資訊發佈
普信集團公佈2024年第三季度業績報告
2024年11月1日，巴爾的摩 - t. Rowe Price Group, Inc.（納斯達克證券交易所：TROW）今天公佈了其2024年第三季度的業績。
▪季末管理資產達到1.63萬億美元
▪淨客戶流出額達122億美元
▪稀釋每股普通股收益（EPS）爲$2.64
▪攤薄後每股收益調整爲2.57美元
▪通過定期的季度股息和股票回購，將35400萬美元返還給股東
Rob Sharps，主席，首席執行官和總裁，評論說：「我們看到了一些令人鼓舞的跡象，表明我們正在走在正確的道路上。我們的主動式etf業務正在擴張，通過推出創新的養老解決方案，我們正在加強我們的養老領導地位，我們的員工正在推動我們的戰略計劃。我們的長期表現穩健，我們仍在按計劃今年減少淨流出。」
財務要點
| 截至三個月結束時 | |||||||||||||||||||||||||||||
| （單位：百萬美元，每股數據除外） | 9/30/2024 | 9/30/2023 | 變化(1) | 6/30/2024 | 變更(1) | ||||||||||||||||||||||||
| 美國通用會計準則基礎 | |||||||||||||||||||||||||||||
| 投資顧問費用 | $ | 1,632.9 | $ | 1,463.9 | 11.5 | % | $ | 1,585.6 | 3.0 | % | |||||||||||||||||||
基於資本配置的收入(2) | $ | 4.6 | $ | 66.1 | n/m | $ | 0.1 | n/m | |||||||||||||||||||||
| 淨收入 | $ | 1,785.6 | $ | 1,670.7 | 6.9 | % | $ | 1,733.3 | 3.0 | % | |||||||||||||||||||
| 營業費用 | $ | 1,172.0 | $ | 1,089.4 | 7.6 | % | $ | 1,168.6 | 0.3 | % | |||||||||||||||||||
| 淨營業收入 | $ | 613.6 | $ | 581.3 | 5.6 | % | $ | 564.7 | 8.7 | % | |||||||||||||||||||
| 非營業收入（損失） | $ | 212.5 | $ | 2.8 | n/m | $ | 80.3 | n/m | |||||||||||||||||||||
| 普信集團歸屬淨利潤 | $ | 603.0 | $ | 453.2 | 33.1 | % | $ | 483.4 | 24.7 | % | |||||||||||||||||||
| 稀釋每股收益 | $ | 2.64 | $ | 1.97 | 34.0 | % | $ | 2.11 | 25.1 | % | |||||||||||||||||||
| 稀釋後加權平均普通股份 | 222.8 | 224.8 | (0.9) | % | 223.5 | (0.3) | % | ||||||||||||||||||||||
調整基礎(3) | |||||||||||||||||||||||||||||
| 營業費用 | $ | 1,099.0 | $ | 1,061.3 | 3.6 | % | $ | 1,105.8 | (0.6) | % | |||||||||||||||||||
| 營業費用，不包括應付資金利潤的懸掛關聯報酬 | $ | 1,087.4 | $ | 1,030.8 | 5.5 | % | $ | 1,097.3 | (0.9) | % | |||||||||||||||||||
| 淨營業收入 | $ | 718.4 | $ | 635.9 | 13.0 | % | $ | 654.9 | 9.7 | % | |||||||||||||||||||
| 非營業收入（損失） | $ | 51.2 | $ | 28.7 | 78.4 | % | $ | 34.7 | n/m | ||||||||||||||||||||
| 普信集團歸屬淨利潤 | $ | 586.5 | $ | 499.5 | 17.4 | % | $ | 519.7 | 12.9 | % | |||||||||||||||||||
| 稀釋每股收益 | $ | 2.57 | $ | 2.17 | 18.4 | % | $ | 2.26 | 13.7 | % | |||||||||||||||||||
資產管理 （以億爲單位） | |||||||||||||||||||||||||||||
| 管理資產的平均資產 | $ | 1,589.5 | $ | 1,393.6 | 14.1 | % | $ | 1,534.0 | 3.6 | % | |||||||||||||||||||
| 結束管理的資產 | $ | 1,630.9 | $ | 1,346.5 | 21.1 | % | $ | 1,569.1 | 3.9 | % | |||||||||||||||||||
| 投資諮詢年化有效費率以點子（bps）計 | 40.9 | 41.7 | (0.8) | 41.6 | (0.7) | ||||||||||||||||||||||||
| 投資諮詢年化實際費率，不包括績效費用（點子） | 40.7 | 41.6 | (0.9) | 41.1 | (0.4) | ||||||||||||||||||||||||
(1) n/m - 百分比變化無意義。 (2) 基於資金配置的收入代表應計攜帶利潤的變化。 (3) 請查看本盈利公告末尾的與比較美國通用會計準則指標的對賬表。
1
資產管理
2024年第三季度，管理資產 (AUM) 增加了618億美元，達到1.63萬億美元。各資產類別的AUM變動元件顯示在下表中。
2024年9月30日結束的三個月 | |||||||||||||||||||||||||||||
| （以億爲單位） | 股權 | 固收，包括貨幣市場 | 多資產(1) | 替代方案(2) | 總費用 | ||||||||||||||||||||||||
| 期初資產管理規模 | $ | 810.3 | $ | 179.9 | $ | 529.1 | $ | 49.8 | $ | 1,569.1 | |||||||||||||||||||
| 經理驅動分配之前的淨現金流量 | (16.1) | 1.1 | 1.9 | 1.7 | (11.4) | ||||||||||||||||||||||||
| 經理驅動的分配 | — | — | — | (0.8) | (0.8) | ||||||||||||||||||||||||
| 淨現金流量 | (16.1) | 1.1 | 1.9 | 0.9 | (12.2) | ||||||||||||||||||||||||
淨市場升值（折舊）和收入(3) | 37.8 | 5.3 | 29.9 | 1.0 | 74.0 | ||||||||||||||||||||||||
| 期間變動 | 21.7 | 6.4 | 31.8 | 1.9 | 61.8 | ||||||||||||||||||||||||
2024年9月30日的資產管理 | $ | 832.0 | $ | 186.3 | $ | 560.9 | $ | 51.7 | $ | 1,630.9 | |||||||||||||||||||
(1) 多資產組合的底層AUm已彙總並列入此類別，並未報告在股票和固收欄目中。
(2) 備選資產類別包括授權投資超過其持有資產50%以上的策略，其中包括私人信貸、槓桿貸款、中間級別融資、實物資產/商業地產、結構化產品、重災區/不良資產、非投資級別CLO、特殊狀況、商業發展公司，或以絕對回報爲投資目標。一般而言，只有那些具有超過每日流動性的策略才會被納入。截至2024年9月30日，承諾但尚未到賬的資金爲145億美元，截至2024年6月30日爲113億美元，在費基資產管理規模中未反映。
(3) 包括未再投資的淨分配金額爲20億美元。
2024年9月30日、2024年6月30日和2023年12月31日，美國境外投資者佔公司資產管理規模的8.6%。
該公司爲那些主要投資於該公司美國共同基金、集合投資信託以及該公司複雜外管理基金的養老計劃提供參與者覈算和計劃管理。截至2024年9月30日，該公司管理的資產爲2860億美元，其中 其中我們管理的資產達到1630億美元。
該公司通過模型交付和多資產解決方案向提供者提供非自主諮詢服務。該公司記錄這些服務產生的營業收入在管理費中。截至2024年9月30日，這些投資組合的管理資產主要位於美國，爲168億美元。
2
財務業績亮點
淨收入
| 截至三個月結束時 | |||||||||||||||||||||||||||||
| （單位百萬） | 9/30/2024 | 9/30/2023 | 變更 | 6/30/2024 | 變更 | ||||||||||||||||||||||||
| 投資顧問費用 | |||||||||||||||||||||||||||||
| 權益 | $ | 978.5 | $ | 885.0 | 10.6 | % | $ | 948.9 | 3.1 | % | |||||||||||||||||||
| 固收，包括貨幣市場 | 104.1 | 100.9 | 3.2 | % | 100.2 | 3.9 | % | ||||||||||||||||||||||
| 多資產 | 465.8 | 405.5 | 14.9 | % | 444.8 | 4.7 | % | ||||||||||||||||||||||
| 另類投資 | 84.5 | 72.5 | 16.6 | % | 91.7 | (7.9) | % | ||||||||||||||||||||||
| 投資顧問費用總計 | 1,632.9 | 1,463.9 | 11.5 | % | 1,585.6 | 3.0 | % | ||||||||||||||||||||||
基於資本配置的收入(1) | 4.6 | 66.1 | n/m | 0.1 | n/m | ||||||||||||||||||||||||
| 行政、分銷和服務費 | 148.1 | 140.7 | 5.3 | % | 147.6 | 0.3 | % | ||||||||||||||||||||||
| 淨收入 | $ | 1,785.6 | $ | 1,670.7 | 6.9 | % | $ | 1,733.3 | 3.0 | % | |||||||||||||||||||
| 平均資產規模（以十億計）： | |||||||||||||||||||||||||||||
| 權益 | $ | 813.1 | $ | 725.0 | 12.2 | % | $ | 790.4 | 2.9 | % | |||||||||||||||||||
| 固收，包括貨幣市場 | 183.3 | 169.0 | 8.5 | % | 174.8 | 4.9 | % | ||||||||||||||||||||||
| 多資產 | 542.3 | 453.8 | 19.5 | % | 520.1 | 4.3 | % | ||||||||||||||||||||||
| 另類投資 | 50.8 | 45.8 | 10.9 | % | 48.7 | 4.3 | % | ||||||||||||||||||||||
| 平均資產淨值（AUM） | $ | 1,589.5 | $ | 1,393.6 | 14.1 | % | $ | 1,534.0 | 3.6 | % | |||||||||||||||||||
| 投資諮詢年化有效費率（基礎點） | 40.9 | 41.7 | (0.8) | 41.6 | (0.7) | ||||||||||||||||||||||||
| 投資諮詢年化實際費率，不包括績效費用（點子） | 40.7 | 41.6 | (0.9) | 41.1 | (0.4) | ||||||||||||||||||||||||
(1)基於資本配置的收入代表了已計提的攜帶利益的變動。百分比變化無意義（未適用）。
淨收入 2024年第三季度收入爲18億美元，比2023年第三季度增長了6.9%，比2024年第二季度增長了3.0%。基於業績的費用分別爲2024年第三季度爲560萬美元，2013年第三季度爲210萬美元，2024年第二季度爲1680萬美元。
▪2024年第三季度，投資諮詢年化有效費率爲40.7個點子，不包括績效費，較2023年第三季度的41.6個點子和2024年第二季度的41.1個點子有所下降。與之前的時期相比，客戶流量和轉賬推動了資產管理中較低費率產品和資產類別的比例轉變。
▪2024年第三季度基於資本配置的收入爲460萬美元，包括額外累計的3510萬美元已實現攜帶利益，減少了3050萬美元的與收購相關的非現金攤銷和減值。相比之下，2023年第三季度的金額爲6610萬美元，包括額外累計的9190萬美元已實現攜帶利益，部分抵消了2580萬美元的與收購相關的非現金攤銷和減值。與之前期間相比的減少主要是整體相對回報率較低的結果。
3
A portion of the capital allocation-based income is passed through as compensation and recognized in compensation and related costs, with the unpaid amount reported as non-controlling interest on the consolidated balance sheet. For detail on the quarterly change in accrued carried interest, which is reported as part of investments on the consolidated balance sheet, and related non-controlling interest, see the applicable tables at the end of this release.
Operating Expenses
| Three months ended | |||||||||||||||||||||||||||||
| (in millions) | 9/30/2024 | 9/30/2023 | Change (1) | 6/30/2024 | Change (1) | ||||||||||||||||||||||||
| Compensation, benefits, and related costs | $ | 632.9 | $ | 617.0 | 2.6 | % | $ | 635.8 | (0.5) | % | |||||||||||||||||||
| Acquisition-related retention agreements | 4.0 | 13.7 | (70.8) | % | 13.1 | (69.5) | % | ||||||||||||||||||||||
Capital allocation-based income compensation(2) | (2.0) | 19.9 | n/m | (2.4) | n/m | ||||||||||||||||||||||||
| Supplemental savings plan | 43.4 | (14.2) | n/m | 14.6 | n/m | ||||||||||||||||||||||||
| Total compensation and related costs | 678.3 | 636.4 | 6.6 | % | 661.1 | 2.6 | % | ||||||||||||||||||||||
| Distribution and servicing | 91.6 | 74.9 | 22.3 | % | 87.7 | 4.4 | % | ||||||||||||||||||||||
| Advertising and promotion | 20.8 | 21.1 | (1.4) | % | 33.3 | (37.5) | % | ||||||||||||||||||||||
| Product and recordkeeping related costs | 75.0 | 73.1 | 2.6 | % | 73.0 | 2.7 | % | ||||||||||||||||||||||
| Technology, occupancy, and facility costs | 164.0 | 159.7 | 2.7 | % | 160.9 | 1.9 | % | ||||||||||||||||||||||
| General, administrative, and other | 104.2 | 85.7 | 21.6 | % | 108.7 | (4.1) | % | ||||||||||||||||||||||
| Change in fair value of contingent consideration | (13.4) | — | n/m | — | n/m | ||||||||||||||||||||||||
| Acquisition-related amortization and impairment costs | 51.5 | 38.5 | 33.8 | % | 43.9 | 17.3 | % | ||||||||||||||||||||||
| Total operating expenses | $ | 1,172.0 | $ | 1,089.4 | 7.6 | % | $ | 1,168.6 | 0.3 | % | |||||||||||||||||||
Total adjusted operating expenses(3) | $ | 1,099.0 | $ | 1,061.3 | 3.6 | % | $ | 1,105.8 | (0.6) | % | |||||||||||||||||||
(1) n/m - the percentage change is not meaningful.
(2) Capital allocation-based income compensation represents the change in accrued carried interest compensation along with acquisition-related, non-cash amortization and impairments.
(3) See the reconciliation to the comparable U.S. GAAP measures at the end of this earnings release.
Operating expenses were $1,172.0 million, an increase of 7.6% from Q3 2023 and 0.3% from Q2 2024. On a non-GAAP basis, adjusted operating expenses in Q3 2024 were $1,099.0 million, a 3.6% increase from Q3 2023 and a 0.6% decrease from Q2 2024.
▪Compensation, benefits, and related costs in Q3 2024 of $632.9 million increased $15.9 million from Q3 2023 and were $2.9 million lower than Q2 2024. The increase from Q3 2023 was primarily due to higher salaries and related benefits and interim bonus accrual. These increases were partially offset by lower stock-based compensation. The Q3 2023 period included severance costs related to the July 2023 workforce action. Compared to Q2 2024, higher salaries and related benefits were more than offset by lower other employee-related costs. The firm employed 8,104 associates at September 30, 2024, an increase of 3.3% from 7,842 associates at September 30, 2023, and 2.2% from 7,929 associates at June 30, 2024.
▪Distribution and servicing costs in Q3 2024 of $91.6 million increased $16.7 million from Q3 2023 and $3.9 million from Q2 2024. The increase from prior periods was primarily driven by higher average assets under management distributed through intermediaries.
4
▪Advertising and promotion expenses in Q3 2024 of $20.8 million decreased $0.3 million from Q3 2023 and $12.5 million from Q2 2024. The decrease from Q2 2024 was primarily due to the timing of advertising and promotion spend.
▪Technology, occupancy, and facility costs in Q3 2024 of $164.0 million increased $4.3 million from Q3 2023 and $3.1 million from Q2 2024. The increase from Q3 2023 was due to higher costs from the firm's ongoing investment in its technology capabilities, primarily hosted solutions. Compared to Q2 2024, the increase was due to higher costs related to our existing facilities.
▪General, administrative, and other costs in Q3 2024 of $104.2 million increased $18.5 million from Q3 2023 and decreased $4.5 million from Q2 2024. The increase over the prior year was primarily driven by a cost recovery recognized in Q3 2023 that didn't recur in Q3 2024. Additionally, higher professional fees recognized in Q3 2024 were partially offset by lower research fee expense as the firm changed its approach to paying for research beginning in Q1 2024, consistent with regulations and general industry practice. Compared to Q2 2024, the decrease was primarily driven by lower travel, entertainment, and research fee expenses. These lower costs were partially offset by higher professional fees.
Non-operating income (loss)
| (in millions) | Three months ended | ||||||||||||||||
| 9/30/2024 | 9/30/2023 | 6/30/2024 | |||||||||||||||
| Net gains (losses) from non-consolidated T. Rowe Price investment products | |||||||||||||||||
| Cash and discretionary investments | |||||||||||||||||
| Dividend income | $ | 37.4 | $ | 30.3 | $ | 33.6 | |||||||||||
| Market-related gains (losses) and equity in earnings (losses) | 5.9 | 2.2 | 0.1 | ||||||||||||||
| Total net gains (losses) from cash and discretionary investments | 43.3 | 32.5 | 33.7 | ||||||||||||||
| Seed capital investments | |||||||||||||||||
| Dividend income | 0.5 | 0.3 | 0.3 | ||||||||||||||
| Market-related gains (losses) and equity in earnings (losses) | 21.3 | (4.5) | 15.3 | ||||||||||||||
| Net gains (losses) recognized upon deconsolidation | (0.6) | 0.7 | — | ||||||||||||||
| Investments used to hedge the supplemental savings plan liability | 41.1 | (19.7) | 14.8 | ||||||||||||||
| Total net gains (losses) from non-consolidated T. Rowe Price investment products | 105.6 | 9.3 | 64.1 | ||||||||||||||
| Other investment income (loss) | 13.4 | 21.4 | 13.9 | ||||||||||||||
| Net gains (losses) on investments | 119.0 | 30.7 | 78.0 | ||||||||||||||
| Net gains (losses) on consolidated sponsored investment products | 85.9 | (24.4) | 8.5 | ||||||||||||||
| Other gains (losses), including foreign currency gains (losses) | 7.6 | (3.5) | (6.2) | ||||||||||||||
| Non-operating income (loss) | $ | 212.5 | $ | 2.8 | $ | 80.3 | |||||||||||
On a non-GAAP basis, non-operating income (loss) consists of investment gains/losses generated from the firm's cash and discretionary investment portfolio.
5
Income taxes
The firm's GAAP effective tax rate for Q3 2024 was 22.5%, compared with 24.8% in Q3 2023. These quarterly rates were the result of an overall year-to-date rate of 23.5% for 2024 and 26.1% for 2023. The following reconciles the statutory federal income tax rate to the firm's effective tax rate for the nine months ended September 30, 2024 and 2023:
| Nine months ended | |||||||||||
| 9/30/2024 | 9/30/2023 | ||||||||||
| Statutory U.S. federal income tax rate | 21.0 | % | 21.0 | % | |||||||
State income taxes for current year, net of federal income tax benefits(1) | 2.7 | 3.0 | |||||||||
Net (income) losses attributable to redeemable non-controlling interests(2) | (0.6) | (0.2) | |||||||||
| Net excess tax losses (benefits) from stock-based compensation plans activity | (0.2) | (0.3) | |||||||||
| Valuation allowances | 0.3 | 2.7 | |||||||||
| Other items | 0.3 | (0.1) | |||||||||
| Effective income tax rate | 23.5 | % | 26.1 | % | |||||||
(1) State income tax benefits are reflected in the total benefits for net income attributable to redeemable non-controlling interests and stock-based compensation plans activity.
(2) Net income attributable to redeemable non-controlling interest represents the portion of earnings held in the firm's consolidated investment products, which are not taxable to the firm despite being included in pre-tax income.
The firm's non-GAAP effective tax rate for Q3 2024 was 23.8%, compared with 24.8% for Q3 2023. The quarterly rates were the result of an overall year-to-date rate of 24.1% for 2024 and 26.8% for 2023. The decrease in the firm's effective tax rate is primarily due to lower valuation allowances recognized in 2024 compared with the 2023 period. In 2023, valuation allowances were recognized against cumulative UK-based deferred tax assets.
The firm estimates that its effective tax rate for the full year 2024 will be in the range of 23.5% to 26.5% on a U.S. GAAP basis, and 23.5% to 25.5% on a non-GAAP basis.
Other Matters
The financial results presented in this release are unaudited. The firm expects that it will file its Form 10-Q Quarterly Report for the third quarter of 2024 with the U.S. Securities and Exchange Commission later today. The Form 10-Q will include additional information on the firm's unaudited financial results at September 30, 2024.
Certain statements in this earnings release may represent “forward-looking information,” including information relating to anticipated changes in revenues, our operations, expenses, earnings, liquidity, cash flows and capital expenditures, industry or market conditions, amount or composition of assets under management, regulatory developments, changes in our effective fee rate, demand for and pricing of our products, new products and services, effective tax rates, net income and earnings per common share, future transactions, our strategic initiatives, general economic conditions, dividends, stock repurchases, and other market conditions. For a discussion concerning risks and other factors that could affect future results, see the firm's 2023 Annual Report on Form 10-K.
6
Founded in 1937, T. Rowe Price (NASDAQ – GS: TROW) helps individuals and institutions around the world achieve their long-term investment goals. As a large global asset management company known for investment excellence, retirement leadership, and independent proprietary research, the firm is built on a culture of integrity that puts client interests first. Clients rely on the award-winning firm for its retirement expertise and active management of equity, fixed income, alternatives, and multi-asset investment capabilities. T. Rowe Price serves millions of clients globally and manages $1.63 trillion in assets under management as of September 30, 2024. About two-thirds of the assets under management are retirement-related. News and other updates can be found on Facebook, Instagram, LinkedIn, X, YouTube, and troweprice.com/newsroom.
Webcast Information
Chair, CEO, and President Rob Sharps and Chief Financial Officer Jen Dardis will provide an update on business performance, review financial results, and answer questions on a webcast to be held on Friday, November 1, 2024 from 8:00 - 8:45 AM (Eastern Time). To access the webcast or to obtain dial in instructions to ask a question, please visit: investors.troweprice.com.
Supplemental materials will be available on the company's investor relations website shortly before the start of the call. A replay of the webcast will be available on the company's investor relations website shortly after the event.
CONTACTS:
| Public Relations | Investor Relations | ||||||||||
| Jamaal Mobley | Linsley Carruth | ||||||||||
| 410-345-3403 | 410-345-3717 | ||||||||||
| jamaal.mobley@troweprice.com | linsley.carruth@troweprice.com | ||||||||||
7
| Unaudited Consolidated Statements of Income | |||||||||||||||||||||||||||||||||||
| (in millions, except per-share amounts) | |||||||||||||||||||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||||||||
| Revenues | 9/30/2024 | 9/30/2023 | 6/30/2024 | 9/30/2024 | 9/30/2023 | ||||||||||||||||||||||||||||||
| Investment advisory fees | $ | 1,632.9 | $ | 1,463.9 | $ | 1,585.6 | $ | 4,772.5 | $ | 4,286.5 | |||||||||||||||||||||||||
| Capital allocation-based income | 4.6 | 66.1 | 0.1 | 51.8 | 121.7 | ||||||||||||||||||||||||||||||
| Administrative, distribution, and servicing fees | 148.1 | 140.7 | 147.6 | 444.8 | 410.3 | ||||||||||||||||||||||||||||||
| Net revenues | 1,785.6 | 1,670.7 | 1,733.3 | 5,269.1 | 4,818.5 | ||||||||||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||
| Compensation, benefits, and related costs | 632.9 | 617.0 | 635.8 | 1,898.0 | 1,801.3 | ||||||||||||||||||||||||||||||
| Acquisition-related retention agreements | 4.0 | 13.7 | 13.1 | 30.6 | 41.5 | ||||||||||||||||||||||||||||||
| Capital allocation-based income compensation | (2.0) | 19.9 | (2.4) | 8.8 | 34.0 | ||||||||||||||||||||||||||||||
| Supplemental savings plan | 43.4 | (14.2) | 14.6 | 111.0 | 61.3 | ||||||||||||||||||||||||||||||
| Total compensation and related costs | 678.3 | 636.4 | 661.1 | 2,048.4 | 1,938.1 | ||||||||||||||||||||||||||||||
| Distribution and servicing | 91.6 | 74.9 | 87.7 | 261.2 | 214.2 | ||||||||||||||||||||||||||||||
| Advertising and promotion | 20.8 | 21.1 | 33.3 | 79.4 | 69.8 | ||||||||||||||||||||||||||||||
| Product and recordkeeping related costs | 75.0 | 73.1 | 73.0 | 223.0 | 222.9 | ||||||||||||||||||||||||||||||
| Technology, occupancy, and facility costs | 164.0 | 159.7 | 160.9 | 474.8 | 461.0 | ||||||||||||||||||||||||||||||
| General, administrative, and other | 104.2 | 85.7 | 108.7 | 305.5 | 293.2 | ||||||||||||||||||||||||||||||
| Change in fair value of contingent consideration | (13.4) | — | — | (13.4) | (72.8) | ||||||||||||||||||||||||||||||
| Acquisition-related amortization and impairment costs | 51.5 | 38.5 | 43.9 | 125.3 | 93.1 | ||||||||||||||||||||||||||||||
| Total operating expenses | 1,172.0 | 1,089.4 | 1,168.6 | 3,504.2 | 3,219.5 | ||||||||||||||||||||||||||||||
| Net operating income | 613.6 | 581.3 | 564.7 | 1,764.9 | 1,599.0 | ||||||||||||||||||||||||||||||
| Non-operating income (loss) | |||||||||||||||||||||||||||||||||||
| Net gains (losses) on investments | 119.0 | 30.7 | 78.0 | 318.5 | 213.7 | ||||||||||||||||||||||||||||||
| Net gains (losses) on consolidated sponsored investment products | 85.9 | (24.4) | 8.5 | 166.7 | 45.4 | ||||||||||||||||||||||||||||||
| Other gains (losses), including foreign currency gains (losses) | 7.6 | (3.5) | (6.2) | (3.5) | (14.7) | ||||||||||||||||||||||||||||||
| Total non-operating income (loss) | 212.5 | 2.8 | 80.3 | 481.7 | 244.4 | ||||||||||||||||||||||||||||||
| Income before income taxes | 826.1 | 584.1 | 645.0 | 2,246.6 | 1,843.4 | ||||||||||||||||||||||||||||||
| Provision for income taxes | 185.7 | 144.9 | 159.7 | 527.5 | 481.3 | ||||||||||||||||||||||||||||||
| Net income | 640.4 | 439.2 | 485.3 | 1,719.1 | 1,362.1 | ||||||||||||||||||||||||||||||
| Less: net income (loss) attributable to redeemable non-controlling interests | 37.4 | (14.0) | 1.9 | 58.9 | 11.0 | ||||||||||||||||||||||||||||||
| Net income attributable to T. Rowe Price Group, Inc. | 603.0 | 453.2 | 483.4 | 1,660.2 | 1,351.1 | ||||||||||||||||||||||||||||||
| Less: net income allocated to outstanding restricted stock and stock unit holders | 15.5 | 10.6 | 12.9 | 44.2 | 32.7 | ||||||||||||||||||||||||||||||
| Net income allocated to T. Rowe Price common stockholders | $ | 587.5 | $ | 442.6 | $ | 470.5 | $ | 1,616.0 | $ | 1,318.4 | |||||||||||||||||||||||||
| Earnings per share | |||||||||||||||||||||||||||||||||||
| Basic | $ | 2.64 | $ | 1.98 | $ | 2.11 | $ | 7.25 | $ | 5.88 | |||||||||||||||||||||||||
| Diluted | $ | 2.64 | $ | 1.97 | $ | 2.11 | $ | 7.23 | $ | 5.86 | |||||||||||||||||||||||||
| Weighted-average common shares | |||||||||||||||||||||||||||||||||||
| Outstanding | 222.3 | 224.1 | 223.0 | 223.0 | 224.3 | ||||||||||||||||||||||||||||||
| Outstanding assuming dilution | 222.8 | 224.8 | 223.5 | 223.5 | 225.1 | ||||||||||||||||||||||||||||||
Summary of Adjusted Basis(1) | Three months ended | Nine months ended | |||||||||||||||||||||||||||||||||
| (in millions, except per-share data) | 9/30/2024 | 9/30/2023 | 6/30/2024 | 9/30/2024 | 9/30/2023 | ||||||||||||||||||||||||||||||
| Operating expenses | $ | 1,099.0 | $ | 1,061.3 | $ | 1,105.8 | $ | 3,276.2 | $ | 3,110.0 | |||||||||||||||||||||||||
| Operating expenses, excluding accrued carried interest related compensation | $ | 1,087.4 | $ | 1,030.8 | $ | 1,097.3 | $ | 3,237.6 | $ | 3,055.2 | |||||||||||||||||||||||||
| Net operating income | $ | 718.4 | $ | 635.9 | $ | 654.9 | $ | 2,065.7 | $ | 1,760.5 | |||||||||||||||||||||||||
| Non-operating income (loss) | $ | 51.2 | $ | 28.7 | $ | 34.7 | $ | 114.4 | $ | 91.3 | |||||||||||||||||||||||||
| Net income attributable to T. Rowe Price | $ | 586.5 | $ | 499.5 | $ | 519.7 | $ | 1,654.7 | $ | 1,355.4 | |||||||||||||||||||||||||
| Diluted earnings per common share | $ | 2.57 | $ | 2.17 | $ | 2.26 | $ | 7.21 | $ | 5.88 | |||||||||||||||||||||||||
(1) See the reconciliation to the comparable U.S. GAAP measures at the end of this earnings release. | |||||||||||||||||||||||||||||||||||
8
| Assets Under Management | Nine months ended 9/30/2024 | ||||||||||||||||||||||||||||
| (in billions) | Equity | Fixed income, including money market | Multi-asset(1) | Alternatives(2) | Total | ||||||||||||||||||||||||
| Assets under management at beginning of period | $ | 743.6 | $ | 170.0 | $ | 483.0 | $ | 47.9 | $ | 1,444.5 | |||||||||||||||||||
| Net cash flows prior to manager-driven distributions | (43.8) | 9.1 | 9.0 | 4.7 | (21.0) | ||||||||||||||||||||||||
| Manager-driven distributions | — | — | — | (2.9) | (2.9) | ||||||||||||||||||||||||
Net cash flows(3) | (43.8) | 9.1 | 9.0 | 1.8 | (23.9) | ||||||||||||||||||||||||
Net market appreciation and gains(4) | 132.2 | 7.2 | 68.9 | 2.0 | 210.3 | ||||||||||||||||||||||||
| Change during the period | 88.4 | 16.3 | 77.9 | 3.8 | 186.4 | ||||||||||||||||||||||||
Assets under management at September 30, 2024 | $ | 832.0 | $ | 186.3 | $ | 560.9 | $ | 51.7 | $ | 1,630.9 | |||||||||||||||||||
(1) The underlying AUM of the multi-asset portfolios have been aggregated and presented in this category and not reported in the equity and fixed income columns.
(2) The alternatives asset class includes strategies authorized to invest more than 50% of its holdings in private credit, leveraged loans, mezzanine, real assets/CRE, structured products, stressed/distressed, non-investment grade CLOs, special situations, business development companies, or that have absolute return as its investment objective. Generally, only those strategies with longer than daily liquidity are included. Unfunded capital commitments as of September 30, 2024 were $14.5 billion and $11.6 billion as of December 31, 2023 and are not reflected in fee basis AUM above.
(3) Alternatives net cash flows include $2.9 billion in outflows that represent investment manager-driven distributions.
(4) Includes net distributions not reinvested of $1.1 billion.
| Net Revenues | Nine months ended | ||||||||||||||||
| (in millions) | 9/30/2024 | 9/30/2023 | % Change | ||||||||||||||
| Investment advisory fees | |||||||||||||||||
| Equity | $ | 2,877.0 | $ | 2,581.2 | 11.5 | % | |||||||||||
| Fixed income, including money market | 304.9 | 303.3 | 0.5 | % | |||||||||||||
| Multi-asset | 1,340.3 | 1,182.8 | 13.3 | % | |||||||||||||
| Alternatives | 250.3 | 219.2 | 14.2 | % | |||||||||||||
| Total investment advisory fees | $ | 4,772.5 | $ | 4,286.5 | 11.3 | % | |||||||||||
| Average AUM (in billions): | |||||||||||||||||
| Equity | $ | 791.4 | $ | 705.3 | 12.2 | % | |||||||||||
| Fixed income, including money market | 175.9 | 169.6 | 3.7 | % | |||||||||||||
| Multi-asset | 519.9 | 438.5 | 18.6 | % | |||||||||||||
| Alternatives | 49.0 | 44.8 | 9.4 | % | |||||||||||||
| Average AUM | $ | 1,536.2 | $ | 1,358.2 | 13.1 | % | |||||||||||
| Non-Operating Income (Loss) | |||||||||||
| (in millions) | Nine months ended | ||||||||||
| 9/30/2024 | 9/30/2023 | ||||||||||
| Net gains (losses) from non-consolidated T. Rowe Price investment products | |||||||||||
| Cash and discretionary investments | |||||||||||
| Dividend income | $ | 98.8 | $ | 76.0 | |||||||
| Market-related gains (losses) and equity in earnings (losses) | 6.2 | 19.1 | |||||||||
| Total net gains (losses) from cash and discretionary investments | 105.0 | 95.1 | |||||||||
| Seed capital investments | |||||||||||
| Dividend income | 0.8 | 1.2 | |||||||||
| Market-related gains (losses) and equity in earnings (losses) | 60.1 | 25.0 | |||||||||
| Net gains (losses) recognized upon deconsolidation | (0.6) | 0.7 | |||||||||
| Investments used to hedge the supplemental savings plan liability | 105.6 | 58.6 | |||||||||
| Total net gains (losses) from non-consolidated T. Rowe Price investment products | 270.9 | 180.6 | |||||||||
| Other investment income (loss) | 47.6 | 33.1 | |||||||||
| Net gains (losses) on investments | 318.5 | 213.7 | |||||||||
| Net gains (losses) on consolidated sponsored investment portfolios | 166.7 | 45.4 | |||||||||
| Other gains (losses), including foreign currency gains (losses) | (3.5) | (14.7) | |||||||||
| Non-operating income (loss) | $ | 481.7 | $ | 244.4 | |||||||
9
The following table summarizes the cash flows for the nine months ended 2024 that are attributable to T. Rowe Price Group, our consolidated sponsored investment products, and the related eliminations required.
| Nine months ended | |||||||||||||||||||||||
| 9/30/2024 | |||||||||||||||||||||||
(in millions) | Cash flow attributable to T. Rowe Price | Cash flow attributable to consolidated T. Rowe Price investment products | Elims | As reported | |||||||||||||||||||
| Cash flows from operating activities | |||||||||||||||||||||||
| Net income (loss) | $ | 1,660.2 | $ | 159.4 | $ | (100.5) | $ | 1,719.1 | |||||||||||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||||||||||||||||||||||
| Depreciation, amortization and impairments of property, equipment and software | 188.4 | — | — | 188.4 | |||||||||||||||||||
| Amortization and impairment of acquisition-related assets and retention agreements | 196.5 | — | — | 196.5 | |||||||||||||||||||
| Fair value remeasurement of contingent liability | (13.4) | — | — | (13.4) | |||||||||||||||||||
| Stock-based compensation expense | 162.2 | — | — | 162.2 | |||||||||||||||||||
| Net (gains) losses recognized on investments | (432.6) | — | 100.5 | (332.1) | |||||||||||||||||||
| Net redemptions in sponsored investment products used to economically hedge supplemental savings plan liability | 29.8 | — | — | 29.8 | |||||||||||||||||||
| Net change in trading securities held by consolidated sponsored investment products | — | (517.9) | — | (517.9) | |||||||||||||||||||
| Other changes | 548.3 | 5.7 | (19.1) | 534.9 | |||||||||||||||||||
| Net cash provided by (used in) operating activities | 2,339.4 | (352.8) | (19.1) | 1,967.5 | |||||||||||||||||||
| Net cash provided by (used in) investing activities | (143.1) | (15.7) | 3.8 | (155.0) | |||||||||||||||||||
| Net cash provided by (used in) financing activities | (1,089.4) | 345.9 | 15.3 | (728.2) | |||||||||||||||||||
| Effect of exchange rate changes on cash and cash equivalents of consolidated sponsored investment products | — | 0.5 | — | 0.5 | |||||||||||||||||||
| Net change in cash and cash equivalents during period | 1,106.9 | (22.1) | — | 1,084.8 | |||||||||||||||||||
| Cash and cash equivalents at beginning of year | 2,066.6 | 77.2 | — | 2,143.8 | |||||||||||||||||||
| Cash and cash equivalents at end of period | $ | 3,173.5 | $ | 55.1 | $ | — | $ | 3,228.6 | |||||||||||||||
| Unaudited Condensed Consolidated Balance Sheet Information (in millions) | As of | ||||||||||
| 9/30/2024 | 12/31/2023 | ||||||||||
| Cash and cash equivalents | $ | 3,173.5 | $ | 2,066.6 | |||||||
| Accounts receivable and accrued revenue | 890.0 | 807.9 | |||||||||
| Investments | 2,966.0 | 2,554.7 | |||||||||
| Assets of consolidated sponsored investment products | 1,857.2 | 1,959.3 | |||||||||
| Operating lease assets | 228.5 | 241.1 | |||||||||
| Property, equipment and software, net | 930.1 | 806.6 | |||||||||
| Goodwill and intangible assets | 3,038.0 | 3,150.1 | |||||||||
| Other assets | 622.6 | 692.5 | |||||||||
| Total assets | 13,705.9 | 12,278.8 | |||||||||
| Supplemental savings plan liability | 969.6 | 895.0 | |||||||||
| Contingent consideration | — | 13.4 | |||||||||
Total other liabilities, includes $57.8 at September 30, 2024, and $54.2 at December 31, 2023, from consolidated sponsored investment products | 1,520.2 | 1,974.2 | |||||||||
| Non-controlling interests* | 966.8 | 786.1 | |||||||||
Stockholders' equity attributable to T. Rowe Price Group, Inc., 222.1 common shares outstanding at September 30, 2024 and 223.9 common shares outstanding at December 31, 2023 | $ | 10,249.3 | $ | 9,505.1 | |||||||
* This includes both redeemable and non-redeemable non-controlling interest in consolidated entities.
10
The following tables detail changes in our investments in affiliated private investment funds - carried interest and non-controlling interest in consolidated entities.
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||
| Investments in affiliated private investment funds - carried interest | 9/30/2024 | 9/30/2023 | 6/30/2024 | 9/30/2024 | 9/30/2023 | ||||||||||||||||||||||||
| Balance at beginning of period | $ | 497.3 | $ | 514.2 | $ | 514.3 | $ | 519.9 | $ | 467.8 | |||||||||||||||||||
| Capital allocation-based income: | |||||||||||||||||||||||||||||
| Change in accrued carried interest | 35.1 | 91.9 | 27.0 | 121.6 | 172.1 | ||||||||||||||||||||||||
| Acquisition-related amortization and impairments | (30.5) | (25.8) | (26.9) | (69.8) | (50.4) | ||||||||||||||||||||||||
| Net distributions | (2.2) | (2.1) | (17.1) | (72.0) | (11.3) | ||||||||||||||||||||||||
Balance at end of period | $ | 499.7 | $ | 578.2 | $ | 497.3 | $ | 499.7 | $ | 578.2 | |||||||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||
| Non-controlling interests (NCI) in consolidated entities | 9/30/2024 | 9/30/2023 | 6/30/2024 | 9/30/2024 | 9/30/2023 | ||||||||||||||||||||||||
| Balance at beginning of period | $ | 205.3 | $ | 202.1 | $ | 205.4 | $ | 192.0 | $ | 190.7 | |||||||||||||||||||
| Capital allocation-based income compensation: | |||||||||||||||||||||||||||||
| Change in accrued carried interest compensation | 11.6 | 30.5 | 8.5 | 38.6 | 54.8 | ||||||||||||||||||||||||
| Acquisition-related amortization and impairments | (13.6) | (10.6) | (10.9) | (29.8) | (20.8) | ||||||||||||||||||||||||
| Net contributions (distributions) | 0.1 | (0.5) | 2.3 | 2.6 | (3.2) | ||||||||||||||||||||||||
Balance at end of period | $ | 203.4 | $ | 221.5 | $ | 205.3 | $ | 203.4 | $ | 221.5 | |||||||||||||||||||
Non-GAAP Information and Reconciliation
The firm believes the non-GAAP financial measures below provide relevant and meaningful information to investors about its core operating results. These measures have been established in order to increase transparency for the purpose of evaluating the firm's core business, for comparing current results with prior period results, and to enable more appropriate comparison with industry peers. However, non-GAAP financial measures should not be considered as a substitute for financial measures calculated in accordance with U.S. GAAP and may be calculated differently by other companies.
11
The following schedules reconcile U.S. GAAP financial measures to non-GAAP financial measures for the three months ended September 30, 2024 and 2023 and June 30, 2024.
Three months ended 9/30/2024 | |||||||||||||||||||||||||||||||||||
| Operating expenses | Net operating income | Non-operating income (loss) | Provision (benefit) for income taxes(5) | Net income attributable to T. Rowe Price Group, Inc. | Diluted earnings per share(6) | ||||||||||||||||||||||||||||||
| U.S. GAAP Basis (FS line item) | $ | 1,172.0 | $ | 613.6 | $ | 212.5 | $ | 185.7 | $ | 603.0 | $ | 2.64 | |||||||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||||||||
| Acquisition-related: | |||||||||||||||||||||||||||||||||||
Investment and NCI amortization and impairments(1) (Capital allocation-based income and Compensation and related costs) | 13.6 | 16.9 | — | 2.3 | 14.6 | 0.06 | |||||||||||||||||||||||||||||
Acquisition-related retention arrangements(1) (Compensation and related costs) | (4.0) | 4.0 | — | 0.5 | 3.5 | 0.02 | |||||||||||||||||||||||||||||
Contingent consideration(1) | 13.4 | (13.4) | — | (1.8) | (11.6) | (0.05) | |||||||||||||||||||||||||||||
Intangible assets amortization and impairments(1) | (51.5) | 51.5 | — | 7.0 | 44.5 | 0.19 | |||||||||||||||||||||||||||||
| Total acquisition-related | (28.5) | 59.0 | — | 8.0 | 51.0 | 0.22 | |||||||||||||||||||||||||||||
Supplemental savings plan liability(2) (Compensation and related costs) | (43.4) | 43.4 | (41.1) | 0.3 | 2.0 | 0.01 | |||||||||||||||||||||||||||||
Consolidated T. Rowe Price investment products(3) | (1.1) | 2.4 | (85.9) | (6.3) | (39.8) | (0.17) | |||||||||||||||||||||||||||||
Other non-operating income(4) | — | — | (34.3) | (4.6) | (29.7) | (0.13) | |||||||||||||||||||||||||||||
| Adjusted Non-GAAP Basis | $ | 1,099.0 | $ | 718.4 | $ | 51.2 | $ | 183.1 | $ | 586.5 | $ | 2.57 | |||||||||||||||||||||||
Three months ended 9/30/2023 | |||||||||||||||||||||||||||||||||||
| Operating expenses | Net operating income | Non-operating income (loss) | Provision (benefit) for income taxes(5) | Net income attributable to T. Rowe Price Group, Inc. | Diluted earnings per share(6) | ||||||||||||||||||||||||||||||
| U.S. GAAP Basis (FS line item) | $ | 1,089.4 | $ | 581.3 | $ | 2.8 | $ | 144.9 | $ | 453.2 | $ | 1.97 | |||||||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||||||||
| Acquisition-related: | |||||||||||||||||||||||||||||||||||
Investment and NCI amortization and impairments(1) (Capital allocation-based income and Compensation and related costs) | 10.6 | 15.2 | — | 4.6 | 10.6 | 0.04 | |||||||||||||||||||||||||||||
Acquisition-related retention arrangements(1) (Compensation and related costs) | (13.7) | 13.7 | — | 4.2 | 9.5 | 0.04 | |||||||||||||||||||||||||||||
Intangible assets amortization and impairments(1) | (38.5) | 38.5 | — | 11.7 | 26.8 | 0.12 | |||||||||||||||||||||||||||||
| Total acquisition-related | (41.6) | 67.4 | — | 20.5 | 46.9 | 0.20 | |||||||||||||||||||||||||||||
Supplemental savings plan liability(2) (Compensation and related costs) | 14.2 | (14.2) | 19.7 | 1.7 | 3.8 | 0.02 | |||||||||||||||||||||||||||||
Consolidated T. Rowe Price investment products(3) | (0.7) | 1.4 | 24.4 | 3.6 | 8.2 | 0.03 | |||||||||||||||||||||||||||||
Other non-operating income(4) | — | — | (18.2) | (5.6) | (12.6) | (0.05) | |||||||||||||||||||||||||||||
| Adjusted Non-GAAP Basis | $ | 1,061.3 | $ | 635.9 | $ | 28.7 | $ | 165.1 | $ | 499.5 | $ | 2.17 | |||||||||||||||||||||||
12
Three months ended 6/30/2024 | |||||||||||||||||||||||||||||||||||
| Operating expenses | Net operating income | Non-operating income (loss) | Provision (benefit) for income taxes(5) | Net income attributable to T. Rowe Price Group, Inc. | Diluted earnings per share(6) | ||||||||||||||||||||||||||||||
| U.S. GAAP Basis (FS line item) | $ | 1,168.6 | $ | 564.7 | $ | 80.3 | $ | 159.7 | $ | 483.4 | $ | 2.11 | |||||||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||||||||
| Acquisition-related: | |||||||||||||||||||||||||||||||||||
Investment and NCI amortization and impairments(1) (Capital allocation-based income and Compensation and related costs) | 10.9 | 16.0 | — | 3.5 | 12.5 | 0.05 | |||||||||||||||||||||||||||||
Acquisition-related retention arrangements(1) (Compensation and related costs) | (13.1) | 13.1 | — | 2.9 | 10.2 | 0.04 | |||||||||||||||||||||||||||||
Intangible assets amortization and impairments(1) | (43.9) | 43.9 | — | 9.6 | 34.3 | 0.15 | |||||||||||||||||||||||||||||
| Total acquisition-related | (46.1) | 73.0 | — | 16.0 | 57.0 | 0.24 | |||||||||||||||||||||||||||||
Supplemental savings plan liability(2) (Compensation and related costs) | (14.6) | 14.6 | (14.8) | — | (0.2) | — | |||||||||||||||||||||||||||||
Consolidated T. Rowe Price investment products(3) | (2.1) | 2.6 | (8.5) | (0.9) | (3.1) | (0.01) | |||||||||||||||||||||||||||||
Other non-operating income(4) | — | — | (22.3) | (4.9) | (17.4) | (0.08) | |||||||||||||||||||||||||||||
| Adjusted Non-GAAP Basis | $ | 1,105.8 | $ | 654.9 | $ | 34.7 | $ | 169.9 | $ | 519.7 | $ | 2.26 | |||||||||||||||||||||||
The following schedules reconcile certain U.S. GAAP financial measures for the nine months ended September 30, 2024 and 2023.
Nine months ended 9/30/2024 | |||||||||||||||||||||||||||||||||||
| Operating expenses | Net operating income | Non-operating income (loss) | Provision (benefit) for income taxes(5) | Net income attributable to T. Rowe Price Group, Inc. | Diluted earnings per share(6) | ||||||||||||||||||||||||||||||
| U.S. GAAP Basis (FS line item) | $ | 3,504.2 | $ | 1,764.9 | $ | 481.7 | $ | 527.5 | $ | 1,660.2 | $ | 7.23 | |||||||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||||||||
| Acquisition-related: | |||||||||||||||||||||||||||||||||||
Investment and NCI amortization and impairments(1) (Capital allocation-based income and Compensation and related costs) | 29.8 | 40.0 | — | 7.8 | 32.2 | 0.14 | |||||||||||||||||||||||||||||
Acquisition-related retention arrangements(1) (Compensation and related costs) | (30.6) | 30.6 | — | 7.2 | 23.4 | 0.10 | |||||||||||||||||||||||||||||
Contingent consideration(1) | 13.4 | (13.4) | — | (1.8) | (11.6) | (0.05) | |||||||||||||||||||||||||||||
Intangible assets amortization and impairments(1) | (125.3) | 125.3 | — | 24.9 | 100.4 | 0.44 | |||||||||||||||||||||||||||||
| Total acquisition-related | (112.7) | 182.5 | — | 38.1 | 144.4 | 0.63 | |||||||||||||||||||||||||||||
Supplemental savings plan liability(2) (Compensation and related costs) | (111.0) | 111.0 | (105.6) | 1.2 | 4.2 | 0.02 | |||||||||||||||||||||||||||||
Consolidated T. Rowe Price investment products(3) | (4.3) | 7.3 | (166.7) | (21.2) | (79.3) | (0.35) | |||||||||||||||||||||||||||||
Other non-operating income(4) | — | — | (95.0) | (20.2) | (74.8) | (0.32) | |||||||||||||||||||||||||||||
| Adjusted Non-GAAP Basis | $ | 3,276.2 | $ | 2,065.7 | $ | 114.4 | $ | 525.4 | $ | 1,654.7 | $ | 7.21 | |||||||||||||||||||||||
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| Nine months ended 9/30/2023 | |||||||||||||||||||||||||||||||||||
| Operating expenses | Net operating income | Non-operating income (loss) | Provision (benefit) for income taxes(5) | Net income attributable to T. Rowe Price Group, Inc. | Diluted earnings per share(6) | ||||||||||||||||||||||||||||||
| U.S. GAAP Basis (FS line item) | $ | 3,219.5 | $ | 1,599.0 | $ | 244.4 | $ | 481.3 | $ | 1,351.1 | $ | 5.86 | |||||||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||||||||
| Acquisition-related: | |||||||||||||||||||||||||||||||||||
Investment and NCI amortization and impairments(1) (Capital allocation-based income and Compensation and related costs) | 20.8 | 29.6 | — | 6.2 | 23.4 | 0.10 | |||||||||||||||||||||||||||||
Acquisition-related retention arrangements(1) (Compensation and related costs) | (41.5) | 41.5 | — | 7.2 | 34.3 | 0.15 | |||||||||||||||||||||||||||||
Contingent consideration(1) | 72.8 | (72.8) | — | (8.0) | (64.8) | (0.28) | |||||||||||||||||||||||||||||
Intangible assets amortization and impairments(1) | (93.1) | 93.1 | — | 17.7 | 75.4 | 0.33 | |||||||||||||||||||||||||||||
| Total acquisition-related | (41.0) | 91.4 | — | 23.1 | 68.3 | 0.30 | |||||||||||||||||||||||||||||
Supplemental savings plan liability(2) (Compensation and related costs) | (61.3) | 61.3 | (58.6) | 1.4 | 1.3 | 0.01 | |||||||||||||||||||||||||||||
Consolidated T. Rowe Price investment products(3) | (7.2) | 8.8 | (45.4) | (0.5) | (25.1) | (0.11) | |||||||||||||||||||||||||||||
Other non-operating income(4) | — | — | (49.1) | (8.9) | (40.2) | (0.18) | |||||||||||||||||||||||||||||
| Adjusted Non-GAAP Basis | $ | 3,110.0 | $ | 1,760.5 | $ | 91.3 | $ | 496.4 | $ | 1,355.4 | $ | 5.88 | |||||||||||||||||||||||
(1) These non-GAAP adjustments remove the impact of acquisition-related amortization and costs including intangible assets and acquired assets amortization and impairments, contingent consideration liability fair value remeasurements, amortization and impairments of acquired investments and non-controlling interest basis differences, and amortization of compensation-related arrangements. Management believes adjusting for these charges helps the reader's ability to understand the firm's core operating results and to increase comparability period to period.
(2) This non-GAAP adjustment removes the compensation expense impact from market valuation changes in the supplemental savings plan liability and the related net gains (losses) on investments designated as economic hedges against the related liability. Amounts deferred under the supplemental savings plan are adjusted for appreciation (depreciation) of hypothetical investments chosen by participants. The firm uses T. Rowe Price investment products to economically hedge the exposure to these market movements. Management believes it is useful to offset the non-operating investment income (loss) recognized on the economic hedges against the related compensation expense and remove the net impact to help the reader's ability to understand the firm's core operating results and to increase comparability period to period.
(3) These non-GAAP adjustments remove the impact the consolidated sponsored investment products have on the firm's U.S. GAAP consolidated statements of income. Specifically, the firm adds back the operating expenses and subtracts the investment income of the consolidated sponsored investment products. The adjustment to operating expenses represents the operating expenses of the consolidated products, net of the elimination of related management and administrative fees. The adjustment to net income attributable to T. Rowe Price represents the net income of the consolidated products, net of redeemable non-controlling interests. Management believes the consolidated sponsored investment products may impact the reader’s ability to understand the firm's core operating results.
(4) This non-GAAP adjustment represents the other non-operating income (loss) and the net gains (losses) earned on the firm's investment portfolio that are not designated as economic hedges of the supplemental savings plan liability and that are not part of the cash and discretionary investment portfolio. Management retains in its non-GAAP measures the investment gains recognized on the cash and discretionary investments as these assets and related income (loss) are considered part of the firm's core operations. Management believes adjusting for the remaining non-operating income (loss) helps the reader’s ability to understand the firm's core operating results and increases comparability to prior years. Additionally, management does not emphasize the impact of this portion of non-operating income (loss) when managing and evaluating the firm's performance.
(5) The income tax impacts were calculated in order to achieve an overall year-to-date non-GAAP effective tax rate of 24.1% in 2024 and 26.8% in 2023. As such, the non-GAAP effective tax rate for the three months ended September 30, 2024 and 2023 was 23.8% and 24.8%, respectively.
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(6) This non-GAAP measure was calculated by applying the two-class method to adjusted net income attributable to T. Rowe Price Group and dividing by the weighted-average common shares outstanding assuming dilution. The calculation of adjusted net income allocated to common stockholders is as follows:
| Three months ended | Nine months ended | ||||||||||||||||||||||||||||
| 9/30/2024 | 9/30/2023 | 6/30/2024 | 9/30/2024 | 9/30/2023 | |||||||||||||||||||||||||
| Adjusted net income attributable to T. Rowe Price | $ | 586.5 | $ | 499.5 | $ | 519.7 | $ | 1,654.7 | $ | 1,355.4 | |||||||||||||||||||
| Less: adjusted net income allocated to outstanding restricted stock and stock unit holders | 15.0 | 11.7 | 13.9 | 44.1 | 32.8 | ||||||||||||||||||||||||
| Adjusted net income allocated to common stockholders | $ | 571.5 | $ | 487.8 | $ | 505.8 | $ | 1,610.6 | $ | 1,322.6 | |||||||||||||||||||
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