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Allstate reported third-quarter revenue of $17.35 billion, up 0.5% from a year earlier. Its filing attributed the increase to more auto and homeowners policies, higher average homeowners premiums and investment income, partly offset by investment and derivative losses. Diluted earnings per share fell to $8.03 from $13.95.
The filing said net income applicable to common shareholders decreased $1.67 billion to $2.05 billion, primarily because of higher catastrophe losses, a gain on the sale of the group health business in 2025 and investment and derivative losses. Catastrophe losses rose to $1.65 billion, driven by two large wind and hail events and more frequent smaller events.
Underwriting income decreased $800 million as higher losses and expenses outweighed increased earned premiums and prior-year reserve releases, Allstate said. Homeowners premiums written increased 7.4%, reflecting higher average premiums and policy growth. Auto policies in force increased 3.4% as of September 30, 2026, compared with a year earlier.
Allstate reported third-quarter free cash flow of $3.7 billion, compared with $3.2 billion a year earlier. Net investment income increased $228 million to $1.18 billion, which the filing attributed to higher market-based and performance-based investment results.
| Q3 FY2026 | Q3 FY2025 | Change | |
|---|---|---|---|
| Revenue | $17.3 billion | $17.3 billion | 0.54% |
| Diluted EPS | $8.03 | $13.95 | −42.4% |
| Gross margin | 49.9% | 35.9% | 14.0 percentage points |
| Operating margin | 24.5% | 11.2% | 13.3 percentage points |
| Free cash flow | $3.7 billion | $3.2 billion | 15.0% |
| Against the consensus | Reported | Consensus | Result |
|---|---|---|---|
| Revenue | $17.5 billion | $17.7 billion | Missed by 1.05% |
Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.
What management said on the call
On Allstate’s latest available call, covering the second quarter, CEO Thomas Wilson said growth required a multifaceted approach rather than simply cutting prices. He pointed to new products, wider distribution, marketing and a new customer acquisition system. Wilson said Allstate was working to grow while managing returns, rather than targeting a particular combined ratio.
Wilson said customer retention had stabilized, although trends needed to be examined by risk segment and product. He said the SAVE program had benefited retention among targeted customers. On homeowners insurance, he said Allstate was introducing rating plans and using analytics on individual roofs to price each house more accurately.
Discussing competition and distribution, Wilson said customers choose between direct, independent-agent and exclusive-agent channels based on the help they want and the cost. He said Allstate sells the same product directly and through its agents, with a 7% lower price in the direct channel because it does not include an agent.
On investment and capital, Wilson said Allstate considered organic growth, investments, acquisitions and repurchases together. He reiterated the commitment to complete $4 billion of repurchases. Asked about reserves, he said the company did not assume further releases, because it aimed to make its estimates as accurate as possible each quarter.
Wilson also described Ally, an artificial intelligence platform Allstate was building. He said it could help reduce expenses and improve pricing, claims and growth, but it had not been fully built or deployed. He told analysts: I can’t give you specific numbers how much growth is going to do or how we can do at expenses.