Fidelity National Financial, Inc. Q2 FY2025 earnings call

• Title Segment: Strong results with industry-leading margin, but impacted by higher expenses. Purchase orders affected by market volatility, refinance orders up, commercial volumes bright. Investing in the business for long-term growth.
• F&G Segment: AUM at record high, strong gross sales, core sales growth. Launched a new reinsurance vehicle with Blackstone.
• Financials: Consolidated revenue was $3.6 billion in Q2 2025. Title segment contributed $260 million, F&G segment contributed $89 million. Interest and investment income expected $90-95 million quarterly with Fed cuts, and $28 million dividend income from F&G to the Corporate segment.

Title Segment

• Adjusted pretax title earnings were $337 million in Q2 2025, a 4% increase from Q2 2024. Adjusted pretax title margin was 15.5% in Q2 2025, down 70 basis points from Q2 2024 due to higher expenses (including $12 million elevated health claims). Purchase daily orders opened were up 5% QoQ but in line YoY. Refinance orders opened were up 28% YoY. Commercial revenue was $626 million in the first 6 months of 2025, up 23% YoY. Total orders opened averaged 5,800 per day in Q2 2025, with July at 5,500 per day, up 5% YoY.

F&G Segment

• AUM before flow reinsurance was $69.2 billion at June 30, 2025, up 13% YoY. Gross sales were $4.1 billion in Q2 2025. Adjusted net earnings for F&G were $89 million in Q2 2025, down from $122 million in Q2 2024.

• Title: Anticipates rebound in transaction volumes, continues investing for long-term efficiency and profitability.
• F&G: AUM expected to grow, new reinsurance vehicle provides growth capital.
• Financials: Interest and investment income expected $90-95 million quarterly with Fed cuts, and $28 million F&G dividends per quarter.

• Title: Higher health claims (expected to normalize in 2026), strategic investments in security, technology, and recruiting impacting margins in the short term.
• Regulatory: FHFA pilot program has limited scope, with monitoring for potential impact on the title industry.

Q: Having hit the 5-year anniversary on the investment in F&G, thoughts on holding separate businesses under FNF?

A: Tony Park states the Board has been pleased with F&G's performance, F&G has contributed 32% of adjusted earnings in the first half of 2025, and they're excited about F&G's fee-based, higher-margin, less capital-intensive business model.

Q: Thoughts on personnel expenses and margin impact?

A: Mike Nolan says recruiting was a strong quarter with about a 20 basis point impact, and Tony Park mentions elevated health claims of $12 million, expected to moderate but remain elevated in 2025 before normalizing in 2026.

Q: Discussion on buybacks and dividend capacity?

A: Tony Park says there's about $250 million available from regulated entities in the second half, ~$60 million from F&G, and nonregulated dividends are variable. Buybacks are active with monitoring of the market.

Q: Thoughts on commercial fee per file?

A: Mike Nolan states commercial fee per file is consistent, with national commercial orders strong, expecting similar fee levels in the back half of 2025.

Q: Regulatory impact on the title industry?

A: Mike Nolan says the FHFA pilot is limited scope, engaged with regulators, and waiting to see program details.