TimesSquare Capital Management, an equity investment management company, released its “U.S. Small Cap Growth Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. During the quarter, the fund returned 11.28% (gross) and 11.02% (net), compared to the Russell 2000 Growth Index by 11.97%. Equities posted double-digit returns in the second quarter as global economic activity measures lifted. In addition, please check the fund’s top five holdings to know its best picks in 20 ...

Key Takeaways Victory Capital's AUM rose 1.3% in August 2025 to $303.7 billion.Equity gains drove increases in mid-cap, small-cap, and global/non-U.S. assets.Solutions climbed 3.2% to $83.5B, while fixed income inched up to $79.9B.Victory Capital Holdings, Inc. (VCTR) reported assets under management (AUM) of $303.7 billion for August 2025. This reflected a 1.3% increase from July 31, 2025.By asset class, VCTR’s U.S. mid-cap equity AUM increased marginally from the July level to $32.1 billion. The U.S. smal ...

SAN ANTONIO--(BUSINESS WIRE)---- $VCTR--Victory Capital reported Total AUM of $303.7 billion, Other Assets of $2.7 billion, and Total Client Assets of $306.4 billion, as of August 31, 2025. ...

Core Insights - Victory Capital Holdings, Inc. (VCTR) reported assets under management (AUM) of $299.8 billion for July 2025, reflecting a marginal increase from June 30, 2025 [1][8] - The U.S. mid-cap equity AUM increased by 1% to $31.9 billion, while U.S. small-cap equity AUM declined by 4.4% to $12.6 billion [1][8] - The global/non-U.S. equity AUM rose slightly to $25.8 billion, and U.S. large-cap equity AUM increased marginally to $62.3 billion [1][8] Asset Class Performance - Victory Capital recorded $80.8 billion in Solutions, up 1.1% from June 2025 [2] - Alternative investments asset balance increased slightly to $2.9 billion, while fixed-income AUM totaled $79.7 billion, showing a marginal decrease [2] - Money market/short-term assets rose by 2.3% to $3.7 billion [2] Business Model and Market Position - The strong positioning of VCTR's integrated multi-boutique business model in a fast-expanding market is expected to enhance its performance in the near term [3] Stock Performance - Over the past six months, VCTR shares have gained 3.7%, outperforming the industry's growth of 1.8% [4] Comparison with Other Asset Managers - Franklin Resources, Inc. (BEN) reported preliminary AUM of $1.62 trillion as of July 31, 2025, which increased slightly from the prior month [6] - Invesco (IVZ) reported AUM of $2,024.5 billion as of July 31, 2025, reflecting a 1.2% increase from the previous month [9]

[PART I — FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section provides the unaudited condensed consolidated financial statements and management's discussion of financial condition and results of operations [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, highlighting significant asset growth and revenue increase driven by the Pioneer Investments acquisition, despite a decline in net income due to higher operating expenses Condensed Consolidated Financial Statements Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 ($ thousands) | December 31, 2024 ($ thousands) | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | **$4,249,447** | **$2,547,591** | **+66.8%** | | Goodwill | $1,232,800 | $981,805 | +25.6% | | Other intangible assets, net | $2,515,005 | $1,260,614 | +99.5% | | **Total Liabilities** | **$1,784,322** | **$1,425,954** | **+25.1%** | | Long-term debt, net | $965,674 | $963,862 | +0.2% | | **Total Stockholders' Equity** | **$2,465,125** | **$1,121,637** | **+119.8%** | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | YTD 2025 ($ thousands) | YTD 2024 ($ thousands) | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | **$351,212** | **$219,621** | **$570,814** | **$435,478** | | Income from Operations | $94,214 | $110,597 | $187,122 | $195,406 | | **Net Income** | **$58,734** | **$74,251** | **$120,709** | **$129,942** | | Net Income Attributable to Common | $46,076 | $74,251 | $105,702 | $129,942 | | **Diluted EPS ($)** | **$0.68** | **$1.12** | **$1.59** | **$1.97** | Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, in thousands) | Cash Flow Activity | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $74,502 | $148,388 | | Net cash provided by (used in) investing activities | $78,116 | $(1,515) | | Net cash used in financing activities | $(171,979) | $(151,409) | Note 3. Revenue Recognition Revenue by Type and Product (Three Months Ended June 30, in thousands) | Revenue Source | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | **Investment management fees** | **$282,306** | **$173,163** | |    Mutual funds (Victory Funds) | $175,308 | $116,550 | |    ETFs (VictoryShares) | $9,834 | $5,515 | |    Separate accounts and other | $78,103 | $49,061 | |    Performance-based fees | $19,061 | $2,037 | | **Fund administration and distribution fees** | **$68,906** | **$46,458** | | **Total Revenue** | **$351,212** | **$219,621** | Note 4. Acquisitions - The company completed the acquisition of Amundi's U.S. business, rebranded as Pioneer Investments, on April 1, 2025, marking its **largest investment franchise addition**[30](index=30&type=chunk)[78](index=78&type=chunk) - The Amundi US acquisition had a total purchase price of approximately **$1.328 billion**, settled entirely through the issuance of **3.3 million Common Stock shares** and **19.7 million Preferred Stock shares**[79](index=79&type=chunk)[81](index=81&type=chunk) Preliminary Purchase Price Allocation for Amundi US (in thousands) | Account | Amount ($ thousands) | | :--- | :--- | | Goodwill | $250,995 | | Other intangible assets | $1,278,000 | | Total purchase price consideration | $1,328,339 | - The fair value of contingent consideration for the WestEnd acquisition decreased to **$80.7 million** as of June 30, 2025, from **$139.9 million** at year-end 2024, following a **$63.7 million cash payment**[73](index=73&type=chunk) Note 10. Equity - The Board approved the 2025 Share Repurchase Program in December 2024, authorizing up to **$200.0 million** in common stock repurchases through December 31, 2026[125](index=125&type=chunk) - In Q2 2025, the company repurchased **0.3 million shares** for **$21.4 million**, with **$178.6 million** remaining available under the program as of June 30, 2025[126](index=126&type=chunk)[127](index=127&type=chunk) - The Amundi US acquisition involved the issuance of **3.3 million shares of Common Stock** and **19.7 million shares of newly issued Preferred Stock**[132](index=132&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the significant impact of the Pioneer Investments acquisition on AUM and revenue, noting increased operating expenses and the use of non-GAAP metrics to illustrate operational profitability Assets Under Management AUM Roll-Forward (in millions) | Period | Beginning AUM ($ millions) | Acquired Assets ($ millions) | Net Flows ($ millions) | Market Appreciation ($ millions) | Ending AUM ($ millions) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Q2 2025** | $167,468 | $111,654 | $(804) | $20,247 | **$298,563** | | **Q2 2024** | $170,342 | $(1) | $(1,744) | $83 | **$168,681** | - AUM increased by **78.3%** to **$298.6 billion** at June 30, 2025, primarily due to **$114 billion** from the Pioneer Investments acquisition and **$20.2 billion** in market appreciation, partially offset by **$0.8 billion** in net outflows[182](index=182&type=chunk)[207](index=207&type=chunk) AUM by Asset Class (as of June 30, in millions) | Asset Class | 2025 ($ millions) | 2024 ($ millions) | | :--- | :--- | | Solutions | $79,988 | $58,936 | | Fixed Income | $79,752 | $24,398 | | U.S. Large Cap Equity | $61,844 | $13,983 | | U.S. Mid Cap Equity | $31,643 | $31,015 | | Global / Non-U.S. Equity | $25,576 | $18,459 | | U.S. Small Cap Equity | $13,140 | $15,182 | | Alternative Investments | $2,986 | $3,390 | | **Total Long-Term Assets** | **$294,930** | **$165,362** | Results of Operations - Total revenue for Q2 2025 increased **59.9%** to **$351.2 million** from **$219.6 million** in Q2 2024, driven by a **69.0%** increase in average AUM post-Pioneer acquisition[213](index=213&type=chunk)[214](index=214&type=chunk) - Personnel compensation and benefits for Q2 2025 rose **95.7%** to **$108.9 million**, primarily due to increased staff from the acquisition and **$13.1 million** in acquisition-related compensation costs[219](index=219&type=chunk)[221](index=221&type=chunk) - Acquisition-related costs of **$25.8 million** and restructuring costs of **$14.0 million** in Q2 2025, primarily from the Amundi US transaction, significantly impacted operating income[231](index=231&type=chunk)[233](index=233&type=chunk) - The effective tax rate for Q2 2025 increased to **32.5%** from **22.5%** in Q2 2024, mainly due to non-deductible transaction costs from the Amundi US acquisition[239](index=239&type=chunk) Supplemental Non-GAAP Financial Information Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | | Net income (GAAP) | $58,734 | $74,251 | | Adjustments (Interest, Taxes, D&A, etc.) | $119,791 | $42,251 | | **Adjusted EBITDA (Non-GAAP)** | **$178,525** | **$116,502** | Reconciliation of Net Income to Adjusted Net Income (in thousands) | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | | :--- | :--- | :--- | | Net income (GAAP) | $58,734 | $74,251 | | Adjustments (Amortization, Stock Comp, etc.) | $63,773 | $2,254 | | **Adjusted Net Income (Non-GAAP)** | **$122,507** | **$76,505** | Liquidity and Capital Resources - As of June 30, 2025, the company held **$107.9 million** in cash and cash equivalents and maintained a fully undrawn **$100.0 million** revolving credit facility[248](index=248&type=chunk)[251](index=251&type=chunk) - Net cash used in financing activities for the first six months of 2025 totaled **$172.0 million**, primarily for **$73.6 million** in dividend payments, **$63.7 million** in acquisition consideration, and **$26.4 million** in common stock repurchases[268](index=268&type=chunk) - Net cash provided by operating activities decreased to **$74.5 million** in the first half of 2025 from **$148.4 million** in the same period of 2024, primarily due to working capital changes and lower net income[264](index=264&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=47&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to market risk, including AUM sensitivity, foreign exchange fluctuations, and interest rate risk from variable-rate debt - A **10%** change in AUM is estimated to result in an annualized revenue change of approximately **$146.5 million**, based on the Q2 2025 weighted-average fee rate of **49 basis points**[271](index=271&type=chunk) - A **10%** change in the U.S. dollar's value against other currencies would impact AUM by approximately **$2.7 billion**, leading to an estimated annualized revenue change of **$13.2 million**[274](index=274&type=chunk) - The company monetized its interest rate swap in Q4 2023 and remains exposed to interest rate risk from its variable-rate term loans under the 2019 Credit Agreement as of June 30, 2025[276](index=276&type=chunk) [Item 4. Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures are **effective** as of June 30, 2025[278](index=278&type=chunk) - No material changes occurred in the company's internal control over financial reporting during the most recent fiscal quarter[279](index=279&type=chunk) [PART II — OTHER INFORMATION](index=49&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, and details on unregistered sales of equity securities and use of proceeds [Item 1. Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) The company reports on stockholder litigation related to the Amundi US acquisition, which was voluntarily discontinued after supplemental disclosures - Stockholder litigation was filed in September 2024 against the company and its board concerning the Amundi US transaction, alleging incomplete and misleading proxy statements[281](index=281&type=chunk)[282](index=282&type=chunk) - The company voluntarily made supplemental disclosures to avoid litigation risk and potential transaction delays, while denying any wrongdoing[283](index=283&type=chunk) - Plaintiffs in the stockholder litigation filed notices of voluntary discontinuance on April 4, 2025, effectively ending the actions[283](index=283&type=chunk) [Item 1A. Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) This section states that there have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - No material changes have occurred to the risk factors disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024[285](index=285&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=49&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's share repurchase activity under its 2025 Share Repurchase Program, including shares purchased and remaining authorization Share Repurchase Activity (Q2 2025) | Metric | Value | | :--- | :--- | | Total Shares Purchased | 341,830 | | Average Price Paid Per Share | $62.53 | | Total Cost ($ millions) | $21.4 | | Remaining Authorization ($ millions) | $178.6 |

Financial Data and Key Metrics Changes - Total client assets increased by 76% quarter over quarter, reaching over $300 billion, a record high for quarter end [4] - Adjusted EBITDA was $179 million, equating to an adjusted EBITDA margin of 50.8%, slightly higher than anticipated [5][15] - Revenue increased to $351.2 million, up 60% from the first quarter [13] - Adjusted net income with tax benefit rose to $133 million or $1.57 per diluted share [5][15] - Net leverage ratio improved to 1.2 times, the lowest level since the initial IPO [16][24] Business Line Data and Key Metrics Changes - Gross long-term flows accelerated to $15.4 billion, with net outflows at $660 million, marking the third consecutive quarter of improving long-term flows [4][19] - The ETF platform posted positive net flows of over $4 billion in the first half of the year, bringing ETF assets under management to $15 billion, up nearly 90% from the same time last year [8] - The company achieved $70 million of net expense synergies on a run rate basis, representing nearly two-thirds of the expected total of $110 million [7][20] Market Data and Key Metrics Changes - The company is now managing assets for investors in 60 countries, with over 16% of total client assets from non-U.S. investors [17][45] - The integration of the Pioneer Investments business is progressing well, enhancing diversification across channels and asset classes [6][17] Company Strategy and Development Direction - The company is focused on expanding its product range, launching new ETFs, and enhancing its global distribution capabilities through the partnership with Amundi [6][10][41] - The Board authorized an increase in the share repurchase plan from $200 million to $500 million, indicating confidence in future growth prospects [12][16] - The company is actively evaluating potential acquisition opportunities, anticipating industry consolidation to accelerate in the coming years [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current trajectory and underlying momentum in several products, particularly in fixed income and global equity [4][6] - The company aims to grow organically and is in the best position in its history to achieve this, despite industry headwinds [55][57] - Management noted that the integration of sales teams is ongoing, with expectations for continued improvement in sales efforts [70][72] Other Important Information - The company closed its Newbridge, SOFAS, and THB investment franchises, managing less than $1 billion of AUM, to allocate more resources to growth areas [11] - The effective tax rate for the quarter was 32.5%, with a normal effective tax rate expected to be approximately 25% going forward [22] Q&A Session Summary Question: Can you provide insight into the nonrecurring expenses and how quickly they will wind down? - Management indicated that $53 million of acquisition-related costs were incurred, with $26 million being one-time deal-related expenses that will not recur [28][30] Question: How does the fixed income product set fit into the current market environment? - Management expressed confidence in their fixed income capabilities, stating that they have a strong product set for various market conditions and expect growth in this area [34][36] Question: What are the expectations for non-U.S. distribution and product launches? - Management highlighted the strategic partnership with Amundi, which allows for selling products outside the U.S., and anticipates significant growth in this area [40][45] Question: What is the outlook for organic growth and flows? - Management noted improvements in net outflows and gross flows, emphasizing their goal to grow organically and invest in distribution efforts [55][57] Question: Can you specify the benefit from one-time performance fees? - Management stated that it is difficult to quantify the exact benefit from one-time fees, but various positive factors contributed to the improved fee rate [58][66]

Second Quarter 2025 Earnings Presentation August 8, 2025 Forward Looking Statements This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect our current expectations regarding future events, results or outcomes. These expectations may or may not be realized. Although we believe the expectations reflected in the forward-looking statements are reasonable, we can give no assurance that these expectati ...

Victory Capital (VCTR -2.96%), a diversified global asset manager, released its earnings on August 7, 2025. The company posted standout financial results thanks to its acquisition of Amundi US, which nearly doubled assets under management and drove GAAP revenue to $351.2 million—exceeding analyst expectations by $14.4 million or 4.3% (GAAP revenue). Non-GAAP diluted earnings per share hit $1.57, also surpassing estimates. However, GAAP operating margin dropped to 26.8% from 50.4% in Q2 2024, as integration ...

Core Insights - Victory Capital Holdings reported a revenue of $351.21 million for the quarter ended June 2025, marking a 59.9% increase year-over-year, with an EPS of $1.57 compared to $1.31 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $335.82 million by 4.58%, and the EPS surpassed the consensus estimate of $1.45 by 8.28% [1] Financial Performance - The company’s shares have returned +7% over the past month, outperforming the Zacks S&P 500 composite, which saw a +1.2% change [3] - Victory Capital currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3] Assets Under Management (AUM) - Total ending Assets Under Management (AUM) stood at $298.56 billion, slightly below the average estimate of $298.57 billion [4] - AUM in U.S. Large Cap Equity was $61.84 billion, exceeding the average estimate of $50.78 billion, while U.S. Mid Cap Equity AUM was $31.64 billion, below the average estimate of $37.49 billion [4] - AUM in U.S. Small Cap Equity was $13.14 billion, significantly lower than the estimated $18.35 billion [4] Revenue Breakdown - Investment management fees generated revenue of $282.31 million, surpassing the average estimate of $262.94 million, reflecting a year-over-year increase of 63% [4] - Fund administration and distribution fees amounted to $68.91 million, which was below the estimated $72.87 million but still represented a 48.3% increase compared to the previous year [4] Client Cash Flows - Total net client cash flows were reported at $-804 million, worse than the average estimate of $-594.7 million [4] - Specifically, net client cash flows in U.S. Mid Cap Equity were $-748 million, compared to the average estimate of $-211.03 million [4]

Core Insights - Victory Capital Holdings (VCTR) reported quarterly earnings of $1.57 per share, exceeding the Zacks Consensus Estimate of $1.45 per share, and showing an increase from $1.31 per share a year ago, resulting in an earnings surprise of +8.28% [1] - The company achieved revenues of $351.21 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 4.58%, and up from $219.62 million year-over-year [2] - Victory Capital shares have increased approximately 5.7% year-to-date, compared to the S&P 500's gain of 7.9% [3] Earnings Outlook - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is $1.49 on revenues of $354.51 million, and for the current fiscal year, it is $5.97 on revenues of $1.27 billion [7] Industry Context - The Financial - Investment Management industry, to which Victory Capital belongs, is currently ranked in the top 23% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8]