Affiliated Managers Group, Inc.
AMG CIK 0001004434 · Every Form 4 filed by insiders at this issuer. See financials → Annual report (10-K) Latest 10-K filed Feb 17, 2026 . Sentiment + YoY language diff vs prior year. Read sections →
Risk Factors: tone -0.0264 Δ-0.0001 93% similar+234 / -196 ¶
MD&A: tone -0.0017 Δ+0.0004 83% similar+326 / -257 ¶
Sentiment via Loughran-McDonald lexicon · YoY diff via Jaccard similarity + paragraph set difference.
Recent 8-K announcements Per-item disclosure feed. Item 2.02 is the earnings release.
Top insiders Most active reporters at Affiliated Managers Group, Inc.
Top performers Insiders ranked by realized 90-day signed return on their open-market trades at Affiliated Managers Group, Inc.. Minimum 3 scored trades. Returns are signed - a sale followed by a rally counts against the insider.
All filings 188 Form 4 / 4-A filings, newest first
Filed Top transaction Shares Price Value
Filed Insider Top transaction Shares Price Value FA PPurchase 750 $304.88 $228,660 Details RD Ryan David Christopher
Director
SSale 3,402 $305.06 $1,037,814 Details MR Matos Rodriguez Felix V.
Director
SSale 1,000 $300.18 $300,180 Details CG PPurchase 1,500 $305.83 $458,745 Details CG Holdings only - - - Details
Showing 1-5 of 188
Per page5 10 25 50 Page 1 of 38 Next Real-time Form 4 intelligence. Smarter insider tracking. bearish bullish YoY shift: Neutral
Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is 0.01pp more bullish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Net-tone change vs last year's 10-K.
MD&A
+0.04pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
Language change vs prior 10-K Risk Factors (Item 1A) - words with the biggest YoY frequency increase adverse +2 litigation +2 divert +2 curtail +2 difficult +1 opportunities +2 favorably +1 innovative +1 advancements +1 advances +1 Risk Factors (Item 1A) 10,078 words
Item 1A. Risk Factors
We and our Affiliates face a variety of risks that are substantial and inherent in our businesses. The following are some of
the more important factors that could affect our and our Affiliates’ businesses. Investors should carefully consider these risks,
along with the other information contained in this Annual Report on Form 10-K, before making an investment decision
regarding our common stock or other publicly-listed securities. There may be additional risks of which we are currently
unaware , or which we currently consider immaterial. Any of these risks could have a material adverse effect on our financial
condition, results of operations, and the market price of our common stock. Certain statements in “Risk Factors” are forward-
looking statements. See “Forward-Looking Statements.”
RISKS RELATED TO OUR INDUSTRY, BUSINESS AND OPERATIONS
Our financial results depend on our Affiliates’ receipt of asset- and performance-based fees, and are impacted by investment
performance, as well as changes in fee levels, product mix, and the relative levels of assets under management among our
Affiliates.
Our financial results depend on our Affiliates’ receipt of asset- and performance-based fees, which may vary substantially
from year to year. Our Affiliates’ ability to grow or maintain current fee levels depends on a number of factors, including our
Language change vs prior 10-K MD&A (Item 7) - words with the biggest YoY frequency increase impairments +5 unpaid +3 declined +2 decline +2 declines +2 gains +11 enhance +2 success +1 effective +1 collaborate +1 MD&A (Item 7) 13,359 words
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following executive overview, which summarizes the significant trends affecting our results of operations and financial
condition, as well as the remainder of this Management’s Discussion and Analysis of Financial Condition and Results of
Operations of Affiliated Managers Group, Inc. and its subsidiaries, should be read in conjunction with the “Forward-Looking
Statements” section set forth in Part I, the “Risk Factors” section set forth in Item 1A of Part I and with our Consolidated
Financial Statements and the notes thereto contained elsewhere in this Annual Report on Form 10-K, and in any more recent
filings with the SEC.
Our discussion and analysis of the key operating performance measures and financial results for fiscal year 2025
compared to fiscal year 2024 is included herein. For discussion and analysis of fiscal year 2024 compared to fiscal year 2023 ,
please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of Part II
in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 , which was filed with the SEC on
February 14, 2025 .
Executive Overview
AMG is a strategic partner to leading independent investment firms globally. Our strategy is to generate long-term value
Material contracts, certifications & more
8 exhibits filed with this 10-K
Ticker AMG
CIK 0001004434
Form Type 10-K
Accession Number 0001628280-26-008665
Filed Feb 17, 2026
Period Dec 31, 2025 (Q4 25)
Industry Investment Advice
Permalink https://insiderdelta.com/issuers/AMG/10-k/0001628280-26-008665Affiliates’ investment performance, as well as competition and trends in the investment management industry, such as investor
demand for passively-managed products, including index and exchange traded funds, that typically carry lower fee rates, or
preferences for other developing strategies or trends. Further, different types of assets under management can generate different
ratios of asset-based fees to assets under management (“asset-based fee ratio”), based on factors such as the investment strategy
and the type of client. Thus, a change in the composition of our assets under management, either within an Affiliate or among
our Affiliates, could result in a decrease in our aggregate fees even if our aggregate assets under management remains
unchanged or increases. Products that use fee structures based on investment performance may also vary significantly from
period to period, depending on the investment performance of the particular product. For some of our Affiliates, performance-
based fees include benchmarks, such as a high-watermark provision, which generally provide that if a product underperforms
on an absolute basis or relative to a specified benchmark, it must regain such underperformance before the Affiliate will earn
any performance-based fees. In addition, in the ordinary course of business, our Affiliates may reduce or waive fees on certain
products for particular time periods, to attract or retain assets or for other reasons. No assurances can be given that our
Affiliates will be able to grow or maintain current fee structures or levels, or that certain strategies they offer will be in demand
at any given time. A reduction in the fees that our Affiliates receive could have an adverse impact on our financial condition
and results of operations.
Additionally, our structured partnership interests are tailored to meet the needs of each Affiliate and are therefore varied,
and our earnings may be adversely affected by changes in the relative performance or in the relative levels and mix of assets
under management among our Affiliates, including as a result of restructurings or dispositions of our equity interests in an
Affiliate, independent of our aggregate operating performance measures. Challenging market conditions, volatility or
slowdowns affecting a particular asset class, client type, product structure, geographic region, industry or other category of
investment could have a significant adverse impact on a specific Affiliate if its investments are concentrated in that area, which
could result in lower investment returns and in turn, lower fees earned at that Affiliate. Further, certain Affiliates contribute
more significantly to our results than other Affiliates and, therefore, changes in fee levels, particularly with respect to Affiliates
earning performance-based fees, product mix, assets under management, or investment performance, or operational issues or
other events impacting such Affiliates could have a disproportionate adverse impact on our financial condition and results of
Our financial results could be adversely affected by any reduction in our assets under management, which could reduce the
asset- and performance-based fees earned by our Affiliates.
Our financial results may be impacted by changes in the total level of our assets under management. The total level of our
assets under management generally or with respect to particular products or Affiliates could be adversely affected by conditions
outside of our control, including:
• a decline in the market value of our assets under management, due to declines or heightened volatility in the capital
markets, fluctuations in foreign currency exchange rates and interest rates, inflation, changes in the yield curve, and
• changes in investor risk tolerance or investment preferences, which could result in investor allocations away from
strategies and products offered by our Affiliates;
• our Affiliates’ ability to attract and retain client assets and market products and services, which may be impacted by
investment performance, client relationships, demand for product and service offerings, their continued development
of products to meet the changing demands of investors, and the prices of securities generally;
• global economic conditions, which may be exacerbated by changes in the equity or debt markets, including impacts
from shifting monetary policies of the U.S. Federal Reserve Bank and other global central banks, or instability and
liquidity issues in the financial system generally;
• financial crises , political or diplomatic developments or instability in the U.S. or globally, including uncertainties
regarding actual and potential changes in domestic, foreign, trade, economic, and other policies, trade tensions, public
health crises , civil unrest , war, terrorism, natural disasters , fluctuations in commodity prices, or risks associated with
global climate change; and
• other factors that are difficult to predict.
A reduction in our assets under management could adversely affect the fees payable to our Affiliates and, ultimately, our
financial condition and results of operations. To the extent any of these conditions or factors adversely affect our or our
Affiliates’ operations or global economic conditions generally, they may also have the effect of heightening other risks
described elsewhere in this “Risk Factors” section.
If our or our Affiliates’ reputations are harmed , we could suffer losses in our business and financial results.
The success of our business depends on earning and maintaining the trust and confidence of our Affiliates and our
stockholders, our ability to compete for future investment opportunities , and our and our Affiliates’ reputations among existing
and potential clients. Our and our Affiliates’ reputations are critical to our business and could be impacted by events that may
be difficult or impossible to control, and costly or impossible to remediate, including:
• alleged or actual failures by us, our Affiliates, or our respective employees or third-party service providers or
counterparties to comply with applicable laws, rules, or regulations, or contractual obligations or instructions;
• errors in our public reports;
• cyber-attack or data breach incidents ;
• fund liquidity or valuation issues, or issues relating to the use of leverage, including with respect to assets within
private markets funds, liquid alternative, or similar products of certain of our Affiliates;
• threatened or actual litigation against us, any of our Affiliates, or our respective employees;
• perceived or actual conflict between us and any of our Affiliates or among our Affiliates;
• changes in the structure of our partnership interests in any of our Affiliates, including any repositioning or divestments
• research published by securities or industry analysts about us or any of our Affiliates;
• negative perceptions of our or certain of our Affiliates’ investments or business practices by stakeholder groups who
have increasingly expressed divergent views on a range of environmental, social, and governance matters;
• fraudulent impersonations of us, our Affiliates, or our respective employees by third-party bad actors, including in
social engineering schemes that attempt to manipulate targeted recipients into sharing confidential information,
participating in fraudulent investments, purport to offer investment services, or solicit fraudulent investments,
including through fake phone calls, e-mails, and websites, and on social media platforms and messaging applications;
• other events and factors that are difficult to predict including those that could impact our Affiliates’ ability to compete
effectively with other firms, our ability to successfully pursue our growth strategy, and other risks described elsewhere
in this “Risk Factors” section.
Any of the foregoing events, or the public announcement and potential publicity surrounding these issues, even if
inaccurate , satisfactorily addressed, or if no violation or wrongdoing actually occurred, could adversely impact our Affiliates’
reputations and their relationships with clients, our relationships with our Affiliates and business partners, our access to the
capital markets or other financing, and our ability to negotiate agreements with new independent investment firms, any of
which could have an adverse effect on our reputation, our financial condition and results of operations, or the market price of
The investment management industry is highly competitive.
Our Affiliates compete with numerous investment management firms globally, including public, private, and client-owned
investment advisers; firms managing passively-managed products, including exchange traded funds; firms associated with
securities broker-dealers, financial institutions, insurance companies, private equity firms, sovereign wealth funds; and other
entities. These firms may have significantly greater financial, technological, and marketing resources, captive distribution and
assets under management, or be subject to less regulation and accordingly have more flexibility to undertake and execute
certain investments with less compliance expense, and many of these firms may offer products and services that our Affiliates
may not in particular investment strategies. These firms may also compete by seeking to capitalize on a trend towards
institutions consolidating the number of investment managers they work with, and advances in technology and digital wealth
Competition from these firms may reduce the fees that our Affiliates can obtain for investment management services, or
could impair our Affiliates’ ability to attract and retain client assets, and any failure by our Affiliates to successfully adapt their
strategies and develop competitive new products and services, or effectively manage the associated operational risks, could
harm our Affiliates’ reputations and competitive positions, and expose them to additional costs or regulatory scrutiny , which
could adversely affect our assets under management, financial condition and results of operations. We believe that our
Affiliates’ ability to compete effectively with other firms depends upon the performance of our Affiliates’ investment strategies,
the applicability of products to meet client objectives and preferences, and the continued development of increasingly complex
strategies and products, including those offered on our U.S. wealth distribution platform, to meet the evolving needs and
demands of investors, as well as our Affiliates’ reputations, client relationships, fee structures, client-servicing capabilities, and
the marketing and distribution of their investment strategies, among other factors. See “Competition” in Item 1. Our Affiliates
may not compare favorably with their competitors in any or all of these categories, and technological developments, including
financial applications and services based on generative artificial intelligence, machine-learning algorithms, and large language
models (“AI”), may over time reduce the demand for, or clients’ willingness to pay for, certain products and services. From
time to time, our Affiliates may also compete with each other for clients and investment opportunities .
Investment management contracts are subject to termination on short notice.
Through our Affiliates, we derive almost all of our asset- and performance-based fees from clients pursuant to investment
management contracts. While certain of our Affiliates’ private equity and alternative products have long-term commitment
periods, many of our Affiliates’ investment management contracts are terminable by the client without penalty upon relatively
short notice (typically not longer than 60 days). We cannot be certain that our Affiliates will be able to retain their existing
clients or attract new clients. If our Affiliates’ clients, in particular a significant client or a series of significant clients,
terminate their investment management contracts or withdraw a substantial amount of assets for any number of reasons,
including poor investment performance, loss of key investment personnel, changes in the client’s decision makers, or
reputational, regulatory, or compliance issues, it is likely to harm our results of operations. In addition, investment
management contracts with mutual funds or other similar products are subject to annual approval by the fund’s board of
We may need to raise additional capital in the future, and existing or future resources may not be available to us in
sufficient amounts or on acceptable terms.
While we believe that our existing cash resources and cash flow from operations will be sufficient to meet our working
capital needs for normal operations for the foreseeable future, our continuing acquisitions of interests in independent investment
firms and our other strategic initiatives may require additional capital. Further, we have significant purchase obligations
relating to Affiliate equity interests, as well as commitments relating to general partner and seed capital investments, and it is
difficult to predict the frequency and magnitude of these purchases or associated capital calls. Additionally, the valuation of
certain of these assets on our balance sheet may cause volatility from period to period. As of December 31, 2025 , the current
redemption value relating to Affiliate equity interests was $408.0 million , of which $246.8 million was presented as
Redeemable non-controlling interests (including $32.2 million of consolidated Affiliate sponsored investment products
primarily attributable to third-party investors), and $161.2 million was included in Other liabilities. See “Liquidity and Capital
Resources-Affiliate Equity” in Item 7 and Notes 13 and 14 of the Consolidated Financial Statements. Unfunded commitments
relating to general partner and seed capital investments were $285.0 million as of December 31, 2025 . See Notes 2 and 6 of our
Consolidated Financial Statements. These obligations may require more cash than is then available from our existing cash
resources and cash flows from operations. Thus, we may need to raise capital through additional borrowings or by selling
shares of our common stock or other equity or debt securities, or otherwise refinance a portion of these obligations.
As of December 31, 2025 , we had outstanding debt of $2.7 billion . Our level of indebtedness may increase if we, our
subsidiaries, and/or our consolidated Affiliates fund future investments or other expenses through borrowings. We may also
seek to refinance existing indebtedness for the purpose of managing maturity dates, to seek alternative financing terms or for
other reasons, which may not be available on similar terms as our existing indebtedness, including with respect to interest rates.
Any additional indebtedness could increase our vulnerability to general adverse economic and industry conditions and may
require us to dedicate a greater portion of our cash flows from operations to payments on our indebtedness.
The financing activities described above could increase our Interest expense, decrease our Net income (controlling
interest), or dilute the interests of our existing stockholders. In addition, our access to additional capital, and the cost of capital
we are able to access, is influenced by a number of factors, including the state of global credit and equity markets, interest rates,
credit spreads, and our credit ratings. As a result, we may be unable to enter into new credit facilities or issue debt or equity in
the future on attractive terms, or at all. We are currently rated A3 by Moody’s Investors Service and BBB+ by S&P Global
Ratings. A reduction in our credit ratings could also increase our borrowing costs under our revolver or, in certain cases, give
rise to a termination right by the counterparty under our derivative financial instruments, if any. There can be no assurance that
we will achieve a particular credit rating or maintain any particular rating in the future.
Our debt agreements impose certain covenants relating to the conduct of our business, including financial covenants under
our revolver, any breach of which could result in the acceleration of the repayment of any amounts borrowed or outstanding
Our debt agreements contain customary affirmative operating covenants and negative covenants that, among other things,
place certain limitations on our and our subsidiaries’ ability to incur debt, merge or transfer assets, and create liens and, in the
case of our revolver, require us to maintain specified financial ratios, including a maximum leverage ratio and a minimum
interest coverage ratio. The breach of any covenant (either due to our actions or omissions or, in the case of financial
covenants, due to a significant and prolonged market-driven decline in our operating results) could result in a default under the
applicable debt agreement and, in the case of our revolver, lenders could refuse to make further extensions of credit to us.
Further, in the event of certain defaults , amounts borrowed under our debt agreements, together with accrued interest and other
fees, could become immediately due and payable. If any indebtedness were to become subject to accelerated repayment, we
may not have sufficient liquid assets to repay such indebtedness in full.
We have substantial intangibles on our balance sheet, and any impairment of our intangibles could adversely affect our
financial condition and results of operations.
As of December 31, 2025 , our total assets were $9.2 billion , of which $4.2 billion were intangibles, and $2.9 billion were
equity method investments in Affiliates, an amount primarily composed of intangible assets. We cannot be certain that we will
realize the value of such intangible assets. Our intangible assets may become impaired as a result of any number of factors,
including changes in market conditions, declines in the value of assets under management, client attrition , product performance,
reductions in fee rates, and changes in strategic objectives or growth prospects of an Affiliate. An impairment of our intangible
assets or an other-than-temporary decline in the value of our equity method investments could adversely affect our financial
condition and results of operations. Determining the value of intangible assets, and evaluating them for impairment , requires
management to exercise significant judgment. For the year ended December 31, 2025 , we recorded expenses to reduce the
carrying value to fair value of certain acquired client relationships, and in prior periods we have recorded expenses to reduce the
carrying value to fair value of certain Affiliates and/or certain acquired client relationships, and may experience similar
impairment events in future reporting periods. See “Critical Accounting Estimates and Judgments” in Item 7 and Notes 7 and 8
of the Consolidated Financial Statements.
Market risk management activities may adversely affect our liquidity and results of operations.
Cash management transactions, capital markets financings, and certain investments or other transactions may create
exposure for us or our Affiliates to changes in interest rates, foreign currency exchange rates, marketable securities, and
financial markets generally, which we or our Affiliates may seek to offset by entering into derivative financial instruments. The
scope of these risk management activities is selective and varies based on the level and volatility of interest rates, foreign
currency exchange rates, applicable marketable securities, and other changing market conditions. We and our Affiliates do not
seek to hedge exposure to all market risks, which means that exposure to certain market risks is not limited. Further, the use of
derivative financial instruments does not entirely eliminate the possibility of fluctuations in the value of the underlying position
or prevent losses if the value of the position declines , and also can limit the opportunity for gain if the value of the position
increases. There can be no assurance that our or our Affiliates’ derivative financial instruments will meet their overall objective
or that we or our Affiliates will be successful in entering into such instruments in the future. Further, while hedging
arrangements may reduce certain risks, such arrangements themselves may entail other risks, may generate significant
transaction costs, and may require the posting of cash collateral. For example, if our or our Affiliates’ counterparties fail to
honor their obligations in a timely manner, including any obligations to return posted collateral, our liquidity and results of
operations could be adversely impacted.
RISKS RELATED TO OUR STRATEGY AND OUR STRUCTURED PARTNERSHIPS WITH AFFILIATES
Our growth strategy depends in part upon our ability to identify and consummate investments in suitable independent
Our continued success in investing in independent investment firms will depend upon our ability to find suitable firms in
which to invest or make additional investments in our existing Affiliates, our ability to negotiate agreements with such firms on
acceptable terms, maintaining our relationships with prospects and our reputation as a leading partner to these firms, and our
ability to raise the capital necessary to finance such transactions. The market for acquisitions of interests in these firms is
highly competitive. Many other public and private financial services companies, including commercial and investment banks,
private equity firms, sovereign wealth funds, insurance companies, and investment management firms, also invest in
independent investment firms and may have significantly greater resources than we do. In addition to direct competition on
particular prospects, these firms can also negatively impact the volume and value of transactions more broadly. Further, our
innovative partnership approach with our Affiliates is designed to enhance our Affiliates’ ability to achieve their long-term
strategic objectives, while preserving their independence and autonomy, and, therefore, their unique entrepreneurial and
investment-centric cultures, and the management of some target firms may prefer terms and structures offered by our
We may not be successful in making investments in new firms or maintaining existing investments, and any firms that we
do invest in may not have favorable results or performance following our initial investment or any subsequent investment,
which could have an adverse effect on our financial condition and results of operations. Our investments involve a number of
risks, including regulatory considerations and the existence of unknown liabilities that may arise after making an investment,
some of which may depend upon factors that are not under our control. We may also make new investments using complex or
innovative structures and terms, including joint ventures, deferred economics, or product development partnerships, which may
introduce additional risks and uncertainties. Further, the consummation of our announced investments is generally subject to a
number of closing conditions, contingencies, and approvals, including, but not limited to, obtaining certain consents of the
independent investment firm’s clients and applicable regulatory approvals. In the event that an announced transaction is not
consummated, we may experience a decline in the price of our common stock.
Our growth strategy also includes selectively pursuing strategic partnerships, transactions, joint ventures, and initiatives,
which could involve additional risks and uncertainties.
Our growth strategy also includes selectively pursuing strategic partnerships, transactions, joint ventures, and initiatives in
areas where we can assist our Affiliates in growing and diversifying their businesses (including through seed capital, general
partner commitments, and other strategic investments in our Affiliates and their funds), to further enhance our competitive
position, or where we believe we can add value and generate meaningful returns. These strategic partnerships, transactions,
joint ventures, and initiatives may be complementary to our existing business or involve new operational areas, product
structures, or strategies (including in private markets and liquid alternatives), which includes, among others, initiatives to
increase the number and type of investment products offered to high-net-worth individuals and families through our U.S. wealth
and global distribution platforms, and expanding the geography and scope of our operations. These initiatives involve risks and
uncertainties, including compliance with additional regulatory and disclosure requirements, increased potential for disputes ,
exposure to more volatile market segments and reputational risks, and significant commitments of capital over extended periods
of time. Addressing these risks and uncertainties may require additional resources and investment, including the
implementation of new operational controls and procedures, as well as require complex contractual arrangements, structures,
and specialized skills. There is no certainty that such initiatives will deliver the anticipated benefits over the expected time
frame or at all, or that our stockholders will react favorably . Any failure to successfully execute on strategic partnerships,
transactions, joint ventures, or initiatives, including in connection with our entry into new operational areas or effectively
managing associated risks, or by our Affiliates in deploying strategic capital into suitable new investment opportunities , could
harm our reputation and expose us to additional costs or divert resources from other opportunities , which could adversely affect
our assets under management, financial condition, and results of operations.
The structure of our partnership interests in our Affiliates may expose us to unanticipated changes in Affiliate revenue,
operating expenses, and other commitments, which we may not anticipate and may have limited ability to control.
The form of our structured partnership interests in our Affiliates differs from Affiliate to Affiliate, and may change during
the course of our investment.
In the case of structures where we contractually share in the Affiliate’s revenue without regard to expenses, comprising
Affiliates that contribute a majority of Consolidated revenue, the Affiliate allocates a specified percentage of its revenue to us
and Affiliate management, while using the remainder for operating expenses and additional distributions to Affiliate
management. In these types of structures, while our distributions generally have priority, our agreed allocations may not
anticipate changes in the revenue and operating expense base of the Affiliate, and the revenue remaining after our specified
share is allocated to us may not be large enough to cover all of the Affiliate’s operating expenses, which could result in a
reduction of the amount allocated to us or could negatively impact the Affiliate’s operations and prospects.
In the case of structures where we contractually share in the Affiliate’s revenue less agreed-upon expenses, we benefit from
any increase in revenue or any decrease in the agreed-upon expenses, but also have exposure to any decrease in revenue or any
increase in such expenses. The degree of our exposure to agreed-upon expenses from these structured partnership interests
varies by Affiliate (and may change during the course of our investment), and includes several Affiliates in which we fully
share in the expenses of the business. In these types of structures, we may have limited or no ability to control the level of
expenses at the Affiliate, and our distributions generally do not have priority. Further, the impact of Affiliate expenses on our
earnings and our stock price could increase if the portion of our earnings derived from such Affiliates increases.
As a result of these factors, unanticipated changes in revenue, operating expenses, or other commitments at any of our
Affiliates could leave the Affiliate with a shortfall in remaining funds for distribution to us or Affiliate management, or for
funding their operations. Changes in the global marketplace in particular could result in rapid changes to our Affiliates’
earnings or expenses, and our Affiliates may be unable to make appropriate expense reductions in a timely manner to respond
to such changes. Any of these developments could have an adverse effect on our financial condition generally, and on our
results of operations for the applicable reporting period.
Additionally, regardless of the particular structure, we may agree to change the structure, or may elect to defer or forgo the
receipt of our share of an Affiliate’s revenue or earnings, or adjust expenses allocated to us, to permit the Affiliate to fund
expenses in light of unanticipated changes in revenue or operating expenses, with the aim of maximizing the long-term benefits
for us and the Affiliate. These types of activities could increase during periods where an Affiliate’s revenues decline rapidly or
other events occur that impact the Affiliate’s expenses or operations. We cannot be certain that any such deferral or
forbearance would be of any greater long-term benefit to us, and such a deferral or forbearance may have an adverse effect on
our near- or long-term financial condition and results of operations.
We may reposition or divest our equity interests in our Affiliates, and we cannot be certain that any such repositioning or
divestment will benefit us in the near- or long-term.
From time to time, we may reposition our relationships with our Affiliates, which could, among other things, include
changes to our structured partnership interests, including changes in our ownership level and in the calculation of our share of
revenue and/or operating expenses. Such repositioning may be done in order to address an Affiliate’s succession planning,
changes in its revenue or operating expense base, our or the Affiliate’s strategic planning, regulatory considerations, or other
developments. Any repositioning of our interest in an Affiliate may result in increased exposure to changes in the Affiliate’s
revenue and/or operating expenses, or in additional investments or commitments from us, or could increase or reduce, or
change the structure of, our interest in the Affiliate, or cause misalignment with Affiliate management. In some cases, this
could result in the partial or full divestment of our interest to Affiliate management or to a third-party, or in our acquisition of
all of the equity interests of the Affiliate. The divestment of our interests in an Affiliate may result in changes in the
composition of our assets under management or client cash flows, and there can be no assurance that the proceeds from any
such transactions will be deployed more effectively, including for new investments or other strategic initiatives, than if we
retained our interest in such Affiliate. In addition, certain of our Affiliates have customary rights in certain circumstances to
restructure or sell their interests in their firm to a third-party, which could be through a direct majority or minority sale
transaction, a private or public offering, or otherwise, and to cause us to participate in such restructuring or sale, which could be
on terms that we view as less favorable than an alternative transaction or to retaining our interest, or that we may view
favorably , but results in reduced control for us, shifting incentives, and creating additional risks and uncertainties. The
occurrence of any of the above transactions or changes, increases in the frequency thereof, or disputes in relation to such
transactions or changes, could have an adverse impact on our reputation, financial condition, and results of operations, as well
as on our relationships with existing and prospective Affiliates, and could divert capital from other opportunities .
We and our Affiliates rely on certain key personnel and cannot guarantee their continued service.
We depend on the efforts of our executive officers and our other officers and employees. Our executive officers, in
particular, play an important role in the stability and growth of our existing Affiliates and in identifying potential investments in
independent investment firms. There is no guarantee that these executive officers will remain with the Company. We do not
have employment agreements with our executive officers, although each has a significant deferred equity interest in the
Company and is subject to non-solicitation and non-competition restrictions that may be triggered upon their departure.
Further, we seek to attract and retain our key officers and employees through a number of initiatives and programs, including
developing a strong values-based culture, a commitment to career development, employee engagement, attractive compensation
and benefits programs, attention to succession planning, and fostering of organizational diversity, any of which may not be
successful in contributing to the retention of such employees. Changes in our management team, in particular, may be
disruptive to our business, and failure to attract and retain members of our executive or senior management team, or to
effectively implement and manage appropriate succession plans, could adversely affect our business, financial condition, and
In addition, our Affiliates depend heavily on the services of key principals who, in many cases, have managed their firms
for many years. These principals often are primarily responsible for their firm’s investment decisions. Although we use a
combination of economic incentives, transfer restrictions and, in some instances, non-solicitation, non-competition, and
employment agreements in an effort to retain key Affiliate personnel, there is no guarantee that these principals will remain
with their firms or refrain from competing with us if they depart their firms. The market for highly skilled professionals in the
investment management industry is highly competitive, particularly in alternative strategies, and further technological
advancements , including with respect to AI, could result in increased demand and competition for individuals with certain
specialized skills and technological knowledge. These individuals also have an increasing number of employment options
outside of asset management firms, such as family offices and multi-manager platforms. Further, the departure of key
individuals at an Affiliate could also cause investors to reduce or terminate their investments in such Affiliates’ funds or
products, or trigger certain provisions tied to the departure of, or cessation of committed time, by specified persons (known as
“key person” provisions) in the documentation governing certain Affiliate products and funds, which could permit the
suspension or termination of those products’ investment periods. In addition, the pervasiveness of social media and public
focus on the externalities of business activities could lead to wider dissemination of adverse or inaccurate information relating
to such key individuals, making remediation more difficult and magnifying reputational risk. Since certain of our Affiliates
contribute more significantly to our results than other Affiliates, the loss of key personnel at these Affiliates could have a
disproportionately adverse impact on our business, financial condition, and results of operations.
RISKS RELATED TO OUR COMMON STOCK
Equity markets and our common stock have been volatile .
The market price of our common stock has experienced and may continue to experience volatility , and the broader equity
markets have experienced and may continue to experience significant price and volume fluctuations. In addition,
announcements of our financial and operating results or other material information, including changes in net client cash flows
and assets under management, announcements and activity regarding our share repurchase programs, changes in our financial
guidance or our failure to meet such guidance, our new investments activity, changes in general conditions in the economy or
the financial markets, perceptions regarding our environmental, social, and governance profile or sustainable investment
decisions of our Affiliates, and other developments affecting us, our Affiliates, or our competitors, as well as geopolitical,
social, regulatory, capital markets, economic, public health, and other factors unrelated to us, could cause the market price of
our common stock to fluctuate substantially.
The sale or issuance of substantial amounts of our common stock, or the expectation that such sales or issuances will occur,
could adversely impact the price of our common stock.
The sale or issuance of substantial amounts of our common stock in the public market could adversely impact its price. In
connection with our financing activities we maintain an equity distribution program, under which we may issue shares of our
common stock from time to time. We also have outstanding option and restricted stock awards that have been granted under
our share-based incentive plans. Additionally, we have the right to settle certain Affiliate equity purchase obligations with
shares of our common stock. Moreover, in connection with future financing activities, we may issue convertible securities or
shares of our common stock, including through forward equity transactions. Any such issuance of shares of our common stock
could have the effect of substantially diluting the interests of our current equity holders. In the event that a large number of
shares of our common stock are sold or issued in the public market, or the expectation that such sales or issuances will occur,
the price of our common stock may decline as a result.
Provisions in our organizational documents, Delaware law, and other factors could delay or prevent a change in control of
the Company, or adversely affect our financial results in periods prior to and following a change in control.
Provisions in our charter and by-laws and anti-takeover provisions under Delaware law could discourage , delay , or prevent
an unsolicited change in control of the Company. These provisions may also have the effect of making it more difficult for
third parties to replace our executive officers without the consent of our Board of Directors. These provisions include:
• the ability of our Board of Directors to issue preferred stock and to determine the terms, rights, and preferences of the
preferred stock without stockholder approval;
• the prohibition on the right of stockholders to call meetings or act by written consent and limitations on the right of
stockholders to present proposals or make nominations at stockholder meetings; and
• legal restrictions on mergers and other business combinations between us and any holder of 15 percent or more of our
outstanding common stock.
Further, given our long-term innovative partnership approach with our Affiliates, which is designed to maintain their
independence and autonomy, and, therefore, their unique entrepreneurial and investment-centric cultures, a change in control
may be viewed negatively by our Affiliates, impacting their relationships with us. Additionally, the disposition of certain of our
Affiliates following a change in control could result in the immediate realization of taxes owed on any excess proceeds above
our tax basis in the relevant Affiliate, which could impact the valuation a third-party may apply to us in a change in control.
Any of the forgoing factors may inhibit a change in control in circumstances that could give our stockholders the opportunity to
realize a premium over the market price of our common stock, or may result in negative impacts on our financial results in
periods prior to and following a change in control.
In addition, a change in control of the Company or the acquisition of a large ownership position in shares of our
outstanding common stock by a single holder may constitute a change in control for certain of our Affiliates for purposes of the
Advisers Act and the Investment Company Act. In that case, absent client consents, the Affiliate’s management agreements
may be deemed to be “assigned” in violation of the agreement and, for mutual fund clients, will terminate . We cannot be
certain that any required client consents (which the impacted Affiliates would need to be involved in requesting) would be
obtained if such a change of control occurs. Any termination , deemed assignment or renegotiation of any of our Affiliates’
management agreements could result in a reduction in our assets under management or the fees payable to our Affiliates and,
ultimately, our aggregate fees. Further, certain of our Affiliates operate regulated businesses in jurisdictions outside of the U.S.
that, in some cases, require regulatory notifications and other filings if a single stockholder acquires an ownership position in
the Company exceeding certain specified thresholds, regardless of whether a change in control has occurred for purposes of the
Advisers Act or the Investment Company Act. Such an ownership position could also trigger approvals under FINRA, for
Affiliates operating a broker-dealer in the U.S. As a result, a large ownership position in our stock, whether or not resulting in a
change of control of the Company, could result in increased regulatory reporting and compliance costs, and potential
restrictions on our or our Affiliates’ business activities, and could reduce the fees that our Affiliates receive under investment
management contracts, any of which could have an adverse effect on the Company’s financial condition and results of
LEGAL AND REGULATORY RISKS
Our and our Affiliates’ businesses are highly regulated.
Our and our Affiliates’ businesses are subject to complex and extensive regulation by regulatory and self-regulatory
authorities and exchanges in various jurisdictions around the world, which, for our Affiliates and our U.S. wealth distribution
subsidiary, include those applicable to investment advisers, as detailed in “Government Regulation” in Item 1. Applicable laws,
rules, and regulations impose requirements, restrictions, and limitations on our and our Affiliates’ businesses, and can result in
significant compliance and operational costs. Further, this regulatory environment may be altered without notice by new laws
or regulations, revisions to existing laws or regulations, or new or revised interpretations, guidance, or enforcement priorities,
and could cause us or our Affiliates to change or curtail operations or product offerings. Any determination of a failure to
comply with applicable laws, rules, or regulations could expose us, our Affiliates, or our respective employees to civil liability,
criminal liability, or disciplinary or enforcement action, with penalties that could include the disgorgement of fees, fines ,
sanctions, suspensions , termination of adviser status, or censure of individual employees or revocation or limitation of business
activities or registration, and may result in monetary losses that are not covered by insurance in adequate amounts or at all, any
of which could have an adverse impact on our stock price, financial condition, and results of operations. Further, if we, any of
our Affiliates, or our respective employees or third-party service providers were to fail to comply with applicable laws, rules, or
regulations, or be named as a subject of an investigation or other regulatory action, the public announcement and potential
publicity surrounding any such failure , investigation , or action could have an adverse effect on our or our Affiliates’ reputations
and on our stock price and result in increased costs, even if we, our Affiliates, or our respective employees or third-party service
providers were found not to have violated such laws, rules, or regulations.
Recently implemented and proposed regulations globally have called for more stringent oversight of the financial services
industry in which we and our Affiliates operate. In the U.S., the SEC has focused its enforcement, examination, and
rulemaking activities on issues relevant to alternative asset management firms, including consistent application of the
methodology, disclosure, and conflicts of interest related to the valuation of private funds to increase transparency and
accountability. Further, in response to shifting enforcement priorities and rulemaking activities at the federal level, certain state
and other governmental entities have maintained, and may continue to seek to maintain, existing, or implement potentially more
rigorous, regulatory requirements in response, which, coupled with legal challenges to a number of significant regulations and
judicial decisions regarding administrative law, may create uncertainty or lead to divergent interpretations of law, or change the
requirements applicable to our and our Affiliates’ businesses.
The use of AI technologies to provide certain business processes, services, and products may also require compliance with
additional U.S. and non-U.S. legal or regulatory frameworks which are not fully developed or tested, and which may subject us
and our Affiliates to litigation and regulatory actions. For example, the European Union (the “EU”) has enacted the Artificial
Intelligence Act, and various other jurisdictions have proposed or finalized laws and regulations that created, or have the
potential to create, regulatory risk around the use of AI or could restrict or eliminate our and our Affiliates’ ability to use certain
AI tools. These evolving laws and regulations could require changes in our and our Affiliates’ implementation of AI
technologies, increase compliance costs and the risk of non-compliance, and restrict or impede our respective abilities to
develop, adopt, and deploy AI technologies efficiently and effectively.
These and other regulatory developments could adversely affect our and our Affiliates’ businesses, increase compliance
and operational costs, require that we or our Affiliates change or curtail operations or investment offerings, or impact our and
our Affiliates’ access to capital and the market for our common stock. Further, in recent years, regulators in the U.S., the UK,
and other jurisdictions have expanded rules and devoted greater resources and attention to the enforcement of anti-bribery and
anti-money laundering laws, and while we and our Affiliates have developed and implemented policies and procedures
designed to comply with these rules, such policies and procedures may not be effective in all instances to prevent violations .
Our and our Affiliates’ international operations are subject to foreign risks, including political, regulatory, economic, and
We and certain of our Affiliates conduct business outside the U.S., and a number of our Affiliates are based or have offices
outside the U.S. and, accordingly, are subject to risks inherent in doing business internationally. These risks may include
difficulties in staffing and managing foreign operations, longer payment cycles, difficulties in collecting investment advisory
and other fees receivable, different (and in some cases less stringent ) legal, regulatory and accounting regimes, political
instability , exposure to fluctuations in currency exchange rates, expatriation controls, expropriation risks, and potential adverse
tax consequences. For example, regulations in the EU pertaining to the integration of environmental, social, and governance
topics into, among other things, the organizational, risk, and governance arrangements of certain financial entities, and
increased disclosure requirements with regard to such factors generally, may materially impact the investment management
industry in member states that have adopted, or may in the future adopt, such legislation. Conversely, opposition to
environmental, social, and governance initiatives has gained momentum in the U.S., with several states and Congress having
proposed, enacted, or indicated an intent to pursue policies, legislation, or initiatives opposing such efforts, including engaging
in related inquiries, investigations , and litigation . The dynamic nature of environmental, social, and governance-related
regulations could impact our or our Affiliates’ businesses, increase regulatory and compliance costs, and adversely affect our
profitability , which effects could be exacerbated in the event of regulatory uncertainty or conflicting or inconsistent regulatory
guidance related thereto, including in the U.S. and the UK, as applicable. In addition, as a result of operating internationally,
certain of our Affiliates and our global capital distribution platform are subject to requirements under non-U.S. regulations to
maintain minimum levels of net capital. Such capital requirements may be increased from time to time with limited advance
notice, which may have the effect of limiting withdrawals of capital by us and the payment of distributions to us or, if there
were a significant change in the required capital or an extraordinary loss or charge against net capital at a particular Affiliate,
could adversely impact such Affiliate’s ability to expand or maintain operations. These or other risks related to our and our
Affiliates’ international operations may have an adverse effect on our business, financial condition, and results of operations.
Changes in tax laws or exposure to additional tax liabilities could have an adverse impact on our business, financial
condition, and results of operations.
We are subject to income taxes as well as non-income based taxes in the U.S. and certain foreign jurisdictions, and our
Affiliates are generally subject to taxes in the jurisdictions in which they operate. Tax laws, regulations, and administrative
practices in these jurisdictions may be subject to significant change, with or without notice, and significant judgment is required
in estimating and evaluating tax provisions and accruals. Our and our Affiliates’ effective tax rates could be affected by a
change in the mix of earnings with differing statutory tax rates, changes to our or their existing businesses, and changes in
relevant tax, accounting or other laws, regulations, administrative practices, and interpretations. In the U.S., An Act to Provide
for Reconciliation Pursuant to Title II of the H. Con. Res. 14 (the “Act”) was signed into law in July 2025, which included
certain modifications to federal tax law. Although the Act is not expected to have a material impact on our net income and cash
flows, any future tax reform proposals, if ultimately enacted into legislation, could materially impact our tax provision, deferred
tax assets, and tax liabilities, or impact decisions on how to return value to stockholders in the most efficient manner. Further, a
portion of our earnings is from outside of the U.S., and the foreign government agencies in jurisdictions in which we and our
Affiliates do business continue to focus on the taxation of multinational companies, and could implement changes to their tax
laws. The potential effects may vary depending on the specific provisions and rules implemented by each jurisdiction. We
cannot predict future changes in the tax laws, regulations, administrative guidance, or judicial decisions to which we and our
Affiliates are subject or that could apply to our and our Affiliates’ businesses, and any changes to federal, state or foreign tax
laws, regulations, accounting standards or administrative practices, or the release of additional guidance, interpretations or other
information, could impact our estimated effective tax rate and overall tax expense, as well as our earnings estimates, and could
result in adjustments to our treatment of deferred taxes, including the realization or value thereof, or in unanticipated additional
tax liabilities, or cause us or our Affiliates to change or curtail product offerings, any of which could have an adverse effect on
our business, financial condition, and results of operations.
In addition, we and our Affiliates may be subject to tax examinations and inquiries by certain federal, state, and foreign tax
authorities. We regularly assess the likely outcomes of examinations that we are subject to, in order to determine the
appropriateness of our tax provision; however, tax authorities may disagree with certain positions we have taken or may take,
and may assess additional taxes and/or penalties and interest. There can be no assurance that we will accurately predict the
outcomes of any examinations and the actual outcomes could have an adverse impact on our financial condition and results of
We or our Affiliates may be involved in legal proceedings and regulatory matters from time to time, and we may be held
responsible for liabilities incurred by certain of our Affiliates.
Our operating agreements with our Affiliates provide for governance structures that give Affiliate management the
authority to manage and operate their businesses on a day-to-day basis, including investment management operations,
marketing, product development, client relationships, employee matters, compensation programs, and compliance activities. As
a consequence, our financial condition and results of operations may be adversely affected by problems stemming from the day-
to-day operations of our Affiliates that we are not involved in, and where weaknesses or failures in internal processes or
systems, legal or regulatory matters, or other operational challenges could lead to a disruption or cessation of our Affiliates’
operations, liability to their clients, exposure to claims or disciplinary action, or reputational harm .
Certain of our Affiliates are limited liability companies or limited partnerships (or equivalent non-U.S. forms) of which we,
or entities controlled by us, are the managing member or general partner (or equivalent). Consequently, to the extent that any of
these Affiliates incur liabilities or expenses that exceed their ability to pay for them, we may be directly or indirectly liable for
their payment. Similarly, an Affiliate’s payment of distributions to us may be subject to claims by potential creditors, and an
Affiliate may default on distributions that are payable to us. In addition, with respect to each of these Affiliates, creditors,
regulators, or other counterparties or claimants may seek to hold us directly or indirectly liable in certain circumstances as a
control person for the acts of the Affiliate or its employees. Such claims , even if ultimately unsuccessful , could result in
significant costs, diversion of management attention, reputational harm , or adverse financial consequences. Further, we also
conduct compliance, governance, and operational activities, including with respect to distribution, sales, and marketing, through
our U.S. wealth and global distribution platforms to extend the reach of our Affiliates, and any liability arising in connection
with these activities, whether as a result of our own actions or the actions of our participating Affiliates or third-party service
providers, could result in direct liability to us. Accordingly, we and our Affiliates may face various claims , litigation , or
complaints from time to time, and we cannot predict the eventual outcome of such matters, some of which may be resolved in a
manner unfavorable to us or our Affiliates, or whether any such matters could become material to a particular Affiliate or us in
any reporting period. See “Legal Proceedings” in Item 3. While we and our Affiliates maintain errors and omissions and
general liability insurance in amounts believed to be adequate to cover potential liabilities, we cannot be certain that we or our
Affiliates will not have claims or related expenses that exceed the limits of available insurance coverage, that the insurers will
remain solvent and will meet their obligations to provide coverage, or that insurance coverage will continue to be available to us
and our Affiliates with sufficient limits and at a reasonable cost. Any legal proceedings or regulatory matters that we or our
Affiliates are subject to could, whether with or without merit, be time consuming and expensive to defend and could divert
management attention and resources, and could result in judgments, findings, settlements, or allegations of wrongdoing that
could adversely affect our or their reputation, current and future business relationships, and our financial condition and results
Our or our Affiliates’ controls and procedures and risk management policies may be inadequate , fail or be circumvented ,
and operational risk could adversely affect our or our Affiliates’ reputation and financial position.
We and our Affiliates have adopted various controls, procedures, policies, and systems to monitor and manage risk in our
and their businesses. While we currently believe that our and our Affiliates’ operational controls, including controls over
compliance and over financial reporting, are effective , we cannot provide assurance that those controls, procedures, policies,
and systems will always be adequate to identify and manage the internal and external risks in our and our Affiliates’ various
businesses. Furthermore, we or our Affiliates may have errors in business processes or fail to implement proper procedures in
operating our respective businesses, which may expose us or our Affiliates to risk of financial loss or failure to comply with
regulatory requirements. Additionally, although we and our Affiliates have systems and practices in place to monitor our
respective third-party service providers, such third parties are subject to similar risks. For example, as we and our Affiliates
increasingly rely on outsourced support services, including for certain fund administration and compliance functions, any
disruptions or operational difficulties by such service providers (including to their information technology infrastructure), and
our or our Affiliates’ inability to make alternative arrangements in a timely manner, could result in significant disruption to our
respective business operations. We and our Affiliates, as well as our respective third-party service providers, are also subject to
the risk that employees or contractors, or other third parties, may deliberately seek to circumvent established controls to commit
fraud or act in ways that are inconsistent with our or their controls, policies, and procedures, and which may be harder to
monitor in remote work environments. The financial and reputational impact of control failures can be significant.
In addition, our and our Affiliates’ businesses and the markets in which we and our Affiliates operate are continuously
evolving. For example, the use of AI technologies by us, our Affiliates, or our respective third-party service providers could
result in new and expanded risks, particularly as the use of AI applications increases in prevalence and scope. Failure by us to
effectively manage the development and use of AI, our competitors’ development or use of AI, and an evolving AI regulatory
environment could have an adverse effect on our growth prospects, reputation, or business and results of operations. If our or
our Affiliates’ risk frameworks are ineffective , either because of a failure to keep pace with changes in the financial markets,
technological advancements , or regulatory requirements, our or our Affiliates’ businesses, counterparties, clients, or respective
third-party service providers, or for other reasons, we or our Affiliates could incur losses , suffer reputational damage , or be out
of compliance with applicable regulatory or contractual mandates or expectations.
Failure to maintain and properly safeguard an adequate technology infrastructure may limit our or our Affiliates’ growth,
result in losses or disrupt our or our Affiliates’ businesses.
Our and our Affiliates’ businesses are reliant upon financial, accounting, and technology systems and networks to process,
transmit, and store information, including sensitive client and proprietary information, and to conduct many business activities
and transactions with clients, advisers, regulators, vendors, and other third parties. The failure to implement, maintain, and
safeguard an infrastructure commensurate with the size and scope of our and our Affiliates’ businesses could impede
productivity and growth, which could adversely impact our financial condition and results of operations. Further, we and our
Affiliates rely on third parties for certain aspects of our respective businesses, including financial intermediaries, providers of
technology infrastructure, and other service providers such as broker-dealers, custodians, administrators and other agents, as
well as accounting, legal, and other professional advisors, and these parties are susceptible to similar risks, which risks are
further heightened by the concentration of certain key services such as cloud storage and e-mail services with certain third-party
service providers, which have experienced outages .
Our computer systems, software, internal and cloud-based networks, and mobile devices are vulnerable to cyber-attacks,
data privacy or security breaches , phishing schemes and related fraud attempts, ransomware, social engineering, unauthorized
access, theft, misuse , computer viruses, or other malicious code and other events that could have a security impact, and bad
actors may target us and our Affiliates because they believe we hold personal, confidential, and other price sensitive
information about our clients, and existing and potential investments, as applicable. Any such cyber-attacks could have a
material impact on our financial conditions or results of operations. Further, third parties on whom we and our Affiliates rely,
including those providing cloud-based network services, may have similar vulnerabilities and may lack the necessary
infrastructure or resources, or may otherwise fail , to adequately protect against or respond to any cyber-attacks, data breaches ,
or other incidents . If any such events occur, it could jeopardize confidential, proprietary, or other sensitive information of ours,
our Affiliates and our respective clients, employees or counterparties that may be stored in, or transmitted through, internal or
third-party computer systems, networks, and mobile devices, the volume of which has increased rapidly in recent years, or
could otherwise cause interruptions or malfunctions in our and our Affiliates’ operations or those of our respective clients or
counterparties, or in the operations of third parties on whom we and our Affiliates rely. The rapid evolution and increased
availability of AI has intensified cybersecurity risk, and given rise to additional vulnerabilities and potential entry points for
cyber threats , providing threat actors with additional tools to automate attacks, evade detection, generate sophisticated phishing
emails, or impersonate legitimate businesses or individuals. Despite efforts to ensure the integrity of systems and networks, it is
possible that we, our Affiliates, or our respective third-party service providers may not be able to anticipate or to implement
effective preventive measures against all threats , especially because the techniques used change frequently and can originate
from a wide variety of sources. Further, human errors may occur from time to time at our third-party service providers’ staff or
among our or our Affiliates’ employees, which can lead to or exacerbate security vulnerabilities or attacks. The increasing
frequency, scope, and sophistication of these cyber threats , and involvement of large criminal organizations that share tactics
and strategies, including in foreign jurisdictions in which we and our Affiliates operate, along with the continued reliance on
work-from-home environments, personal mobile and computing technologies, and third-party web conferencing services, have
increased exposures to these security-related risks. As a result, we or our Affiliates could experience disruption , significant
losses , increased costs, reputational harm , regulatory actions, or legal liability, any of which could have an adverse effect on our
financial condition and results of operations. We or our Affiliates may be required to spend significant additional resources to
modify protective measures or to investigate and remediate vulnerabilities or other exposures, and may be subject to litigation ,
regulatory investigations , and potential fines , and financial losses that are either not insured against fully or not fully covered
through any insurance that we or our Affiliates maintain. Additionally, given our business model of providing our Affiliates
with autonomy in managing their businesses, we do not control, and may have limited involvement in, the design, oversight,
and maintenance of their technology systems and networks, as well as in the identification of or response to any cyber-attacks,
data breaches , or other incidents . See “Cybersecurity” in Item 1C.
Further, government and regulatory oversight of data privacy in particular has become a priority for regulators around the
world, including as examples, through the EU’s General Data Protection Regulation and the California Privacy Rights Act,
resulting in heightened data security and handling requirements, increased enforcement risk and fines , increased compliance
costs, and expanded incident response, reporting, and notification obligations. More recently, the SEC has implemented new
rules related to cybersecurity risk management for public companies and indicated that the implementation and testing of
cybersecurity procedures and controls is a continued examination priority. Recent well-publicized security breaches and
service outages at other companies and third-party service providers have exemplified security-related vulnerabilities , and may
lead to further government and regulatory scrutiny and heightened security requirements both in the U.S. and in other
jurisdictions in which we and our Affiliates operate.
by investing in high-quality independent partner-owned firms, which we refer to as “Affiliates,” through a proven partnership
approach, and allocating resources across our unique opportunity set to the areas of highest growth and return. With their
entrepreneurial, investment-centric cultures and alignment of interests with clients through direct equity ownership by firm
principals, independent firms have fundamental competitive advantages in offering unique return streams to the marketplace.
Through AMG’s distinctive approach, we enhance these advantages to magnify the long-term success of our Affiliates and
actively support their independence. Our innovative model enables each Affiliate’s management team to retain autonomy
and significant equity ownership in their firm, while they leverage our strategic capabilities and insight, including access to
growth capital, product strategy and development, capital formation capabilities, incentive alignment and succession
planning, and strategic advisory to expand their reach, diversify their businesses, and enhance their long-term success . As of
December 31, 2025 , our aggregate assets under management were approximately $813 billion across a diverse range of
private markets, liquid alternative , and differentiated long-only investment strategies.
In 2025, we advanced our strategy of allocating capital to areas of durable client demand by entering into four new
partnerships with independent firms collectively managing approximately $23 billion in alternative strategies, announcing a
strategic partnership with Brown Brothers Harriman (“BBH”), and further expanding our U.S. wealth platform.
I n the first quarter of 2025, we completed our minority investment in NorthBridge Partners, LLC (“NorthBridge”), a
private markets manager specializing in industrial logistics real estate assets, and in the second quarter of 2025, we completed
our minority investment in Verition Fund Management LLC (“Verition”), a global multi-strategy investment firm.
In the fourth quarter of 2025, we completed our minority investments in Montefiore Investment (“Montefiore”), a
European private equity firm focused on the services sector, and Qualitas Energy , a renewables-focused global infrastructure
manager specializing in energy transition. We also announced a strategic partnership with BBH, a privately held global
financial services firm, to acquire a minority equity interest in BBH Credit Partners, a newly formed subsidiary of BBH
focused on structured and alternative credit investment strategies. The transaction was completed in January 2026.
Following the close of these transactions, Affiliate management continues to hold a significant majority of the equity of the
respective businesses and directs the day-to-day operations.
On February 12, 2026, we announced the completion of our additional minority investment in Garda Capital Partners LP
(“Garda”), a liquid alternatives manager specializing in fixed income relative value strategies and an Affiliate since 2019, and
our minority investment in HighBrook Investors (“HighBrook”), a private markets manager specializing in real estate assets.
Following the close of the transactions, our investment in Garda continues to be accounted for under the equity method and
Affiliate management continues to hold a majority of the equity of the respective businesses and directs the day-to-day
While Affiliates typically partner with AMG to preserve their independence and partnership culture, evolving conditions
may lead an Affiliate to consider strategic alternatives; consistent with our partnership approach, in such instances, we
collaborate with Affiliates to evaluate these options. When strategic transactions occur, they typically enhance our flexibility
to execute our growth strategy and return capital to shareholders, as we deploy the resulting proceeds in accordance with our
disciplined capital allocation framework.
In the third quarter of 2025, we completed the sale of our minority equity interest in Peppertree Capital Management,
Inc. (“Peppertree”), as part of the announced acquisition of Peppertree by TPG Inc. (“TPG”), a public company listed on the
Nasdaq Global Select Market (the “Peppertree Transaction”). Pursuant to the terms of the agreement with TPG, under which
we and each of the other owners agreed to sell our respective equity interests in Peppertree, we received total consideration of
$253.2 million , net of transaction costs, which included $99.8 million in cash and 2.9 million TPG Class A common shares,
all of which we have since sold. Our gain from the transaction was $127.6 million .
In November 2025, Comvest Partners (“Comvest”) completed the previously announced agreement to sell its private
credit business to Manulife Financial Corporation (the “Comvest Transaction”). Pursuant to the terms of the agreement, we
received total cash consideration of $282.0 million for our portion of Comvest’s private credit business and our gain from the
transaction was $227.6 million .
In December 2025, we completed the sale of our minority equity interest in Montrusco Bolton Investments Inc.
(“Montrusco Bolton”) to Walter Global Asset Management Inc. (the “Montrusco Bolton Transaction” ). Pursuant to the terms
of the agreement, we received total cash consideration of $22.0 million and our gain from the transaction was $16.2 million .
Operating Performance Measures
Under accounting principles generally accepted in the U.S. (“GAAP”), we are required to consolidate certain of our
Affiliates and use the equity method of accounting for others. Whether we consolidate an Affiliate or use the equity method of
accounting, we maintain the same innovative partnership approach and provide support and assistance in substantially the same
manner for all of our Affiliates. Furthermore, all of our Affiliates are investment managers and are impacted by similar
marketplace factors and industry trends. Therefore, certain key aggregate operating performance measures are important in
providing management with a comprehensive view of the operating performance and material trends across our entire business.
The following table presents our key aggregate operating performance measures:
As of and for the Years Ended December 31,
(in billions, except as noted)
Assets under management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average assets under management . . . . . . . . . . . . . . . . . . . . . . . . .
Aggregate fees (in millions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Assets under management, and therefore average assets under management, include the assets under management of our
consolidated and equity method Affiliates. Assets under management is presented on a current basis without regard to the
timing of the inclusion of an Affiliate’s financial results in our operating performance measures and Consolidated Financial
Statements. Average assets under management reflects the timing of the inclusion of an Affiliate’s financial results in our
operating performance measures and Consolidated Financial Statements. Average assets under management for equities and
similar investment products generally represents an average of the daily net assets under management, while for liquid
alternatives and multi-asset and fixed income products, average assets under management generally represents an average of the
assets at the beginning or end of each month during the applicable period. Average assets under management for private
markets products generally represents total commitments or invested assets under management.
Aggregate fees consist of the total asset- and performance-based fees earned by all of our consolidated and equity method
Affiliates. In the case of our equity method Affiliates, asset- and performance-based fees are presented net of certain expense
reimbursements paid by the underlying products. For certain of our Affiliates accounted for under the equity method, we report
the Affiliate’s aggregate fees one quarter in arrears . Aggregate fees are provided in addition to, but not as a substitute for,
Consolidated revenue or other GAAP performance measures.
Our Affiliates manage capital on behalf of clients across a diverse range of investment strategies. Our Affiliates earn asset-
based fees on the capital that they manage and certain of our Affiliate’s strategies earn performance-based fees based on the
performance generated by their investment products. For the year ended December 31, 2025 , assets under management
increased $105.4 billion or 15% driven by a combination of investment performance generated across our Affiliates, net client
cash inflows, and the addition of assets associated with new partnerships with Affiliates operating in growing areas within
alternative strategies. C lient demand for alternative strategies continued in 2025, with strong net inflows into liquid alternative
strategies and momentum in private markets fundraising, which more than offset net outflows in equity strategies — an area
that continues to face headwinds in line with industry trends — and the removal of assets under management associated with
the sale of certain minority equity interests in Affiliates completed during the year. As we continue to execute our growth
strategy by investing in new and existing Affiliates, as well as in AMG’s strategic capabilities, we expect our business mix to
further evolve, expanding our exposure to in-demand strategies in both private markets and liquid alternatives, better
positioning AMG to continue to benefit from industry growth trends with a n increasingly diversified business profile.
The following table presents changes in our assets under management by strategy:
December 31, 2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Client cash inflows and commitments . . . . . . . . . . . .
Client cash outflows . . . . . . . . . . . . . . . . . . . . . . . . . .
Net client cash flows . . . . . . . . . . . . . . . . . . . . . . .
New investments (1) . . . . . . . . . . . . . . . . . . . . . . . . . . .
Affiliate transactions (2) . . . . . . . . . . . . . . . . . . . . . . . .
Market changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign exchange (3) . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realizations and distributions (net) . . . . . . . . . . . . . .
Other (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) Attributable to NorthBridge, Verition, Montefiore, and Qualitas Energy as of their respective closing dates.
(2) Attributable to Peppertree, Comvest’s private credit business , and Montrusco Bolton as of their respective closing dates.
(3) Foreign exchange reflects the impact of translating the assets under management of our Affiliates whose functional
currency is not the U.S. dollar into our functional currency.
(4) Other includes product transitions and reclassifications.
The following tables present performance of our investment strategies, where available, measured by the percentage of
assets under management ahead of their relevant benchmark:
% of AUM Ahead of Benchmark (1)
Private markets (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
% of AUM Ahead of Benchmark (1)
Liquid alternatives (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equities (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Multi-asset and fixed income (4) . . . . . . . . . . . . . . . . . . . . . . . .
(1) Past performance is not indicative of future results. Performance and AUM information is as of December 31, 2025 and is
based on data available at the time of calculation. Product returns are sourced from Affiliates while benchmark returns are
generally sourced via third-party subscriptions.
(2) For private markets products, performance is reported as the percentage of assets that have outperformed benchmarks on a
since-inception internal rate of return basis. Benchmarks utilized include a combination of public market equivalents, peer
medians, and absolute returns where benchmarks are not available. For purposes of investment performance comparisons,
the latest vintage comparison includes the most recent vehicles and strategies (traditional long-duration investment funds,
customized vehicles, and other evergreen vehicles and product structures) where meaningful performance is available and
calculable. In order to illustrate the performance of our private markets product category over a longer period of history,
the last three vintages comparison incorporates the latest vintage vehicles and the prior two vintages for traditional long-
duration investment funds, as well as additional vehicles and strategies launched during the equivalent time period as the
last three vintages of traditional long-duration investment funds. Due to the nature of these investments and vehicles,
reported performance is typically on a three- to six-month lag basis.
(3) For liquid alternative and equity products, performance is reported as the percentage of assets that have outperformed
benchmarks across the indicated periods, and excludes market-hedging products. For purposes of investment performance
comparisons, products are an aggregation of portfolios (separate accounts, investment funds, and other products) that each
represent a particular investment objective, using the most representative portfolio for the performance comparison.
Performance is presented for products with a three-, five-, and/or ten-year track record and is measured on a consistent
basis relative to the most appropriate benchmarks. Benchmark appropriateness is generally reviewed annually to reflect
any changes in how underlying portfolios/mandates are managed. Product and benchmark performance is reflected as total
return and is annualized. Reported product performance is gross-of-fees for institutional and high-net-worth separate
accounts, and generally net-of-fees across retail funds and other commingled vehicles such as hedge funds.
(4) Multi-asset and fixed income products are mainly our wealth management and solutions offerings. These investment
products are primarily customized toward wealth preservation, estate planning, and liability and tax management, and
therefore are typically not measured against a benchmark.
Aggregate fees consist of asset- and performance-based fees of our consolidated and equity method Affiliates. In the case
of our equity method Affiliates, asset- and performance-based fees are presented net of certain expense reimbursements paid by
the underlying products. Asset-based fees include advisory and other fees earned by our Affiliates for services provided to their
clients and are typically determined as a percentage of the value of a client’s assets under management, generally i nclusive of
uncalled commitments . Asset-based fees are generally impacted by the level of average assets under management and the
composition of these assets across our strategies with different asset-based fee ratios. Our asset-based fee ratio is calculated as
asset-based fees divided by average assets under management.
In some cases, if product returns exceed certain performance thresholds, we will participate in performance-based fees.
Performance-based fees are based on investment performance, typically on an absolute basis or relative to a benchmark or
hurdle rate, and are generally recognized when it is improbable that there will be a significant reversal in the amount of revenue
recognized. Performance-based fees are generally recognized less frequently than asset-based fees and will vary from period to
period because they inherently depend on investment performance. As of December 31, 2025 , approximately 28% of our total
assets under management could potentially earn performance-based fees. These percentages were approximately 10% and 47%
of our assets under management for our consolidated Affiliates and Affiliates accounted for under the equity method,
respectively. We anticipate performance-based fees will be a recurring component of aggregate fees ; however we do not
anticipate these fees to be a significant component of Consolidated revenue as these fees are predominately earned by our
Affiliates accounted for under the equity method.
Aggregate fees were $6,167.5 million in 2025 , an increase of $931.5 million or 18% as compared to 2024 . The increase in
aggregate fees was due to a $660.2 million or 13% increase from asset-based fees and a $271.3 million or 5% increase from
performance-based fees, primarily in liquid alternative strategies. The increase in asset-based fees was principally due to an
increase in our Affiliates’ average assets under management, primarily in liquid alternative and private markets strategies, and
changes in the composition of our assets under management, including net client cash flows from our Affiliates managing
alternative strategies, which typically have higher fee rates and the impact of our investments in new Affiliates primarily
managing alternative strategies.
Financial and Supplemental Financial Performance Measures
The following table presents our key financial and supplemental financial performance measures:
For the Years Ended December 31,
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . .
Adjusted EBITDA (controlling interest) (1) . . . . . . . . . . . . . . . . . . .
Economic net income (controlling interest) (1) . . . . . . . . . . . . . . . . .
(1) Adjusted EBITDA (controlling interest) and Economic net income (controlling interest) are non-GAAP performance
measures and are discussed in “Supplemental Financial Performance Measures.”
Net income (controlling interest) increased $205.0 million or 40% in 2025 . This increase was primarily due to $371.3
million of Affiliate transaction gains and a $150.2 million increase in Equity method income (net). These increases were
partially offset by a $97.4 million increase in Income tax expense attributable to the controlling interest, primarily due to
Affiliate transaction gains , a $97.1 million increase in Intangible amortization and impairments attributable to the controlling
interest, and a $91.2 million increase in Affiliate equity expense attributable to the controlling interest.
Adjusted EBITDA (controlling interest) is an important supplemental financial performance measure for management as it
provides a comprehensive view of our share of the financial performance of our business. Adjusted EBITDA (controlling
interest) increased $103.7 million or 11% in 2025 , primarily due to a $931.5 million or 18% increase in aggregate fees.
Adjusted EBITDA (controlling interest) increased less than aggregate fees on a percentage basis primarily due to an increase in
earnings at certain Affiliates, many of which manage alternative strategies and are accounted for under the equity method, and
therefore we own less of an economic interest.
We believe Economic net income (controlling interest) is an important supplemental financial performance measure
because it represents our performance before non-cash expenses primarily related to our acquisition of interests in Affiliates and
improves comparability of performance between periods. Economic net income (controlling interest) increased $67.7 million
or 10% in 2025 , primarily due to a $103.7 million or 11% increase in Adjusted EBITDA (controlling interest).
The following discussion includes the key operating performance measures and financial results of our consolidated and
equity method Affiliates. Our consolidated Affiliates’ financial results are included in Consolidated revenue, Consolidated
expenses, and Investment and other income, and our share of our equity method Affiliates’ financial results is reported, net of
intangible amortization and impairments and tax, in Equity method income (net) in our Consolidated Statements of Income.
Consolidated revenue is derived primarily from asset-based fees from investment management services earned by our
consolidated Affiliates. For these Affiliates, we typically use operating structures where we contractually share in the
Affiliate’s revenue without regard to expenses. Consolidated revenue is generally determined by the level of our consolidated
Affiliates’ average assets under management and the composition of these assets across our consolidated Affiliates’ investment
strategies with different asset-based fee ratios and performance-based fees.
The following table presents our consolidated Affiliates’ average assets under management and Consolidated revenue:
For the Years Ended December 31,
(in millions, except as noted)
Consolidated Affiliate average assets under management (in
billions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated revenue increased $33.5 million or 2% in 2025 , due to a $26.1 million or 1% increase from asset-based fees
and a $7.4 million or 1% increase from performance-based fees, primarily in private markets strategies. The increase in asset-
based fees was principally due to an increase in our consolidated Affiliates’ average assets under management, primarily in
private markets strategies, partially offset by changes in the composition of our assets under management.
The following table presents our Consolidated expenses:
For the Years Ended December 31,
Compensation and related expenses . . . . . . . . . . . . . . . . . . . . . . . .
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . . .
Intangible amortization and impairments . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and other amortization . . . . . . . . . . . . . . . . . . . . . . .
Other expenses (net) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total consolidated expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) Percent change is not meaningful.
Compensation and related expenses increased $104.5 million or 11% in 2025 , primarily due to an $83.9 million increase in
Affiliate equity-related activities and a $7.2 million increase in share-based compensation.
Selling, general and administrative expenses increased $32.1 million or 9% in 2025 , primarily due to a $23.8 million
increase in professional fees and an $8.5 million increase in investment-related expenses driven by an increase in average assets
under management on which these expenses are incurred.
Intangible amortization and impairments increased $131.3 million in 2025 , primarily due to expenses of $135.0 million to
reduce the carrying value of indefinite-lived acquired client relationships for certain mutual fund assets to fair value. This
increase was partially offset by a $3.7 million decrease in amortization expense due to certain definite-lived assets being fully
Interest expense increased $3.2 million or 2% in 2025 , primarily due to a $14.4 million increase from our 5.50% senior
unsecured notes issued in August 2024 (the “2034 senior notes”), a $6.7 million increase from our 6.75% junior subordinated
notes issued in March 2024 (the “2064 junior subordinated notes”), and a $3.6 million increase from borrowings under our
senior unsecured multicurrency revolving credit facility (the “revolver”). These increases were partially offset by a $13.0
million decrease due to the repayment of our senior unsecured term loan facility in the third quarter of 2024, a $5.3 million
decrease due to the maturity of our 3.50% senior notes in August 2025 , and a $2.2 million decrease due to the maturity of our
4.25% senior notes in February 2024.
There were no significant changes to Depreciation and other amortization i n 2025 .
Other expenses (net) increased $29.5 million or 73% in 2025 , primarily due to a $9.2 million increase in expenses related
to the settlement of conversions with respect to our junior convertible securities (see Note 5) and an $8.2 million increase in
expenses related to changes in the values of contingent payment obligations.
Equity Method Income (Net)
When we do not own a controlling equity interest in an Affiliate, but have significant influence, we account for our interest
in the Affiliate under the equity method. Our share of pre-tax earnings or losses from Affiliates accounted for under the equity
method (“pre-tax equity method earnings”), net of intangible amortization and impairments and tax , is included in Equity
method income (net). For certain of our Affiliates accounted for under the equity method, we report the Affiliate’s financial
results in our Consolidated Financial Statements one quarter in arrears .
For a majority of these Affiliates, we use operating structures where we contractually share in the Affiliate’s revenue less
agreed-upon expenses. We also use operating structures where we contractually share in the Affiliate’s revenue without regard
E quity method revenue, net is derived primarily from asset- and performance-based fees from investment management
services earned by our equity method Affiliates, net of certain expense reimbursements paid by the underlying products. Equity
method revenue, net is generally determined by the level of our equity method Affiliates’ average assets under management and
the composition of these assets across our equity method Affiliates’ investment strategies with different asset-based fee ratios
and performance-based fees. Our Affiliates accounted for under the equity method manage a greater proportion of assets
subject to performance-based fees than our consolidated Affiliates and, as a result, equity method revenue, net will generally
have more performance-based fees than Consolidated revenue.
The following table presents our equity method Affiliates’ average assets under management and equity method Affiliate
revenue, net, as well as pre-tax equity method earnings, equity method intangible amortization, equity method intangible
impairments , if any, and equity method income tax, which in aggregate form Equity method income (net):
For the Years Ended December 31,
(in millions, except as noted)
Operating Performance Measures
Equity method Affiliate average assets under management (in
billions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity method revenue, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Performance Measures
Pre-tax equity method earnings . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity method intangible amortization . . . . . . . . . . . . . . . . . . . . .
Equity method intangible impairments . . . . . . . . . . . . . . . . . . . . . .
Equity method income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity method income (net) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) Percent change is not meaningful.
Equity method revenue, net increased $898.0 million or 28% in 2025 , due to a $634.1 million or 20% increase from asset-
based fees and a $263.9 million or 8% increase from performance-based fees, primarily in liquid alternative strategies. The
increase in asset-based fees was principally due to an increase in our equity method Affiliates’ average assets under
management, primarily in liquid alternative strategies, and changes in the composition of our assets under management,
including net client cash flows from our equity method Affiliates managing alternative strategies, which typically have higher
fee rates and the impact of our investments in new Affiliates primarily managing alternative strategies.
Pre-tax equity method earnings increased $122.4 million or 27% in 2025 , primarily due to an $898.0 million or 28%
increase in equity method revenue, net.
Equity method intangible amortization increased $8.0 million or 9% in 2025 , primarily due to a $17.6 million increase in
amortization expense due to investments in new Affiliates. This increase was partially offset by a $4.6 million decrease in
amortization expense related to certain definite-lived assets being fully amortized and a $3.9 million decrease in amortization
expense due to a decrease in actual and expected client attrition for certain definite-lived acquired client relationships.
For the year ended December 31, 2024 , we recorded a $39.9 million impairment on equity method investments. For the
year ended December 31, 2025 , no equity method intangible impairments were recorded. See Note 8 of our Consolidated
Affiliate Transaction Gains
The following table presents our Affiliate transaction gains :
For the Years Ended December 31,
Affiliate transaction gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) P e rcent change is not meaningful.
For the years ended December 31, 2023 and 2025 , we recorded a gain of $133.1 million on the sale of our equity interest in
Veritable, LP (“Veritable”) (the “Veritable Transaction”), and total gains of $371.3 million related to the sale of our equity
interests in Peppertree, Comvest’s private credit business, and Montrusco Bolton, respectively. See Notes 7 and 8 of our
Consolidated Financial Statements.
Investment and Other Income
The following table presents our Investment and other income:
For the Years Ended December 31,
Investment and other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investment and other income increased $5.7 million or 7% in 2025 , primarily due to increases in net realized and
unrealized gains on other investments and marketable securities of $17.4 million and $5.8 million, respectively. These
increases were partially offset by a $16.6 million decrease in interest income.
The following table presents our Income tax expense:
For the Years Ended December 31,
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Our consolidated income tax provision includes taxes attributable to the controlling interest and, to a lesser extent, taxes
attributable to the non-controlling interests.
Income tax expense increased $99.7 million or 55% in 2025 . Our effective tax rate (controlling interest) for the year ended
December 31, 2025 was 27.5% as compared to 25.5% for the year ended December 31, 2024. The increase in the effective tax
rate (controlling interest) was primarily due to unrecognized tax benefits and n on-deductible compensation expense , partially
offset by higher tax windfalls attributable to share-based compensation for the year ended December 31, 2025.
The following table presents Net income, Net income (non-controlling interests), and Net income (controlling interest):
For the Years Ended December 31,
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (non-controlling interests) . . . . . . . . . . . . . . . . . . . . . .
Net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (controlling interest) increased $205.0 million or 40% in 2025 , primarily due to Affiliate transaction gains and
an increase in Equity method income (net). These increases to Net income (controlling interest) were partially offset by
increases in Income tax expense attributable to the controlling interest, primarily due to Affiliate transaction gains , Intangible
amortization and impairments attributable to the controlling interest, and Affiliate equity expense attributable to the controlling
Supplemental Financial Performance Measures
As supplemental information to our GAAP performance measures, including Net income (see Note 21 of our Consolidated
Financial Statements), we provide non-GAAP performance measures of Adjusted EBITDA (controlling interest), Economic net
income (controlling interest), and Economic earnings per share. We believe that many investors use our Adjusted EBITDA
(controlling interest) when comparing our financial performance to other companies in the investment management industry.
Management utilizes these non-GAAP performance measures to assess our performance before our share of certain non-cash
GAAP expenses primarily related to the acquisition of interests in Affiliates and to improve comparability between periods.
Economic net income (controlling interest) and Economic earnings per share are used by management and our Board of
Directors as our principal performance benchmarks, including as one of the measures for determining executive compensation.
These non-GAAP performance measures are provided in addition to, but not as a substitute for, Net income, Net income
(controlling interest), Earnings per share, or other GAAP performance measures.
Adjusted EBITDA (controlling interest)
Adjusted EBITDA (controlling interest) represents our performance before our share of interest expense, income and
certain non-income based taxes, depreciation, amortization, impairments , gains and losses related to Affiliate transactions, and
non-cash items such as certain Affiliate equity-related activities, gains and losses on our contingent payment obligations, and
unrealized gains and losses on seed capital, general partner commitments, and other strategic investments. Adjusted EBITDA
(controlling interest) is also adjusted to include realized economic gains and losses related to these seed capital, general partner
commitments, and other strategic investments.
The following table presents a reconciliation of Net income (controlling interest) to Adjusted EBITDA (controlling
For the Years Ended December 31,
Net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible amortization and impairments (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Affiliate transactions (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other items (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Adjusted EBITDA (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) Includes equity method income tax.
(2) Intangible amortization and impairments in our Consolidated Statements of Income include amortization attributable to the
non-controlling interests of our consolidated Affiliates. For our Affiliates accounted for under the equity method, we do
not separately report intangible amortization and impairments in our Consolidated Statements of Income. Our share of
these Affiliates’ amortization and impairments is included in Equity method income (net). The following table presents the
Intangible amortization and impairments shown above:
For the Years Ended December 31,
Consolidated intangible amortization and impairments . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated intangible amortization and impairments (non-controlling interests) . . .
Equity method intangible amortization and impairments . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3) The year ended December 31, 2023 includes a gain of $133.1 million related to the Veritable Transaction and realized
gains of $29.6 million on ordinary shares of EQT AB (“EQT”), a public company listed on the Nasdaq Stockholm
(EQT.ST), which we received in connection with the sale of our equity interest in Baring Private Equity Asia (“BPEA”) in
the fourth quarter of 2022 (the “BPEA Transaction”). The year ended December 31, 2025 includes total gains of
$371.3 million related to the Peppertree, Comvest, and Montrusco Bolton Transactions and realized gains of $6.2 million
on TPG Class A common shares. See Notes 7 and 8 of our Consolidated Financial Statements. Veritable, Peppertree,
Comvest, and Montrusco Bolton Transaction gains are recorded in Affiliate transaction gains , and realized gains on EQT
ordinary shares and TPG Class A common shares are recorded in Investment an d other income in our Consolidated
(4) Other items include certain non-income based taxes, depreciation, and non-cash items such as certain Affiliate equity-
related activities, gains and losses on our contingent payment obligations, unrealized gains and losses on seed capital,
general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed
capital, general partner commitments, and other strategic investments. For the year ended December 31, 2025 , the increase
in other items was predominantly the result of Affiliate equity-related activities.
Economic Net Income (controlling interest) and Economic Earnings Per Share
Under our Economic net income (controlling interest) definition, we adjust Net income (controlling interest) for our share
of pre-tax intangible amortization and impairments related to intangible assets (including the portion attributable to equity
method investments in Affiliates) because these expenses do not correspond to the changes in the value of these assets, which
do not diminish predictably over time. We also adjust for deferred taxes attributable to intangible assets because we believe it
is unlikely these accruals will be used to settle material tax obligations. Further, we adjust for gains and losses related to
Affiliate transactions, net of tax, and other economic items.
Economic earnings per share represents Economic net income (controlling interest) divided by the Average shares
outstanding (adjusted diluted). In this calculation, we exclude the potential shares issued upon settlement of Redeemable non-
controlling interests from Average shares outstanding (adjusted diluted) because we intend to settle those obligations without
issuing shares, consistent with all prior Affiliate equity purchase transactions. The potential share issuance in connection with
our junior convertible securities is measured using a “treasury stock” method. Under this method, only the net number of
shares of common stock equal to the value of these junior convertible securities in excess of par, if any, are deemed to be
outstanding. We believe the inclusion of net shares under a treasury stock method best reflects the benefit of the increase in
available capital resources (which could be used to repurchase shares of our common stock) that occurs when these securities
are converted and we are relieved of our debt obligation.
The following table presents a reconciliation of Net income (controlling interest) to Economic net income (controlling
interest) and Economic earnings per share:
For the Years Ended December 31,
(in millions, except per share data)
Net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible amortization and impairments (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible-related deferred taxes (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Affiliate transactions (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other economic items (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Economic net income (controlling interest) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average shares outstanding (diluted) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hypothetical issuance of shares to settle Redeemable non-controlling interests . . . . . . . .
Assumed issuance of junior convertible securities shares . . . . . . . . . . . . . . . . . . . . . . . . .
Dilutive impact of junior convertible securities shares . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average shares outstanding (adjusted diluted) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Economic earnings per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1) See note (2) to the table in “Adjusted EBITDA (controlling interest).”
(2) Includes equity method deferred taxes. For the year ended December 31, 2023, intangible-related deferred taxes have been
adjusted to eliminate benefits of $28.9 million related to the Veritable Transaction. For the year ended December 31, 2025,
intangible-related deferred taxes have been adjusted to eliminate net expenses of $4.4 million related to the Peppertree and
(3) The year ended December 31, 2023 includes a gain of $133.1 million related to the Veritable Transaction and realized
gains of $29.6 million on EQT ordinary shares related to the BPEA Transaction, net of $40.6 million income tax expense.
The year ended December 31, 2025 includes total gains of $371.3 million related to the Peppertree, Comvest, and
Montrusco Bolton Transactions and realized gains of $6.2 million on TPG Class A common shares, net of $93.1 million of
income tax expense. See Notes 7 and 8 of our Consolidated Financial Statements.
(4) Other economic items include certa in Affiliat e equity-related activities, gains and losses related to contingent payment
obligations, tax windfalls and shortfalls from share-based compensation, unrealized gains and losses on seed capital,
general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed
capital, general partner commitments, and other strategic investments. For the year ended December 31, 2025 , the increase
in other economic items was predominantly the result of Affiliate equity-related activities.
Liquidity and Capital Resources
We generate long-term value by investing in new Affiliate partnerships, existing Affiliates, and strategic value-add
capabilities through which we can leverage our scale and resources to benefit our Affiliates and enhance their long-term growth
prospects. Given our annual cash generation from operations, in addition to investing for growth in our business, we are also
able to return excess capital to shareholders primarily through share repurchases. We continue to manage our capital structure
consistent with an investment grade company and are currently rated A3 by Moody’s Investors Service and BBB+ by S&P
Cash and cash equivalents were $586.0 million as of December 31, 2025 and were attributable to both our controlling and
the non-controlling interests. In 2025 , we met our cash requirements primarily through cash generated by operating activities,
senior bank debt borrowings, and an issuance of senior notes . In addition, during the year ended December 31, 2025 , we
received total after-tax net proceeds of approximately $490 million from the Peppertree, Comvest, and Montrusco Bolton
Transactions. Ou r principal uses of cash in 2025 were for investments in new Affiliates, the return of excess capital through
share repurchases, repayment of debt, and distributions to Affiliate equity holders.
We expect investments in new Affiliates, investments in existing Affiliates, primarily through purchases of Affiliate equity
interests and general partner and seed capital investments, the return of capital through share repurchases and the payment of
cash dividends on our common stock, repayment of debt, distributions to Affiliate equity holders, payment of income taxes, and
general working capital to be the primary uses of cash on a consolidated basis for the foreseeable future. In addition, in January
2026, we settled each of our conversion obligations with respect to our junior convertible securities in cash for an aggregate
amount of $514.6 million. We anticipate that our current cash balance, cash flows from operations, and borrowings under our
revolver will be sufficient to support our uses of cash for the foreseeable future. In addition, we may draw funding from the
debt and equity capital markets, and our credit ratings, among other factors, allow us to access these sources of funding on
The following table presents operating, investing, and financing cash flow activities:
For the Years Ended December 31,
Operating cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investing cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financing cash flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating cash flows are calculated by adjusting Net income for other significant sources and uses of cash, significant non-
cash items, and timing differences in the cash settlement of assets and liabilities.
For the year ended December 31, 2025 , Cash flows from operating activities were $973.2 million , primarily from Net
income of $904.0 million adjusted for non-cash items of $424.5 million and distributions of earnings received from equity
method investments of $467.8 million . In 2025 , operating cash flows were primarily attributable to the controlling interest.
For the year ended December 31, 2025 , Cash flows used in investing activities were $206.1 million , primarily due to
$776.0 million of investments in Affiliates and $103.8 million of purchases of investment securities. These items were partially
offset by $403.8 million of cash proceeds from Affiliate transactions and $266.2 million of maturities and sales of investment
securities. In 2025 , investing cash flows were primarily attributable to the controlling interest.
For the year ended December 31, 2025 , Cash flows used in financing activities were $1,148.7 million , primarily due to
repayment of senior bank debt borrowings and matured senior notes of $826.1 million , $706.3 million of repurchases of
common stock, net, $252.3 million of distributions to non-controlling interests, $170.3 million of Affiliate equity purchases, net
of issuances, and $108.0 million of taxes paid on shares withheld for share-based awards. These items were partially offset by
senior bank debt borrowings and an issuance of senior notes of $899.3 million. In 2025 , financing cash flows were primarily
attributable to the controlling interest.
We periodically purchase Affiliate equity from and issue Affiliate equity to our consolidated Affiliate partners and other
parties under agreements that provide us with a conditional right to call and Affiliate equity holders with a conditional right to
put their Affiliate equity interests to us at certain intervals. We have the right to settle a portion of these purchases in shares of
our common stock. For Affiliates accounted for under the equity method, we do not typically have such put and call
arrangements. The purchase price of these conditional purchases is generally calculated based upon a multiple of the Affiliate’s
cash flow distributions, which is intended to represent fair value. In certain cases, Affiliate equity holders are also permitted to
sell their equity interests to Affiliate partners or other parties, subject to our approval or other restrictions.
As of December 31, 2025 , the current redemption value of Affiliate equity interests was $408.0 million , of which $246.8
million was presented as Redeemable non-controlling interests (including $32.2 million of consolidated Affiliate sponsored
investment products primarily attributable to third-party investors), and $161.2 million was included in Other liabilities on the
Consolidated Balance Sheets. Although the timing and amounts of these purchases are difficult to predict, we paid $176.7
million for Affiliate equity purchases and received $6.4 million for Affiliate equity issuances in 2025 , and we expect net
purchases of approximately $100 million of Affiliate equity in 2026 . In the event of a purchase, we become the owner of the
cash flow associated with the purchased equity. See Notes 13 and 14 of our Consolidated Financial Statements.
Our Board of Directors authorized share repurchase programs in July 2024 and January 2026 t o repurchase up to 5.4
million and 4.2 million shares of our common stock, respectively, and these authorizations have no expiry. Purchases may be
made from time to time, at management’s discretion, in the open market or in privately negotiated transactions, including
through the use of trading plans, as well as pursuant to accelerated share repurchase programs or other share repurchase
strategies that may include derivative financial instruments. For the year ended December 31, 2025 , we repurchased 3.3 million
shares of our common stock at an average price per share of $212.92 . As of the January 26, 2026 authorization, there were a
total of 6.0 million shares available for repurchase under our share repurchase programs.
The following table presents the carrying value of our outstanding indebtedness and a reconciliation to Debt as presented
on our Consolidated Balance Sheets:
Senior bank debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Senior notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Junior subordinated notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Junior convertible securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total carrying value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
As of December 31, 2025 , the weighted average maturity of our outstanding senior and junior subordinated notes is 22
years, all of which is maturing in 2030 and beyond. Our nearest term maturity with respect to our senior and junior
subordinated notes relates to our $350.0 million senior notes due June 2030 (“the 2030 senior notes”). See Note 5 of our
Consolidated Financial Statements.
As of December 31, 2025 , we had a $1.25 billion revolver which matures on November 15, 2029. Subject to certain
conditions, we may increase the commitments under the revolver by up to an additional $500.0 million .
Under the terms of the revolver we are required to meet two financial ratio covenants. The first of these covenants is a
maximum ratio of debt to EBITDA (the “bank leverage ratio”) of 3.25x. The second covenant is a minimum ratio of EBITDA
to cash interest expense (the “bank interest coverage ratio”) of 3.00x. For purposes of calculating these ratios, share-based
compensation and certain Affiliate equity expenses, among other specified expenses, charges, and costs, are added back to
Adjusted EBITDA. As of December 31, 2025 , our bank leverage and bank interest coverage ratios were 0.9x and 8.5x ,
As of December 31, 2025 , we had no outstanding borrowings under the revolver, and we could borrow all remaining
capacity and maintain compliance with all of the terms of the revolver. As of the date of this Annual Report on Form 10-K, we
had outstanding borrowings of $475.0 million under the revolver .
In the third quarter of 2025, our $350.0 million 3.50% senior notes matured and were fully repaid.
As of December 31, 2025 , we had senior notes outstanding, the respective principal terms of which are presented and
Issue date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Maturity date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Par value (in millions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Stated coupon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Coupon frequency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
On December 11, 2025, we issued $425.0 million of 2036 senior unsecured notes with a maturity date of February 15,
2036 (the “2036 senior notes”) . Interest is payable beginning August 15, 2026.
In addition to customary event of default provisions, the indenture governing the senior notes, including the applicable
supplemental indentures with respect to the 2030, 2034, and 2036 senior notes, limits our ability to consolidate, merge, or sell
all or substantially all of our assets, and requires us to make an offer to repurchase the applicable senior notes at 101% of the
principal amount (plus any accrued and unpaid interest), upon certain change of control triggering events. The senior notes
may be redeemed, in whole or in part, at a make-whole redemption price (plus accrued and unpaid interest), at any time prior to
March 15, 2030, in the case of the 2030 senior notes, at any time prior to May 20, 2034, in the case of the 2034 senior notes,
and at any time prior to November 15, 2035, in the case of the 2036 senior notes. In addition, the 2030, 2034, and 2036 senior
notes may be redeemed at par (plus accrued and unpaid interest), in whole or in part, at any time, on or after March 15, 2030,
May 20, 2034, and November 15, 2035, respectively . We may also repurchase senior notes in the open market or in privately
negotiated transactions from time to time at management’s discretion.
We used a majority of the net proceeds from the 2036 senior notes to settle our conversion obligations with respect to our
junior convertible securities in January 2026, as further described below.
Junior Subordinated Notes
As of December 31, 2025 , we had junior subordinated notes outstanding, the respective principal terms of which are
presented and described below:
Issue date . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Maturity date . . . . . . . . . . . . . . . . . . . . . . . . .
Par value (in millions) . . . . . . . . . . . . . . . . . .
Stated coupon . . . . . . . . . . . . . . . . . . . . . . . . .
Coupon frequency . . . . . . . . . . . . . . . . . . . . .
NYSE Symbol . . . . . . . . . . . . . . . . . . . . . . . .
As of December 31, 2025 , each of the 2059 and 2060 junior subordinated notes could be redeemed at any time, in whole or
in part. The other junior subordinated notes may be redeemed at any time, in whole or in part, on or after September 30, 2026,
in the case of the 2061 junior subordinated notes, and on or after March 30, 2029, in the case of the 2064 junior subordinated
notes. In each case, the junior subordinated notes may be redeemed at 100% of the principal amount of the notes being
redeemed, plus any accrued and unpaid interest thereon. Prior to the applicable redemption date, at our option, the applicable
junior subordinated notes may also be redeemed, in whole but not in part, at 100% of the principal amount, plus any accrued
and unpaid interest, if certain changes in tax laws, regulations, or interpretations occur; or at 102% of the principal amount, plus
any accrued and unpaid interest, if a rating agency makes certain changes relating to the equity credit criteria for securities with
features similar to the applicable notes.
Junior Convertible Securities
As of December 31, 2025 , we had $340.6 million of principal outstanding on our junior convertible trust preferred
securities outstanding (the “junior convertible securities”). Prior to their redemption , as described below, the junior convertible
securities bore interest at a rate of 5.15% per annum, which interest payments were payable quarterly in cash. The junior
convertible securities were considered contingent payment debt instruments under federal income tax regulations, which
required us to deduct interest in an amount greater than its reported interest expense (“excess interest expense deductions”).
In November 2025, pursuant to the terms of the junior convertible securities, we adjusted the conversion rate of the
securities to 0.2582 shares of common stock per $50.00 junior convertible security, equivalent to an adjusted conversion price
of $193.65 per share. The adjustment was the result of our cumulative declared dividends on our common stock since the prior
On December 8, 2025, we delivered notice that we had elected to redeem all of the outstanding junior convertible securities
on December 29, 2025 (the “Redemption Date”), and announced our intention to settle any and all conversion obligations in
cash. Substantially all holders of the junior convertible securities delivered requests to convert their securities prior to the
Redemption Date. On December 15, 2025, we made an irrevocable election to settle our conversion obligations in cash by
reference to the daily volume weighted average price of our common stock during each applicable ten trading day conversion
reference period. These conversions resulted in a settlement value in excess of the associated carrying value (the “conversion
premium”). As of December 31, 2025, the conversion premium of $155.5 million was recorded within Other liabilities, with a
corresponding reduction to Additional paid-in capital on the Consolidated Balance Sheets. In addition, the conversion resulted
in a reduction to Deferred tax liability (net) on the Consolidated Balance Sheets of $38.9 million , with a corresponding increase
to Additional paid-in capital. Our election to settle each applicable conversion premium in cash using a ten-day reference
period was accounted for as a forward sale contract, which resulted in a $9.2 million expense recorded in Other expenses (net)
in our Consolidated Statements of Income, in the fourth quarter of 2025.
On the Redemption Date, we redeemed $1.1 million of junior convertible securities which were not converted, reflecting
the principal amount of the redeemed securities, plus accrued and unpaid interest, up to, but not including, the Redemption
In January 2026 , we settled each of our applicable conversion obligations in cash for an aggregate amount of
$514.6 million which resulted in an incremental expense related to the forward sale contract of $9.3 million . As a result of the
settlement of these securities, we expect to incur a current cash tax liability of approximately $56.0 million in 2026, reflective
of the recapture of excess interest expense deductions. As of the date of this Annual Report on Form 10-K, no junior
convertible securities are outstanding.
Equity Distribution Program
In the first quarter of 2025, we entered into an equity distribution agreement and forward sale agreements with several
major securities firms under which we may, from time to time, issue and sell shares of our common stock (immediately or on a
forward basis) having an aggregate sales price of up to $500.0 million (the “equity distribution program”). This equity
distribution program superseded and replaced our prior equity distribution program. As of December 31, 2025 , no sales had
occurred under the equity distribution program.
See Note 6 of our Consolidated Financial Statements.
Other Contingent Commitments
See Notes 3 and 6 of our Consolidated Financial Statements.
As of December 31, 2025 , our lease obligations were $30.8 million through 2026 , $53.4 million from 2027 through 2028,
$48.0 million from 2029 through 2030, and $48.5 million thereafter. The portion of these lease obligations attributable to the
controlling interest were $5.8 million through 2026 , $6.7 million from 2027 through 2028, $6.6 million from 2029 through
2030, and $11.3 million thereafter. See Note 9 of our Consolidated Financial Statements.
Recent Accounting Developments
See Note 1 of our Consolidated Financial Statements.
Critical Accounting Estimates and Judgments
The preparation of financial statements and related disclosures in conformity with GAAP requires us to make judgments,
assumptions, and estimates that affect the amounts reported in our Consolidated Financial Statements and accompanying notes.
See Note 1 of our Consolidated Financial Statements for a discussion of our significant accounting policies.
The following are our critical accounting estimates and judgments used in the preparation of our Consolidated Financial
Statements, and due to their subjectivity, actual results could differ materially from the amounts reported.
Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in
the principal or most advantageous market in an orderly transaction between market participants at the measurement date.
These standards establish a fair value hierarchy that gives the highest priority to quoted prices in active markets for identical
assets or liabilities and the lowest priority to unobservable inputs.
We make judgments to determine the fair value of certain assets, liabilities, and equity interests when allocating the
purchase price of our new investments, when revaluing our contingent payment obligations, when we issue or purchase
Affiliate equity interests, and when we test our goodwill, indefinite- and definite-lived acquired client relationships, or equity
method investments for impairment .
In determining fair values that reflect our own assumptions concerning unobservable inputs, we typically use valuation
techniques, including probability-weighted discounted cash flow analyses and Monte Carlo simulations, where we make
assumptions about growth rates of assets under management, client attrition , asset- and performance-based fee rates, and
expenses. In these analyses, we also consider historical and current market multiples, tax benefits, credit risk, interest rates, tax
rates, discount rates, volatility , and discounts for lack of marketability. We consider the reasonableness of our assumptions by
comparing our valuation conclusions to observed market transactions and, in certain instances, by consulting with third-party
valuation firms. Changes in the assumptions used could significantly impact fair values.
Indefinite-Lived Acquired Client Relationships
Indefinite-lived acquired client relationships include investment advisory contracts between our Affiliates and their mutual
funds and other retail-oriented investment products. Because these contracts are with the investment products themselves, and
not with the underlying investors, and the contracts between our Affiliates and the investment products are typically renewed on
an annual basis, industry practice under GAAP is to consider the contract life to be indefinite and, as a result, not amortizable.
We perform indefinite-lived acquired client relationship impairment assessments annually, or more frequently should
circumstances indicate fair value has declined below the related carrying value. For purposes of our assessments, we consider
various qualitative and quantitative factors to determine if it is more-likely-than-not that the fair value of each asset group is
greater than its carrying amount. If we determine that it is likely that the fair value has declined below our related carrying
value, we perform discounted cash flow analyses to determine the fair value of the asset group and record an expense in
Intangible amortization and impairments to reduce the carrying value to its fair value. In these analyses, the most relevant
assumptions are revenue growth rates and discount rates.
In the first quarter of 2025, we completed an impairment assessment of the indefinite-lived acquired client relationships for
certain mutual fund assets and determined that the fair value of the assets had declined below their carrying values.
Accordingly, we recorded an expense in Intangible amortization and impairments of $59.2 million attributable to the controlling
interest ( $70.0 million in aggregate) to reduce the carrying value of the assets to fair value. The decline in the fair value was a
result of current and projected declines in assets under management that decreased the forecasted revenue associated with the
assets. The most relevant assumptions used in these analyses were revenue growth rates over the next five years ranging from
(21)% to 0% , long-term revenue growth rates of 0% , and discount rates of 11.0% .
In the fourth quarter of 2025, we completed our annual impairment assessment of our indefinite-lived acquired client
relationships and determined that the fair value of certain mutual fund assets had declined below their carrying values.
Accordingly, we recorded an expense in Intangible amortization and impairments of $37.0 million attributable to the controlling
interest ( $58.0 million in aggregate) to reduce the carrying value of the assets to fair value. The decline in the fair value was a
result of current and projected declines in assets under management that decreased the forecasted revenue associated with the
assets. The most relevant assumptions used in these analyses were revenue growth rates over the next five years ranging from
(34)% to 0% , long-term revenue growth rates of 0% , and discount rates of 10.5% .
While we believe all assumptions used in our assessments are reasonable and appropriate, changes in these estimates could
produce different values. We performed a sensitivity analysis over the most relevant assumptions used in these assessments.
Assuming all other assumptions remain constant, a decrease in the revenue growth rates over the next five years of 200 basis
points would result in an additional impairment amount of approximately $80 million , while an increase in the discount rate of
100 basis points would result in an additional impairment amount of approximately $85 million . Further declines in assets
under management resulting from negative investment performance or net client outflows above our estimates could result in
additional future impairments .
For the year ended December 31, 2025 , no other impairments were indicated for our indefinite-lived acquired client
Equity Method Investments in Affiliates
We periodically perform assessments to determine if the fair value of an investment may have declined below its related
carrying value for our Affiliates accounted for under the equity method for a period that we consider to be other-than-
temporary. We perform these assessments if certain triggering events occur or annually during the fourth quarter. We first
consider whether certain qualitative and quantitative factors (including discount rates) indicate an increased likelihood of a
decline in the fair value of an Affiliate during the reporting period. If such a decline is identified, and it is likely that an
investment’s fair value may have declined below its carrying value, we perform a quantitative assessment to determine if an
impairment exists. Impairments are recorded as an expense in Equity method income (net) to reduce the carrying value of the
Affiliate to its fair value.
When we quantitatively test our equity method investments for impairment , we typically use valuation methods such as
discounted cash flow analyses. In these analyses, our most significant assumptions relate to growth rates of projected assets
under management, client attrition , asset- and performance-based fees, expenses, and discount rates. We consider the
reasonableness of our assumptions by comparing our valuation conclusions to observed market transactions, comparable
company valuations, and, in certain instances, by consulting with third-party valuation firms. Changes in these assumptions
could significantly impact the respective fair value of an Affiliate.
For the year ended December 31, 2025 , the Company completed its annual assessme nt of its investments in Affiliates
accounted for under the equity method and no impairments were indicated.
