Cohen & Steers Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Adjusted Earnings Per Share (EPS):: $0.85, up from $0.79 in Q1 and $0.73 in Q2 2025.

Net Income:: $44 million, an 8% increase from Q1 and an 18% increase from Q2 2025.

Assets Under Management (AUM):: Increased by approximately 8% to over $100 billion, driven by strong net inflows of $1.3 billion, marking one of the strongest flow quarters in recent history.

Operating Margin:: Improved to 36.3%.

Revenue:: Increased 5% to $152 million, while operating expenses rose 3% to $97 million, indicating effective cost management.

2Strategic Updates and Business Highlights

Net Inflows:: Strongest in four and a half years, with U.S. Real Estate leading at $833 million. Other strategies, including multi-strategy Real Assets and global listed infrastructure, also saw significant inflows.

Investment Performance:: 41%, 91%, and 97% of AUM outperformed benchmarks over the last one, three, and five years, respectively, although U.S. REITs faced short-term underperformance due to specific sector challenges.

Growth Initiatives:: Active ETFs surpassed $1 billion in AUM, with plans for further expansion. The firm is also enhancing its international distribution, particularly in Asia and Europe.

Non-Traded REIT Performance:: The Cohen & Steers Income Opportunities REIT has outperformed its peers significantly since inception.

3Forward Guidance and Outlook

Expense Guidance:: Maintaining expectations of compensation and benefits expenses at approximately 40% of revenues, with mid-single-digit growth in G&A expenses.

Market Conditions:: Anticipated continued interest in real assets, with a favorable macro backdrop for U.S. real estate and global infrastructure strategies.

Pipeline:: A robust $1.6 billion won/unfunded pipeline, with a healthy velocity of fundings and a diverse geographic reach.

4Bad News, Challenges, or Points of Concern

U.S. REIT Underperformance:: Short-term underperformance attributed to specific sectors like cell tower REITs, raising concerns about the sustainability of recent inflows.

Private Real Estate Fundraising:: Down about 5% annualized this year, indicating challenges in the private market.

Market Volatility:: Recent geopolitical tensions and inflationary pressures could impact future performance and investor sentiment.

5Notable Q&A Insights

Demand for Real Estate:: Strong demand anticipated in both wealth management and institutional channels, driven by recent performance and macroeconomic factors.

International Distribution:: Positive traction noted in markets like South Africa, Japan, and Korea, with ongoing efforts to enhance presence and capitalize on opportunities.

ETF Strategy:: Active ETFs are gaining traction, with a focus on performance and scaling to attract larger institutional investors. Fee rates for ETFs are competitive with existing open-end funds.

Sub-Advisory Opportunities:: Recent wins in Canada indicate growing interest in real assets strategies, with potential for further growth in this channel. Overall, Cohen & Steers reported a strong quarter with solid financial results and strategic progress, though challenges in certain sectors and market conditions remain points of concern.