Artisan Partners(US:APAM)2025-10-31 20:33Assets Under Management (AUM) - As of September 30, 2025, the company's assets under management (AUM) increased to $181.3 billion, a rise of $5.8 billion or 3% from $175.5 billion at June 30, 2025, primarily due to $8.3 billion of market appreciation[117]. - Total Assets Under Management (AUM) reached $181.306 billion[131]. - As of September 30, 2025, the total assets under management (AUM) reached $181,306 million, an increase from $167,840 million as of September 30, 2024, representing a growth of approximately 8.7%[136]. - The ending AUM by distribution channel as of September 30, 2025, was $109,165 million (60.2%) for intermediated wealth and $72,141 million (39.8%) for institutional clients[136]. - The beginning AUM for the nine months ended September 30, 2025, was $161,208 million, showing a decrease from $167,840 million at the end of the previous fiscal year[134]. Revenue and Income - Revenue for the three months ended September 30, 2025, was $301.3 million, an 8% increase from $279.6 million for the same period in 2024[117]. - Total operating income for the three months ended September 30, 2025, was $101.8 million, up 9% from $93.2 million in the same period of 2024[142]. - For the nine months ended September 30, 2025, management fees were $861.2 million, a 6% increase from $814.7 million in the same period of 2024[156]. - Total operating income for the nine months ended September 30, 2025, was $268.1 million, a 4% increase from $257.5 million in the same period of 2024[156]. - Net income attributable to Artisan Partners Asset Management Inc. for the three months ended September 30, 2025, was $66.8 million, down 8% from $72.9 million in the same period of 2024[142]. Client Cash Flows - Net client cash flows for the three months ended September 30, 2025, were $(2.3) billion, a significant decline of 213.5% compared to $(0.7) billion for the same period in 2024[123]. - For the nine months ended September 30, 2025, net client cash flows were $(7.0) billion, compared to $(2.9) billion for the same period in 2024, indicating a 144.6% decline[123]. - The company experienced a net client cash flow decline of $2,329 million for the three months ended September 30, 2025, compared to a net inflow of $879 million for the same period in 2024[132]. - Gross client cash inflows for the nine months ended September 30, 2025, totaled $19,331 million, while gross client cash outflows were $26,363 million, resulting in net client cash flows of negative $7,032 million[134]. - Gross client cash inflows for the three months ended September 30, 2025, were $6.084 billion, compared to $6.210 billion for the same period in 2024, a decrease of 2%[137]. Investment Performance - Global Opportunities Strategy reported a 1-year return of 10.43% and a 3-year return of 19.57%[130]. - U.S. Mid-Cap Growth Strategy achieved a 1-year return of 22.48% and a 10-year return of 14.47%[130]. - Non-U.S. Growth Strategy delivered a 1-year return of 30.44% and a 5-year return of 11.23%[130]. - Developing World Strategy posted a 1-year return of 21.09% and a 3-year return of 29.38%[131]. - Global Value Strategy achieved a 1-year return of 21.11% and a 5-year return of 17.52%[131]. - Sustainable Emerging Markets Strategy reported a 1-year return of 28.24% and a 5-year return of 9.47%[130]. - Credit Opportunities Strategy delivered a 1-year return of 15.53% and a 3-year return of 16.34%[130]. - Franchise Strategy reported a 1-year return of 23.94% since its inception[130]. - Value Income Strategy achieved a 1-year return of 4.63% and a 5-year return of 6.32%[130]. Operating Expenses and Margins - The GAAP operating margin was 33.8% for the three months ended September 30, 2025, compared to 33.3% for the same period in 2024, while the adjusted operating margin was 36.2%, up from 35.0%[117]. - Total operating expenses for the three months ended September 30, 2025, were $199.5 million, an increase of 7% from $186.4 million in the same period of 2024[142]. - Total compensation and benefits increased by $14.3 million, or 10%, for the three months ended September 30, 2025, primarily due to a $7.3 million increase in short-term incentive compensation[149]. - Total compensation and benefits accounted for 56% of revenues for the nine months ended September 30, 2025, compared to 55% for the same period in 2024[161]. - The adjusted operating margin improved to 33.4% for the nine months ended September 30, 2025, compared to 32.7% in 2024[174]. Tax and Other Financial Metrics - The provision for income taxes increased by 50% to $36.9 million for the three months ended September 30, 2025, compared to $24.6 million in the same period of 2024[142]. - The effective income tax rate for the three months ended September 30, 2025, was 30.0%, up from 19.1% in the same period of 2024[153]. - The effective income tax rate increased to 24.0% for the nine months ended September 30, 2025, from 19.9% in 2024, influenced by a $10.7 million charge from the enactment of the OBBBA[165][166]. - Artisan's share of total investment gains for the three months ended September 30, 2025, was $15.7 million, including $10.1 million from compensation plan hedges[152]. - Total non-operating income decreased by $13.9 million, or 39%, for the three months ended September 30, 2025, compared to the same period in 2024[151]. Dividends and Distributions - The company declared and distributed dividends of $0.73 per share of Class A common stock during the three months ended September 30, 2025[117]. - The company declared a variable quarterly dividend of $0.88 per share of Class A common stock for the September quarter of 2025, representing approximately 80% of the cash generated in that quarter[185]. - Total distributions from Holdings Partnership to limited partners for the nine months ended September 30, 2025, were $276.8 million, compared to $241.8 million for the same period in 2024, reflecting a 14.5% increase[184]. Cash and Financing Activities - As of September 30, 2025, cash and cash equivalents increased to $300.2 million from $201.2 million as of December 31, 2024, representing a 49.2% increase[175]. - The company had $190 million in unsecured notes outstanding and a $100 million revolving credit facility, which was unused as of September 30, 2025[180]. - Net cash provided by operating activities decreased by $86.5 million for the nine months ended September 30, 2025, totaling $249.2 million compared to $335.7 million for the same period in 2024[190]. - The net cash used in financing activities decreased by $63.4 million for the nine months ended September 30, 2025, totaling $142.5 million compared to $205.9 million for the same period in 2024[192].