Prudential Financial, Inc.

quarterly earnings call. At this time, all lines are in a listen-only mode. Later, we will conduct the question and answer session. Instructions will be given to you at that time. If you need assistance during the call today, press star and then zero, and an operator will assist you offline. And as a reminder, today's conference call is being recorded. I would now like to turn the conference over to Mr. Darren Arita. Please go ahead.

Thank you, Cynthia. Good morning, and thank you for joining our call. Representing Prudential on today's call are Charlie Lowry, Chairman and CEO, Rob Balzin, Vice Chairman, Steve Pelletier, Head of Domestic Businesses, Scott Slyster, Head of International Businesses, Ken Tanji, Chief Financial Officer, and Rob Axel, Controller and Principal Accounting Officer. We will start with prepared comments by Charlie, Rob, and Ken, and then we will take your questions. Today's presentation may include forward-looking statements. It is possible that actual results may differ materially from the predictions we make today. In addition, this presentation may include references to non-GAAP measures. For reconciliation of such measures to the comparable GAAP measures and the discussion of factors that could cause actual results to differ materially from those in the forward-looking statements, please see the slide titled Forward-looking Statements and Non-GAAP Measures in the appendix to today's presentation. which can be found on our website at investor.prudential.com. Also, in response to your request, we are changing the timing of our earnings release date starting next quarter. We will report our third quarter results on Monday, November 4th, and host the conference call on Tuesday, November 5th at 11 a.m. With that, I will hand it over to Charlie.

Thank you, Darren. Good morning, everyone, and thank you for joining us. As we outlined in our investor day in early June, we are accelerating our strategy to bring greater financial opportunity to more customers and to enhance the value we provide to our investors. Across each of our businesses, we are energized by our purpose of making lives better by solving the financial challenges of our changing world. As expectations of our customers rapidly evolve, it's imperative that we move quickly and with urgency to achieve our purpose. Despite what we would characterize as a mixed quarter, we remain confident about the financial goals we shared with you during our investor day. At that time, we increased our return on equity goal to a range of 12% to 14% from the prior range of 12% to 13%. We also articulated how we can achieve a high single-digit earnings per share growth rate over the intermediate term with potential for a low double-digit growth rate over the longer term. The strength of our distinct business model and ability to execute our strategy gives us confidence that we will achieve our financial results. Our U.S. financial wellness businesses, PGM, and our international business offers unique scale and growth opportunities that cannot be easily replicated. In the near term, however, we expect several factors to impact our level of earnings. First, as we discussed on Investor Day, there will be implementation costs from accelerating our strategy. Second, the significant decline in long-term interest rates over the past six months obviously affects our spread income and reinvestment rates of our general account. Third, this quarter's assumption update in individual life reduced future earnings. And fourth, we expect lower earnings in Gibraltar. Now, we have ways to mitigate some of these effects. We believe the actions to accelerate our strategy will lead to $500 million of margin improvement, of which we expect to realize a run rate level of $50 million by the end of this year. In addition, we can adjust our pricing, streamline distribution, and optimize our in-force book, all of which we are seriously pursuing. As we said during our last call and on Investor Day, we're also very focused on connecting our track record of operating fundamentals with commensurate financial outcomes. Quite frankly, part of this is on us to produce better financial results, and we get it. But part of this relates to better aligning external expectations with our internal forecasts, and part of this call is focused on trying to do that. As a result, we enhanced our disclosures this quarter to help give you better visibility on our expected results, and Ken will cover this in more detail. We also continue to explore ways to reduce the variability of our quarterly earnings, which, as you know, has been and remains an ongoing effort. Turning back to the second quarter financial results, we generated a return on equity of 12.9%, which is in line with our 12% to 14% goal. We grew adjusted book value per share by 5% from a year ago to a record level of $97.15. We also maintained a rock-solid balance sheet. This provided the foundation for us to return $911 million to shareholders through share repurchases and dividends. Our quarterly dividend of $1 per share represents a 4% yield on our adjusted book value. Our holding company's highly liquid assets stood at $4.9 billion at the top end of our target range of $3 to $5 billion. Turning to slide three, our adjusted earnings per share was $3.14, up from $3.01 a year ago. Our sales and net flows varied by business and were mixed in this quarter, but we continue to see a robust pipeline of opportunities. During the quarter, PGM had net outflows driven by a large client withdrawal, which was unfortunate but frankly inevitable from time to time when you were the 10th largest asset manager in the world. Also, Gibraltar had lower sales as we focused on recurring premium product and profitability over the total sales amount, which is consistent with the way in which we run this business. On the positive side, our retirement business achieved record account levels of $478 billion and net flows of $15 billion, driven primarily by a robust pension risk transfer pipeline. And our individual annuities and individual life sales were up 29% and 27% respectively. Our individual annuities business continued to generate consistent quarterly dividends to the parent company, with more than $1.1 billion produced over the past 12 months. Finally, our life planner headcount in our international business reached an all-time high. And with that, I'll turn it over to Rob to touch on strategic highlights from the quarter. Thanks, Charlie.