Financial Data and Key Metrics Changes - Assets under management (AUM) reached a record $867 billion at year-end 2025, reflecting market appreciation and strong sales [5] - Adjusted earnings for Q4 2025 were $0.96 per unit, down 9% year-over-year, while full-year adjusted earnings increased 2% to $3.33 [23][24] - Total net revenues for Q4 were $957 million, down 2% year-over-year, with full-year revenues flat at $3.5 billion [24] - Adjusted operating margin for the year was 33.7%, at the upper end of the 30%-35% target range [8][37] Business Line Data and Key Metrics Changes - Bernstein Private Wealth had $156 billion in AUM, contributing approximately 37% of firm-wide revenues in 2025 [5] - Private Markets platform closed the year with $82 billion in AUM, up 18% year-over-year [6] - SMA franchise reached $62 billion in AUM, growing 12% organically in 2025 [6] - Active ETF suite expanded to $14 billion across 24 strategies, delivering 65% organic growth in 2025 [6] Market Data and Key Metrics Changes - Firm-wide active net flows were negative for both the quarter and the full year, with total net active outflows of $9.4 billion in 2025 [6] - Taxable fixed income saw $2 billion in outflows in Q4 and $9.1 billion for the year, driven by geopolitical uncertainty [7] - Tax-exempt franchise generated $3.9 billion in inflows in Q4 and $11.6 billion for the year, marking 13 consecutive years of organic growth [7] Company Strategy and Development Direction - The company is focused on expanding its Private Markets capabilities and enhancing commercial real estate lending [9][22] - A partnership with Equitable is seen as a strategic advantage, expected to onboard over $10 billion of new long-duration assets by year-end 2026 [9][31] - The firm aims to exceed its target of $90 billion-$100 billion in Private Markets AUM by 2027, with ongoing investments in growth initiatives [39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the firm's strategic progress and disciplined execution throughout 2025 [4] - The outlook for 2026 includes expectations for continued growth in private asset mandates and a focus on enhancing investment services [39] - The firm anticipates that stable economic growth could favor international and value strategies moving forward [16] Other Important Information - The effective tax rate for 2025 was 5.9%, with a forecast of 6%-7% for 2026 [32] - The firm is investing in a new investment management platform expected to enhance operational efficiency and drive future growth [30] Q&A Session Summary Question: Outlook for high-yield funds in Asia - Management noted that macro factors like FX risk have not significantly impacted structural demand for fixed income in Asia, with strong demand for U.S. dollar-denominated strategies [41][42] Question: Seasonality in Private Wealth - Management indicated that tax impacts in Q2 are a key seasonal factor, with overall confidence in the pipeline for new client acquisition [47][48] Question: Private credit exposure to software - Management stated that exposure to software within the private credit portfolio is not significant, with diligent monitoring of credit risks [51][53] Question: Growth of Private Markets AUM beyond 2027 - Management expressed ambition to exceed the current target for Private Markets AUM and indicated that further opportunities for expansion exist [55]

Financial Data and Key Metrics Changes - Assets under management (AUM) reached a record $867 billion at year-end 2025, reflecting market appreciation and strong sales [5] - Adjusted earnings for Q4 2025 were $0.96 per unit, down 9% year-over-year, while full-year adjusted earnings increased 2% to $3.33 [23][24] - Total net revenues for Q4 were $957 million, down 2% year-over-year, with full-year revenues flat at $3.5 billion [24] - Adjusted operating margin for the year expanded to 33.7%, at the upper end of the 30%-35% target range [8][37] Business Line Data and Key Metrics Changes - Bernstein Private Wealth business had $156 billion in AUM, contributing approximately 37% of firm-wide revenues in 2025 [5] - Private markets platform closed the year with $82 billion in AUM, up 18% year-over-year [6] - SMA franchise reached $62 billion in AUM, growing 12% organically in 2025 [6] - Active ETF suite expanded to $14 billion across 24 strategies, delivering 65% organic growth in 2025 [6] Market Data and Key Metrics Changes - Firm-wide active net flows were negative for both the quarter and the full year, with total net active outflows of $9.4 billion in 2025 [6] - Taxable fixed income saw $2 billion in outflows in Q4 and $9.1 billion for the year, driven by geopolitical uncertainty [7] - Tax-exempt franchise generated $3.9 billion in inflows in Q4 and $11.6 billion for the year, marking 13 consecutive years of organic growth [7] Company Strategy and Development Direction - The company is focused on expanding its private markets capabilities and enhancing commercial real estate lending [9][22] - A partnership with Equitable is expected to onboard more than $10 billion of new long-duration assets by year-end 2026 [9] - The strategic direction includes disciplined investments in targeted growth initiatives, product innovation, and expanded marketing efforts [39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the firm's ability to navigate macroeconomic challenges and maintain strong demand for its products [41][44] - The outlook for private markets AUM is ambitious, with expectations to exceed the $90 billion-$100 billion target by 2027 [55] - Management noted that the firm is well-positioned to capture fixed income's enduring value amid ongoing market trends [18] Other Important Information - The effective tax rate for 2025 was 5.9%, with a forecast of 6%-7% for 2026 [32] - The firm experienced a decline in performance fees, with full-year performance fees totaling $172 million, down 24% year-over-year [25][35] Q&A Session Summary Question: Outlook for high-yield funds in Asia - Management discussed macro factors influencing demand, including FX risk and interest rates, noting strong structural demand for U.S. dollar-denominated strategies [41][42][44] Question: Seasonality in private wealth - Management indicated that tax impacts in Q2 are significant, with overall positive sentiment about the pipeline for new client acquisition [47][48] Question: Private credit exposure to software - Management stated that exposure to software within the private credit portfolio is not significant, with diligent monitoring of credit risks [51][53] Question: Growth of private markets AUM beyond 2027 - Management expressed ambition to exceed the current target and indicated that onboarding from the commercial mortgage lending team will contribute to growth [55]

Financial Data and Key Metrics Changes - Assets under management (AUM) reached a record $867 billion at year-end 2025, reflecting market appreciation and strong sales [5] - Adjusted earnings for Q4 2025 were $0.96 per unit, down 9% year-over-year, while full-year adjusted earnings increased 2% to $3.33 [22] - Total net revenues for Q4 were $957 million, down 2% year-over-year, with full-year revenues flat at $3.5 billion [23] - Adjusted operating margin expanded to 33.7% for the year, at the upper end of the 30%-35% target range [9][36] Business Line Data and Key Metrics Changes - Bernstein Private Wealth business had $156 billion in AUM, contributing approximately 37% of firm-wide revenues in 2025 [5] - Private markets platform closed the year with $82 billion in AUM, up 18% year-over-year [6] - SMA franchise reached $62 billion in AUM, growing 12% organically in 2025 [6] - Active ETF suite expanded to $14 billion across 24 strategies, delivering 65% organic growth in 2025 [6] Market Data and Key Metrics Changes - Firm-wide active net flows were negative for both the quarter and the full year, with total net active outflows of $9.4 billion in 2025 [6] - Tax-exempt franchise generated $3.9 billion in inflows in Q4 and $11.6 billion for the year, marking 13 consecutive years of organic growth [8] - Alternatives and multi-asset strategies posted $1.9 billion active net inflows in Q4 and $10.6 billion for the full year [9] Company Strategy and Development Direction - The company is focused on expanding its private markets capabilities and enhancing commercial real estate lending [10][21] - Strategic partnership with Equitable is seen as a competitive advantage, expected to onboard over $10 billion of new long-duration assets by year-end 2026 [10][21] - Investments in technology and operational build-out are aimed at enhancing earnings power over time [29][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the firm's ability to navigate macroeconomic challenges and highlighted strong momentum entering 2026 [22][36] - The company anticipates adding approximately $3 billion of new private asset mandates from strategic insurance partnerships in the first half of 2026 [11] - Management noted that the bond reallocation trend has significant runway, positioning the firm to capture fixed income's enduring value [17] Other Important Information - The effective tax rate for 2025 was 5.9%, with a forecast of 6%-7% for 2026 [31] - The firm expects non-compensation expenses to be in the range of $625 million-$650 million for 2026, reflecting investments in growth initiatives [26][30] Q&A Session Summary Question: Outlook for high-yield funds distributed in Asia - Management noted macro factors such as FX risk and interest rates but emphasized strong structural demand for U.S. dollar-denominated strategies in Asia [40][41] Question: Seasonality in private wealth and expected flow demand - Management indicated that tax impacts in Q2 are a key seasonal factor, with strong growth driven by M&A activity and onboarding new ultra network clients [45][46] Question: Private credit exposure to software across the portfolio - Management stated that exposure to software is not significant, with around 25% of the corporate direct lending business related to technology [49][50] Question: Growth of private markets AUM beyond the target - Management expressed ambition to exceed the $90 billion-$100 billion target for private markets AUM by 2027, with ongoing opportunities for expansion [53]

Financial Data and Key Metrics Changes - Firm-wide assets under management (AUM) reached $860 billion, with a record high of $153 billion in Bernstein Private Wealth [4][5] - Adjusted earnings per unit increased by 12% year-over-year to $0.86, while net revenues rose by 5% to $885 million [25][26] - Total adjusted operating expenses remained flat at $582 million, with total compensation and benefits expenses increasing by 6% to $439 million [26][28] Business Line Data and Key Metrics Changes - Institutional asset management business AUM stood at $351 billion, while the retail platform AUM was $356 billion [4] - Tax-exempt fixed income saw over $4 billion in inflows, marking 11 consecutive quarters of positive organic growth [6][7] - Private markets generated nearly $3 billion in net inflows, reflecting improved conditions in commercial real estate [7][8] Market Data and Key Metrics Changes - The U.S. equity markets delivered strong returns, with the S&P 500 returning 8.1% in Q3 2025 [11] - Emerging markets outperformed, while global developed equities underperformed compared to the U.S. [12][13] - The firm observed a rebound in client flows into American Income, indicating renewed interest in U.S. dollar-denominated assets [10] Company Strategy and Development Direction - The company aims to expand its third-party insurance asset management business, leveraging partnerships like the one with Fortitude [8][9] - A strategic alliance with Equitable enhances the firm's competitive advantage, allowing for the scaling of higher-fee private alternative strategies [9][10] - The focus remains on scalable, long-duration assets that align with sustainable organic growth and long-term profitability [31][34] Management's Comments on Operating Environment and Future Outlook - Management maintains a positive outlook on fixed income, anticipating a reallocation wave as bonds regain diversification value [11] - The firm is well-positioned to capture growth opportunities in Asia, particularly in taxable fixed income [47][49] - The company is committed to investing in growth initiatives while maintaining expense discipline [34][56] Other Important Information - The firm has successfully expanded its private markets platform to nearly $80 billion, representing a 17% year-over-year growth [22] - The effective tax rate for the third quarter was 6%, consistent with full-year guidance [28] - The firm is raising its full-year performance fee guidance to $130 million-$155 million, driven by strong public market performance [32] Q&A Session Summary Question: Can you elaborate on the insurance opportunity and the Ruby Re sidecar? - Management expressed excitement about the insurance asset management business, confirming that the Ruby Re relationship is performing as expected and that the FCA REIT sidecar is additive to their strategy [38][40] Question: What is the outlook for private credit and credit quality? - Management noted competitive environments in private credit but reassured that there is no material deterioration in credit quality, with manageable maturities and positive cash flow generation [42][43] Question: How is the Asia business performing post-trade conflicts? - The Asia business showed improvement, particularly in taxable fixed income, with strong engagement from institutional clients despite external noise [47][48] Question: What is the capital allocation strategy regarding buybacks? - The light buyback in the quarter was attributed to timing rather than any strategic shift, with plans to continue funding the deferred compensation plan [57] Question: How is the firm positioned for the bond reallocation? - Management indicated that they are well-positioned to benefit from the bond reallocation, particularly in Asia, with a strong distribution capability [60][61]