Principal raised its 2026 EPS growth guidance to 9%-12% and free cash flow target to 75%-85% while lifting its return on equity objective to 15%-17% from 14%-16%. The company closed 2025 with 12% adjusted EPS growth and nearly 20% on a reported basis, with free cash flow at the top end of its range.

Principal’s research shows 95% of small and midsize business clients expect stable or higher salaries and roughly 85% plan to maintain or increase headcount. SMB customers average 30 years in operation, with many clients active over a decade, highlighting resilience through cycles, recurring deposits and about 2% natural employee growth.

Within retirement, Principal’s Total Retirement Solutions spans 401(k), defined benefit, non-qualified plans and ESOPs, positioning it beyond a traditional provider. In employee benefits, the firm averages over 3.1 coverages per client, using annual repricing in dental, life and disability to manage premiums and deliver improved loss ratios.

Principal reorganized its global asset management into dedicated investment and distribution teams across 80 countries, concentrating international pension in China, Brazil, Chile and Mexico. The company has recorded six consecutive quarters of private markets inflows and is deploying AI-driven productivity tools to enhance advisor platforms and operations.