WisdomTree (WT) Q4 2024 earnings summary

Executive summary

• Ended 2024 with $109.8B in AUM, up nearly 10% year-over-year, despite net outflows in H2; AUM reached $113.7B by Jan 29, 2025 due to positive market movement and inflows.

• Adjusted EPS increased over 70% year-over-year, with Q4 adjusted EPS at $0.17 and net income of $27.3M; stock price rose 50% year-over-year.

• Adjusted revenue grew 21.6% in Q4 and 21.3% for the year, with operating margin expanding 680bps year-over-year to 33.6%.

• Significant progress in digital assets and tokenization, with 26,000 Prime accounts opened and $31M in digital AUM, despite regulatory delays.

• Strategic capital actions included $345M convertible note issuance, repurchase of Series A Preferred Stock, and common stock buybacks.

Financial highlights

• Q4 adjusted revenues were $110.5M, up 1% sequentially and 22% year-over-year, driven by higher average AUM and European product revenues.

• Adjusted operating margin expanded by 680bps year-over-year to 33.6%; Q4 operating margin was 31.7%, impacted by non-recurring costs.

• Q4 adjusted net income was $25.3M, or $0.17 per share; full-year adjusted EPS grew 73% year-over-year.

• Gross margin for 2024 was 80.2%, with Q4 impacted by non-recurring custody migration costs; guidance for 2025 is 81%-82%.

• Cash and financial instruments at year-end: $266.8M, up from $188.2M in 2023.

Outlook and guidance

• 2025 compensation-to-revenue ratio forecasted at 28%-30%, with discretionary spending expected at $68-$72M.

• Gross margin anticipated at 81%-82% for 2025, up from 80.2% in 2024.

• Annual adjusted interest expense projected at $20M, higher due to debt for preferred stock repurchase.

• Targeting 35%-40% growth in model AUA and 25%-30% increase in model users in 2025.

• Expect further AUM growth in 2025 through deepening client engagement and expanding digital asset offerings.