How did T. Rowe Price's assets under management change in the third quarter of 2025?

Ending AUM rose $90.4 billion to $1.77 trillion. The change reflects $89.1 billion of net market appreciation and income, $7.9 billion of net client outflows, and the addition of managed account - model delivery assets of $9.2 billion beginning July 1, 2025.

What drove the year-over-year change in revenue and earnings?

Net revenues rose 6.0% to $1,893.5 million, led by investment advisory fees of $1,698.7 million, up 4.4%. Capital allocation-based income increased to $42.0 million from $4.6 million, and net income attributable to T. Rowe Price Group rose 7.1% to $646.1 million.

Why did operating expenses increase, and what was the restructuring charge?

GAAP operating expenses increased 6.7% to $1,250.3 million. Technology, occupancy, and facility costs rose $19.2 million, and the company recorded a $28.5 million restructuring charge, primarily severance, related to the July workforce action under its broader plan to reduce expense growth and realign resources.

Is the company's fee rate under pressure?

The investment advisory annualized effective fee rate excluding performance-based fees was 39.1 basis points, down from 40.7 basis points in Q3 2024 and 39.6 basis points in Q2 2025. The company attributed the decline primarily to client flows and transfers shifting assets toward lower-fee strategies and products.

What did the company return to shareholders and what is its tax outlook?

T. Rowe Price returned $442 million to stockholders through the recurring quarterly dividend and stock repurchases. For full-year 2025, it estimates an effective tax rate of 23.0% to 26.0% on a U.S. GAAP basis and 23.5% to 25.5% on an adjusted basis.

TROW 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed October 31, 2025. Cited figures are marked; the original filing is the authoritative source.

Rowe Price Group, Inc. reported results for the third quarter and nine months ended September 30, 2025, furnishing its earnings release as Exhibit 99.1 under Item 2.02. Quarter-end assets under management reached $1.77 trillion^a, up $90.4 billion during the quarter, which includes the addition of managed account - model delivery assets beginning July 1, 2025. The firm recorded net client outflows of $7.9 billion in the quarter, with net market appreciation of $89.1 billion driving most of the AUM increase.

Q3 2025 net revenues were $1,893.5 million^b, up 6.0% from Q3 2024, and U.S. GAAP diluted EPS was $2.87 versus $2.64 a year earlier. Adjusted diluted EPS was $2.81, compared with $2.57 in Q3 2024. GAAP operating expenses rose 6.7% year over year to $1,250.3 million, which included a $28.5 million restructuring charge tied to the July workforce action.

The investment advisory annualized effective fee rate, excluding performance-based fees, declined to 39.1 basis points from 40.7 basis points a year earlier, which the company attributed primarily to client flows and transfers toward lower-fee strategies. The company returned $442 million^c to stockholders through its recurring quarterly dividend and stock repurchases during the quarter. The release notes that the firm expects to file its Form 10-Q for the third quarter later the same day, and that its full-year 2025 effective tax rate is estimated at 23.0% to 26.0% on a U.S. GAAP basis and 23.5% to 25.5% on an adjusted basis.

02—Key points

Key Highlights

Quarter-end AUM of $1.77 trillion, with a net increase of $90.4 billion in Q3 2025 including $89.1 billion of net market appreciation and income.
Net client outflows of $7.9 billion in Q3 2025; equity assets saw net outflows of $14.4 billion while fixed income had net inflows of $4.4 billion.
Net revenues of $1,893.5 million, up 6.0% from Q3 2024 and 9.9% from Q2 2025; capital allocation-based income was $42.0 million versus $4.6 million a year earlier.
GAAP diluted EPS of $2.87 (vs. $2.64 in Q3 2024) and adjusted diluted EPS of $2.81 (vs. $2.57).
GAAP operating expenses of $1,250.3 million, up 6.7% year over year, including a $28.5 million restructuring charge; adjusted operating expenses were $1,134.4 million, up 3.2%.
Effective advisory fee rate excluding performance-based fees fell to 39.1 basis points from 40.7 basis points a year earlier.
Returned $442 million to stockholders via dividends and stock repurchases; 2025 full-year effective tax rate guided to 23.0%–26.0% (GAAP) and 23.5%–25.5% (adjusted).

03—Questions

Frequently Asked Questions

How did T. Rowe Price's assets under management change in the third quarter of 2025?
Ending AUM rose $90.4 billion to $1.77 trillion. The change reflects $89.1 billion of net market appreciation and income, $7.9 billion of net client outflows, and the addition of managed account - model delivery assets of $9.2 billion beginning July 1, 2025.
What drove the year-over-year change in revenue and earnings?
Net revenues rose 6.0% to $1,893.5 million, led by investment advisory fees of $1,698.7 million, up 4.4%. Capital allocation-based income increased to $42.0 million from $4.6 million, and net income attributable to T. Rowe Price Group rose 7.1% to $646.1 million.
Why did operating expenses increase, and what was the restructuring charge?
GAAP operating expenses increased 6.7% to $1,250.3 million. Technology, occupancy, and facility costs rose $19.2 million, and the company recorded a $28.5 million restructuring charge, primarily severance, related to the July workforce action under its broader plan to reduce expense growth and realign resources.
Is the company's fee rate under pressure?
The investment advisory annualized effective fee rate excluding performance-based fees was 39.1 basis points, down from 40.7 basis points in Q3 2024 and 39.6 basis points in Q2 2025. The company attributed the decline primarily to client flows and transfers shifting assets toward lower-fee strategies and products.
What did the company return to shareholders and what is its tax outlook?
T. Rowe Price returned $442 million to stockholders through the recurring quarterly dividend and stock repurchases. For full-year 2025, it estimates an effective tax rate of 23.0% to 26.0% on a U.S. GAAP basis and 23.5% to 25.5% on an adjusted basis.

04—Continue

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