Federated Hermes (FHI) Q2 2026 earnings summary

Executive summary

• Achieved record assets under management (AUM) of $911.6 billion as of June 30, 2026, up 8% year-over-year, driven by equity, money market, and private market growth, and the FCP Fund Manager acquisition.

• Q2 2026 revenue was $502.8 million, up 18% year-over-year, with net income of $104.3 million and EPS of $1.38, a 19% increase year-over-year.

• Board declared a $0.38 per share dividend for Q2 2026, payable August 14, 2026.

• Expanded product offerings with new ETFs and a blockchain-focused fund; completed the acquisition of an 80% interest in FCP Fund Manager, L.P.

• Equity and fixed income assets grew year-over-year, while liquidity assets saw a slight sequential decline.

Financial highlights

• Q2 2026 revenue increased 18% year-over-year to $502.8 million, driven by higher average equity and money market assets and the FCP acquisition.

• Operating income for Q2 2026 was $132.9 million, up 13% year-over-year; operating expenses rose 20% mainly due to distribution, compensation, and acquisition costs.

• Net income for the first half of 2026 was $200.7 million, compared to $192.1 million in the prior year period.

• Cash and investments at June 30, 2026, were $480.7 million; long-term debt stood at $348.5 million.

• Dividend per share for Q2 2026 was $0.38, up from $0.34 in Q2 2025.

Outlook and guidance

• Management expects continued investment in technology and global expansion, with $296 million planned over the next three years for technology initiatives.

• Positive net sales in MDT strategies for the 14th consecutive quarter; ongoing expansion in private markets and new product launches expected to support growth.

• Regulatory changes and market volatility are expected to impact expenses and asset flows; management is monitoring these closely.

• No material exposure to Pillar Two income taxes is expected for 2026.

• Forward-looking statements caution about market, economic, and regulatory risks impacting future results.