SEI Investments (SEIC) Q3 2024 earnings summary

Executive summary

• Q3 2024 delivered record or near-record results, with EPS up 37% to $1.19, revenue up 13% to $537.4M, and operating income up 33% year-over-year, driven by top-line growth, margin expansion, and expense management.

• Combined assets under management, administration, and advisement reached a record $1.6 trillion, with net sales events totaling $46 million.

• Strategic focus on sales, client engagement, and market expansion yielded momentum across all business segments, supported by strong client adoption of new offerings.

• Leadership changes, including the addition of Michael Lane, and a $10M strategic investment in a wealth management innovation platform, are expected to drive further growth and innovation.

• CEO emphasized maximizing shareholder value through strategic adjustments and innovation.

Financial highlights

• Q3 2024 revenue was $537.4M (+13% YoY); operating income $143.8M (+33% YoY); net income $154.9M (+34% YoY); diluted EPS $1.19 (+37% YoY).

• Nine-month revenue grew 9% to $1.57B; net income up 25% to $425.4M; diluted EPS up 27% to $3.23.

• Each business segment saw revenue and margin growth year-over-year and sequentially.

• LSV contributed $37M to equity income in Q3, up over 20% year-over-year, driven by a large one-time performance fee.

• Interest and dividend income increased 22% year-over-year for both Q3 and the nine months.

Outlook and guidance

• Management expects continued growth driven by stability, innovation, and scalable solutions, with recurring revenues anticipated from record sales events.

• Integrated Cash Program modifications could nearly double Q4 contribution compared to $11M in Q3, but balances are expected to fluctuate and outlook remains uncertain.

• No expectation of a similar large performance fee from LSV in Q4, as such fees are episodic.

• Management remains focused on long-term, sustainable growth and continued investment in technology, innovation, and infrastructure.

• Available funds and cash flow from operations are expected to be sufficient for operational needs and stock repurchases for at least the next 12 months.