707		127		1,230		677		2,445		(1)		7,185
Interest credited to policyholders' account balances	0		188		355		32		179		369		12		1,135
Interest expense	24		15		12		5		254		1		215		526
Deferral of acquisition costs	0		(34)		(173)		(4)		(220)		(297)		39		(689)
Amortization of DAC	0		4		118		4		107		174		(15)		392
Operating expenses(4)	477		68		160		186		169		467		107		1,634
Variable expenses(4)	313		39		395		109		267		446		(21)		1,548
Other benefits and expenses(5)	0		124		1		0		(48)		33		0		110
Total benefits and expenses	814		3,111		995		1,562		1,385		3,638		336		11,841
Total pre-tax income	$	229	$	396	$	326	$	125	$	108	$	761	$	(280)	$	1,665	$	(925)	$	740

Reconciling items:
Realized investment gains (losses), net, and related charges and adjustments															(516)
Change in value of market risk benefits, net of related hedging gains (losses)															(426)
Market experience updates															42
Divested and Run-off Businesses:
Closed Block division															(18)
Other Divested and Run-off Businesses															12
Equity in earnings of joint ventures and other operating entities and earnings attributable to noncontrolling interests															(18)
Other adjustments															(1)
Total reconciling items															(925)
Total GAAP pre-tax income															$	740

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Three Months Ended June 30, 2024
			Retirement Strategies
Select revenues and significant benefits and expenses, on an adjusted operating income basis, by segment	PGIM		Institutional Retirement Strategies		Individual Retirement Strategies (1)(2)		Group Insurance		Individual Life(1)		International Businesses		Corporate and Other(3)		Total Adjusted Operating Income		Total Reconciling Items		Total GAAP Revenues and Pre-tax Income
(in millions)
Revenues:
Premiums	$	0	$	2,758	$	11	$	1,272	$	241	$	3,002	$	(7)	$	7,277	$	543	$	7,820
Policy charges and fee income	0		8		312		165		510		80		(14)		1,061		24		1,085
Net investment income	14		1,142		496		128		762		1,390		286		4,218		631		4,849
Asset management fees, commissions and other income	949		133		435		21		16		40		(301)		1,293		(164)		1,129
Total revenues	963		4,041		1,254		1,586		1,529		4,512		(36)		13,849		1,034		14,883
Benefits and expenses:
Policyholders' benefits	0		3,718		39		1,140		787		2,446		(7)		8,123
Interest credited to policyholders' account balances	0		153		245		36		209		288		21		952
Interest expense	26		9		19		4		250		(2)		174		480
Deferral of acquisition costs	0		(15)		(164)		(4)		(219)		(268)		56		(614)
Amortization of DAC	0		2		98		2		110		161		(10)		363
Operating expenses(4)	445		60		142		185		118		428		133		1,511
Variable expenses(4)	286		20		448		102		266		399		(32)		1,489
Other benefits and expenses(5)	0		(456)		(12)		0		95		358		0		(15)
Total benefits and expenses	757		3,491		815		1,465		1,616		3,810		335		12,289
Total pre-tax income	$	206	$	550	$	439	$	121	$	(87)	$	702	$	(371)	$	1,560	$	(145)	$	1,415

Reconciling items:
Realized investment gains (losses), net, and related charges and adjustments															175
Change in value of market risk benefits, net of related hedging gains (losses)															(297)
Market experience updates															47
Divested and Run-off Businesses:
Closed Block division															(60)
Other Divested and Run-off Businesses															38
Equity in earnings of joint ventures and other operating entities and earnings attributable to noncontrolling interests															(43)
Other adjustments															(5)
Total reconciling items															(145)
Total GAAP pre-tax income															$	1,415

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2025
			Retirement Strategies
Select revenues and significant benefits and expenses, on an adjusted operating income basis, by segment	PGIM		Institutional Retirement Strategies		Individual Retirement Strategies (1)		Group Insurance		Individual Life(1)		International Businesses		Corporate and Other(3)		Total Adjusted Operating Income		Total Reconciling Items		Total GAAP Revenues and Pre-tax Income
(in millions)
Revenues:
Premiums	$	0	$	3,871	$	37	$	2,745	$	469	$	5,766	$	(16)	$	12,872	$	1,110	$	13,982
Policy charges and fee income	0		12		563		381		1,072		180		(30)		2,178		228		2,406
Net investment income	79		2,491		1,311		267		1,391		2,920		660		9,119		1,237		10,356
Asset management fees, commissions and other income	1,949		238		748		42		76		271		(575)		2,749		(2,297)		452
Total revenues	2,028		6,612		2,659		3,435		3,008		9,137		39		26,918		278		27,196
Benefits and expenses:
Policyholders' benefits	0		5,144		157		2,526		1,468		5,226		(9)		14,512
Interest credited to policyholders' account balances	0		370		680		67		361		716		24		2,218
Interest expense	45		32		25		10		514		0		422		1,048
Deferral of acquisition costs	0		(61)		(355)		(4)		(422)		(603)		72		(1,373)
Amortization of DAC	0		10		227		6		217		339		(31)		768
Operating expenses(4)	981		139		304		380		289		903		262		3,258
Variable expenses(4)	617		71		824		236		538		909		(6)		3,189
Other benefits and expenses(5)	0		99		7		0		(31)		38		0		113
Total benefits and expenses	1,643		5,804		1,869		3,221		2,934		7,528		734		23,733
Total pre-tax income	$	385	$	808	$	790	$	214	$	74	$	1,609	$	(695)	$	3,185	$	(1,525)	$	1,660

Reconciling items:
Realized investment gains (losses), net, and related charges and adjustments															(762)
Change in value of market risk benefits, net of related hedging gains (losses)															(777)
Market experience updates															81
Divested and Run-off Businesses:
Closed Block division															(40)
Other Divested and Run-off Businesses															(39)
Equity in earnings of joint ventures and other operating entities and earnings attributable to noncontrolling interests															(15)
Other adjustments															27
Total reconciling items															(1,525)
Total GAAP pre-tax income															$	1,660

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)


	Six Months Ended June 30, 2024
			Retirement Strategies
Select revenues and significant benefits and expenses, on an adjusted operating income basis, by segment	PGIM		Institutional Retirement Strategies		Individual Retirement Strategies (1)(2)		Group Insurance		Individual Life(1)		International Businesses		Corporate and Other(3)		Total Adjusted Operating Income		Total Reconciling Items		Total GAAP Revenues and Pre-tax Income
(in millions)
Revenues:
Premiums	$	0	$	13,055	$	39	$	2,570	$	487	$	6,141	$	(9)	$	22,283	$	1,074	$	23,357
Policy charges and fee income	0		14		618		340		1,013		160		(28)		2,117		24		2,141
Net investment income	(29)		2,234		940		264		1,568		2,802		559		8,338		1,275		9,613
Asset management fees, commissions and other income	1,982		276		878		46		41		122		(528)		2,817		464		3,281
Total revenues	1,953		15,579		2,475		3,220		3,109		9,225		(6)		35,555		2,837		38,392
Benefits and expenses:
Policyholders' benefits	0		14,576		79		2,389		1,637		5,213		(12)		23,882
Interest credited to policyholders' account balances	0		307		446		76		415		567		43		1,854
Interest expense	50		26		33		6		550		(3)		347		1,009
Deferral of acquisition costs	(1)		(34)		(314)		(10)		(414)		(561)		73		(1,261)
Amortization of DAC	1		4		191		3		226		320		(20)		725
Operating expenses(4)	939		123		287		371		301		884		438		3,343
Variable expenses(4)	589		45		872		219		517		820		(69)		2,993
Other benefits and expenses(5)	0		(459)		2		0		85		387		0		15
Total benefits and expenses	1,578		14,588		1,596		3,054		3,317		7,627		800		32,560
Total pre-tax income	$	375	$	991	$	879	$	166	$	(208)	$	1,598	$	(806)	$	2,995	$	(190)	$	2,805

Reconciling items:
Realized investment gains (losses), net, and related charges and adjustments															112
Change in value of market risk benefits, net of related hedging gains (losses)															(174)
Market experience updates															15
Divested and Run-off Businesses:
Closed Block division															(63)
Other Divested and Run-off Businesses															3
Equity in earnings of joint ventures and other operating entities and earnings attributable to noncontrolling interests															(70)
Other adjustments															(13)
Total reconciling items															(190)
Total GAAP pre-tax income															$	2,805

(1)The Individual Retirement Strategies and Individual Life segments’ results reflect DAC as if the business is a stand-alone operation. The elimination of intersegment costs capitalized in accordance with this policy is included in consolidating adjustments within Corporate and Other operations.

(2)The amounts for the three and six months ended June 30, 2024 reflect the correction of an error related to indexed variable and fixed annuity products within the Individual Retirement Strategies segment. See “—Adjusted Operating Income” above for additional information. Prior period amounts have been updated to conform to current period presentation.

(3)Corporate and Other operations, through Prudential Advisors, generates fee revenues from the sale and distribution of certain insurance, annuity and investment products offered by Prudential and third parties.

(4)“Operating expenses” includes amounts related to salaries, employee benefits, occupancy, technology, consulting, external and contracted services, legal, corporate charges, costs for initiatives, and other miscellaneous expenses. “Variable expenses” includes commissions, certain compensation related to levels of investment performance, premium taxes and other fees related to sales of certain insurance and investment products.

(5)“Other benefits and expenses” primarily includes: (i) the change in estimates of liability for future policy benefits, which can be either positive or negative, for Retirement Strategies, Individual Life and International Businesses; (ii) dividends to policyholders for Individual Life and International Businesses, which are included in adjusted operating income; and (iii) dividends to policyholders in the Closed Block Division, which are not included in adjusted operating income.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)



	June 30, 2025		December 31, 2024
	(in millions)
Assets by segment:
PGIM	$	37,454	$	36,044
U.S. Businesses:
Institutional Retirement Strategies	130,095		126,842
Individual Retirement Strategies	153,867		150,151
Retirement Strategies	283,962		276,993
Group Insurance	40,408		39,340
Individual Life	125,793		122,590
Total U.S. Businesses	450,163		438,923
International Businesses	191,258		180,038
Corporate and Other	31,619		31,767
Closed Block division	48,458		48,815
Total assets per Unaudited Interim Consolidated Financial Statements	$	758,952	$	735,587

Intersegment revenues

Management has determined the intersegment revenues with reference to market rates. Intersegment revenues are eliminated within consolidation in Corporate and Other operations. The PGIM segment revenues include intersegment revenues, primarily consisting of asset-based management and administration fees, as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
PGIM segment intersegment revenues	$	222	$	204	$	446	$	411

Segments may also enter into internal derivative contracts with other segments. For adjusted operating income, each segment accounts for the internal derivative results consistent with the manner in which that segment accounts for other similar external derivatives.

Asset management and service fees

The table below presents asset management and service fees, predominantly related to investment management activities, for the periods indicated:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Asset-based management fees	$	841	$	853	$	1,695	$	1,685
Performance-based incentive fees	25		19		32		61
Other fees	116		129		239		254
Total asset management and service fees	$	982	$	1,001	$	1,966	$	2,000

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

20. RELATED PARTY TRANSACTIONS

In September 2023, the Company invested approximately $200 million, and acquired a 20% equity interest as a limited partner, in Prismic, a Bermuda-exempted limited partnership that owns all of the outstanding capital stock of Prismic Re, a licensed Bermuda-based life and annuity reinsurance company. Also in September 2023, the Company entered into an agreement with Prismic Re to reinsure approximately $9 billion of reserves for certain structured settlement annuity contracts issued by PICA, a wholly-owned subsidiary of the Company. These contracts represent approximately 70% of the Company’s in-force structured settlement annuities business. Separately, the Company, through PGIM, entered into an investment management agreement with Prismic to manage a large portion of Prismic Re's assets.

In March 2025, the Company entered into an agreement with Prismic Re International, a wholly-owned subsidiary of Prismic, to reinsure approximately $7 billion of reserves for certain USD-denominated Japanese whole life policies originated by the Company’s Japanese affiliates. In connection with this transaction, the Company invested an additional $103 million in Prismic to maintain its 20% equity interest in Prismic. PGIM also provides investment management services on a large portion of Prismic Re International’s assets.

As the investment in Prismic is accounted for under the equity method, Prismic, Prismic Re and Prismic Re International are considered related parties. The following tables summarize the impacts to the Company’s financial statements related to the agreements that the Company entered with Prismic, Prismic Re and Prismic Re International.

The related party balances with Prismic, Prismic Re and Prismic Re International impacted the Company’s balance sheet as of the periods indicated as follows:


	June 30, 2025		December 31, 2024
	(in millions)
Reinsurance recoverables and deposit receivables	$	15,315	$	9,084
Other assets	$	163	$	187
Reinsurance and funds withheld payables (includes $45 and $(91) of embedded derivatives at fair value at June 30, 2025 and December 31, 2024, respectively)	$	7,776	$	7,796
Accumulated other comprehensive income (loss)	$	(172)	$	(139)

The Company has agreed to guarantee Prismic Re's reimbursement obligations on letters of credit that may be obtained by Prismic Re from third-party financial institutions to support Prismic Re’s obligations under the reinsurance agreement with the Company for a total amount up to $2.0 billion as of both June 30, 2025 and December 31, 2024. As part of the transaction with Prismic Re International, the Company provided an $80 million, 10-year contingent debt facility, where the Company may be required to purchase subordinated debt from certain subsidiaries of Prismic in the event their capital ratio falls below a predetermined level. See Note 21 for additional information on the Company’s guarantees and commitments.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The related party activity with Prismic, Prismic Re and Prismic Re International impacted the Company’s results of operations and cash flows for the periods indicated as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
	(in millions)
Premiums	$	(13)	$	19	$	(16)	$	15
Asset management and service fees	15		9		28		18
Other income (loss)	99		35		160		74
Realized investment gains(losses), net	(33)		114		(270)		318
Policyholders’ benefits	(70)		(70)		(141)		(141)
Change in estimates of liability for future policy benefits	(14)		20		(17)		16
Amortization of deferred policy acquisition costs	(3)		0		(4)		0
General and administrative expenses	14		8		17		19
Income (loss) from related parties, before income taxes	141		219		47		531
Other comprehensive income (loss), before tax	(24)		(224)		(33)		(92)
Total comprehensive income (loss), before tax	$	117	$	(5)	$	14	$	439


	Six Months Ended June 30,
	2025		2024
	(in millions)
CASH FLOWS FROM OPERATING ACTIVITIES
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Realized investment (gains) losses, net	$	270	$	(318)
Change in:
Deferred policy acquisition costs	$	(4)	$	0
Reinsurance related-balances	$	(404)	$	(369)
Other, net	$	21	$	5
CASH FLOWS FROM INVESTING ACTIVITIES
Other, net	$	(64)	$	0
CASH FLOWS FROM FINANCING ACTIVITIES
Other, net	$	167	$	180

21. COMMITMENTS AND CONTINGENT LIABILITIES

Commitments and Guarantees

Commercial Mortgage Loan Commitments


	June 30, 2025		December 31, 2024
	(in millions)
Total outstanding mortgage loan commitments	$	3,164	$	2,552
Portion of commitment where prearrangement to sell to investor exists	$	779	$	578

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The Company originates commercial mortgage loans as part of its commercial mortgage operations. Commitments for loans that will be held for sale are recognized as derivatives and recorded at fair value. In certain of these transactions, the Company prearranges that it will sell the loan to an investor, including to government sponsored entities as discussed below, after the Company funds the loan. The above amount includes unfunded commitments that are not unconditionally cancellable. For related credit exposure, there was an allowance for credit losses of $4 million and $2 million as of June 30, 2025 and December 31, 2024, respectively. The change in allowance was $2 million for both the three and six months ended June 30, 2025 and $0 million for both the three and six months ended June 30, 2024.

Commitments to Purchase Investments (excluding Commercial Mortgage Loans)


	June 30, 2025		December 31, 2024
	(in millions)
Expected to be funded from the general account and other operations outside the separate accounts	$	12,033	$	11,664
Expected to be funded from separate accounts	$	257	$	0

The Company has other commitments to purchase or fund investments, some of which are contingent upon events or circumstances not under the Company’s control, including those at the discretion of the Company’s counterparties. The Company anticipates a portion of these commitments will ultimately be funded from its separate accounts. The above amount includes unfunded commitments that are not unconditionally cancellable. There were no related charges for credit losses for either the three or six months ended June 30, 2025 or 2024.

Indemnification of Securities Lending and Securities Repurchase Transactions


	June 30, 2025		December 31, 2024
	(in millions)
Indemnification provided to certain clients for securities lending and securities repurchase transactions(1)	$	5,054	$	5,015
Fair value of related collateral associated with above indemnifications(1)	$	5,167	$	5,119
Accrued liability associated with guarantee	$	0	$	0

(1)Includes $0 million and $240 million related to securities repurchase transactions as of June 30, 2025 and December 31, 2024, respectively.

In the normal course of business, the Company may facilitate securities lending or securities repurchase transactions on behalf of certain client accounts (collectively, “the accounts”). In certain of these arrangements, the Company has provided an indemnification to the accounts to hold them harmless against losses caused by counterparty (i.e., borrower) defaults associated with such transactions facilitated by the Company. In securities lending transactions, collateral is provided by the counterparty to the accounts at the inception of the transaction in an amount at least equal to 102% of the fair value of the loaned securities and the collateral is maintained daily to equal at least 102% of the fair value of the loaned securities. In securities repurchase transactions, collateral is provided by the counterparty to the accounts at the inception of the transaction in an amount at least equal to 95% of the fair value of the securities subject to repurchase and the collateral is maintained daily to equal at least 95% of the fair value of the securities subject to repurchase. The Company is only at risk if the counterparty to the transaction defaults and the value of the collateral held is less than the value of the securities loaned to, or subject to repurchase from, such counterparty. The Company believes the possibility of any payments under these indemnities is remote.

Credit Derivatives Written

As discussed further in Note 5, the Company writes credit derivatives under which the Company is obligated to pay the counterparty the referenced amount of the contract and receive in return the defaulted security or similar security.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

Guarantees of Asset Values


	June 30, 2025		December 31, 2024
	(in millions)
Guaranteed value of third-parties’ assets	$	77,495	$	76,416
Fair value of collateral supporting these assets	$	73,402	$	71,423
Asset (liability) associated with guarantee, carried at fair value	$	(16)	$	(1)

Certain contracts underwritten by the Retirement Strategies segment include guarantees related to financial assets owned by the guaranteed party. These contracts are accounted for as derivatives and carried at fair value. The collateral supporting these guarantees is not reflected on the Unaudited Interim Consolidated Statements of Financial Position.

Indemnification of Serviced Mortgage Loans


	June 30, 2025		December 31, 2024
	(in millions)
Maximum exposure under indemnification agreements for mortgage loans serviced by the Company	$	3,359	$	3,272
First-loss exposure portion of above	$	966	$	942
Accrued liability associated with guarantees(1)	$	23	$	25

(1)The accrued liability associated with guarantees includes an allowance for credit losses of $11 million and $12 million as of June 30, 2025 and December 31, 2024, respectively. The change in allowance was a reduction of $0 million and $1 million for the three months ended June 30, 2025 and 2024, respectively, and a reduction of $1 million and $1 million for the six months ended June 30, 2025 and 2024, respectively.

As part of the commercial mortgage activities of the Company’s PGIM segment, the Company provides commercial mortgage origination, underwriting and servicing for certain government sponsored entities, such as Fannie Mae and Freddie Mac. The Company has agreed to indemnify the government sponsored entities for a portion of the credit risk associated with certain of the mortgages it services through a delegated authority arrangement. Under these arrangements, the Company originates multi-family mortgages for sale to the government sponsored entities based on underwriting standards they specify, and makes payments to them for a specified percentage share of losses they incur on certain loans serviced by the Company. The Company’s percentage share of losses incurred generally varies from 4% to 20% of the loan balance, and is typically based on a first-loss exposure for a stated percentage of the loan balance, plus a shared exposure with the government sponsored entity for any losses in excess of the stated first-loss percentage, subject to a contractually specified maximum percentage. The Company determines the liability related to this exposure using historical loss experience, and the size and remaining life of the asset. The Company serviced $26,327 million and $25,763 million of mortgages subject to these loss-sharing arrangements as of June 30, 2025 and December 31, 2024, respectively, all of which are collateralized by first priority liens on the underlying multi-family residential properties. As of June 30, 2025, these mortgages had a weighted-average debt service coverage ratio of 1.99 times and a weighted-average loan-to-value ratio of 62%. As of December 31, 2024, these mortgages had a weighted-average debt service coverage ratio of 1.95 times and a weighted-average loan-to-value ratio of 62%. The Company had no losses related to indemnifications that were settled for either the six months ended June 30, 2025 or 2024.

Other Guarantees


	June 30, 2025		December 31, 2024
	(in millions)
Other guarantees where amount can be determined	$	288	$	289
Accrued liability for other guarantees and indemnifications	$	31	$	32

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The Company is also subject to other financial guarantees and indemnity arrangements. The Company has provided indemnities and guarantees related to acquisitions, dispositions, investments and other transactions that are triggered by, among other things, breaches of representations, warranties or covenants provided by the Company. These obligations are typically subject to various time limitations, defined by the contract or by operation of law, such as statutes of limitation. In some cases, the maximum potential obligation is subject to contractual limitations, while in other cases such limitations are not specified or applicable. This includes guarantees issued on $1.5 billion of standby committed letters of credit and $0.5 billion of standby uncommitted letters of credit that may be obtained by Prismic Re from third-party financial institutions, for the benefit of PICA as beneficiary, to support U.S. statutory reserve credit related to a reinsurance agreement with PICA. As of June 30, 2025, no letters of credit have been issued to PICA under the facility, and the likelihood of PICA drawing upon them is remote. The guarantees are renewable on an annual basis. The current value of the guarantees is estimated to be immaterial. See Note 20 for additional information on the related party relationship between the Company and Prismic Re and Note 12 for additional information on the Company’s reinsurance transactions.

Since certain of these obligations are not subject to limitations, it is not possible to determine the maximum potential amount due under these guarantees. The accrued liability identified above relates to the sale of The Prudential Life Insurance Company of Taiwan Inc. (“POT”) and represents a financial guarantee of certain insurance obligations of POT.

Contingent Liabilities

On an ongoing basis, the Company and its regulators review its operations including, but not limited to, sales and other customer interface procedures and practices, and procedures for meeting obligations to its customers and other parties. These reviews may result in the modification or enhancement of processes or the imposition of other action plans, including concerning management oversight, sales and other customer interface procedures and practices, and the timing or computation of payments to customers and other parties. In certain cases, if appropriate, the Company may offer customers or other parties remediation and may incur charges, including the cost of such remediation, administrative costs and regulatory fines.

The Company is subject to the laws and regulations of states and other jurisdictions concerning the identification, reporting and escheatment of unclaimed or abandoned funds, and is subject to audit and examination for compliance with these requirements.

It is possible that the results of operations or the cash flow of the Company in a particular quarterly or annual period could be materially affected as a result of payments in connection with the matters discussed above or other matters depending, in part, upon the results of operations or cash flow for such period. Management believes, however, that ultimate payments in connection with these matters, after consideration of applicable reserves and rights to indemnification, should not have a material adverse effect on the Company’s financial position.

Litigation and Regulatory Matters

The Company is subject to legal and regulatory actions in the ordinary course of its businesses. Pending legal and regulatory actions include proceedings relating to aspects of the Company’s businesses and operations that are specific to it and proceedings that are typical of the businesses in which it operates, including in both cases businesses that have been either divested or placed in wind-down status. Some of these proceedings have been brought on behalf of various alleged classes of complainants. In certain of these matters, the plaintiffs are seeking large and/or indeterminate amounts, including punitive or exemplary damages. The outcome of litigation or a regulatory matter, and the amount or range of potential loss at any particular time, is often inherently uncertain.

The Company establishes accruals for litigation and regulatory matters when it is probable that a loss has been incurred and the amount of that loss can be reasonably estimated. For litigation and regulatory matters where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established but the matter, if potentially material, is disclosed, including matters discussed below. The Company estimates that as of June 30, 2025, the aggregate range of reasonably possible losses in excess of accruals established for those litigation and regulatory matters for which such an estimate currently can be made is less than $250 million. Any estimate is not an indication of expected loss, if any, or the Company’s maximum possible loss exposure on such matters. The Company reviews relevant information with respect to its litigation and regulatory matters on a quarterly and annual basis and updates its accruals, disclosures and estimates of reasonably possible loss based on such reviews.

PRUDENTIAL FINANCIAL, INC.

Notes to Unaudited Interim Consolidated Financial Statements—(Continued)

The following discussion of litigation and regulatory matters provides an update of those matters discussed in Note 25 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and should be read in conjunction with the complete descriptions provided in the Form 10-K.

Individual Annuities, Individual Life and Group Insurance

California Advocates for Nursing Home Reform v. The Prudential Insurance Company of America and Pruco Life Insurance Company, et al.

In April 2025, Plaintiff filed a First Amended Complaint removing allegations related to the Unclaimed Life Insurance and Annuities Act, and the Defendant filed a demurrer seeking to dismiss the Amended Complaint.

Securities Litigation

Donel Davidson v. Charles F. Lowrey, et al.

In March 2025, plaintiffs filed a motion seeking preliminary approval of the settlement notice and preliminary approval of the proposed settlement of the derivative litigation (“the Settlement”). In April 2025, the court issued an order granting the motion for preliminary approval of the Settlement. In June 2025, the Court granted final approval of the Settlement and issued a final judgment dismissing the action with prejudice. This matter is now closed.

Daniel Plaut v. Prudential Financial, Inc.

In July 2025, the parties entered into a Stipulation of Dismissal with Prejudice. This matter is now closed.

Shareholder Demands

This matter is now closed.

Summary

The Company’s litigation and regulatory matters are subject to many uncertainties, and given their complexity and scope, their outcome cannot be predicted. It is possible that the Company’s results of operations or cash flow in a particular quarterly or annual period could be materially affected by an ultimate unfavorable resolution of pending litigation and regulatory matters depending, in part, upon the results of operations or cash flow for such period. In light of the unpredictability of the Company’s litigation and regulatory matters, it is also possible that in certain cases an ultimate unfavorable resolution of one or more pending litigation or regulatory matters could have a material adverse effect on the Company’s financial statements. Management believes, however, that, based on information currently known to it, the ultimate outcome of all pending litigation and regulatory matters, after consideration of applicable reserves and rights to indemnification, is not likely to have a material adverse effect on the Company’s financial statements.

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