Great-West Lifeco’s Earnings Surge and Buyback Boost

Great-West Lifeco: The Boring Insurance Giant That’s Actually a Gold Mine

​Honestly, if someone told you they were properly excited about an insurance company’s earnings report, you’d probably think they need a more interesting hobby. But look, sometimes "boring" is exactly where the money is hidden. While everyone is busy chasing the latest AI tech stock or some random crypto coin, a Canadian giant called Great-West Lifeco (GWO) just dropped a massive bomb of a report for Q3 2025.

​They didn’t just grow; they delivered a double-digit surge that has caught the whole market off guard. We’re talking about $1.23 billion in core earnings. That is a 15% jump compared to last year. If you’re sitting there wondering why an insurance firm is making billions while most of us are checking our grocery receipts twice, you’ve come to the right place.

​Straight up, this isn't just a "good quarter." It’s a clear sign that Great-West is turning into a massive cash machine, and they are starting to share that cash with their investors in a big way.

​What’s the Big Deal with "Base Earnings"?

​Before we dive into the deep end, let’s talk about "base earnings." In the finance world, companies love to use fancy, complex words to hide things, but base earnings are actually quite simple. It’s the profit the company makes from its actual day-to-day job—selling insurance and managing retirement plans—without all the weird one-off surprises like a big building sale or a sudden market crash.

​For Great-West, hitting $1.23 billion in base earnings is a record. To be fair, even the top experts were expecting something much lower. But the company absolutely smashed it, and that’s exactly why the stock market is buzzing right now. It means their engine isn’t just running; it’s properly screaming.

​The Secret Weapon: Empower Retirement

​If you want to know why Great-West is winning, you have to look at their U.S. business, specifically a brand called Empower.

​Look, retirement is big business. In the U.S., millions of people are pouring money into their 401(k) plans every single month without fail. In Q3 2025 alone, Empower sucked in $30 billion in new retirement plans. That is an insane amount of money to move in three months. It’s like adding the entire economy of a small country to your bank account every quarter.

​Because they manage so much money ($3.5 trillion in total assets), they get to collect steady fees. And when the stock market goes up, those fees go up too. It’s a subscription model that actually works for everyone. In the U.S. alone, their earnings climbed 10% to $436 million. It’s the kind of steady growth that makes investors feel very warm and fuzzy inside.

​The "Share Buyback" Plot Twist

​Honestly, here is the bit that actually matters for your wallet. Great-West basically told everyone they’re upping their share buybacks to a massive $1.5 billion this year.

​Look, if you’re wondering how this works, it’s dead simple. A share buyback is just the company using its leftover cash to go shopping for its own shares and then literally deleting them. Consider a pizza that’s been cut into 10 slices. If the company buys 2 slices and bins them, those 8 slices left on the table suddenly look a lot bigger and more filling for the people still holding them.

​By buying back $1.5 billion worth of shares, Great-West is making every remaining share you own worth more. It’s a massive vote of confidence. They are basically saying, "We think our stock is way too cheap, so we’re going to buy it ourselves." For an investor, that is pure music to the ears.

​Europe is the Surprise Star

While North America grabbed the attention, Great-West’s European business was steadily outperforming out of sight. They saw a 19% growth in earnings, hitting $266 million.

​Why? It’s a mix of smart insurance plays in the UK and wealth management in Ireland. They’ve managed to keep their insurance claims low and their fees high. In a year where Europe has been a bit of an economic mess, Great-West has managed to find a way to thrive. It shows that they aren't just a "Canada-only" story anymore; they are a proper global powerhouse.

​The "Human" Side of Insurance

​I know, I know—chatting about insurance usually feels a bit robotic and cold. But step back for a moment and look at reality. Behind that $1.23 billion profit are regular families saving for a house or parents finally getting their retirement sorted. Behind those numbers are real people—and real lives being impacted. Think about your parents planning for retirement or a young family saving for a home. Great-West's products provide that safety net.

​When Great-West grows, it means they have more "firepower" to innovate. They are spending millions on digital tools to make claims easier and using AI to give personalized wealth advice. It’s growth that actually helps people sleep better at night, knowing their nest egg is safe with a company that has been around since 1891.

​Is This the New John Deere?

​Properly speaking, it reminds me of that John Deere situation from a while back. Remember that? In 2023, Deere had a proper rough patch because farmers just weren't buying new gear. But the people who didn't panic and held on through the dip saw a massive 25% bounce back by 2024.

​Great-West is kind of the opposite of that. They don't really have "rough" years because everyone always needs insurance and retirement plans, no matter what the economy is doing. They are "steady climbers." Their book value per share is up 8% to $27.86, and with the dividend increase (now $0.61 per quarter), they are becoming a favourite for people who just want a reliable cheque every three months.

​The "Cheap" Stock Narrative

​Here’s a bit of straight talk: Great-West is currently trading at a "Price-to-Earnings" (P/E) ratio of about 9.

​In simple terms, that is incredibly cheap. Their competitors, like Sun Life or Manulife, often trade at much higher levels. When a company is growing at 15%, but the stock is priced like it’s barely growing at all, that’s what investors call a "bargain." With the company buying back its own shares, they are essentially forcing the market to notice how undervalued it really is.

​The Risks: No Rose Without Thorns

​To be fair, it’s not all sunshine and perfect vibes. Their "Corporate" side actually lost about $113 million, mostly because borrowing money is still properly expensive these days. Interest rates are still a bit of a nightmare for everyone. Also, if the global stock markets take a massive tumble, those fees from managing $3.5 trillion will naturally shrink.

​But look, with $2.5 billion in cash tucked away and a health rating (LICAT) of 131%, they’ve got plenty of cushion. They’re like a massive ship in a storm—they might wobble a bit, but they aren't going to sink anytime soon.

​My Take

​Honestly, the bottom line is simple: Great-West is properly firing on all cylinders. They’ve got record profits, they’re handing out bigger dividends, and they’re aggressively buying back their own stock.

​In a world where the economy feels a bit shaky, having a piece of a 130-year-old giant that is growing at double digits is a very smart move. It might not be as "sexy" as a tech startup, but as my grandad used to say, "You can't pay your mortgage with hype." You can, however, definitely pay it with Great-West’s dividends.

Frequently Asked Questions (FAQs)

​What caused Great-West Lifeco's 15% earnings jump in 2025?

Honestly, it was a perfect storm of good news. The record $1.23 billion in base earnings came from a massive influx of money into their U.S. retirement brand, Empower, plus some very solid insurance wins in Europe. Basically, they managed more money and kept their costs lower than anyone expected.

​How do the increased share buybacks actually help me as an investor?

Look, think of it as a way to make your "slice of the pie" bigger. By spending $1.5 billion to buy and delete its own shares, Great-West is making the remaining shares more valuable. It’s a massive signal that the bosses think the stock is currently a bargain.

​Is the Great-West Lifeco dividend safe for the long term?

Properly speaking, yes. They just bumped the dividend to $0.61 per quarter, and they’re only using about 45.9% of their profits to pay it. With $2.5 billion in cash sitting in the bank, they have a huge safety net to keep those payments coming even if the market gets a bit shaky.

​How does Great-West compare to other giants like Manulife or Sun Life?

To be fair, Great-West is currently the "value" play. While Manulife and Sun Life are great, Great-West is trading at a much lower P/E ratio (around 9x). This means you’re getting more earnings for every dollar you invest, plus you get the bonus of their massive U.S. retirement business.

​What are the main risks I should watch out for with GWO stock?

Nothing is ever 100% safe, right? The main things to watch are interest rates and the global stock market. If markets crash, the fees Great-West earns from managing $3.5 trillion will drop. Also, their corporate segment lost a bit of money recently due to high borrowing costs, so that’s something to keep an eye on.