T. Rowe Price Group (TROW) Q1 2026 earnings summary

Executive summary

• Adjusted EPS for Q1 2026 was $2.52, up 13% year-over-year, with diluted EPS at $2.23, driven by higher average AUM and lower expenses.

• Assets under management (AUM) ended Q1 2026 at $1.71 trillion, down from the prior quarter due to $13.7 billion in net outflows and $52.2 billion in market depreciation, but average AUM for the quarter was $1.78 trillion, up 9.6% year-over-year.

• Net revenues rose 5.3% year-over-year to $1.86 billion, driven by higher investment advisory fees and capital allocation-based income.

• Equity and mutual fund businesses faced outflows, while multi-asset, fixed income, and alternatives saw positive net flows and growth.

• $629 million was returned to shareholders in Q1 2026 via dividends and share repurchases.

Financial highlights

• Investment advisory fees increased 5.3% year-over-year to $1.68 billion, with multi-asset and alternatives showing the strongest growth.

• Adjusted operating expenses (excluding carried interest) were $1.14 billion, up 1% year-over-year and down 7% sequentially, reflecting cost savings and seasonal trends.

• Adjusted operating margin improved to 37.9% in Q1 2026 from 36.1% in Q1 2025.

• Net operating income rose 14.1% year-over-year to $680.5 million.

• $340 million in stock buybacks were executed in Q1, with 214.9 million shares outstanding at quarter-end.

Outlook and guidance

• 2026 adjusted operating expenses (excluding carried interest) are expected to rise 3%-6% over 2025's $4.6 billion, with continued investment in strategic priorities.

• Effective tax rate for full-year 2026 is estimated at 23.0% to 26.0%.

• Management expects continued volatility and is focused on active management and innovation to capture market opportunities.