WisdomTree (WT) Q2 2024 earnings summary

Executive summary

• Achieved record assets under management (AUM) of $109.7 billion as of June 30, 2024, with $110.5 billion as of July 24, 2024, driven by market appreciation, net inflows, and strong engagement in U.S.-listed and offshore UCITS ETFs.

• U.S. listed ETF AUM rose to $79.7 billion and European listed ETP AUM increased to $30.0 billion, both supported by market appreciation and net inflows.

• Continued expansion in tokenized assets, blockchain-enabled finance, and direct-to-consumer channels, with WisdomTree Prime now available to nearly 80% of the U.S. population.

• Focus remains on innovation, digital assets, and expanding product development and technology infrastructure.

Financial highlights

• Q2 2024 revenues increased 24.9% year-over-year to $107 million, with operating revenues for the first six months at $203.9 million, up 22% from the prior year.

• Adjusted net income for Q2 2024 was $27.1 million ($0.16 per share), up from $14.9 million in Q2 2023.

• Gross margin for Q2 2024 was 81.2%, with full-year guidance of 80%-81%.

• Other revenue reached $8.1 million in Q2, with a new quarterly run-rate guidance of ~$8 million, reflecting new asset-based arrangements in Europe.

• Net income for Q2 2024 was $21.8 million, down from $54.3 million in Q2 2023 due to the absence of a one-time gain from the gold payments obligation termination.

Outlook and guidance

• Compensation-to-revenue ratio for 2024 is estimated at 28%-29%, lower than 2023's 31.4%.

• Discretionary spending guidance for 2024 is $64-$68 million, with higher spend expected in Q4.

• Gross margin guidance raised to 80%-81% for the year, with potential for further expansion if AUM grows.

• Third-party distribution expense guidance maintained at $10-$11 million; adjusted interest expense at $14-$16.5 million; interest income at $5 million.

• Adjusted tax rate guidance remains at 24%-25%; weighted average diluted shares guidance unchanged at 166-168 million.