01—Abstract
Summary
Summary of the 10-Q filed May 2, 2025. Cited figures are marked; the original filing is the authoritative source.
T.
Rowe Price Group, Inc. reported first-quarter 2025 net revenues of $1,763.9 milliona, up 0.8% from $1,750.2 million a year earlier. Investment advisory fees rose 4.0% to $1,598.4 million as average assets under management increased 9.2% to $1,620.3 billion, though the annualized effective fee rate declined to 40.3 basis points from 42.1. Capital allocation-based income fell to a $1.2 million loss from $47.1 million, reflecting lower overall market returns and a decline in accrued carried interest.
U.S. GAAP net income attributable to T. Rowe Price Group fell 14.5% to $490.5 millionb, and diluted EPS was $2.15 versus $2.49, driven mainly by lower investment gains. On a non-GAAP basis, diluted EPS was $2.23 compared with $2.38.
Ending assets under management were $1,566.3 billionc, down $40.3 billion from year-end 2024, reflecting $31.7 billion of market depreciation and $8.6 billion of net cash outflows. The balance sheet remained liquid, with cash and cash equivalents of $2,836.7 million at March 31, 2025, up from $2,649.8 million at December 31, 2024. The company repurchased $217.5 million of common stock and paid $288.8 million in dividends declared, and it raised its quarterly dividend 2.4% to $1.27 per share.
02—Key points
Key Highlights
- Net revenues rose 0.8% to $1,763.9 million, led by a 4.0% increase in investment advisory fees to $1,598.4 million.
- Average AUM grew 9.2% to $1,620.3 billion, but the annualized effective fee rate fell to 40.3 basis points from 42.1 basis points, reflecting a mix shift toward lower-fee asset classes and products.
- Capital allocation-based income was a $1.2 million loss versus $47.1 million income a year earlier, as the change in accrued carried interest declined to $9.2 million from $59.5 million.
- U.S. GAAP net income attributable to T. Rowe Price Group fell 14.5% to $490.5 million; diluted EPS was $2.15 versus $2.49, while non-GAAP diluted EPS was $2.23 versus $2.38.
- Ending AUM was $1,566.3 billion, down $40.3 billion from December 31, 2024, driven by $31.7 billion of market depreciation and $8.6 billion of net cash outflows.
- The company repurchased 2.1 million shares for $217.5 million at an average price of $101.57 and raised its quarterly dividend 2.4% to $1.27 per share.
- Cash and cash equivalents rose to $2,836.7 million at March 31, 2025, and total cash and investments in T. Rowe Price products were $5,683.4 million.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed May 2, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $1.76B$1.75B | +0.8% |
| Operating Expenses | $1.17B$1.16B | +0.3% |
| Operating Income | $596.30M$586.60M | +1.7% |
| Net Income | $490.50M$573.80M | −14.5% |
| EPS (Basic) | $2.15$2.50 | −14.0% |
| EPS (Diluted) | $2.15$2.49 | −13.7% |
| Shares Outstanding (Basic) | 222.30M223.60M | −0.6% |
| Shares Outstanding (Diluted) | 222.60M224.20M | −0.7% |
05—Questions
Frequently Asked Questions
Why did GAAP earnings decline despite higher advisory fees?
Net income attributable to T. Rowe Price Group fell to $490.5 million from $573.8 million, mainly because lower investment gains and a $48.3 million swing in capital allocation-based income offset the advisory fee growth. Net gains on investments were $31.9 million versus $121.5 million a year earlier.
How did assets under management change during the quarter?
Ending AUM was $1,566.3 billion, a decrease of $40.3 billion from December 31, 2024. The decline reflected $31.7 billion of market depreciation and $8.6 billion of net cash outflows, with equity AUM falling $56.3 billion during the period.
Is the company's fee rate under pressure?
The annualized effective fee rate excluding performance-based fees was 40.0 basis points versus 41.6 a year earlier. The company attributed the decline to client flows and transfers that shifted assets toward lower-fee asset classes and products.
How is the company returning capital to shareholders?
In the first quarter the company paid $288.8 million in dividends declared and repurchased $217.5 million of stock. The quarterly dividend increased to $1.27 per share from $1.24, and the board had 16,235,865 shares remaining under its authorizations at March 31, 2025.
What drove the change in operating expenses?
GAAP operating expenses rose 0.3% to $1,167.6 million. Technology, occupancy, and facility costs rose $17.7 million, general and administrative costs rose $10.7 million, and distribution and servicing costs rose $11.7 million, while total compensation and related costs fell $44.5 million, mainly due to lower deferred compensation liability charges.
06—Continue