Financial Data and Key Metrics Changes - For the first nine months of 2025, total firm-wide revenue was $2.1 billion, including record Financial Advisory revenue of $1.3 billion [4] - Third-quarter firm-wide revenue reached $725 million, up 12% year-over-year, driven by both business segments [8] - Financial Advisory revenue for the third quarter totaled $422 million, up 14% from the previous year [8] - Asset Management revenue for the third quarter was $294 million, an increase of 8% year-over-year and 10% sequentially [9] Business Line Data and Key Metrics Changes - Financial Advisory was active in M&A across healthcare, industrials, and consumer sectors, with notable transactions including Mallinckrodt Pharmaceuticals' $6.7 billion deal [8] - Asset Management saw record gross inflows for the third quarter, with total AUM increasing by 17% year-to-date [6][10] - Management fees for Asset Management increased by 6% year-over-year, while incentive fees rose to $9 million from $3 million [9][10] Market Data and Key Metrics Changes - The company reported net positive flows of $1.6 billion year-to-date in Asset Management, with AUM reaching $265 billion, a 7% increase from both September 2023 and June 2023 [10] - The effective tax rate for the third quarter was 21.4%, down from 32.5% in the same quarter last year [12] Company Strategy and Development Direction - The company is focused on long-term growth strategies, including expanding its team of Financial Advisory Managing Directors and enhancing productivity [15][20] - The introduction of new active ETFs and a focus on quantitative and emerging market strategies are part of the Asset Management growth strategy [17][18] - The company aims to double firm-wide revenue from 2023 to 2030 and deliver an average annual shareholder return of 10% to 15% [20][21] Management's Comments on Operating Environment and Future Outlook - Management sees an increasingly constructive environment for advisory activity, despite potential impacts from the U.S. government shutdown [13][14] - The company anticipates continued growth in both M&A and restructuring activities, driven by a diverse range of client needs [14][16] - Management expressed confidence in achieving or exceeding productivity goals, with average revenue per Managing Director increasing to nearly $9 million [15] Other Important Information - The company returned $60 million to shareholders in the third quarter, including a quarterly dividend of $47 million [12] - Chris Hogan will join as CEO of Lazard Asset Management in December, expected to accelerate growth [6][18] Q&A Session Summary Question: Hiring environment and talent retention - Management noted strong success in attracting high-quality talent and minimal regrettable departures, indicating a healthy Managing Director pool [25][26] Question: Recent success in Asset Management net inflows - Inflows are primarily from quantitative strategies and emerging markets, with a strong geographic mix outside the U.S. [30][31] Question: Trends in gross outflows - Gross outflows have decreased compared to last year, particularly from sub-advised accounts, with a more promising trajectory outside that category [40] Question: Operating leverage and achieving 60% comp ratio - Management is confident in achieving operating leverage in 2026, driven by improved productivity and strategic hiring [42] Question: Secondary market outlook - The company expects strong trends in the secondary market to continue, with no signs of slowing down [84] Question: Fee rates on inflows and outflows - A small increase in average fee rates was noted, with expectations for stability in the near term [86]

Financial Data and Key Metrics Changes - For the first nine months of 2025, total firm-wide revenue was $2.1 billion, including record Financial Advisory revenue of $1.3 billion [4] - Third quarter firm-wide revenue reached $725 million, up 12% year-over-year, driven by both business segments [8] - Financial Advisory revenue for the third quarter totaled $422 million, reflecting a 14% increase from the previous year [8] - Asset Management revenue for the third quarter was $294 million, an 8% increase year-over-year and a 10% sequential increase [10] - Compensation expense for the third quarter was $475 million, resulting in a compensation ratio of 65.5%, down from 66% a year ago [13] Business Line Data and Key Metrics Changes - Financial Advisory was active in M&A across healthcare, industrials, and consumer sectors, with notable transactions including Mallinckrodt Pharmaceuticals and Ferrero [4][9] - Asset Management achieved record gross inflows for the third quarter, with year-to-date net positive flows of $1.6 billion and total AUM up 17% [6][10] - Management fees for Asset Management increased by 6% year-over-year, while incentive fees rose to $9 million from $3 million in the same quarter last year [10] Market Data and Key Metrics Changes - The company noted strong client engagement and demand across investment platforms, particularly in quantitative and emerging market strategies [11] - The effective tax rate for the third quarter was 21.4%, down from 32.5% in the previous year, with an expected full-year 2025 effective tax rate around 20% [14] Company Strategy and Development Direction - The company is focused on expanding its team of financial advisory managing directors, aiming for a net addition of 10 to 15 MDs per year [16] - The strategy includes enhancing productivity per MD, with average revenue per MD increasing to almost $9 million [17] - The company is also expanding its ETF business, launching six strategies in 2025, and plans to further grow its offerings to reach new clients [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in an increasingly constructive environment for advisory activity, despite potential impacts from the U.S. government shutdown [15][16] - The company anticipates ongoing demand for M&A and restructuring services as businesses adapt to changing market conditions [16] - Management highlighted the importance of active management in areas with information imperfections, which is expected to drive future growth [18] Other Important Information - The company returned $60 million to shareholders in 2025, including a quarterly dividend of $47 million [15] - The hiring of Chris Hodgman as CEO of Lazard Asset Management is expected to accelerate growth and evolution in the asset management business [6][20] Q&A Session Summary Question: How does the company balance hiring strong talent with compensation leverage? - Management noted success in attracting high-quality talent and emphasized that increased productivity per MD will lead to better compensation leverage over time [30][32] Question: What is the outlook for net inflows in Asset Management? - Management indicated that while there are significant gross inflows, outflows from sub-advised accounts remain a challenge, but overall trends are positive [35][36] Question: How is the restructuring business performing amid recent credit concerns? - Management does not view recent bankruptcies as indicative of broader issues and expects both M&A and restructuring activities to coexist due to increased performance dispersion among firms [70][72] Question: What is the outlook for the secondaries business? - Management expressed confidence in continued strong growth in the secondaries business, expecting it to remain a permanent part of the market environment [88] Question: How are fee rates trending in Asset Management? - Management reported a slight increase in average fee rates due to inflows from higher-fee products, with expectations for stability in the near term [91]

Core Insights - Baillie Gifford, a prominent mutual fund manager, has filed for its first US exchange-traded funds (ETFs), marking a significant shift in its investment strategy as the industry increasingly favors ETFs over mutual funds [2][4] Group 1: Company Developments - The firm manages $264 billion globally and is launching a suite of five actively managed ETFs that will incorporate assets from existing mutual funds [2] - Jamie McGregor has been hired to lead the ETF initiative, bringing experience from Goldman Sachs' ETF Accelerator program [2] - Baillie Gifford's US assets under management total $116 billion, and the new funds will focus on various strategies including Emerging Markets and International Alpha [5] Group 2: Market Context - The move to ETFs comes at a time when the SEC is set to approve dual-share-class requests, which could enhance the competitive landscape for asset managers [4] - Despite the growing popularity of ETFs, there remains a limited selection for investors seeking active, long-term growth strategies, with only 11 out of 235 international large cap equity ETFs offering such options [3] Group 3: Challenges and Considerations - The firm faces hurdles in rolling out ETF share classes, including the need to improve performance and invest in distribution and marketing to drive sales [5] - New entrants to the ETF market must expand their capabilities, either by hiring staff and investing in technology or collaborating with third-party trusts [6] - The distribution landscape for new ETFs is uncertain, as broker-dealers may be slow to approve them for their platforms [6]

Core Viewpoint - Emerald Advisers is launching the F/m Emerald Special Situations ETF (NASDAQ:SPIT), which aims to target companies undergoing significant transformations, diverging from traditional benchmark-focused ETFs [2][5]. Group 1: ETF Characteristics - SPIT is designed for investors seeking unique opportunities that avoid crowded strategies and mega-cap concentration [3]. - The fund managers are not limited by sector or geography, allowing them to invest in companies where the market may be temporarily confused [3][5]. - The ETF is compared to a "gas pedal" within a portfolio, providing true diversification beyond existing holdings [4]. Group 2: Market Context - The launch of SPIT comes at a time when passive ETFs are experiencing record inflows and market concentration risks are at multi-decade highs, highlighting the need for active management [5]. - This ETF represents the second collaboration between Emerald Advisers and F/m Investments, following the introduction of the F/m Emerald Life Sciences Innovation ETF (NASDAQ:LFSC) [5].

Core Insights - The article discusses the high-quality development activities of public funds in Beijing, emphasizing the themes of the new era, new funds, and new value [1] Group 1 - The focus is on the formation of MACD golden cross signals, indicating a positive trend in certain stocks [1]

Group 1 - The ongoing significance of Liberation Day continues to influence market concerns from a forward-looking perspective [1]

Core Insights - Small-cap investing is gaining interest as a way to refresh portfolios amid market uncertainty, providing exposure to undervalued companies and mitigating concentration risk [1][3] - An active management approach to small-caps can enhance performance and identify firms best positioned for growth [4] Small-Cap Market Outlook - Small-cap firms are expected to have a stronger end to 2025 and a potentially rewarding start to 2026, aided by lower borrowing costs from recent rate cuts [2] - U.S. investors face concentration risk in megacap tech stocks, making small firms an attractive alternative with potential upside despite inflation and economic slowdown [3] Active Management Benefits - Active management can leverage fundamental research to identify small-cap firms that are likely to outperform in uncertain market conditions [4] Investment Options - The T. Rowe Price Small-Mid Cap ETF (TMSL) is highlighted as a viable investment option, charging a 55 basis point fee and focusing on growth or value characteristics through a bottom-up approach [5] - TMSL has achieved a year-to-date return of 9.1%, outperforming its category average of 6.9% and FactSet Segment average of 6% [5]

Core Insights - Sprott Asset Management USA, Inc. announced that its Sprott Active Gold & Silver Miners ETF (GBUG) reached $100 million in assets under management as of September 22, 2025, just over seven months after its inception on February 19, 2025 [1][2]. Company Overview - Sprott Asset Management USA, Inc. is a subsidiary of Sprott Inc., focusing on precious metals and critical materials investments, with a belief that their in-depth knowledge and experience differentiate them from generalists [4]. - The company operates from multiple locations, including Toronto, New York, Connecticut, and California, and is listed on the New York Stock Exchange and the Toronto Stock Exchange [4][5]. Investment Strategy - GBUG is an actively managed ETF that aims for long-term capital appreciation by investing in shares of companies involved in gold and silver mining, exploration, and development, as well as royalty and streaming companies [1][3]. - The investment strategy of GBUG is described as value-oriented and contrarian, leveraging the expertise of a team with over a century of relevant experience in the mining industry [3]. Market Performance - Gold and silver mining stocks have recently outperformed due to a surge in physical bullion prices, contributing to the rapid growth of GBUG [2]. - The wide dispersion of performance among gold and silver miners enhances the value of active management, according to Sprott's executives [3].

Core Insights - The Federal Reserve has initiated the first rate cut of the year, with potential for more cuts before the end of 2025, prompting fixed income investors to adjust their portfolios for the changing interest rate environment [1] - A steeper yield curve is emerging as short-term rates decline, necessitating a re-strategization of portfolios to accommodate both short-term and long-term changes [2] Active ETFs Advantages - Active ETFs provide diversified exposure and flexibility in uncertain markets, allowing portfolio managers to adjust holdings based on market conditions, unlike passive funds that are tied to market value weight indexes [3][6] - The Thornburg Core Plus Bond ETF (TPLS) offers core exposure with added flexibility compared to passive funds [7] - The Thornburg Multi Sector Bond ETF (TMB) provides income diversification and active management, making it suitable for a rate-cutting environment [8] Market Dynamics - Cash and shorter-dated securities face reinvestment risk as yields fall, while longer-dated bonds may experience volatility due to various economic factors [3] - Investors are encouraged to avoid closely tracking the Fed's movements and instead leverage active ETFs to navigate the new macro environment of lower rates [4] Portfolio Management - Portfolio managers can adjust ETF holdings to capture upside or mitigate downside risk, particularly in a yield-focused fund [5] - The complexity of bond markets necessitates active management to achieve market objectives and maximize income opportunities [5]

Group 1 - The rise of new active ETFs is occurring amid an uncertain investing environment as 2025 approaches, with recent rate cuts prompting investors to reassess their portfolios, thereby supporting the case for active management in international exposure [1] - Geopolitical risks and inflation are significant concerns for the market, alongside the impact of tariffs on businesses, which will influence operational decisions [2] - U.S. investors are increasingly interested in international equities to diversify and reduce home country bias due to uncertainty in U.S. equities, which have been primarily driven by technology stocks capitalizing on the AI theme [3][4] Group 2 - Active management is essential for selecting ETFs for international exposure given the various dynamics affecting international markets, with specific funds like Thornburg International Equity ETF (TXUE) and Thornburg International Growth Fund ETF (TXUG) recommended for investors [5]