Hamilton Lane INC

Previous wording

We are a global private markets investment solutions provider and operate our business in a single segment. We offer a variety of investment solutions to address our clients’ needs across a range of private markets, including private equity, private credit, real estate, infrastructure, real assets, growth equity, venture capital and impact. These solutions are constructed from a range of investment types, including primary investments in funds managed by third-party managers, direct investments alongside such funds and acquisitions of secondary stakes in such funds, with a number of our clients utilizing multiple investment types. These solutions are offered in a variety of formats covering some or all phases of private markets investment programs:

Current wording

We are a global private markets investment solutions provider and operate our business in a single segment. We offer a variety of investment solutions to address our clients’ needs across a range of private markets, including private equity, private credit, direct equity, real estate, infrastructure, other real assets, growth equity, venture capital and impact. These solutions are constructed from a range of investment types, including primary investments in funds managed by third-party managers, direct investments alongside such funds and acquisitions of secondary stakes in such funds, with a number of our clients utilizing multiple investment types. These solutions are offered in a variety of formats covering some or all phases of private markets investment programs:

Previous wording

•Customized Separate Accounts: We design and build customized portfolios of private markets funds and direct investments to meet our clients’ specific portfolio objectives with regard to return, risk tolerance, diversification and liquidity. We generally have discretionary investment authority over our customized separate accounts, which comprised $98.8 billion of our AUM as of March 31, 2025.

Current wording

•Customized Separate Accounts: We design and build customized portfolios of private markets funds and direct investments to meet our clients’ specific portfolio objectives with regard to return, risk tolerance, diversification and liquidity. We generally have discretionary investment authority over our customized separate accounts, which comprised $91.7 billion of our AUM as of March 31, 2026.

Previous wording

•Advisory Services: We offer non-discretionary investment advisory services to assist clients in developing and implementing their private markets investment programs. Our investment advisory services include asset allocation, strategic plan creation, development of investment policies and guidelines, the screening and recommending of investments, the monitoring of and reporting on investments and investment manager review and due diligence. Our advisory clients include some of the largest and most sophisticated private markets investors in the world. We had $819.5 billion of AUA as of March 31, 2025.

Current wording

•Advisory Services: We offer non-discretionary investment advisory services to assist clients in developing and implementing their private markets investment programs. Our investment advisory services include asset allocation, strategic plan creation, development of investment policies and guidelines, the screening and recommending of investments, the monitoring of and reporting on investments, and investment manager review and due diligence. Our advisory clients include some of the largest and most sophisticated private markets investors in the world. We had $905.3 billion of AUA as of March 31, 2026.

Previous wording

•Reporting, Monitoring, Data and Analytics: We provide our clients with comprehensive reporting and investment monitoring services, usually bundled into our broader investment solutions offerings, but also on a stand-alone, fee-for-service basis. We also provide comprehensive research and analytical services as part of our investment solutions, leveraging our large, global, proprietary and high-quality database for transparency and powerful analytics. Our data, as well as our benchmarking and forecasting models, are accessible through our proprietary technology solution, Cobalt LP, on a stand-alone, subscription basis.

Current wording

•Reporting, Monitoring, Data and Analytics: We provide our clients with comprehensive reporting and investment monitoring services, usually bundled into our broader investment solutions offerings, but also on a stand-alone, fee-for-service basis. We also provide comprehensive research and analytical services as part of our investment solutions, leveraging our large, global, proprietary and high-quality database to support transparency, decision making and portfolio construction. Our data, as well as our benchmarking and forecasting models, are accessible through our proprietary technology solution, Cobalt LP, on a stand-alone, subscription basis.

Previous wording

Our client and investor base is broadly diversified by type, size and geography. Our client base primarily comprises institutional investors that range from those seeking to make an initial investment in alternative assets to some of the world’s largest and most sophisticated private markets investors. As we offer a highly customized, flexible service, we are equipped to provide investment services to institutional clients of all sizes and with different needs, internal resources and investment objectives. Our clients include prominent institutional investors in the United States, Canada, Europe, the Middle East, Asia, Australia and Latin America. We provide private markets solutions and services to some of the largest global pension, sovereign wealth and U.S. state pension funds. In addition, we believe we are a leading provider of private markets solutions for U.S. labor union pension plans, and we serve numerous smaller public and corporate pension plans, sovereign wealth funds, financial institutions and insurance companies, endowments and foundations, as well as family offices and high-net-worth individuals.

Current wording

Our client and investor base is broadly diversified by type, size and geography. Our client base ranges from those seeking to make an initial investment in private markets to some of the world’s largest and most sophisticated private markets investors. As we offer a highly customized, flexible service, we are equipped to provide investment services to institutional clients of all sizes and with different needs, internal resources and investment objectives. Our clients include prominent institutional investors in the United States, Canada, Europe, the Middle East, Asia, Australia and Latin America. We provide private markets solutions and services to some of the largest global pension, sovereign wealth and U.S. state pension funds, and believe we are a leading provider of private markets solutions for U.S. labor union pension plans. We also serve a growing number of smaller public and corporate pension plans, sovereign wealth funds, financial institutions and insurance companies, endowments and foundations, as well as family offices and high-net-worth individuals.

Previous wording

Our results of operations are affected by a variety of factors, including conditions in the global financial markets and the economic and political environments, particularly in the United States, Western Europe and Asia. As interest rates remain elevated in response to continued inflationary pressures and public equity volatility continues, leading to a wider range of equity returns, we see increasing investor demand for alternative investments to achieve higher and less correlated relative yields and returns on invested capital. As a result, some investors have increased their allocation to private markets relative to other asset classes. In addition, the opportunities in private markets have expanded as firms have created new vehicles and products in which to access private markets across different geographies and opportunity sets.

Current wording

Our results of operations are affected by a variety of factors, including conditions in the global financial markets and the economic and political environments, particularly in the United States, Western Europe and Asia. Interest rates remain elevated relative to recent historical levels, inflationary pressures have persisted and public equity volatility continues, contributing to a wider range of equity returns. Against this backdrop, we continue to see investor demand for alternative investments as investors seek attractive yield, return and diversification opportunities, and some investors have increased their allocation to private markets relative to other asset classes. In addition, the opportunities in private markets continue to expand as firms have created new vehicles and products in which to access private markets across different geographies and opportunity sets.

Previous wording

•Unpredictable, volatile and uncertain macroeconomic conditions. Global economic conditions, including political environments, financial market performance, tariff policies, interest rates, credit spreads or other conditions beyond our control, all of which affect the performance of the assets underlying private market investments, are unpredictable and could negatively affect the performance of our clients’ portfolios or the ability to raise funds in the future. Since early 2025, the United States and countries around the world have experienced elevated levels of market volatility and uncertainty driven principally by geopolitical and global trade concerns, including, in particular, the announcements of the imposition of tariffs by the United States on certain of its trading partners in April 2025 and retaliation by certain such trade partners. This volatility and uncertainty adds to the risks and uncertainties in the business environment in which we operate and may have various negative impacts on our business and results of operations, including with respect to decreased valuations of investments by our specialized funds and customized separate accounts, deployments, realizations, and fundraising activities.

Current wording

•Unpredictable, volatile and uncertain macroeconomic conditions. Global economic conditions, including political environments, financial market performance, tariff policies, interest rates, credit spreads or other conditions beyond our control, all of which affect the performance of the assets underlying private market investments, are unpredictable and could negatively affect the performance of our clients’ portfolios or the ability to raise funds in the future. The United States and countries around the world continue to experience elevated levels of market volatility and uncertainty driven in part by geopolitical conflicts and global trade concerns. This volatility and uncertainty adds to the risks and uncertainties in the business environment in which we operate and may have various negative impacts on our business and results of operations, including with respect to decreased valuations of investments by our specialized funds and customized separate accounts, deployments, realizations, and fundraising activities.

Previous wording

Management and advisory fees comprise specialized fund and customized separate account management fees, advisory and reporting fees and distribution management fees.

Current wording

Management and advisory fees comprise specialized fund and customized separate account management fees, advisory fees and reporting, monitoring data and analytic fees and distribution management fees.

Previous wording

Revenues from customized separate accounts are generally based on a contractual rate applied to committed capital or net invested capital under management. These fees often decrease over the life of the contract due to built-in declines in contractual rates and/or as a result of lower net invested capital balances as capital is returned to clients. In certain cases, we also provide advisory and/or reporting services, and, therefore, we also receive fees for services such as monitoring and reporting on a client’s existing private markets investments. In addition, we may provide for investments in our specialized funds as part of our customized separate accounts. In these cases, we generally reduce the asset-based and/or incentive fees on customized separate accounts to the extent that assets in the accounts are invested in our specialized funds so that our clients do not pay duplicate fees.

Current wording

Revenues from customized separate accounts are generally based on a contractual rate applied to committed capital, net invested capital and/or net asset value (“NAV”). These fees often decrease over the life of the contract due to built-in declines in contractual rates and/or as a result of lower net invested capital balances as capital is returned to clients. In certain cases, we also provide advisory and/or reporting services, and, therefore, we also receive fees for services such as monitoring and reporting on a client’s existing private markets investments. In addition, we may provide for investments in our specialized funds as part of our customized separate accounts. In these cases, we generally reduce the asset-based and/or incentive fees on customized separate accounts to the extent that assets in the accounts are invested in our specialized funds so that our clients do not pay duplicate fees.

Previous wording

Revenues from specialized funds are based on a percentage of limited partners’ capital commitments to, net invested capital or net asset value (“NAV”) in, our specialized funds. The management fee during the investment period is often charged on capital commitments and after the investment period (or a defined anniversary of the fund’s initial closing) is typically reduced by a percentage of the management fee for the preceding year or charged on net invested capital or NAV. In the case of certain funds, we charge management fees on capital commitments, with the management fee increasing during the early years of the fund’s term and declining in the later years. Management fees for certain funds are discounted based on the amount of the limited partners’ commitments, whether the limited partners commit early in the offering period or if the limited partners are investors in our other funds.

Current wording

Revenues from specialized funds are based on a percentage of limited partners’ capital commitments to, net invested capital or NAV in, our specialized funds. The management fee during the investment period is often charged on capital commitments and after the investment period (or a defined anniversary of the fund’s initial closing) is typically reduced by a percentage of the management fee for the preceding year or charged on net invested capital or NAV. In the case of certain funds, we charge management fees on capital commitments, with the management fee increasing during the early years of the fund’s term and declining in the later years. Management fees for certain funds are discounted based on the amount of the limited partners’ commitments, whether the limited partners commit early in the offering period or if the limited partners are investors in our other funds. Revenues from specialized funds that charge management fees during their fundraising periods include retroactive fees. Retroactive fees are management fees earned from investors that commit to a specialized fund after the first close of the fund and are required to pay a catch-up management fee as if they had committed to the fund at the first closing.

Previous wording

Incentive fees comprise carried interest earned from our specialized funds and certain customized separate accounts structured as single-client funds in which we have a general partner commitment, and performance fees earned on certain other specialized funds and customized separate accounts.

Current wording

Incentive fees comprise carried interest earned from our specialized funds and certain customized separate accounts structured as single-client funds in which we have a commitment, and performance fees earned on certain other specialized funds and customized separate accounts.

Previous wording

12.5%, subject to a compounded annual preferred return that is generally 6.0% to 8.0%. To the extent that our primary funds also directly make secondary investments and direct investments, they generally earn carried interest on a similar basis. Furthermore, certain of our primary funds earn carried interest on their investments in other private markets funds on a primary basis that is generally 5.0% of net profits, subject to the fund’s compounded annual preferred return. We recognize carried interest when it is probable that a significant reversal will not occur.

Current wording

For each of our secondary funds, direct investment funds, strategic opportunity funds and some of our evergreen funds, we generally earn carried interest equal to a fixed percentage of net profits, usually 10.0% to 12.5%, subject to a compounded annual preferred return that is generally 6.0% to 8.0%. To the extent that our primary funds also directly make secondary investments and direct investments, they generally earn carried interest on a similar basis. Furthermore, certain of our primary funds earn carried interest on their investments in other private markets funds on a primary basis that is generally 5.0% of net profits, subject to the fund’s compounded annual preferred return. We recognize carried interest when it is probable that a significant reversal will not occur.

Previous wording

General, administrative and other includes travel, accounting, legal and other professional fees, commissions, placement fees, office expenses, depreciation and other costs associated with our operations. Our occupancy-related costs and professional services expenses, in particular, generally increase or decrease in relative proportion to the number of our employees and the overall size and scale of our business operations.

Current wording

General, administrative and other includes travel, accounting, legal and other professional fees, commissions, placement fees, office expenses, depreciation, fund reimbursement expense and other costs associated with our operations. Our occupancy-related costs and professional services expenses, in particular, generally increase or decrease in relative proportion to the number of our employees and the overall size and scale of our business operations. Commissions and placement fees generally fluctuate based on the level and timing of fundraising activity, capital raised for our products and the extent to which we engage third-party placement agents and other distribution channels. Fund reimbursement expenses generally fluctuate in connection with the timing of new fund formations.

Previous wording

We have commitments in our specialized funds and certain customized separate accounts that invest solely in primary funds, secondary funds and direct investments, as well as those that invest across investment types. Equity in income (loss) of investees will increase or decrease as the change in underlying fund investment valuations increases or decreases. Since our direct investment funds invest in underlying portfolio companies, their quarterly and annual valuation changes are more affected by individual company movements than our primary and secondary funds that have exposures across multiple portfolio companies in underlying private markets funds. Our specialized funds and customized separate accounts invest across industries, strategies and geographies, and therefore our investments do not include any significant concentrations in a specific sector or area outside the United States.

Current wording

We have commitments in our specialized funds and certain customized separate accounts that invest solely in primary funds, secondary funds and direct investments, as well as those that invest across investment types. Equity in income of investees will increase or decrease as the change in underlying fund investment valuations increases or decreases. Since our direct investment funds invest in underlying portfolio companies, their quarterly and annual valuation changes are more affected by individual company movements than our primary and secondary funds that have exposures across multiple portfolio companies in underlying private markets funds. Our specialized funds and customized separate accounts invest across industries, strategies and geographies, and therefore our investments do not include any significant concentrations in a specific sector or area outside the United States.

Previous wording

Non-operating gain (loss)consists primarily of gains and losses on certain investments, changes in liability under the tax receivable agreement and other non-recurring or non-cash items.

Current wording

Non-operating gain (loss), netconsists primarily of gains and losses on certain investments, changes in liability under the tax receivable agreement and other non-recurring or non-cash items.

Previous wording

Other income (expense) of consolidated variable interest entities (“VIEs”)consists of earnings from funds in which consolidated general partners entities, that are not wholly-owned by us, have commitments as well as interest income, unrealized gains on investments and interest expense on consolidated funds.

Current wording

Other income (expense) of Consolidated Funds and Partnerships consists of earnings from consolidated funds and consolidated general partners entities, that are not wholly-owned by us, have commitments as well as interest income, unrealized gains on investments and interest expense on consolidated funds.

Previous wording

We are a corporation for U.S. federal income tax purposes and therefore are subject to U.S. federal and state income taxes on our share of taxable income generated by HLA. HLA is treated as a pass-through entity for U.S. federal and state income tax purposes. As such, income generated by HLA flows through to its limited partners, including us, and is generally not subject to U.S. federal or state income tax at the partnership level. Our non-U.S. subsidiaries generally operate as corporate entities in non-U.S. jurisdictions, with certain of these entities subject to non-U.S. income taxes. Additionally, certain of our subsidiaries are subject to local jurisdiction income taxes at the entity level. Accordingly, the tax liability with respect to income attributable to non-controlling interests (“NCI”) in HLA is borne by the holders of such NCI.

Current wording

We are a corporation for U.S. federal income tax purposes and therefore are subject to U.S. federal and state income taxes on our share of taxable income generated by HLA. HLA is treated as a pass-through entity for U.S. federal and state income tax purposes. As such, income generated by HLA flows through to its members and is generally not subject to U.S. federal or state income tax at the partnership level. Accordingly, the tax liability with respect to income attributable to non-controlling interests (“NCI”) in HLA is generally borne by the holders of such NCI. Our non-U.S. subsidiaries generally operate as corporate entities in non-U.S. jurisdictions and are subject to non-U.S. income taxes.

Previous wording

Fee-earning AUM is a metric we use to measure the assets from which we earn management fees. Our fee-earning AUM comprise assets in our customized separate accounts and specialized funds from which we derive management fees that are generally derived from applying a certain percentage to the appropriate fee base. We classify customized separate account revenue as management fees if the client is charged an asset-based fee, which includes the majority of our discretionary AUM accounts but also includes certain non-discretionary AUA accounts. Our fee-earning AUM is equal to the amount of capital commitments, net invested capital and NAV of our customized separate accounts and specialized funds depending on the fee terms. The vast majority of our customized separate accounts and specialized funds earn fees based on commitments or net invested capital, which are not affected by market appreciation or depreciation. Therefore, revenues and fee-earning AUM are not significantly affected by changes in market value.

Current wording

Fee-earning AUM is a metric we use to measure the assets from which we earn management fees. Our fee-earning AUM comprise assets in our customized separate accounts and specialized funds from which we derive management fees that are generally derived from applying a certain percentage to the appropriate fee base. We classify customized separate account revenue as management fees if the client is charged an asset-based fee, which includes the majority of our discretionary AUM accounts but also includes certain non-discretionary AUA accounts. Our fee-earning AUM is equal to the amount of capital commitments, net invested capital and NAV of our customized separate accounts and specialized funds depending on the fee terms. A substantial portion of our customized separate accounts and specialized funds earn management fees based on capital commitments or net invested capital, which are generally not affected by short‑term market appreciation or depreciation. However, certain of our products, earn management fees based on NAV, and accordingly, management fees and fee‑earning AUM for those products may be affected by changes in market valuations. As a result, the extent to which our revenues and fee‑earning AUM are affected by changes in market value varies based on the mix of fee structures across our products.

Previous wording

Total revenues increased $158.3 million for fiscal 2025 compared to fiscal 2024, due to increases in management and advisory fees and incentive fees.

Current wording

Total revenues increased $42.6 million for fiscal 2026 compared to fiscal 2025, due to an increase in management and advisory fees, partially offset by a decrease in incentive fees.

Previous wording

Management and advisory fees increased $61.9 million for fiscal 2025 compared to fiscal 2024. Specialized funds revenue increased by $54.2 million compared to the prior year, due primarily to increases of $52.1 million in revenue from our evergreen funds and $10.6 million in revenue from our latest secondary fund, which added $4.1 billion and $1.2 billion, respectively, in fee-earning AUM year-over-year. Revenue from our latest secondary fund included $20.7 million in retroactive fees during fiscal 2025 compared to $19.6 million during fiscal 2024. Retroactive fees are management fees earned from investors that commit to a specialized fund after the first closing of the fund and are required to pay a catch-up management fee as if they had committed to the fund at the first closing in a prior period. Revenue from our specialized funds was partially offset by a decrease of $10.3 million from contractual step downs and funds reaching the end of their term. Customized separate accounts revenue increased $5.6 million compared to the prior year due primarily to a $1.8 billion increase in fee-earning AUM from the addition of new accounts, additional allocations from existing accounts and continued investment activity during the fiscal year. Reporting, monitoring, data and analytics revenue increased $4.5 million compared to the prior year due primarily to increased Cobalt LP subscriptions during fiscal 2025. Fund reimbursement revenue increased by $1.5 million compared to the prior year attributed primarily to the timing of newly created funds. Distribution management revenue decreased $2.4 million in fiscal 2025 compared to the prior year due to decreased stock distribution activity from investments held by clients that are managed by us.

Current wording

Management and advisory fees increased $70.4 million for fiscal 2026 compared to fiscal 2025. Specialized funds revenue increased by $59.2 million compared to the prior year, due primarily to increases of $72.1 million in revenue from our evergreen funds and $11.9 million in revenue from our latest direct equity fund which added $7.1 billion and $0.9 billion, respectively, in fee-earning AUM year-over-year. Revenue from our specialized funds was partially offset by $20.7 million of retroactive fees from our latest secondary fund recognized during fiscal 2025 compared to $3.3 million from our latest direct equity fund during fiscal 2026. Customized separate accounts revenue increased $7.1 million compared to the prior year due primarily to a $1.6 billion increase in fee-earning AUM from the addition of new accounts, additional allocations from existing accounts and continued investment activity during the fiscal year. Reporting, monitoring, data and analytics revenue increased $6.5 million compared to the prior year due primarily to increased Cobalt LP subscriptions during fiscal 2026. Advisory revenue decreased $2.3 million in fiscal 2026 compared to the prior year due primarily to advisory agreements reaching the end of their term.

Previous wording

Total expenses increased $88.0 million for fiscal 2025 compared to fiscal 2024, due to increases in both compensation and benefits expenses and general, administrative and other expenses.

Current wording

Total expenses increased $36.2 million for fiscal 2026 compared to fiscal 2025, due to increases in both compensation and benefits expenses and general, administrative and other expenses.

Previous wording

Compensation and benefits expenses increased $70.5 million for fiscal 2025 compared to fiscal 2024. Base compensation and benefits increased $41.8 million for fiscal 2025 compared to fiscal 2024, due primarily to an increase in salary expense from additional headcount and an increase in our bonus plan accrual. Equity-based compensation increased $19.3 million in fiscal 2025 compared to fiscal 2024, driven primarily by the performance awards granted during fiscal 2025. Incentive fee compensation increased $9.4 million for fiscal 2025 compared to fiscal 2024 due to an increase in incentive fee revenue in fiscal 2025.

Current wording

Compensation and benefits expenses increased $25.1 million for fiscal 2026 compared to fiscal 2025. Base compensation and benefits increased $20.4 million for fiscal 2026 compared to fiscal 2025, due primarily to an increase in salary expense from additional headcount and an increase in our bonus plan accrual related to stronger operating performance compared to the prior fiscal year. Equity-based compensation increased $19.5 million in fiscal 2026 compared to fiscal 2025, driven primarily by the performance awards granted during fiscal 2025. Incentive fee compensation decreased $14.8 million for fiscal 2026 compared to fiscal 2025 due to a decrease in incentive fee revenue in fiscal 2026.

Previous wording

General, administrative and other expenses increased $17.5 million for fiscal 2025 compared to fiscal 2024. This change consisted primarily of an increase of $4.2 million in fund reimbursement expense attributed to the timing of newly created funds, an increase of $4.1 million in consulting and professional fees, an increase of $2.7 million in third-party commissions primarily attributed to the increase in gross subscriptions to our evergreen funds, an increase of$1.9 million in conference and marketing expenses and an increase of$1.3 million in expenses relating to our leased office space.

Current wording

General, administrative and other expenses increased $11.1 million for fiscal 2026 compared to fiscal 2025. This change consisted primarily of an increase of $5.6 million in consulting and professional fees, an increase of $3.8 million in third-party commissions attributed to the increase in gross subscriptions to our evergreen funds and increases in fundraising activity on our drawdown funds.

Previous wording

Other income (expense) increased $5.4 million for fiscal 2025 compared to fiscal 2024, due primarily to an increase in non-operating gain (loss), partially offset by a decrease in equity in income of investees.

Current wording

Other income (expense) increased $18.5 million for fiscal 2026 compared to fiscal 2025, due primarily to an increase in equity in income of investees, partially offset by a decrease in non-operating gain (loss).

Previous wording

Equity in income of investees decreased $5.9 million for fiscal 2025 compared to fiscal 2024 due primarily to relatively smaller increases in investment valuations due to market conditions in fiscal 2025.

Current wording

Equity in income of investees increased $22.9 million for fiscal 2026 compared to fiscal 2025 due primarily to larger increases in investment valuations due to market conditions in fiscal 2026.

Previous wording

Non-operating gain (loss) increased $10.9 million for fiscal 2025 compared to fiscal 2024, due primarily to the recognition of $10.8 million of gains on our technology investments compared to negative fair value adjustments in the prior year, partially offset by the recognition of $2.1 million in tax receivable agreement expense in fiscal 2025.

Current wording

Non-operating gain (loss), net decreased $6.0 million for fiscal 2026 compared to fiscal 2025, due primarily to the recognition of $10.8 million of gains on our technology investments in fiscal 2025 that did not recur in fiscal 2026, partially offset by a decrease in our liability under the tax receivable agreement in fiscal 2026.

Previous wording

The following table shows the results of operations of consolidated VIEs:

Current wording

The following table shows the results of operations of Consolidated Funds and Partnerships:

Previous wording

Our effective income tax rate in fiscal 2025 and 2024 was 13.4% and 19.3%, respectively. The fiscal 2025 effective income tax rate was different from the statutory tax rate due primarily to the portion of income allocated to NCI and a reduction in valuation allowance recorded against deferred tax assets. The effective income tax rate for fiscal 2025 was less than fiscal 2024 due primarily to less valuation allowance recorded against deferred tax assets in fiscal 2025.

Current wording

Our effective income tax rate in fiscal 2026 and 2025 was 16.3% and 13.4%, respectively. The fiscal 2026 effective income tax rate was different from the statutory tax rate primarily due to the portion of income allocated to NCI and change in valuation allowance recorded against deferred tax assets . The effective income tax rate for fiscal 2026 was higher than fiscal 2025 primarily due to changes in the valuation allowance recorded against deferred tax assets in fiscal 2025.

Previous wording

Net income attributable to NCI increased by $10.0 million in fiscal 2025 compared to fiscal 2024, due primarily to increases in overall net income.

Current wording

Net income attributable to NCI increased by $42.2 million in fiscal 2026 compared to fiscal 2025, due primarily to increases in overall net income.

Previous wording

Net income attributable to NCI in Hamilton Lane Advisors, L.L.C. increased by $12.0 million due primarily to an overall increase in net income, partially offset by a decrease in NCI holders’ economic ownership percentage of Hamilton Lane Advisors, L.L.C. between periods.

Current wording

Net income attributable to NCI in HLA increased by $1.5 million due primarily to an overall increase in net income.

Previous wording

Fee-earning AUM increased $6.3 billion for fiscal 2025 compared to fiscal 2024 due to contributions from customized separate accounts and specialized funds.

Current wording

Fee-earning AUM increased $9.5 billion for fiscal 2026 compared to fiscal 2025 due to contributions from customized separate accounts and specialized funds.

Previous wording

Customized separate accounts fee-earning AUM increased $1.8 billion for fiscal 2025 compared to fiscal 2024. Customized separate accounts contributions were $6.7 billion for fiscal 2025 due primarily to new allocations from existing clients and the addition of new clients. Distributions were $4.9 billion for fiscal 2025 due primarily to $1.9 billion from accounts moving from a committed to net invested capital fee base, $1.8 billion from returns of capital in accounts earning fees on a net invested capital or NAV fee base, and $1.2 billion from accounts reaching the end of their fund term.

Current wording

Customized separate accounts fee-earning AUM increased $1.6 billion for fiscal 2026 compared to fiscal 2025. Customized separate accounts contributions were $6.2 billion for fiscal 2026 due primarily to new allocations from existing clients. Distributions were $5.0 billion for fiscal 2026 due primarily to $2.0 billion from returns of capital in accounts earning fees on a net invested capital or NAV fee base, $1.6 billion from accounts reaching the end of their fund term and $1.4 billion from accounts moving from a committed to net invested capital fee base.

Previous wording

Specialized funds fee-earning AUM increased $4.5 billion for fiscal 2025 compared to fiscal 2024. Specialized fund contributions were $7.1 billion for fiscal 2025, due primarily to $4.2 billion from our evergreen funds and $1.2 billion from our latest secondary fund. Distributions were $3.3 billion for fiscal 2025, due primarily to $2.0 billion from returns of capital and redemptions in funds earning fees on a net invested capital or NAV fee base and $1.1 billion from accounts reaching the end of their fund term.

Current wording

Specialized funds fee-earning AUM increased $7.9 billion for fiscal 2026 compared to fiscal 2025. Specialized fund contributions were $8.8 billion for fiscal 2026, due primarily to $6.6 billion from our evergreen funds. Distributions were $2.6 billion for fiscal 2026, due primarily to $2.0 billion from returns of capital and redemptions in funds earning fees on a net invested capital or NAV fee base and $0.5 billion from accounts reaching the end of their fund term.

Previous wording

Fee Related Earnings (“FRE”) is used to highlight earnings from revenues that are measured and received on a recurring basis. FRE represents net income excluding (a) incentive fees, net of fee related performance revenues, and related compensation, (b) equity-based compensation, (c) interest income and expense, (d) income tax expense, (e) equity in income of investees, (f) non-operating gain (loss) and (g) certain other significant items that we believe are not indicative of our core performance. We believe FRE is useful to investors because it provides additional insight into the operating profitability of our business. FRE is presented before income taxes.

Current wording

Fee Related Earnings (“FRE”) is used to highlight earnings from revenues that are measured and received on a recurring basis. FRE represents net income excluding (a) incentive fees, net of fee related performance revenues, and related compensation, (b) equity-based compensation, (c) interest income and expense, (d) income tax expense, (e) equity in income of investees, (f) non-operating gain (loss), net and (g) certain other significant items that we believe are not indicative of our core performance. We believe FRE is useful to investors because it provides additional insight into the operating profitability of our business. FRE is presented before income taxes.

Previous wording

Fee related performance revenues (“FRPR”) are incentive fees expected to be measured and received from certain of our funds on a recurring basis and are not dependent on realization events of the fund’s underlying investments. We believe FRPR is useful to investors because it provides additional insight into our recurring revenues.

Current wording

Fee related performance revenues (“FRPR”) are incentive fees expected to be measured and received from certain of our funds on a recurring basis and are not dependent on realization events of the fund’s underlying investments. FRPR includes incentive fees earned from Consolidated Funds that are eliminated under GAAP. We believe FRPR is useful to investors because it provides additional insight into our recurring revenues.

Previous wording

Beginning in the fourth quarter of fiscal 2025, the Company modified its definition of FRE to exclude equity-based compensation and include FRPR. Equity-based compensation is non-cash compensation provided to retain employees and align employee and shareholder interest. It is not directly correlated with our operating results. Fee related performance revenues are expected to be received on a recurring basis depending upon performance of certain funds that pay incentive fees on a high-water mark basis. We believe that reporting non-GAAP results inclusive of these changes provides a supplemental view of our ongoing performance that is useful and relevant to our investors. As a result of the change, prior period amounts have been recast to reflect the updated presentation.

Current wording

Beginning in the fourth quarter of fiscal 2025, we modified our definition of FRE to exclude equity-based compensation and include FRPR. Equity-based compensation is non-cash compensation provided to retain employees and align employee and stockholder interest. It is not directly correlated with our operating results. FRPR is expected to be received on a recurring basis depending upon performance of certain funds that pay incentive fees on a high-water mark basis. We believe that reporting non-GAAP results inclusive of these changes provides a supplemental view of our ongoing performance that is useful and relevant to our investors. As a result of the change, prior period amounts have been recast to reflect the updated presentation.

Previous wording

Adjusted EBITDA is an internal measure of profitability. We believe Adjusted EBITDA is useful to investors because it enables them to better evaluate the performance of our core business across reporting periods. Adjusted EBITDA represents net income excluding (a) interest expense on our outstanding debt, (b) income tax expense, (c) depreciation and amortization expense, (d) equity-based compensation expense, (e ) non-operating (loss) gain and (f) certain other significant items that we believe are not indicative of our core performance.

Current wording

Adjusted EBITDA is an internal measure of profitability. We believe Adjusted EBITDA is useful to investors because it enables them to better evaluate the performance of our core business across reporting periods. Adjusted EBITDA represents net income excluding (a) interest expense on our outstanding debt, (b) income tax expense, (c) depreciation and amortization expense, (d) equity-based compensation expense, (e) non-operating gain, net and (f) certain other significant items that we believe are not indicative of our core performance. Adjusted EBITDA also includes FRPR related to Consolidated Funds and management fees related to Consolidated Funds.

Previous wording

(1) Incentive fee related compensation includes incentive fee compensation expense and bonus related to carried interest that is classified as base compensation.

Current wording

(1)Incentive fee related compensation includes incentive fee compensation expense and bonus related to carried interest that is classified as base compensation.

Previous wording

(1) For the year ended March 31, 2025, represents corporate income taxes at our estimated statutory tax rate of 23.7% applied to adjusted pre-tax net income. The 23.7% is based on a federal tax statutory rate of 21.0% and a combined state income tax rate net of federal benefits of 2.70%. The year ended March 31, 2024 represents corporate income taxes at our estimated statutory tax rate of 23.4% applied to adjusted pre-tax net income. The 23.4% is based on a federal tax statutory rate of 21.0% and a combined state income tax rate net of federal benefits of 2.4%. The year ended March 31, 2023 represents corporate income taxes at our estimated statutory tax rate of 23.8% applied to adjusted pre-tax net income. The 23.8% is based on a federal tax statutory rate of 21.0% and a combined state income tax rate net of federal benefits of 2.8%.

Current wording

(1) For the years ended March 31, 2026, 2025, and 2024, represents corporate income taxes at our estimated statutory tax rate of 23.3%, 23.7%, and 23.4% respectively, applied to adjusted pre-tax income. The estimated statutory tax rates are based on federal statutory tax rate of 21.0% and a combined state income tax rate of 2.3%, 2.7%, and 2.4%, respectively.

Previous wording

(2) Assumes the full exchange of Class B and Class C units in HLA for Class A common stock of HLI pursuant to the exchange agreement. For the year ended March 31, 2024, and 2023, the full exchange of Class B and Class C units is already included within the GAAP weighted-average shares of Class A common stock outstanding - diluted.

Current wording

(2) Assumes the full exchange of Class B and Class C units in HLA for Class A common stock of HLI pursuant to the exchange agreement. For the years ended March 31, 2026 and 2024, the full exchange of Class B and Class C units is already included within the GAAP weighted-average shares of Class A common stock outstanding - diluted.