Artisan Partners(US:APAM)2026-02-20 21:30Assets Under Management (AUM) - The firm's AUM decreased by approximately 43% from June 30, 2008, to March 31, 2009, primarily due to general market conditions [120]. - During the first quarter of 2020, AUM levels decreased by approximately 24% from February 19, 2020, to March 31, 2020, due to sharp global equity market declines related to the COVID-19 pandemic [120]. - In 2022, the firm's assets declined by approximately 27% as a result of persistent inflation, interest rate increases, and geopolitical tensions [120]. - As of December 31, 2025, the company's assets under management (AUM) increased to $179.9 billion, a rise of $18.7 billion, or 12%, from $161.2 billion at the end of 2024 [252]. - The average AUM for the year ended December 31, 2025, was $173.0 billion, reflecting an 8.0% increase from $160.2 billion in 2024 [252]. - Total Assets Under Management (AUM) reached $179,928 million, including $123 million for which Artisan Partners provides investment models to managed account sponsors [268]. - As of December 31, 2025, total assets under management (AUM) reached $179.9 billion, with equity, credit, and alternative assets contributing $158.0 billion, $17.9 billion, and $4.0 billion respectively [274]. Investment Performance - Approximately 88% of the company's AUM is managed in long-only equity investment strategies, exposing it to greater risk during market declines [143]. - Investment returns contributed $33.4 billion to the AUM in 2025, significantly impacting the overall growth despite net outflows [261]. - The Global Opportunities Strategy has an AUM of $16,537 million with a 1-year return of 10.14% and a 5-year average annual return of 5.25% [267]. - The Non-U.S. Growth Strategy reported a 1-year return of 37.93% and a 3-year return of 21.19%, with an AUM of $15,475 million [267]. - The Developing World Strategy achieved a 1-year return of 9.15% and a 3-year return of 22.93%, with an AUM of $4,283 million [268]. - The Global Value Strategy has an AUM of $36,280 million, with a 1-year return of 35.45% and a 5-year average annual return of 14.65% [267]. - The Emerging Markets Local Opportunities Strategy reported a 1-year return of 25.39% and an AUM of $1,861 million [268]. - The Credit Opportunities Strategy achieved a 1-year return of 11.06% and has an AUM of $367 million [267]. - The Global Equity Strategy has an AUM of $432 million with a remarkable 1-year return of 47.84% [267]. - The Sustainable Emerging Markets Strategy reported a 1-year return of 43.91% and an AUM of $2,537 million [267]. - The Antero Peak Strategy achieved a 1-year return of 21.80% with an AUM of $2,220 million [268]. Revenue and Financial Performance - The company generated $1,196.7 million in revenue for the year ended December 31, 2025, representing a 7.6% increase from $1,111.8 million in 2024 [252]. - The GAAP operating margin was 33.4% in 2025, compared to 33.0% in 2024, while the adjusted operating margin improved to 35.3% from 33.8% [252]. - Total revenues for the year ended December 31, 2025, were $1.2 billion, with management fees making up $1.2 billion and performance fees at $29.1 million [283]. - Approximately 80% of investment advisory fees were earned from clients located in the United States for the years ended December 31, 2025, 2024, and 2023 [284]. - The weighted average fee rate for Artisan Funds and Artisan Global Funds was 0.883% for the year ended December 31, 2025, slightly decreasing from 0.901% in 2023 [279]. Client Flows and Relationships - Net client cash flows for 2025 were $(12.7) billion, compared to $(3.7) billion in 2024, indicating increased outflows [258]. - Gross client cash inflows for 2025 were $27.0 billion, while gross client cash outflows were $39.7 billion [261]. - The company experienced net outflows of $15.6 billion in equity strategies in 2025, primarily due to weaker performance and client reallocations [261]. - The intermediated wealth distribution channel accounted for 61.4% of total AUM as of December 31, 2025, up from 58.6% in 2024 [271]. - The institutional channel represented 38.6% of total AUM as of December 31, 2025, a decrease from 41.4% in 2024 [271]. Operational and Regulatory Risks - The firm may offer lower fees to retain current assets and attract additional assets, which could exert downward pressure on fees [126]. - The firm has experienced competition for skilled investment professionals, which could impact its ability to execute business strategies [105]. - Poor investment performance can lead to a loss of AUM, negatively impacting revenues and financial condition [114]. - The investment management industry is facing transformative pressures, including a shift towards passive investment strategies and increased fee competition [133]. - The company is subject to extensive regulatory scrutiny, including from the SEC and other regulatory bodies, which could lead to significant operational costs and legal liabilities [165]. - The company is experiencing increased operational and regulatory risks associated with newer investment strategies offered through private funds [145]. - Employee misconduct or perceived misconduct could expose the company to significant legal liability and reputational harm [157]. - The company relies heavily on internal and third-party technology systems for operations, increasing the risk of operational disruptions and cybersecurity incidents [172]. Dividends and Shareholder Returns - The company declared a dividend of $1.58 per share of Class A common stock for Q1 2026, consisting of a variable quarterly dividend of $1.01 per share and a special annual dividend of $0.57 per share [237]. - The variable quarterly dividend of $1.01 per share represents approximately 80% of the cash generated in the fourth quarter of 2025 [237]. - The company expects to pay a quarterly dividend of approximately 80% of the cash generated from operations, subject to Board approval [237]. - The company’s stockholders would have experienced an 8% annual total return as of December 31, 2025, if all dividends were retained, compared to an 11% annual total return if all dividends were reinvested [236]. Cybersecurity and Risk Management - The company has a comprehensive cybersecurity risk management strategy integrated into its overall risk management framework [207]. - The company has not experienced any known material cybersecurity breach or threat that resulted in or is reasonably likely to result in any material loss or impact on its business strategy, results of operations, or financial condition [212]. - The Audit Committee oversees cybersecurity risk management and receives quarterly reports on significant cybersecurity events or trends impacting the company [219]. - The information security governance team reports to senior management on the results of its annual cybersecurity risk assessment [215]. - The company maintains a robust information security program that includes periodic internal audits and independent third-party reviews [210].