T Rowe Price (TROW) Q4 2025 Earnings Transcript

Motley Fool Transcribing, The Motley Fool

Wed, February 4, 2026 astatine 8:11 AM CST 28 min read

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Wednesday, Feb. 4, 2026 astatine 8 a.m. ET

• Chief Executive Officer — Robert W. Sharps

• Chief Financial Officer — Jennifer Benson Dardis

• Head of Global Investments — Eric Lanoue Veiel

Robert W. Sharps: Thank you, Linsley, and convey you each for joining today's call. 2025 brought a 3rd consecutive twelvemonth of beardown planetary marketplace returns, though it remains a constrictive marketplace dominated by a fistful of mega-cap stocks, and with riskier names outperforming prime and value. While this marketplace maturation served arsenic a tailwind for our assets nether absorption and concern advisory revenue, it was not an situation that was highly conducive to cardinal research, progressive management, and semipermanent investing. But we did spot immoderate grounds of the marketplace broadening successful the 4th quarter, which would beryllium a affirmative for cardinal research-driven progressive management.

We closed the twelvemonth with $1.78 trillion successful assets nether management, up implicit 10% from the commencement of the twelvemonth contempt $56.9 cardinal successful nett outflows. Net outflows were concentrated successful our equity and communal money business, with $75 cardinal of nett outflows from equity and connected a conveyance basis, astir $64 cardinal from communal funds successful 2025. Importantly, we saw an summation successful gross sales, which were higher than 2024 and up implicit 40% from 2023. Offsetting these higher gross income were redemptions that were greater than anticipated and were driven by show shortfalls successful definite strategies and from portfolio rebalancing owed to elevated equity markets.

We generated implicit $2 cardinal of escaped travel successful 2025 and returned astir $1.8 cardinal of currency to our stockholders. We besides extended our agelong past of expanding our regular dividend, marking our thirty-ninth consecutive twelvemonth of increases since our IPO successful 1986. We are gathering momentum crossed our strategical initiatives. I stay assured successful our plan, and our people, and I look guardant to what's ahead. With that, I'll crook to concern performance. We are seeing betterment successful the show of respective cardinal and proceed to person beardown semipermanent show crossed a scope of strategies and plus classes. While we're headed successful the close direction, determination remains country for further improvement.

About fractional of our funds bushed their adjacent group, crossed the clip periods, with 49%, 56%, 46%, and 61% outperforming connected the one, three, five, and ten-year clip periods respectively. For the three, five, and ten-year clip periods, asset-weighted show is stronger, with 72%, 54%, and 79% of money assets beating their adjacent groups for the respective periods. For the one-year clip period, 42% of money assets bushed their adjacent groups. On an asset-weighted basis, implicit fractional of our equity funds bushed their adjacent groups connected a 3 and five-year basis, and implicit 70% bushed their peers for the ten-year clip period.