Company: APO
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0001858681-25-000049
Chunk: 26

Company: Apollo Global Management, Inc.
Filing Date: 2025-05-07
Form: 10-Q
Item: Item 2
Chunk 26
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 FIA embedded derivatives of $2.2 billion was primarily due to the performance of the equity indices to which Athene’s FIA policies are linked. The largest percentage of Athene’s FIA policies are linked to the S&P 500 Index, which decreased 4.6% in 2025, compared to an increase of 10.2% in 2024. The change in fair value of FIA embedded derivatives was also driven by the favorable impact of rates on policyholder projected benefits. These impacts were partially offset by the unfavorable change in discount rates used in Athene’s embedded derivative calculations as 2025 experienced a decrease in discount rates compared to an increase in 2024.

Market risk benefits remeasurement (gains) losses were $385 million in 2025, an increase of $539 million from $(154) million in 2024. The losses in 2025 compared to gains in 2024 were primarily driven by an unfavorable change in the fair value of market risk benefits. The change in fair value of market risk benefits was $417 million unfavorable compared to 2024 due to a decrease in the risk-free discount rate across the curve, which is used in the fair value measurement of the liability for market risk benefits, and $123 million unfavorable related to unfavorable equity market performance in 2025 compared to 2024. 

Policy and other operating expenses were $542 million in 2025, an increase of $89 million from $453 million in 2024, primarily driven by an increase in interest expense and policy acquisition expenses related to significant growth.

DAC, DSI and VOBA amortization was $267 million in 2025, an increase of $60 million from $207 million in 2024, primarily due to an increase in acquisition costs that are deferred and amortized driven by strong growth in Athene’s deferred annuity business. 

Income Tax (Provision) Benefit

The Company’s income tax provision totaled $243 million and $422 million in 2025 and 2024, respectively. The change to the provision was primarily related to the decline in pretax income and increased income passed through to non-controlling interests. The (provision) for income taxes includes federal, state, local and foreign income taxes resulting in an effective income tax rate of 20.6% and 19.3% for 2025 and 2024, respectively. The most significant reconciling items between the U.S. federal statutory income tax rate and the effective income