LPL Financial (LPLA) Q4 2023 earnings summary

Executive summary

• FY 2023 advisory and brokerage assets reached $1.354T; organic NNA was $100B, a 9.0% annualized growth rate.

• FY 2023 gross profit was $4.027B and adjusted EPS was $15.72; strategic priorities included advisor-market expansion, integrated services and operating leverage.

• Q4 net income was $218M and diluted EPS was $2.85, down 28% YoY; adjusted EPS was $3.51, down 17% YoY.

Financial highlights

• Q4 revenue was $2.64B, up 13% YoY; FY revenue was $10.053B, up 17%.

• Q4 gross profit was $1.01B, up 4% YoY; FY gross profit was $4.027B, up 26%.

• Q4 net income was $218M vs. $319M a year earlier; FY net income was $1.066B vs. $846M in 2022.

• FY adjusted net income was $1.224B and adjusted EPS was $15.72, up 36% YoY; diluted EPS was $13.69, up 32%.

• Q4 EBITDA decreased 17% YoY to $445M; FY EBITDA increased 30% to $1.986B, with Credit Agreement EBITDA of $2.195B.

Outlook and guidance

• FY 2024 core G&A guidance is $1.455B–$1.490B, representing 6.25%–8.75% YoY growth, before Prudential-related expenses.

• Prudential-related core G&A is expected to build late in 2024 and be incurred primarily in 2025; onboarding is expected toward year-end 2024.

• 2024 investment priorities include organic growth, advisor and enterprise experience, services, foundational infrastructure and cost-to-serve efficiency.