Why did assets under management decline in the quarter?

AUM decreased $40.3 billion to $1.57 trillion. The filing attributes $8.6 billion of the decline to net client outflows and $31.7 billion to net market depreciation and income, with equity assets accounting for most of the outflows and market losses.

Why did GAAP earnings per share fall year over year?

GAAP diluted EPS was $2.15 versus $2.49 in Q1 2024. Net income attributable to the firm fell 14.5% to $490.5 million, mainly because non-operating income dropped to $70.7 million from $188.9 million, while operating income rose to $596.3 million from $586.6 million.

What drove the decline in the effective fee rate?

The company said the effective fee rate excluding performance-based fees fell to 40.0 basis points from 41.6 basis points a year earlier, due to client flows and transfers that shifted assets toward lower-fee asset classes and products.

What did operating expenses look like compared with the prior year?

GAAP operating expenses were $1,167.6 million, up 0.3% from Q1 2024. Adjusted operating expenses were $1,135.1 million, up 5.9%, with the filing citing higher salaries, benefits, distribution and servicing costs, product and recordkeeping costs, and technology and occupancy costs.

What is the company's guidance for the full-year 2025 tax rate?

The company estimates its full-year 2025 effective tax rate will be between 23.5% and 27.5% on a U.S. GAAP basis, and between 24.0% and 27.0% on an adjusted basis.

TROW 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed May 2, 2025. Cited figures are marked; the original filing is the authoritative source.

Rowe Price Group, Inc. (NASDAQ: TROW) reported first-quarter 2025 results on May 2, 2025, furnishing an earnings release (Exhibit 99.1) and a supplemental earnings presentation (Exhibit 99.2). Quarter-end assets under management were $1.57 trillion^a, down $40.3 billion from $1.61 trillion at December 31, 2024, driven by $8.6 billion in net client outflows and $31.7 billion of net market depreciation. Net revenues were $1,763.9 million, up 0.8% from Q1 2024 and down 3.3% from Q4 2024.

GAAP diluted EPS was $2.15^b, compared with $2.49 a year earlier and $1.92 in Q4 2024; adjusted diluted EPS was $2.23, versus $2.38 in Q1 2024. The effective fee rate, excluding performance-based fees, fell to 40.0 basis points from 41.6 basis points a year earlier, which the company attributes to client flows and transfers shifting assets toward lower-fee asset classes and products. GAAP operating expenses rose 0.3% year over year to $1,167.6 million, while adjusted operating expenses rose 5.9% to $1,135.1 million, largely on higher compensation, distribution, and technology costs.

GAAP net income attributable to the firm fell 14.5% to $490.5 million^c, reflecting lower non-operating income, which was $70.7 million versus $188.9 million in Q1 2024. The company returned $506 million to stockholders through its recurring quarterly dividend and share repurchases during the quarter, with the dividend per share at $1.27 compared with $1.24 in the prior periods. The company expects its full-year 2025 effective tax rate to fall between 23.5% and 27.5% on a GAAP basis and between 24.0% and 27.0% on an adjusted basis.

02—Key points

Key Highlights

Quarter-end AUM of $1.57 trillion, with net client outflows of $8.6 billion in Q1 2025, concentrated in U.S. equities.
GAAP diluted EPS of $2.15 versus $2.49 in Q1 2024; adjusted diluted EPS of $2.23 versus $2.38 a year earlier.
Net revenues of $1,763.9 million, up 0.8% year over year and down 3.3% from Q4 2024.
Effective fee rate excluding performance-based fees declined to 40.0 basis points from 41.6 basis points in Q1 2024.
Adjusted operating expenses rose 5.9% year over year to $1,135.1 million; GAAP operating expenses rose 0.3% to $1,167.6 million.
Returned $506 million to stockholders via dividends and share repurchases; dividend per share was $1.27.
Full-year 2025 effective tax rate guidance of 23.5%–27.5% (GAAP) and 24.0%–27.0% (adjusted).

03—Questions

Frequently Asked Questions

Why did assets under management decline in the quarter?
AUM decreased $40.3 billion to $1.57 trillion. The filing attributes $8.6 billion of the decline to net client outflows and $31.7 billion to net market depreciation and income, with equity assets accounting for most of the outflows and market losses.
Why did GAAP earnings per share fall year over year?
GAAP diluted EPS was $2.15 versus $2.49 in Q1 2024. Net income attributable to the firm fell 14.5% to $490.5 million, mainly because non-operating income dropped to $70.7 million from $188.9 million, while operating income rose to $596.3 million from $586.6 million.
What drove the decline in the effective fee rate?
The company said the effective fee rate excluding performance-based fees fell to 40.0 basis points from 41.6 basis points a year earlier, due to client flows and transfers that shifted assets toward lower-fee asset classes and products.
What did operating expenses look like compared with the prior year?
GAAP operating expenses were $1,167.6 million, up 0.3% from Q1 2024. Adjusted operating expenses were $1,135.1 million, up 5.9%, with the filing citing higher salaries, benefits, distribution and servicing costs, product and recordkeeping costs, and technology and occupancy costs.
What is the company's guidance for the full-year 2025 tax rate?
The company estimates its full-year 2025 effective tax rate will be between 23.5% and 27.5% on a U.S. GAAP basis, and between 24.0% and 27.0% on an adjusted basis.

04—Continue

← View all 8-K filings