Artisan Partners Asset Management (APAM) investor relations material

Executive summary

• Q3 revenue rose 4% YoY to $312.5M; adjusted EPS was $1.03. Ending AUM was $168.7B amid $10.6B of net outflows and $3.8B of market depreciation.

• Long-term benchmark outperformance remained strong: 92% of AUM outperformed over 10 years and 99% since inception, gross of fees.

Financial highlights

• Q3 adjusted operating income was $110.9M and adjusted net income was $84.2M; adjusted EPS was $1.03, up 1% YoY.

• Q3 GAAP operating income was $109.8M; GAAP net income attributable to shareholders was $75.2M, up 13% YoY, and diluted EPS was $1.04 versus $0.93.

• YTD revenue rose 7% to $923.4M; adjusted operating income increased 6% to $306.5M, adjusted net income rose 7% to $231.5M and adjusted EPS increased 6% to $2.84.

• 9M GAAP operating income was $288.6M, up 8%; GAAP net income was $214.1M and diluted EPS was $2.96.

• Average AUM was $180.5B in Q3, up 2% YoY; weighted average fee was 68.7 bps versus 67.5 bps a year earlier.

Outlook and guidance

• Q4 fund distributions are estimated to cause ~$2.5B of net outflows from investors who do not reinvest; increased mutual fund redemptions are possible.

• Recurring fee rate was expected near 70 bps and relatively stable; performance fees could lift the overall Q4 rate. Performance fees were projected to be similar to last year's ~$29M, subject to year-end markets and performance.

• Seven of eight performance-fee teams were in the money; fixed-cost growth guidance remained mid-single-digit, excluding specified Grandview, KIX and LTI effects.

• If recent trends persist, credit and alternatives could continue to attract inflows while equity strategies could see outflows; long-term AUM growth is expected to rely primarily on investment returns.

• An interval fund for public and private credit was in development for wealth clients in 2027, with warm initial feedback.