PRUDENTIAL FINANCIAL INC

Results of Operations by Segment

PGIM

The following table sets forth PGIM’s operating results for the periods indicated:

(1)Certain of PGIM’s investment activities are based in currencies other than the USD and are therefore subject to foreign currency exchange rate risk. The financial results of PGIM include the impact of an intercompany arrangement with our Corporate and Other operations designed to mitigate the impact of exchange rate changes on PGIM’s USD-equivalent earnings. For additional information regarding this intercompany arrangement, see “—Results of Operations—Impact of Foreign Currency Exchange Rates,” above.

(2)Includes certain components of consideration for business acquisitions, which are recognized as compensation expense over the requisite service periods.

Three Month Comparison. Adjusted operating income increased $23 million, primarily reflecting higher asset management fees, net of related expenses, and higher other related revenues, net of related expenses. These impacts were partially offset by higher operating expenses, as well as lower service, distribution and other revenues, net of related expenses.

Six Month Comparison. Adjusted operating income increased $10 million, primarily reflecting higher asset management fees, net of related expenses. These impacts were partially offset by higher operating expenses and lower other related revenues, net of related expenses.

Revenues and Expenses

The following table sets forth PGIM’s revenues, presented on a basis consistent with the table above under “—Operating Results,” by type:

(2)Includes revenues from the Company’s general account assets, as well as certain separate account assets of the Company’s insurance and retirement businesses managed by PGIM.

(3)Includes mortgage origination revenues from our commercial mortgage origination and servicing business.

Three Month Comparison. Revenues increased $80 million. Asset management fees increased, primarily reflecting asset growth driven by the impact of equity market and fixed income appreciation, net inflows and strong investment performance. Service, distribution and other revenues increased, primarily reflecting higher revenues from certain consolidated funds (which were fully offset by higher expenses related to noncontrolling interests in these funds). Other related revenues increased, primarily reflecting higher commercial mortgage origination revenues driven by higher loan production and higher incentive fees driven by more favorable investment performance, partially offset by lower transaction fees.

Expenses increased $57 million, primarily reflecting higher operating expenses, driven by higher compensation expenses, primarily due to business growth, as well as higher variable expenses corresponding to higher revenues from certain consolidated funds, as described above.

Six Month Comparison. Revenues increased $75 million. Asset management fees increased, primarily reflecting asset growth driven by the impact of equity market and fixed income appreciation, net inflows and strong investment performance. Service, distribution and other revenues increased, primarily reflecting higher revenues from certain consolidated funds (which were fully offset by higher expenses related to noncontrolling interests in these funds). These variances were partially offset by lower other related revenues, primarily reflecting lower seed and co-investments results and lower incentive fees driven by less favorable investment performance, partially offset by higher commercial mortgage origination revenues driven by higher loan production.

Expenses increased $65 million, primarily reflecting higher operating expenses, including higher compensation expenses, primarily due to business growth, partially offset by decreases related to certain long-term employee compensation plans. Also contributing to the increase were higher variable expenses corresponding to higher fee-based earnings and higher revenues from certain consolidated funds, as described above.

Assets Under Management

The following table sets forth assets under management by asset class as of the dates indicated:

(1)“Public equity” represents stock ownership interest in a corporation or partnership (excluding hedge funds) or real estate investment trust. “Public fixed income” represents debt instruments that pay interest and usually have a maturity (excluding mortgages). “Real estate” includes direct real estate equity and real estate mortgages. “Private credit and other alternatives” includes private credit, private equity, hedge funds and other alternative strategies. “Multi-asset” includes funds or products that invest in more than one asset class, balancing equity and fixed income funds and target date funds.

(2)Primarily includes assets related to certain insurance and retirement products in our U.S. Businesses and Corporate and Other operations, and certain general account assets in our International Businesses. These assets are not directly managed by PGIM, but rather are invested in non-proprietary funds or are managed by either the divisions themselves or by our Chief Investment Officer Organization.

The following table sets forth assets under management by source as of the dates indicated:

(2)Includes the Company’s general account assets, as well as certain separate account assets of the Company’s insurance and retirement businesses managed by PGIM.

(3)Primarily includes assets related to certain insurance and retirement products in our U.S. Businesses and Corporate and Other operations, and certain general account assets in our International Businesses. These assets are not directly managed by PGIM, but rather are invested in non-proprietary funds or are managed by either the divisions themselves or by our Chief Investment Officer Organization.

The following table sets forth the component changes in PGIM’s assets under management for the periods indicated:

(2)Represents assets that PGIM manages for the benefit of other reporting segments within the Company. Additions and withdrawals of these assets are attributable to third-party product inflows and outflows in other reporting segments.

(3)Realizations reflect proceeds from the disposition or monetization of assets from closed end funds and from collateralized loan obligations. Distributions reflect income and dividend distributions related to certain closed and open ended private alternative funds and collateralized loan obligations.

(4)Includes income reinvestment, where applicable.

PGIM’s assets under management as of June 30, 2025 increased $113 billion in comparison to the prior year quarter, primarily driven by fixed income and equity market appreciation, net inflows and strong investment performance. PGIM’s assets under management as of June 30, 2025 increased $66 billion in comparison to the prior year end, primarily driven by fixed income and equity market appreciation, favorable foreign exchange rate impacts and net inflows.

Private Capital Deployment

Private capital deployment is indicative of the pace and magnitude of capital that is invested and will result in future revenues that may include management fees, transaction fees, incentive fees and servicing revenues, as well as future costs to manage these assets.

Private capital deployment represents the gross value of private capital invested in real estate debt and equity, and private credit and equity asset classes. Assets under management resulting from private capital deployment are primarily included in “Real estate” and “Private credit and other alternatives” in the “—Assets Under Management— by asset class table” above. As of June 30, 2025, these asset classes increased $10.7 billion compared to December 31, 2024, primarily reflecting private capital net inflows, market appreciation and favorable foreign exchange rate impacts, partially offset by realizations and distributions.

Private capital deployment includes PGIM’s real estate agency debt business, which consists of agency commercial mortgage loans that are originated and sold to third-party investors. PGIM continues to service these loans; however, they are not included in assets under management.

The following table sets forth PGIM’s private capital deployed by asset class for the periods indicated:

Seed and Co-Investments

As of June 30, 2025 and December 31, 2024, PGIM had approximately $1,192 million and $1,079 million of seed investments and $437 million and $415 million of co-investments at carrying value, respectively, primarily consisting of public fixed income, public equity, private credit and other alternatives, and real estate investments.