WisdomTree Announces First Quarter 2026 Results
NEW YORK--( BUSINESS WIRE)--WisdomTree, Inc. (NYSE: WT), a global financial innovator, today reported financial results for the first quarter of 2026.
($23.1) million of net loss ($40.6 (1) million of net income, as adjusted), including a loss on extinguishment of convertible notes of $62.3 million, comprised of a loss on extinguishment of $16.9 million associated with the repurchase of $75.0 million in aggregate principal amount of our 3.25% convertible senior notes due 2026 (the “2026 Notes”) and a $45.4 million inducement expense related to the repurchase of $275.0 million in aggregate principal amount of our 3.25% convertible senior notes due 2029 (the “2029 Notes”). See “Non-GAAP Financial Measurements” for additional information.
$152.6 billion of ending AUM, an increase of 5.6% from the prior quarter arising primarily from net inflows and market appreciation.
$5.9 billion of net inflows, primarily driven by inflows into our international developed equity, fixed income and leveraged and inverse products across the United States and Europe.
0.36% average advisory fee, a 1 basis point increase from the prior quarter.
0.42% revenue yield (2), unchanged from the prior quarter.
$159.5 million of operating revenues, an increase of 8.2% from the prior quarter due to higher average AUM and higher other revenues attributable to our European listed exchange-traded products (“ETPs”).
84.4% gross margin (1), a 1.2 point increase from the prior quarter primarily due to higher revenues.
37.2% operating income margin (39.3% (1) as adjusted), a 3.3 point decrease (2.4 point decrease, as adjusted) from the prior quarter primarily due to seasonally higher compensation expense.
$603.75 million issuance of convertible senior notes due 2031 (the “2031 Notes”), bearing interest at a rate of 4.50% and issued with a conversion price of $21.58 per share. Concurrent with the issuance of the 2031 Notes, we completed separate, privately negotiated transactions with certain holders of our outstanding 2026 Notes (conversion price of $11.04 per share) to exchange $75.0 million in aggregate principal amount of the 2026 Notes for approximately 6.81 million shares of our common stock and with certain holders of our outstanding 2029 Notes (conversion price of $11.82 per share) to exchange $275.0 million in aggregate principal amount of the 2029 Notes for approximately $302.7 million in cash and approximately 4.19 million shares of common stock.
$0.03 quarterly dividend declared, payable on May 27, 2026 to stockholders of record as of the close of business on May 13, 2026.
Update from Jarrett Lilien, WisdomTree President and COO
“This was another quarter of consistent, broad-based execution, with nearly $6 billion of net inflows and continued momentum across the business. What stands out most is the quality and breadth of those flows, with clients engaging across asset classes, geographies and use cases. That speaks to the strength of our platform and our ability to generate growth across market environments. We are not reliant on any single product or theme – our business is becoming increasingly diversified, resilient and positioned to scale.”
Update from Jonathan Steinberg, WisdomTree CEO
“We delivered another quarter of strong execution in a volatile environment, reinforcing the strength of a business that is becoming more diversified, more durable and increasingly capable of compounding growth over time. Our strategy is centered on building a high-quality growth platform – combining organic momentum with disciplined, strategic acquisitions like Ceres Partners and Atlantic House that expand our capabilities, enhance our economics and accelerate our long-term trajectory. We believe this positions WisdomTree to deliver sustained growth, margin expansion and increasing earnings power.”
OPERATING AND FINANCIAL HIGHLIGHTS
Three Months Ended
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Consolidated Operating Highlights ($ in billions):
AUM—end of period
$
152.6
$
144.5
$
137.2
$
126.1
$
115.8
Net inflows/(outflows)
$
5.9
$
(0.3
)
$
2.2
$
3.5
$
3.1
Average AUM
$
154.7
$
140.7
$
130.8
$
119.2
$
114.6
Average advisory fee
0.36%
0.35%
0.35%
0.35%
0.35%
Revenue yield (2)
0.42%
0.42%
0.38%
0.38%
0.38%
Consolidated Financial Highlights ($ in millions, except per share amounts):
Operating revenues
$
159.5
$
147.4
$
125.6
$
112.6
$
108.1
Net (loss)/income
$
(23.1
)
$
40.0
$
19.7
$
24.8
$
24.6
Diluted (loss)/earnings per share
$
(0.17
)
$
0.28
$
0.13
$
0.17
$
0.17
Operating income margin
37.2%
40.5%
36.3%
30.8%
31.6%
As Adjusted (Non-GAAP (1)):
Operating revenues, as adjusted
$
159.5
$
147.4
$
125.6
$
112.6
$
108.1
Gross margin
84.4%
83.2%
82.2%
81.1%
80.8%
Net income, as adjusted
$
40.6
$
41.2
$
34.5
$
25.9
$
23.0
Diluted earnings per share, as adjusted
$
0.27
$
0.29
$
0.23
$
0.18
$
0.16
Operating income margin, as adjusted
39.3%
41.7%
38.3%
32.5%
31.6%
RECENT BUSINESS DEVELOPMENTS
Company News
Product News
WISDOMTREE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Operating Revenues:
Advisory fees
$
134,880
$
122,712
$
114,485
$
103,241
$
99,549
Management fees
5,231
4,908
—
—
—
Performance fees
2,955
7,105
—
—
—
Other revenues
16,404
12,709
11,131
9,380
8,533
Total revenues
159,470
147,434
125,616
112,621
108,082
Operating Expenses:
Compensation and benefits
47,517
37,273
33,791
32,827
33,788
Fund management and administration
24,880
24,830
22,353
21,252
20,714
Marketing and advertising
5,392
5,613
4,788
5,330
4,813
Sales and business development
4,197
4,045
3,943
4,232
4,137
Professional fees
3,308
3,596
3,505
3,177
2,782
Occupancy, communications and equipment
1,935
1,892
1,601
1,559
1,482
Depreciation and amortization
2,096
2,043
615
580
540
Third-party distribution fees
5,795
4,772
3,977
4,083
3,112
Acquisition-related costs
1,933
317
2,409
1,967
—
Other
3,067
3,306
2,980
2,982
2,552
Total operating expenses
100,120
87,687
79,962
77,989
73,920
Operating income
59,350
59,747
45,654
34,632
34,162
Other Income/(Expenses):
Interest expense
(11,023
)
(11,023
)
(8,466
)
(5,490
)
(5,441
)
Interest income
2,592
2,965
4,015
2,090
1,897
Loss on extinguishment of convertible notes
(62,302
)
(833
)
(13,011
)
—
—
Remeasurement of contingent consideration
(2,562
)
(710
)
—
—
—
Other losses and gains, net
(637
)
317
1,325
638
(250
)
(Loss)/income before income taxes
(14,582
)
50,463
29,517
31,870
30,368
Income tax expense
8,549
10,437
9,816
7,093
5,739
Net (loss)/income
$
(23,131
)
$
40,026
$
19,701
$
24,777
$
24,629
(Loss)/earnings per share—basic
$
(0.17
)
$
0.29
$
0.14
(3)
$
0.17
$
0.17
(Loss)/earnings per share—diluted
$
(0.17
)
$
0.28
$
0.13
(3)
$
0.17
$
0.17
Weighted average common shares—basic
138,005
136,340
139,584
143,076
142,580
Weighted average common shares—diluted
138,005
143,314
150,675
146,640
146,545
As Adjusted (Non-GAAP (1))
Total revenues
$
159,470
$
147,434
$
125,616
$
112,621
$
108,082
Total operating expenses
$
96,752
$
85,936
$
77,553
$
76,022
$
73,920
Operating income
$
62,718
$
61,498
$
48,063
$
36,599
$
34,162
Income before income taxes
$
54,654
$
53,840
$
45,318
$
33,798
$
30,947
Income tax expense
$
14,061
$
12,605
$
10,842
$
7,935
$
7,933
Net income
$
40,593
$
41,235
$
34,476
$
25,863
$
23,014
Earnings per share—diluted
$
0.27
$
0.29
$
0.23
$
0.18
$
0.16
Weighted average common shares—diluted
152,372
143,314
150,675
146,640
146,545
QUARTERLY HIGHLIGHTS
Operating Revenues
Operating Expenses
Other Income/(Expenses)
Income Taxes
CONFERENCE CALL DIAL-IN AND WEBCAST DETAILS
WisdomTree will discuss its results and operational highlights during a live webcast on Friday, May 1, 2026 at 11:00 a.m. ET, which, together with all earnings materials, can be accessed via WisdomTree’s investor relations website at https://ir.wisdomtree.com. A replay of the webcast will be available shortly after the call.
Participants also can dial in using the following numbers: (877) 407-9210 or (201) 689-8049. Click here to access the participant international toll-free access numbers.
To avoid delays, we encourage participants to log in or dial into the conference call 10 minutes ahead of the scheduled start time.
About WisdomTree
WisdomTree is a global financial innovator, offering a diverse suite of exchange-traded products (ETPs), models and solutions, private market investments and digital asset-related products. Our offerings empower investors to shape their financial future and equip financial professionals to grow their businesses. Leveraging the latest financial infrastructure, we create products that emphasize access, transparency and provide an enhanced user experience. Building on our heritage of innovation, we offer next-generation digital products and services related to tokenized real world assets and stablecoins, as well as our institutional platform, WisdomTree Connect™ and blockchain-native digital wallet, WisdomTree Prime ®*, and have expanded into private markets through the acquisition of Ceres Partners’ U.S. farmland platform.
* The WisdomTree Connect institutional platform and WisdomTree Prime digital wallet and digital asset services are made available through WisdomTree Digital Movement, Inc., a federally registered money services business, state-licensed money transmitter and financial technology company (NMLS ID: 2372500) or WisdomTree Digital Trust Company, LLC, and may be limited where prohibited by law. WisdomTree Digital Trust Company, LLC is chartered as a limited purpose trust company by the New York State Department of Financial Services to engage in virtual currency business. Visit https://wisdomtreeconnect.com, https://www.wisdomtreeprime.com or the WisdomTree Prime mobile app for more information.
WisdomTree currently has approximately $163.19 billion in assets under management globally, inclusive of assets managed by Ceres Partners, LLC as of the last reportable period.
For more information about WisdomTree, WisdomTree Connect and WisdomTree Prime, visit: https://www.wisdomtree.com.
Please visit us on X at @WisdomTreeNews.
WisdomTree ® is the marketing name for WisdomTree, Inc. and its subsidiaries worldwide.
PRODUCTS AND SERVICES AVAILABLE VIA WISDOMTREE CONNECT AND WISDOMTREE PRIME:
NOT FDIC INSURED | NO BANK GUARANTEE | NOT A BANK DEPOSIT | MAY LOSE VALUE | NOT SIPC PROTECTED | NOT INSURED BY ANY GOVERNMENT AGENCY
The products and services available through WisdomTree Connect and the WisdomTree Prime app are not endorsed, indemnified or guaranteed by any regulatory agency.
References to third-party platforms, protocols, or use cases are provided for informational purposes only and do not constitute an endorsement, recommendation, or solicitation by WisdomTree or its affiliates. WisdomTree and its affiliates do not control or operate such third-party platforms or protocols and are not responsible for their operation or performance.
(1)
See “Non-GAAP Financial Measurements.”
(2)
Revenue yield is computed by dividing our annualized adjusted operating revenues as reported in the GAAP to Non-GAAP Reconciliation herein by our average AUM during the period.
(3)
Earnings per share (“EPS”) is calculated pursuant to the two-class method as it results in a lower EPS amount as compared to the treasury stock method. In addition, the three months ended September 30, 2025 includes $718 of stock repurchase excise taxes, which is excluded from net income, but is required to be added to net income to arrive at income available to common stockholders in the calculation of EPS. This item is excluded from our EPS when computed on a non-GAAP basis.
WISDOMTREE, INC. AND SUBSIDIARIES
KEY OPERATING STATISTICS
(Unaudited)
Three Months Ended
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
GLOBAL PRODUCTS ($ in millions)
Beginning of period assets
$
144,525
$
137,175
$
126,070
$
115,787
$
109,779
Add: Digital Assets—Jan. 1, 2025
—
—
—
—
32
Add: Assets acquired—Ceres Acquisition
—
1,812
—
—
—
Inflows/(outflows)
5,934
(283
)
2,241
3,529
3,052
Market appreciation
2,097
5,821
8,864
6,754
2,924
End of period assets
$
152,556
$
144,525
$
137,175
$
126,070
$
115,787
Average assets during the period
$
154,663
$
140,686
$
130,760
$
119,185
$
114,622
Average ETP advisory fee during the period
0.36%
0.35%
0.35%
0.35%
0.35%
Total revenue yield
0.42%
0.42%
0.38%
0.38%
0.38%
Revenue days
90
92
92
91
90
Number of products—end of the period
416
405
397
383
375
(1)
ETPs AND TOKENIZED PRODUCTS
U.S. LISTED ETFs ($ in millions)
Beginning of period assets
$
88,521
$
88,293
$
85,179
$
80,531
$
79,095
Inflows/(outflows)
2,643
(1,108
)
(445
)
1,110
1,847
Market (depreciation)/appreciation
(218
)
1,336
3,559
3,538
(411
)
End of period assets
$
90,946
$
88,521
$
88,293
$
85,179
$
80,531
Average assets during the period
$
91,742
$
88,074
$
87,205
$
81,525
$
81,127
Number of ETFs—end of the period
90
85
84
81
78
EUROPEAN LISTED ETPs ($ in millions)
Beginning of period assets
$
53,345
$
48,290
$
40,541
$
35,124
$
30,684
Inflows
3,118
609
2,448
2,201
1,104
Market appreciation
2,295
4,446
5,301
3,216
3,336
End of period assets
$
58,758
$
53,345
$
48,290
$
40,541
$
35,124
Average assets during the period
$
60,193
$
50,102
$
42,853
$
37,439
$
33,415
Number of ETPs—end of the period
306
300
295
285
280
DIGITAL ASSETS ($ in millions)
Beginning of period assets
$
770
$
592
$
350
$
132
$
—
Add: Digital Assets—Jan. 1, 2025
—
—
—
—
32
Inflows
98
179
238
218
101
Market (depreciation)/appreciation
(1
)
(1
)
4
—
(1
)
End of period assets
$
867
$
770
$
592
$
350
$
132
Average assets during the period
$
781
$
695
$
702
$
221
$
80
Number of products—end of the period
19
19
18
17
17
(1)
PRIVATE ASSETS ($ in millions)
Beginning of period assets
$
1,889
$
—
$
—
$
—
$
—
Add: Assets acquired—Ceres Acquisition
—
1,812
—
—
—
Inflows
75
37
—
—
—
Market appreciation
21
40
—
—
—
End of period assets
$
1,985
$
1,889
$
—
$
—
$
—
Average assets during the period
$
1,947
$
1,815
$
—
$
—
$
—
Number of products—end of the period
1
1
—
—
—
ETPs AND TOKENIZED PRODUCT CATEGORIES ($ in millions)
U.S. Equity
Beginning of period assets
$
41,427
$
40,977
$
38,617
$
35,628
$
35,414
Add: Digital Assets—Jan. 1, 2025
—
—
—
—
9
Inflows
354
191
32
1,287
963
Market (depreciation)/appreciation
(270
)
259
2,328
1,702
(758
)
End of period assets
$
41,511
$
41,427
$
40,977
$
38,617
$
35,628
Average assets during the period
$
42,394
$
41,161
$
40,024
$
36,080
$
36,281
Commodity & Currency
Beginning of period assets
$
36,980
$
31,705
$
26,696
$
25,487
$
21,906
Add: Digital Assets—Jan. 1, 2025
—
—
—
—
1
Inflows/(outflows)
35
177
1,096
(110
)
(159
)
Market appreciation
3,295
5,098
3,913
1,319
3,739
End of period assets
$
40,310
$
36,980
$
31,705
$
26,696
$
25,487
Average assets during the period
$
41,458
$
33,824
$
28,162
$
25,888
$
23,993
International Developed Market Equity
Beginning of period assets
$
25,616
$
23,893
$
21,725
$
18,178
$
17,602
Inflows
3,495
1,147
478
1,646
474
Market appreciation
75
576
1,690
1,901
102
End of period assets
$
29,186
$
25,616
$
23,893
$
21,725
$
18,178
Average assets during the period
$
29,349
$
24,708
$
22,481
$
19,577
$
18,275
Fixed Income
Beginning of period assets
$
21,074
$
22,509
$
22,543
$
22,230
$
20,043
Add: Digital Assets—Jan. 1, 2025
—
—
—
—
21
Inflows/(outflows)
1,272
(1,358
)
(58
)
148
2,092
Market appreciation/(depreciation)
49
(77
)
24
165
74
End of period assets
$
22,395
$
21,074
$
22,509
$
22,543
$
22,230
Average assets during the period
$
21,187
$
21,422
$
23,128
$
22,526
$
21,464
Emerging Market Equity
Beginning of period assets
$
10,643
$
10,855
$
10,957
$
9,985
$
10,468
(Outflows)/inflows
(206
)
(508
)
(250
)
28
(445
)
Market (depreciation)/appreciation
(294
)
296
148
944
(38
)
End of period assets
$
10,143
$
10,643
$
10,855
$
10,957
$
9,985
Average assets during the period
$
10,902
$
10,839
$
10,874
$
10,295
$
10,072
Leveraged & Inverse
Beginning of period assets
$
3,275
$
2,913
$
2,631
$
2,133
$
1,924
Inflows/(outflows)
565
(15
)
(52
)
141
116
Market (depreciation)/appreciation
(177
)
377
334
357
93
End of period assets
$
3,663
$
3,275
$
2,913
$
2,631
$
2,133
Average assets during the period
$
3,785
$
3,097
$
2,750
$
2,354
$
2,083
Cryptocurrency
Beginning of period assets
$
2,242
$
3,168
$
2,087
$
1,553
$
1,912
Add: Digital Assets—Jan. 1, 2025
—
—
—
—
1
Inflows/(outflows)
137
(117
)
764
198
(89
)
Market (depreciation)/appreciation
(596
)
(809
)
317
336
(271
)
End of period assets
$
1,783
$
2,242
$
3,168
$
2,087
$
1,553
Average assets during the period
$
2,021
$
2,550
$
2,412
$
1,800
$
1,900
Alternatives
Beginning of period assets
$
1,379
$
1,155
$
814
$
593
$
510
Inflows
207
163
231
191
100
Market (depreciation)/appreciation
(6
)
61
110
30
(17
)
End of period assets
$
1,580
$
1,379
$
1,155
$
814
$
593
Average assets during the period
$
1,620
$
1,270
$
929
$
665
$
554
Headcount
357
360
338
321
315
Note: Previously issued statistics may be restated due to fund closures and trade adjustments.
Source: WisdomTree
WISDOMTREE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
Mar. 31,
2026
Dec. 31,
2025
(Unaudited)
ASSETS
Current assets:
Cash, cash equivalents and restricted cash
$
625,505
$
311,732
Financial instruments owned, at fair value
65,237
107,117
Accounts receivable
66,112
64,452
Income taxes receivable
1,262
—
Prepaid expenses
8,649
7,338
Other current assets
1,320
1,723
Total current assets
768,085
492,362
Fixed assets, net
401
431
Deferred tax assets, net
6,689
9,803
Investments
28,623
29,075
Right of use assets—operating leases
2,326
2,764
Goodwill
228,624
228,624
Intangible assets, net
747,954
748,957
Other noncurrent assets
1,126
925
Total assets
$
1,783,828
$
1,512,941
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Current liabilities:
Convertible notes—current
$
74,910
$
149,604
Fund management and administration payable
34,465
29,448
Compensation and benefits payable
19,132
52,435
Payable to Gold Bullion Holdings (Jersey) Limited (“GBH”)
14,176
13,940
Operating lease liabilities
1,498
1,614
Income taxes payable
—
2,295
Accounts payable and other liabilities
23,948
32,720
Total current liabilities
168,129
282,056
Convertible notes—long term
1,125,434
804,203
Contingent consideration
14,406
11,844
Operating lease liabilities—long term
841
1,166
Total liabilities
1,308,810
1,099,269
STOCKHOLDERS’ EQUITY
Common stock, par value $0.01; 400,000 shares authorized:
Issued and outstanding: 152,439 and 140,713 at March 31, 2026 and December 31, 2025, respectively
1,524
1,407
Additional paid-in capital
279,000
189,244
Accumulated other comprehensive gain
1,069
2,227
Retained earnings
193,425
220,794
Total stockholders’ equity
475,018
413,672
Total liabilities and stockholders’ equity
$
1,783,828
$
1,512,941
WISDOMTREE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
Three Months Ended
March 31,
2026
2025
Cash flows from operating activities:
Net (loss)/income
$
(23,131
)
$
24,629
Adjustments to reconcile net (loss)/income to net cash provided by operating activities:
Loss on extinguishment of convertible notes
62,302
—
Advisory and license fees paid in gold, other precious metals and cryptocurrency
(25,348
)
(15,373
)
Stock-based compensation
8,431
6,238
Deferred income taxes
3,395
5,835
Increase in fair value of contingent consideration
2,562
—
Depreciation and amortization
2,096
540
Amortization of issuance costs—convertible notes
1,154
624
Losses on financial instruments owned, at fair value
882
440
Amortization of right of use asset
456
326
Losses/(gains) on investments
452
(316
)
Imputed interest on payable to GBH
235
455
Changes in operating assets and liabilities:
Accounts receivable
(1,410
)
(394
)
Income taxes receivable/payable
(2,572
)
(4,092
)
Prepaid expenses
(1,360
)
(1,522
)
Gold and other precious metals
24,825
14,738
Other assets
168
(295
)
Fund management and administration payable
5,224
3,150
Compensation and benefits payable
(33,182
)
(28,056
)
Operating lease liabilities
(459
)
(325
)
Accounts payable and other liabilities
(6,763
)
(232
)
Net cash provided by operating activities
17,957
6,370
Cash flows from investing activities:
Purchase of financial instruments owned, at fair value
(6,003
)
—
Cash paid—software development
(980
)
(577
)
Purchase of fixed assets
(28
)
(31
)
Proceeds from the sale of financial instruments owned, at fair value
45,650
388
Proceeds from held-to-maturity securities maturing or called prior to maturity
—
6
Net cash provided by/(used in) investing activities
38,639
(214
)
Cash flows from financing activities:
Repurchase of convertible notes
(302,675
)
—
Common stock repurchased
(24,963
)
(12,714
)
Dividends paid
(4,744
)
(4,626
)
Issuance costs—convertible notes
(12,593
)
—
Proceeds from the issuance of convertible notes
603,750
—
Excise taxes paid on common stock repurchased
—
(1,868
)
Net cash provided by/(used in) financing activities
258,775
(19,208
)
(Decrease)/increase in cash flow due to changes in foreign exchange rate
(1,598
)
2,234
Net increase/(decrease) in cash, cash equivalents and restricted cash
313,773
(10,818
)
Cash, cash equivalents and restricted cash—beginning of year
311,732
181,191
Cash, cash equivalents and restricted cash—end of period
$
625,505
$
170,373
Supplemental disclosure of cash flow information:
Cash paid for income taxes
$
7,659
$
4,042
Cash paid for interest
$
18,448
$
6,412
NON-GAAP FINANCIAL MEASUREMENTS
In an effort to provide additional information regarding our results as determined by GAAP, we also disclose certain non-GAAP information which we believe provides useful and meaningful information. Our management reviews these non-GAAP financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-GAAP measurements so as to share this perspective of management. Non-GAAP measurements do not have any standardized meaning, do not replace nor are they superior to GAAP financial measurements and are unlikely to be comparable to similar measures presented by other companies. These non-GAAP financial measurements should be considered in the context with our GAAP results. The non-GAAP financial measurements contained in this press release include the following:
Adjusted Operating Income, Operating Expenses, Income Before Income Taxes, Income Tax Expense, Net Income and Diluted Earnings per Share
We disclose adjusted operating income, operating expenses, income before income taxes, income tax expense, net income and diluted earnings per share as non-GAAP financial measurements in order to report our results exclusive of items that are non-recurring or not core to our operating business. We believe presenting these non-GAAP financial measurements provides investors with a consistent way to analyze our performance. These non-GAAP financial measurements exclude the following:
Gains or losses on financial instruments owned: We account for our financial instruments owned as trading securities, which requires these instruments to be measured at fair value with gains and losses reported in net income. We exclude these items when calculating our non-GAAP financial measurements as the gains and losses introduce earnings volatility and are not core to our operating business.
Foreign currency remeasurement gains and losses on U.S. dollars held by foreign subsidiaries: GAAP requires account balances to be remeasured into an entity’s functional currency, with resulting gains and losses reported in net income. Foreign subsidiaries holding U.S. dollars remeasure these balances into their functional currencies and recognize the gains and losses. We exclude remeasurement effects from our non-GAAP financial measures, as they introduce earnings volatility, are not core to our operations and arise from balances denominated in our reporting currency.
Tax windfalls and shortfalls upon vesting of stock-based compensation awards: GAAP requires the recognition of tax windfalls and shortfalls within income tax expense. These items arise upon the vesting of stock-based compensation awards and the magnitude is directly correlated to the number of awards vesting/exercised, as well as the difference between the price of our stock on the date the award was granted and the date the award vested or was exercised. We exclude these items when calculating our non-GAAP financial measurements as they introduce earnings volatility and are not core to our operating business.
Amortization of intangible assets and remeasurement of contingent consideration arising from our acquisition of Ceres Partners, LLC: On October 1, 2025, we completed the Ceres Acquisition for aggregate consideration consisting of (i) $275 million in cash payable at closing, subject to customary post-closing adjustments and (ii) contingent consideration of up to $225 million, payable in 2030, contingent upon Ceres Partners, LLC achieving a compound annual growth rate (“CAGR”) in revenues of 12% to 22% during the measurement period of January 1, 2025 through December 31, 2029. GAAP requires contingent consideration to be re-measured each reporting period with changes in fair value reported in net income. In addition, a portion of the consideration totaling $143.5 million was allocated to intangible assets, which is amortized over 25 years. We exclude changes in fair value of contingent consideration and amortization of intangible assets arising from the Ceres Acquisition when calculating our non-GAAP financial measurements as these items are not core to our operating business.
Other items: Losses related to convertible notes transactions, changes in deferred tax asset valuation allowance, acquisition-related costs, imputed interest on our payable to Gold Bullion Holdings (Jersey) Limited (“GBH”) and gains and losses recognized on our investments are excluded when calculating our non-GAAP financial measurements.
Adjusted Effective Income Tax Rate
We disclose our adjusted effective income tax rate as a non-GAAP financial measurement in order to report our effective income tax rate exclusive of items that are non-recurring or not core to our operating business. We believe reporting our adjusted effective income tax rate provides investors with a consistent way to analyze our income taxes. Our adjusted effective income tax rate is calculated by dividing adjusted income tax expense by adjusted income before income taxes. See above for information regarding the items that are excluded.
Gross Margin and Gross Margin Percentage
We disclose our gross margin and gross margin percentage as non-GAAP financial measurements because we believe they provide investors with a consistent way to analyze the amount we retain after paying third-party service providers to operate our ETPs. These measures also assist us in analyzing the profitability of our products. We define gross margin as total adjusted operating revenues less fund management and administration expenses. Gross margin percentage is calculated as gross margin divided by total adjusted operating revenues.
GAAP to NON-GAAP RECONCILIATION (CONSOLIDATED)
(in thousands)
(Unaudited)
Three Months Ended
Adjusted Net Income and Diluted Earnings per Share:
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Net (loss)/income, as reported
$
(23,131
)
$
40,026
$
19,701
$
24,777
$
24,629
Add back: Losses related to convertible notes transactions, net of income taxes
62,280
505
12,763
—
—
Deduct: Tax windfalls upon vesting of stock-based compensation awards
(4,421
)
—
(76
)
(4
)
(2,083
)
Add back: Increase in fair value of contingent consideration, net of income taxes
1,940
538
—
—
—
Add back: Acquisition-related costs, net of income taxes
1,933
240
1,824
1,489
—
Add back: Amortization of intangible assets arising from the Ceres Acquisition, net of income taxes
1,087
1,086
—
—
—
Add back/(deduct): Losses/(gains) on financial instruments owned, net of income taxes
668
8
(810
)
(972
)
333
(Deduct)/add back: Foreign currency remeasurement (gains)/losses on U.S. dollar balances, net of income taxes
(435
)
(141
)
—
1,136
—
Add back/(deduct): Losses/(gains) recognized on investments, net of income taxes
342
(75
)
734
(458
)
(239
)
Add back: Imputed interest on payable to GBH, net of income taxes
179
285
364
354
344
Add back/(deduct): Increase/(decrease) in deferred tax asset valuation allowance on capital losses
151
(1,237
)
(24
)
(459
)
30
Adjusted net income
$
40,593
$
41,235
$
34,476
$
25,863
$
23,014
Weighted average common shares—diluted
152,372
143,314
150,675
146,640
146,545
Adjusted earnings per share—diluted
$
0.27
$
0.29
$
0.23
$
0.18
$
0.16
Three Months Ended
Gross Margin and Gross Margin Percentage:
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Operating revenues
$
159,470
$
147,434
$
125,616
$
112,621
$
108,082
Deduct: Fund management and administration
(24,880
)
(24,830
)
(22,353
)
(21,252
)
(20,714
)
Gross margin
$
134,590
$
122,604
$
103,263
$
91,369
$
87,368
Gross margin percentage
84.4%
83.2%
82.2%
81.1%
80.8%
Three Months Ended
Adjusted Operating Income and Adjusted Operating Income Margin:
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Operating revenues
$
159,470
$
147,434
$
125,616
$
112,621
$
108,082
Operating income
59,350
59,747
$
45,654
$
34,632
$
34,162
Add back: Amortization of intangible assets arising from the Ceres Acquisition
1,435
1,434
—
—
—
Add back: Acquisition-related costs
1,933
317
2,409
1,967
—
Adjusted operating income
$
62,718
$
61,498
$
48,063
$
36,599
$
34,162
Adjusted operating income margin
39.3%
41.7%
38.3%
32.5%
31.6%
Three Months Ended
Adjusted Total Operating Expenses:
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Total operating expenses
$
100,120
$
87,687
$
79,962
$
77,989
$
73,920
Deduct: Amortization of intangible assets arising from the Ceres Acquisition
(1,435
)
(1,434
)
—
—
—
Deduct: Acquisition-related costs
(1,933
)
(317
)
(2,409
)
(1,967
)
—
Adjusted total operating expenses
$
96,752
$
85,936
$
77,553
$
76,022
$
73,920
Three Months Ended
Adjusted Income Before Income Taxes:
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
(Loss)/income before income taxes
$
(14,582
)
$
50,463
$
29,517
$
31,870
$
30,368
Add back: Losses related to convertible notes transactions
62,302
833
13,011
—
—
Add back: Increase in fair value of contingent consideration
2,562
710
—
—
—
Add back: Acquisition-related costs
1,933
317
2,409
1,967
—
Add back: Amortization of intangible assets arising from the Ceres Acquisition
1,435
1,434
—
—
—
Add back/(deduct): Losses/(gains) on financial instruments owned
882
10
(1,070
)
(1,284
)
440
(Deduct)/add back: Foreign currency remeasurement (gains)/losses on U.S. dollar balances, net of income taxes
(566
)
(205
)
—
1,383
—
Add back/(deduct): Losses/(gains) recognized on investments
452
(99
)
970
(605
)
(316
)
Add back: Imputed interest on payable to GBH
236
377
481
467
455
Adjusted income before income taxes
$
54,654
$
53,840
$
45,318
$
33,798
$
30,947
Three Months Ended
Adjusted Income Tax Expense and Adjusted Effective Income Tax Rate:
Mar. 31,
2026
Dec. 31,
2025
Sept. 30,
2025
June 30,
2025
Mar. 31,
2025
Adjusted income before income taxes (above)
$
54,654
$
53,840
$
45,318
$
33,798
$
30,947
Income tax expense
$
8,549
$
10,437
$
9,816
$
7,093
$
5,739
Add back: Tax windfalls upon vesting of stock-based compensation awards
4,421
—
76
4
2,083
Add back: Tax benefit arising from convertible notes transactions
22
328
248
—
—
Add back: Tax benefit arising from increase in fair value of contingent consideration
622
172
—
—
—
Add back: Tax benefit of intangible asset amortization arising from the Ceres Acquisition
348
348
—
—
—
Add back/(deduct): Tax benefit/(expense) arising from losses/(gains) on financial instruments owned
214
2
(260
)
(312
)
107
(Deduct)/add back: (increase)/decrease in deferred tax asset valuation allowance on capital losses
(151
)
1,237
24
459
(30
)
(Deduct)/add back: Tax (expense)/benefit on foreign currency remeasurement losses on U.S. dollar balances
(131
)
(64
)
—
247
—
Add back/(deduct): Tax benefit/(expense) on losses/(gains) on investments
110
(24
)
236
(147
)
(77
)
Add back: Tax benefit on imputed interest
57
92
117
113
111
Add back: Tax benefit on acquisition-related costs
—
77
585
478
—
Adjusted income tax expense
$
14,061
$
12,605
$
10,842
$
7,935
$
7,933
Adjusted effective income tax rate
25.7%
23.4%
23.9%
23.5%
25.6%
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that are based on our management’s beliefs and assumptions and on information currently available to our management. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, the risks described below. If one or more of these or other risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance. You should read this press release completely and with the understanding that our actual future results may be materially different from any future results expressed or implied by these forward-looking statements.
In particular, forward-looking statements in this press release may include statements about:
Our business is subject to many risks and uncertainties, including without limitation:
Additional risks include those associated with the acquisitions of Ceres Partners, LLC and Atlantic House Holdings Limited, including the risk that the integrations may be more difficult, time-consuming or costly than expected, or that expected benefits (including projected business growth, realization of synergies, or the ability to raise additional capital into the funds of the acquired businesses) may not be realized as anticipated. Other factors, such as general economic conditions, including currency exchange rate fluctuations, also may have an effect on the results of our operations. For a more complete description of the risks noted above and other risks that could cause our actual results to differ from our current expectations, see “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025.
The forward-looking statements in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments may cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. Therefore, these forward-looking statements do not represent our views as of any date other than the date of this press release.
Category: Business Update