WisdomTree(US:WT)2025-08-01 17:02Financial Data and Key Metrics Changes - The company reported revenues of $112.6 million for the quarter, an increase of 4.2% from the first quarter and up approximately 5.2% year-over-year driven by higher average AUM [24] - Year-to-date revenues have grown 8.3% due to higher average AUM and increased other revenues from European listed products, partially offset by lower average fee capture [25] - Adjusted net income for the quarter was $25.9 million or $0.18 per share, excluding $2 million of acquisition-related costs [25] Business Line Data and Key Metrics Changes - The company generated $6.6 billion of inflows year-to-date through June, with approximately $3 billion into U.S. listed products, $3.3 billion into European products, and over $300 million in digital assets [21][22] - The European Defense Fund, with AUM of approximately $3.5 billion, attracted nearly $2.1 billion of flows in the quarter and over $2.8 billion year-to-date [23] - AUM in digital assets has more than doubled since last quarter, reaching $350 million at June 30 and approximately $500 million today [24] Market Data and Key Metrics Changes - The company’s AUM reached a record high of $126 billion at June 30, with U.S. listed AUM at $85.2 billion and European AUM at $40.5 billion, both all-time highs [23] - The acquisition of Cerus Partners is expected to raise at least $750 million into farmland-focused strategies by 2030, which would more than double their current base [7][20] Company Strategy and Development Direction - The acquisition of Cerus Partners is aimed at expanding the company’s platform into U.S. farmland investment management, which is seen as a stable and underpenetrated asset class [6][9] - The company plans to leverage its institutional capabilities across distribution, product structuring, and technology to broaden access to farmland investing [11] - The company is focused on accretive capital deployment opportunities, including share repurchases and other strategic initiatives [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of farmland as an asset class, highlighting its historical performance during market downturns [12][13] - The company anticipates that the acquisition will diversify revenue, support operating margins, and provide new ways to serve clients [15] - Management is optimistic about the digital assets segment, with significant growth expected in the stablecoin market [34][81] Other Important Information - The company has received several accolades in 2025, including being ranked one of America's most innovative companies and recognized for its digital asset processing solutions [36] - The acquisition consideration includes $275 million upfront in cash and an earn-out of up to $225 million contingent on achieving specific revenue growth targets [18] Q&A Session Summary Question: Where does Cerus raise funds from and what is the fund structure? - The fund is a combination of an Evergreen fund, designed to be a long-term partner for farmers, rather than a traditional drawdown fund [41][42] Question: How durable and predictable are performance fees from Cerus? - Performance fees are driven by rental income and the mark-to-market of the farmland portfolio, with historical appreciation rates providing a stable basis for these fees [44][46] Question: Which end customer market will be targeted first for the farmland opportunity? - The RIA channel is expected to be the primary focus for distributing farmland investments, leveraging existing client relationships [88] Question: What are the key growth drivers for digital assets in the second half of 2025? - The focus will be on regulatory compliance and expanding functionality, with significant growth anticipated in the stablecoin market [90][92]