American International Group Inc (AIG) reported first-quarter results that surpassed Wall Street expectations, signaling to investors that its strategic momentum may be continuing ahead of Peter Zaffino's transition from CEO to Executive Chairman on June 1. For the three months ended March, the insurer's operating earnings per share increased by 80% year-over-year to $2.11, exceeding the average analyst estimate of $1.87 from a Bloomberg survey. This performance was driven by higher net premiums written and lower catastrophe losses, while AIG's core operating return on equity improved to 12.2% from 7.7% in the same period last year.

The growth narrative was most evident in AIG's general insurance business, where net premiums written rose 24% to $5.6 billion in the first quarter, propelled by recent strategic transactions. Zaffino expressed confidence that AIG can continue to achieve disciplined, profitable growth while navigating a more complex global risk landscape, adding that the company remains on track to meet the targets set last year. This is significant because Zaffino has recently championed a series of strategic moves designed to support revenue growth, including AIG's agreement last year to acquire the renewal rights to a $2 billion premium retail insurance portfolio from Everest Group, and a transaction to acquire an equity stake in specialty insurer Convex Group, which included a quota-share agreement.

For investors, the quarterly report may be viewed as a test of whether AIG's strategic deals are beginning to show a stronger impact in the financial data. Bloomberg Intelligence analyst Matthew Palazola wrote last week that both the Everest and Convex transactions are expected to contribute to AIG's growth. Nonetheless, the quarter also presented areas of pressure: net investment income fell 36% to $712 million, partly due to a decline in the fair value of AIG's stake in Corebridge Financial, whose share price dropped 21% during the quarter. On an adjusted pre-tax basis, net investment income increased 8% compared to the prior year. As of Thursday's close, AIG's stock price has declined 12.6% year-to-date.