APAM Q1 2026 Earnings Call Summary

Assets Under Management (AUM): $173 billion as of March 31, 2026, down 4% from the previous quarter but up 7% year-over-year. AUM recovered to nearly $184 billion by early April.
Revenue: $303 million, a decrease of 10% sequentially but an increase of 9% year-over-year. The decline was attributed to the absence of performance fees, which were $29 million in the prior quarter.
Average AUM: $182 billion, up 1% sequentially and 9% year-over-year.
Adjusted Operating Income: Decreased 30% sequentially, increased 6% year-over-year.
Adjusted Net Income per Share: Declined 31% from the December quarter but increased 5% year-over-year.
Dividend: Declared a quarterly dividend of $0.77 per share, a 24% decrease from the prior quarter but a 13% increase year-over-year.

Investment Performance: Long-term performance remains strong, with 74% of AUM outperforming benchmarks over three years and 99% over ten years. Recent accolades were received for the Global Value team and other funds.
Net Outflows: Firm-wide net outflows of $3.1 billion were primarily from equity strategies due to client reallocations and a shift towards passive investments. However, there were net inflows in 13 investment strategies, including $250 million in sustainable emerging markets and $800 million in credit.
New Initiatives: Onboarded Grandview Property Partners, a real estate private equity firm, and expanded distribution capabilities in EMEA and the intermediate wealth channel. Filed for ETF share classes for Artisan mutual funds.

Business Development: Anticipates continued strong inflows in credit and alternatives, while the equity landscape remains unpredictable. The firm is actively exploring opportunities for expansion through potential acquisitions and team lift-outs, particularly in credit and alternatives.
Expense Management: Full-year expense guidance remains unchanged, with expectations for fixed expenses to increase at a low single-digit rate, excluding incremental expenses related to Grandview.

Equity Strategy Performance: Recent underperformance in key equity strategies has led to net outflows and challenges in institutional relationships.
Market Volatility Impact: AUM experienced a sharp decline in March due to market conditions, although it has since recovered.
Absence of Performance Fees: The lack of performance fees in Q1 contributed to lower revenue and operating income, impacting cash generation and dividend levels.

Equity Reallocation: The CEO noted that outflows were primarily due to rebalancing among institutional clients, particularly in international strategies, rather than terminations.
Pipeline for New Mandates: The firm is not currently seeing any large institutional exits but is focused on maintaining strong relationships with existing clients amid performance challenges.
Growth in Intermediate Wealth: There is a positive outlook for the intermediate wealth segment, which has seen improved inflows due to recent talent acquisitions and enhanced capabilities.
M&A Opportunities: The management team expressed optimism about potential acquisitions in credit and alternatives, with a stronger pipeline compared to previous quarters.

This summary encapsulates the key points from the earnings call, highlighting both the successes and challenges faced by Artisan Partners in Q1 2026.

APAM — Artisan Partners Asset Management Inc.