What changed in Principal Financial Group's 10-K — 2024 vs 2025

We believe that our owned and leased properties are suitable and adequate for our current business operations. 36 Table of Contents Item 3. Legal Proceedings Disclosure concerning legal proceedings can be found in Item 8.

“Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 16, Contingencies, Guarantees, Indemnifications and Leases” under the caption, “Litigation and Regulatory Contingencies” and Item 8. “Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 14, Income Taxes” under the caption, “Other Tax Information,” which are incorporated here by this reference.

Information about our Executive Officers The following information is furnished with respect to our executive officers, each of whom is elected by and serves at the pleasure of the Board. Vivek Agrawal, 57, has been Executive Vice President and Chief Growth Officer of the Company and Principal Life since March 2023.

Prior to joining the Company and Principal Life, he was a senior partner at McKinsey & Company, where he led consulting practices in both the United States and Asia and contributed to the growth of top-tier asset management, retirement, wealth management and insurance organizations.

Kamal Bhatia, 53, has been the President and Chief Executive Officer of Principal Asset Management of the Company and Principal Life since February 10, 2024 and President and Chief Executive Officer of Principal Funds since August 2019.

Prior to his current position, he was the Global Head of Investments for Principal Asset Management from 2023 to February 2024 and Chief Operating Officer of Principal Asset Management from 2020 to 2023. Previously, he held leadership roles at OC Private Capital, OppenheimerFunds, TIAA, Mellon Asset Management and Citigroup.

Thomas Cheong, 56, has been Executive Vice President of the Company since January 2021 and President, Principal Asia of the Company since March 2019. Thomas is from Singapore and is located in our Hong Kong office.

Prior to his current position, he was Senior Vice President of the Company from 2019 to 2020 and served as Vice President, Head of North Asia of the Company from 2015 to 2019. Previously, he held several leadership roles in various Asia markets at Manulife Financial Corporation and Prudential UK.

Amy Friedrich, 54, has been President of Benefits and Protection since May 2017. Prior to her current position, she was Senior Vice President of the Specialty Benefits division of U.S. Insurance Solutions from 2015 to 2017 and Vice President of Specialty Benefits from 2008 to 2015.

Daniel Houston, 63, was a director of the Company and Principal Life and Chief Executive Officer of the Company and Principal Life from August 2015 until his retirement effective January 7, 2025.

Prior to holding these positions, he held the same positions except was Chief Operating Officer (and not Chief Executive Officer) from 2014 to 2015 and was President of the Company and Principal Life from 2014 to August 2024.

Previously, he served as President, Retirement, Insurance and Financial Services of the Company and Principal Life from 2010 to 2014 and held several leadership roles in Retirement and Income Solutions of the Company and Principal Life. He currently serves as Executive Chairman of the Company and Principal Life.

Kathleen Kay, 62, has been Executive Vice President of the Company and Principal Life since March 2022 and Chief Information Officer of the Company and Principal Life since May 2020. Prior to her current position, she was Senior Vice President of the Company and Principal Life from 2020 to 2022.

Previously, she was Senior Vice President and Chief Information Officer of Pacific Gas & Electric Company from 2015 to 2020, Enterprise Chief Technology Officer at SunTrust from 2012 to 2015 and held leadership roles at Comerica Bank and OnStar of General Motors.

Natalie Lamarque, 48, has been Executive Vice President and General Counsel of the Company and Principal Life since July 2022 and Secretary of the Company and Principal Life since October 2022.

Prior to her current position, she was with New York Life Insurance Company in various roles, including General Counsel from 2020 to 2022 and Deputy General Counsel from 2019 to 2020, both while a Senior Vice President; Vice President in Corporate Compliance from 2016 to 2019; and Associate General Counsel from 2014 to 2016.

Previously, she served as an Assistant U.S. Attorney in the Criminal Division of the U.S. Attorney’s Office of the Southern District of New York and worked as an attorney at Debevoise & Plimpton LLP. Christopher Littlefield, 58, has been President, Retirement and Income Solutions since March 2022.

Prior to his current position, he was Executive Vice President and General Counsel of the Company and Principal Life from 2020 to 2022 and Secretary of the Company and Principal Life from 2020 to 2022.

Previously, he served as President and Chief Executive Officer of Fidelity & Guaranty Life Insurance Holdings from 2014 to 2018 and held several leadership roles at Aviva USA Corporation and AmerUS Group Co. 37 Table of Contents Kenneth McCullum, 60, has been Executive Vice President and Chief Risk Officer of the Company and Principal Life since April 2023.

Prior to his current position, he was Senior Vice President and Chief Risk Officer from 2020 to 2023 and Vice President and Chief Actuary from 2015 to 2020.

Previously, he served as Executive Vice President responsible for business development and in force management at Delaware Life Insurance Company from 2013 to 2015 and held several leadership roles at Sun Life Financial and the Hartford. Joel Pitz, 52, has been the Interim Chief Financial Officer of the Company and Principal Life since August 20, 2024.

Prior to his current position, he was Senior Vice President and Controller of the Company and Principal Life from 2021 to August 2024. Previously, he served as Vice President and Chief Financial Officer of Principal International from May 2016 to August 2021.

Deanna Strable-Soethout, 56, served as President and Chief Operating Officer of the Company and Principal Life from August 20, 2024 to January 7, 2025, at which time she assumed the role of President and Chief Executive Officer of the Company and Principal Life.

Prior to her current position, she was Executive Vice President and Chief Financial Officer of the Company and Principal Life from February 2017 to August 2024. Previously, she was Executive Vice President of the Company and Principal Life from 2016 to 2017, President, U.S.

Insurance Solutions of the Company and Principal Life from 2015 to 2017 and Senior Vice President of the Company and Principal Life from 2006 to 2015. PART II Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock began trading on the New York Stock Exchange under the symbol “PFG” on October 23, 2001. Prior to such date, there was no established public trading market for our common stock.

Effective December 15, 2017, we changed our listing to the Nasdaq Global Select Market and continue trading under the symbol “PFG”. On January 30, 2025, there were 201,942 stockholders of record of our common stock. We have historically paid cash dividends on our common stock.

Future dividend decisions will be based on and affected by a number of factors, including our results and financial requirements and the impact of regulatory restrictions. See Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for a discussion of regulatory restrictions on Principal Life’s ability to pay dividends or make other distributions.

The following table presents the amount of our share purchase activity for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total number Maximum dollar ​ ​ ​ ​ ​ ​ ​ of shares ​ value of shares ​ ​ ​ ​ ​ ​ ​ purchased as ​ that may yet be ​ ​ Total number ​ Average ​ part of publicly ​ purchased under ​ ​ of shares ​ price paid ​ announced ​ the programs Period ​ purchased (1) ​ per share ​ programs ​ (in millions) (2) January 1, 2024 - January 31, 2024 706,696 ​ $ 79.07 706,696 ​ $ 232.0 ​ February 1, 2024 - February 29, 2024 860,430 ​ $ 79.04 740,658 ​ $ 1,673.5 ​ March 1, 2024 - March 31, 2024 1,354,115 ​ $ 81.47 ​ 1,051,468 ​ $ 1,587.7 ​ April 1, 2024 - April 30, 2024 1,214,041 ​ $ 81.80 ​ 1,213,500 ​ $ 1,488.5 ​ May 1, 2024 - May 31, 2024 1,406,551 ​ $ 82.46 ​ 1,406,551 ​ $ 1,372.5 ​ June 1, 2024 - June 30, 2024 438,010 ​ $ 79.82 ​ 435,299 ​ $ 1,337.7 ​ July 1, 2024 - July 31, 2024 1,167,924 ​ $ 82.63 ​ 1,162,868 ​ $ 1,241.6 ​ August 1, 2024 - August 31, 2024 1,932,449 ​ $ 76.58 ​ 1,931,932 ​ $ 1,093.7 ​ September 1, 2024 - September 30, 2024 80,351 ​ $ 91.51 ​ 74,621 ​ $ 1,086.8 ​ October 1, 2024 - October 31, 2024 1,587,784 ​ $ 86.87 ​ 1,587,553 ​ $ 948.9 ​ November 1, 2024 - November 30, 2024 1,158,412 ​ $ 84.37 1,157,569 ​ $ 851.2 ​ December 1, 2024 - December 31, 2024 761,873 ​ $ 85.39 761,496 ​ $ 786.2 ​ Total 12,668,636 ​ 12,230,211 ​ ​ (1) Includes the number of shares of common stock utilized to execute certain stock incentive awards and shares purchased as part of publicly announced programs.

(2) In January 2022, our Board authorized a $1.6 billion increase to the June 2021 share repurchase program authorization, which was completed in April 2024. In February 2024, our Board authorized a share repurchase program of up to $1.5 billion of our outstanding common stock, which has no expiration date.

In February 2025, our Board authorized a share repurchase program of up to $1.5 billion of our outstanding common stock, which has no expiration date, and is in addition to the $786.2 million that remained available under existing share repurchase authorizations as of December 31, 2024. ​ ​ 38 Table of Contents ​ Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations The following analysis discusses our financial condition as of December 31, 2024, compared with December 31, 2023, our consolidated results of operations for the years ended December 31, 2024 and 2023, and, where appropriate, factors that may affect our future financial performance.

The discussion should be read in conjunction with our audited consolidated financial statements and the related notes to the financial statements and the other financial information included elsewhere in this Form 10-K.

For information and analysis relating to our financial condition and consolidated results of operations as of and for the year ended December 31, 2022, as well as for the year ended December 31, 2023 compared with the year ended December 31, 2022, see Item 7.

“Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023. Forward-Looking Information Our narrative analysis below contains forward-looking statements intended to enhance the reader’s ability to assess our future financial performance.

Forward-looking statements include, but are not limited to, statements that represent our beliefs concerning future operations, strategies, financial results or other developments, and contain words and phrases such as “anticipate,” “believe,” “plan,” “estimate,” “expect,” “intend” and similar expressions. Forward-looking statements are made based upon management’s current expectations and beliefs concerning future developments and their potential effects on us.

Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those included in the forward-looking statements as a result of risks and uncertainties. Those risks and uncertainties include, but are not limited to, the risk factors listed in Item 1A.

“Risk Factors.” Overview We provide financial products and services through the following reportable segments: ● Retirement and Income Solutions; ● Principal Asset Management and ● Benefits and Protection. We also have a Corporate segment, which consists of the assets and activities that have not been allocated to any other segment. See Item 1.

“Business” for a description of our reportable segments. In the fourth quarter of 2024, we implemented changes to our Principal Asset Management segment to align the global operations by business function. Prior to the fourth quarter of 2024, our Principal Asset Management segment was organized into Principal Global Investors and Principal International.

The Principal Asset Management segment is now organized into Investment Management and International Pension. The change has been applied retrospectively, which did not have an impact on our consolidated financial statements. Economic Factors and Trends Positive market performance led to an increase in account values in our Retirement and Income Solutions segment in 2024.

Since account values are the base by which this business generates revenues, market performance volatility may impact our revenues in future quarters. Positive market performance led to an increase in AUM in our Principal Asset Management segment in 2024, which was partially offset by foreign currency headwinds.

Since AUM is the base by which this business generates revenues, market performance and fluctuations in foreign currency exchange rates may impact our revenues in future quarters. Also included in revenues are borrower fees, transaction fees and performance fees, which can fluctuate between years.

In our Benefits and Protection segment, premium and fee growth is a key indicator of earnings growth.

Higher levels of unemployment may impact new sales in our businesses and reduce in-group growth in our Specialty Benefits business in the short-term. ​ 39 Table of Contents Profitability Our profitability depends in large part upon our amount of AUM and our ability to: ● manage the difference between the investment income we earn and the interest we credit to policyholders; ● generate fee revenues by providing trust and custody, administrative and investment management services; ● price our insurance products at a level that enables us to earn a margin over the cost of providing benefits and the related expenses; ● manage our investment portfolio to maximize investment returns and minimize risks such as interest rate changes or defaults or impairments of invested assets; ● effectively hedge fluctuations in foreign currency to U.S. dollar exchange rates on certain transactions and ● manage our operating expenses.

Critical Accounting Policies and Estimates The increasing complexity of the business environment and applicable authoritative accounting guidance requires us to closely monitor our accounting policies. Our significant accounting policies are described in Item 8.

“Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 1, Nature of Operations and Significant Accounting Policies.” We have identified critical accounting policies that are complex and require significant judgment and estimates about matters that are inherently uncertain.

A summary of our critical accounting policies is intended to enhance the reader’s ability to assess our financial condition and results of operations and the potential volatility due to changes in estimates and changes in guidance. The identification, selection and disclosure of critical accounting policies and estimates have been discussed with the Board Audit Committee.

Valuation and Allowance for Credit Loss of Fixed Income Investments Fixed Maturities. Fixed maturities include bonds, asset-backed securities (“ABS”), redeemable preferred stock and certain non-redeemable preferred securities. We classify our fixed maturities as either AFS or trading and, accordingly, carry them at fair value in the consolidated statements of financial position.

Volatility in net income can result from changes in fair value of fixed maturities classified as trading. Volatility in other comprehensive income can result from changes in fair value of fixed maturities classified as AFS.

We measure the fair value of our financial assets and liabilities based on assumptions used by market participants in pricing the asset or liability, which may include inherent risk, restrictions on the sale or use of an asset, or nonperformance risk, including our own credit risk. For additional details concerning the methodologies, assumptions and inputs utilized see Item 8.

“Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 18, Fair Value Measurements” under the caption, “Determination of Fair Value.” The fair values of our public fixed maturities are primarily based on market prices from third party pricing vendors.

We have regular interactions with these vendors to ensure we understand their pricing methodologies and to confirm they are utilizing observable market information. In addition, 16% of our invested asset portfolio as of December 31, 2024, was invested in privately placed fixed maturities with no readily available market quotes to determine the fair market value.

The majority of these assets are valued using a matrix pricing valuation approach that utilizes observable market inputs. In the matrix approach, securities are grouped into pricing categories that vary by sector, rating and average life. Each pricing category is assigned a risk spread based on observable public market data.

The expected cash flows of the security are then discounted back at the current Treasury curve plus the appropriate risk spread. Although the matrix valuation approach provides a fair valuation of each pricing category, the valuation of an individual security within each pricing category may be impacted by company specific factors.

This excludes privately placed securities subject to Rule 144A of the Securities Act of 1933 that are primarily based on market prices from third party pricing vendors, similar to public fixed maturities.

If we are unable to price a fixed maturity security using prices from third party pricing vendors or other sources specific to the asset class, we may obtain a broker quote or utilize an internal pricing model specific to the asset utilizing relevant market information, to the extent available and where at least one significant unobservable input is utilized.

In addition, there may be certain securities managed by external managers where we obtain the valuation from the external manager when we are unable to obtain prices from third party pricing vendors or other sources. These are reflected in Level 3 in the fair value hierarchy and can include fixed maturities across all asset classes.

As of December 31, 2024, approximately 3% of our total fixed maturities were Level 3 securities valued using internal pricing models. See Item 8.

“Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 18, Fair Value Measurements” for further discussion. 40 Table of Contents The $227.0 million increase in net unrealized losses from U.S. investment operations for the year ended December 31, 2024, can primarily be attributed to an increase in interest rates, which was partially offset by a tightening of credit spreads.

For additional information about interest rate risk see Item 7A. “Quantitative and Qualitative Disclosures About Market Risk.” We have a process in place to identify fixed maturity securities that could potentially require an allowance for credit loss.

This process involves monitoring market events that could impact issuers’ credit ratings, business climate, management changes, litigation and government actions and other similar factors. This process also involves monitoring late payments, pricing levels, downgrades by rating agencies, key financial ratios, financial statements, revenue forecasts and cash flow projections as indicators of credit issues.

Each reporting period, all securities in an unrealized loss position are reviewed to determine whether a decline in value is due to credit.

Relevant facts and circumstances considered include: (1) the extent the fair value is below cost; (2) the reasons for the decline in value; (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events and (4) for structured securities, the adequacy of the expected cash flows.

To the extent we determine an unrealized loss is due to credit, an allowance for credit loss is recognized through a reduction to net income. See Item 8. “Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 4, Investments” under the caption, “Allowance for Credit Loss” for further discussion.

A number of significant risks and uncertainties are inherent in the process of monitoring credit losses and determining the allowance for credit loss.

These risks and uncertainties include: (1) the risk that our assessment of an issuer’s ability to meet all of its contractual obligations will change based on changes in the credit characteristics of that issuer; (2) the risk that the economic outlook will be worse than expected or have more of an impact on the issuer than anticipated; (3) the risk that our investment professionals are making decisions based on fraudulent or misstated information in the financial statements provided by issuers and (4) the risk that new information obtained by us or changes in other facts and circumstances lead us to change our intent to not sell the security prior to recovery of its amortized cost.

Any of these situations could result in a charge to net income in a future period. As of December 31, 2024, we had $46,367.3 million in AFS fixed maturities with gross unrealized losses totaling $6,475.2 million. Included in the gross unrealized losses are losses attributable to both movements in market interest rates as well as movement in credit spreads.

For more detailed information concerning allowances for credit loss, see Item 8. “Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 4, Investments” under the caption, “Allowance for Credit Loss.” Mortgage Loans. Mortgage loans consist primarily of commercial mortgage loans on real estate.

Commercial mortgage loans on real estate are generally reported at cost adjusted for amortization of premiums and accrual of discounts, computed using the interest method and net of valuation allowances.

We establish a valuation allowance for the risk of credit losses inherent in our mortgage loans, which is maintained at a level believed adequate by management to absorb estimated expected credit losses. The valuation allowance is based on amortized cost excluding accrued interest receivable and includes reserves for pools of financing receivables with similar risk characteristics.

Amounts on loans deemed to be uncollectible are charged off and removed from the valuation allowance. The change in the valuation allowance provision is included in net realized capital gains (losses) on our consolidated statements of operations. For more detailed information concerning mortgage loan valuation allowances, see Item 8.

“Financial Statements and Supplementary Data, Notes to Consolidated Financial Statements, Note 4, Investments” under the caption, “Financing Receivables Valuation Allowance.” Derivatives We use derivatives primarily to hedge or reduce exposure to market risks. The fair values of exchange-traded derivatives are determined through quoted market prices.

Exchange-traded derivatives include futures that are settled daily, which reduces their fair value in the consolidated statements of financial position. The fair values of privately negotiated contracts, which are usually referred to as over-the-counter (“OTC”) derivatives, that are cleared through centralized clearinghouses are determined through market prices published by the clearinghouses.