PRICE T ROWE GROUP INC
For the period ended Dec 31, 2025. Filed Feb 13, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 13, 2026
TROW$108.41-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-14.
0001113169-25-000007
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-13.
0001628280-26-008002
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 176 previous paragraphs and 183 current paragraphs.
64 unchanged; 78 reworded; 39 added; 30 removed; 4 previous and 2 current paragraphs rearranged.
Tables are not compared: 22 previous and 22 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (39)
Current report
In 2025, we took several steps to execute on this plan, including targeted role eliminations, outsourcing and expanding some of our technology capabilities through trusted vendor partnerships, and the decision to exit certain owned buildings with plans to dispose of the properties in 2026.
Current report
The impact of these actions has been recorded as a restructuring charge in the consolidated statements of income and is discussed later in Item 7. and Item 8. These measures also help offset ongoing inflationary pressures on compensation and contractual spending. Our strategic investments include hiring investment and distribution professionals, adopting new technologies, offering new products, and growing and diversifying our business through innovative global partnerships.
Current report
Major U.S. stock market indices rose in 2025. After a challenging start to 2025 stemming from new U.S. tariff and trade policies, equities advanced starting in April, as the U.S. and China made efforts to improve their trade relationship, economic growth and corporate earnings remained favorable, investors favored artificial intelligence-related businesses and other high-growth companies, and Congress passed tax legislation that should provide some fiscal stimulus to the economy. In addition, signs of a weakening labor market in the latter part of the year prompted the Federal Reserve to reduce short-term interest rates, despite continued elevated inflation. The central bank lowered rates in September, October, and December.
Current report
Developed non-U.S. equity markets outperformed U.S. stocks in U.S. dollar terms, helped by a weaker dollar versus major non-U.S. currencies. In Europe, equity markets were mostly positive in dollar terms. Stocks in Spain and Austria fared best, surging 80%, while equities in Finland, Ireland, and Italy advanced close to 60%. UK stocks rose 35%. Developed Asian markets were also mostly positive with stocks in Hong Kong climbing 35% and Japanese stocks rising 25%.
Current report
Stocks in emerging markets outperformed equities in developed markets in U.S. dollar terms. In the emerging Asian, Latin American, and the emerging Europe, Middle East, and Africa (EMEA) regions, markets were mostly positive.
Current report
Global bond returns were positive in 2025. In the U.S., Treasury bill yields, which tend to track the federal funds target rate, declined about 70 basis points (0.70%) for the year, as the Federal Reserve reduced the federal funds target rate by 25 basis points (0.25%) three times in the final months of the year. At the end of the year, the federal funds target rate was in the 3.50% to 3.75% range. Short- and intermediate-term U.S. Treasury yields had a comparable decline, but the 10-year U.S. Treasury note yield fell 40 basis points (0.40%), from 4.58% to 4.18%. The 30-year U.S. Treasury bond yield rose modestly for the year.
Current report
Bonds in developed non-U.S. markets produced positive returns in U.S. dollar terms, helped by a weaker dollar versus major non-U.S. currencies. In the eurozone, longer-term bond yields increased in many countries, though policymakers for the European Central Bank reduced short-term interest rates four times in the first half of 2025. In the UK, longer-term bond yields fell slightly for the year, as the Bank of England reduced the Bank Rate by 25 basis points (0.25%) four times in 2025. The euro strengthened more than 13% versus the U.S. dollar, while the British pound rose more than 7%. In Japan, long-term government bond yields climbed as the Bank of Japan raised its benchmark interest rate to 0.50% in January and to 0.75% in December. Bond yields were also pressured higher by late-year concerns that new Prime Minister Sanae Takaichi will pursue aggressive fiscal stimulus funded by debt issuance. The yen rose marginally versus the dollar.
Current report
Emerging markets bonds produced strong positive returns in U.S. dollar terms. Bonds denominated in local currencies generally outperformed dollar-denominated bonds, as many emerging markets currencies appreciated versus the dollar, boosting returns to U.S. investors.
Current report
ASSETS UNDER MANAGEMENT.(1)
Current report
(1)Includes assets in which T. Rowe Price and its affiliates have full discretionary authority and, beginning in 2025, managed account - model delivery assets.
Current report
(5)Amount represents the net assets as of July 1, 2025 and all activity for the second half of 2025 is presented in the lines that follow.
Current report
Our multi-asset investment division provides advisory solutions that include investment insights, strategic asset allocation design, tactical asset allocation recommendations, and portfolio rebalancing services. The assets in these solutions, predominantly in the United States, were $27.8 billion at December 31, 2025, compared with $8.0 billion at December 31, 2024.
Current report
INVESTMENT PERFORMANCE.(1)
Current report
(1)n/m - the percentage change is not meaningful.
Current report
(3)See the reconciliation to the comparable U.S. GAAP measures at the end of the Results of Operations section of this Management's Discussion and Analysis.
Current report
Net revenues consist of investment advisory revenues; performance-based advisory fees; administrative, distribution, services, and other fees; and capital allocation-based income. More than 90% of our net revenues are related to investment advisory fees. Total net revenues were $7,314.8 million in 2025, a 3.1% increase compared to $7,093.6 million in 2024. The increase was driven primarily by higher investment advisory fees on higher average assets under management, as well as higher capital allocation-based income, which was partially offset by lower performance-based advisory fees.
Current report
The average annualized effective fee rate earned for 2025 declined from 2024 primarily due to client flows and transfers shifting assets under management toward lower-fee strategies and products, partially offset by market appreciation.
Current report
Capital allocation-based income will fluctuate quarter-to-quarter to reflect the adjustment to accrued carried interest for the change in value of certain affiliated funds assuming the funds’ underlying investments were realized as of the end of the period.
Current report
Operating expenses on a U.S. GAAP basis were $5,126.0 million in 2025, an increase of 7.7% compared to $4,760.3 million in 2024. On a non-GAAP basis, operating expenses were $4,666.5 million, an increase of 3.7% compared to $4,498.8 million in 2024.
Current report
Compared to 2024, the increase in U.S. GAAP operating expenses was primarily due to the restructuring charge as well as higher technology and facility costs, compensation and related costs, and distribution and servicing costs. These increases were partially offset by lower advertising and promotion costs. The drivers of the increase in non-GAAP operating expenses were the same as those for the increase in U.S. GAAP operating expenses with the exception of the restructuring charge, which is excluded from our non-GAAP operating expenses measures.
Current report
Operating margin was 29.9% in 2025 compared to 32.9% in 2024. The decrease is primarily driven by the restructuring charge recognized in 2025, which largely contributed to operating expense growth exceeding net revenue growth.
Current report
Diluted earnings per share was $9.24 in 2025 compared to $9.15 in 2024. The increase in GAAP basis diluted earnings per share was primarily due to higher non-operating income and fewer outstanding shares, partially offset by lower operating income.
Current report
On a non-GAAP basis, diluted earnings per share was $9.72 in 2025 compared to $9.33 in 2024. The increase was primarily due to fewer outstanding shares and higher net income.
Current report
Capital allocation-based income includes the change in accrued carried interest along with acquisition-related amortization and impairments. For 2025, the change in accrued carried interest increased net revenues by $149.5 million compared to $134.1 million for 2024. The year‑over‑year change reflects relative performance and market impacts between 2025 and 2024. Additionally, the decrease in acquisition-related amortization and impairments for 2025 compared to 2024 period was primarily due to higher impairments recognized in 2024.The firm realized carried interest of $117.8 million compared to $139.6 million in 2024.
Current report
Administrative, distribution, services, and other fees in 2025 were $593.9 million, an increase of $5.9 million compared to 2024. The increase was primarily driven by higher recordkeeping and transfer agent servicing activities provided to the T. Rowe Price mutual funds. Beginning in the third quarter of 2025, revenue from managed account model delivery assets and certain other advisory services is reported in investment advisory fees. This change muted the increases mentioned above, as more than $28 million of revenue in the second half of 2025 is now reported in investment advisory fees.
Current report
(1)n/m - The percentage change is not meaningful.
Current report
(2)Capital allocation-based income compensation represents the change in accrued carried interest compensation along with acquisition-related, non-cash amortization and impairments.
Current report
(3)See the reconciliation to the comparable U.S. GAAP measures at the end of the Results of Operations section of this Management's Discussion and Analysis.
Current report
Compensation, benefits, and related costs were $2,644.3 million for 2025, an increase of $40.9 million, or 1.6%, compared to 2024. The increase was driven by higher salaries, benefits and long-term incentive compensation. These increases were partially offset by lower temporary personnel costs, net of capitalized labor, and other employee-related costs. The firm employed 7,773 associates at December 31, 2025, a decrease of 4.7% from the end of 2024. The average headcount for first half of 2025 was 8,089, an increase of 2.5% compared to the first half of 2024. Additionally, the average headcount for 2025 was 7,969, a decrease of 0.2% compared to 2024. The decrease in associates from 2024 was primarily driven by the workforce action in July 2025 as part of our broad plan to reduce expense growth and realign resources.
Current report
Advertising and promotion costs were $107.4 million for 2025, a decrease of $22.2 million, or 17.1%, compared to 2024. The decrease was primarily driven by lower media spending from the absence of the prior year’s elevated media costs related to a specific campaign and broader marketing initiatives.
Current report
Product and recordkeeping related costs were $312.9 million for 2025, an increase of $15.4 million, or 5.2%, compared to 2024. The increase was primarily driven by higher recordkeeping related costs and higher custody fees related to our trust products from higher assets under management.
Current report
Technology, occupancy, and facility costs were $723.6 million for 2025, an increase of $79.5 million or 12.3%, compared to 2024. The increase was driven by higher technology-related costs, including hosted solutions and depreciation, as well as higher occupancy and facility costs related to our new corporate headquarters, which we began occupying in March 2025.
Current report
General, administrative, and other expenses were $441.9 million for 2025, an increase of $8.1 million or 1.9%, compared to 2024. The increase was primarily driven by higher charitable contributions and other general and administrative costs, partially offset by lower travel-related expenses and lower external research fees.
Current report
Acquisition-related amortization and impairment costs primarily relate to the indefinite- and definite-lived intangible assets identified and separately recognized, at fair value, on acquisition date. In 2025, we recognized acquisition-related amortization and impairment costs of $111.3 million, a decrease of $45.4 million or 29.0%, compared to 2024. The decline was largely due to impairment charges recorded in 2024 for the trade name intangible asset that did not recur in 2025, as well as lower amortization expense resulting from the reduced carrying amount of our definite‑lived intangible asset base.
Current report
Restructuring charge of $177.3 million for 2025 relates to actions taken under our previously announced broad and ongoing expense management program, which is designed to reduce expense growth and realign resources to support investment in existing and future capabilities. The charge includes accelerated depreciation and impairment charges related to certain owned real estate of $127.3 million as well as compensation‑related costs, primarily severance.
Current report
Higher average cash balances increased dividend income in 2025 despite declining money-fund yields from 2024 and 2023. Market returns remained positive, contributing to continued gains within our investment portfolio.
Current report
Our effective tax rate for 2025 was 23.2%, compared to 24.3% for 2024 and 26.3% for 2023. The decrease in our effective tax rate in 2025 from 2024 was primarily due to lower state taxes resulting from prior period settlements. Additionally, the impact of redeemable non-controlling interest contributed to the lower U.S. GAAP effective tax rate compared to 2024.
Current report
(3) This non-GAAP adjustment removes accelerated depreciation and impairment charges related to certain owned real estate, as well as compensation expenses, primarily severance, resulting from actions taken as part of our broad and ongoing plan to reduce expense growth and realign resources to invest in existing and future capabilities. We believe this adjustment helps the reader’s ability to understand our core operating results and increases comparability period to period.
Removed paragraphs (30)
Previous report
U.S. stocks produced strong gains for the second consecutive year in 2024, and various equity indexes reached new all-time highs during the year. The equity market was buoyed by generally favorable corporate earnings and by continuing interest in companies expected to benefit from AI developments. Although inflation remained above the Federal Reserve’s long-term 2% target, the central bank shifted its focus toward the moderating labor market in the second half of the year and began reducing interest rates starting in September. In the final months of the year, equity investors generally welcomed not only looser monetary policy, but also diminished political uncertainty following U.S. elections in early November. Market volatility increased, however, as investors curtailed their expectations for short-term interest rate cuts in 2025.
Previous report
Developed non-U.S. equity markets were mostly positive in 2024, helped by looser monetary policies from various central banks around the world. However, returns to U.S. investors were hurt by a stronger dollar versus major non-U.S. currencies. In Europe, equity markets were widely mixed in U.S. dollar terms, whereas developed Asian markets were mostly positive.
Previous report
Emerging equity markets generally appreciated and outperformed stocks in developed non-U.S. markets in U.S. dollar terms. Emerging Asian markets were mostly positive in dollar terms, though South Korean stocks fell sharply due in large part to late-year political turmoil. Equities in the emerging Europe, Middle East, and Africa (EMEA) region were also mostly positive. In Latin America, stocks in regional heavyweights Brazil and Mexico fell sharply, though some smaller markets produced positive returns.
Previous report
Global bond returns were mostly positive in 2024, as many central banks around the world reduced short-term interest rates due to easing inflation pressures. In the U.S., Treasury bill yields declined as the Federal Reserve reduced the federal funds target rate by 100 basis points (1.00%) in three steps starting in mid-September. Intermediate- and long-term U.S. Treasury yields fluctuated throughout the year, but ultimately increased for the year amid expectations for fewer interest rate cuts in 2025 due to inflation remaining above the Federal Reserve’s 2% long-term goal. The 10-year U.S. Treasury note yield was 4.58% at December 31, 2024 compared to 3.88% at December 31, 2023 .
Previous report
Bonds in developed non-U.S. markets produced negative returns in U.S. dollar terms due to weaker currencies versus the dollar and rising bond yields in some countries. Easing inflation pressures enabled central banks in Europe and the UK to reduce interest rates a few times. In Japan, longer-term interest rates rose as the Bank of Japan increased short-term rates in March, ending a multi-year period of negative interest rates. The Bank of Japan also unexpectedly raised rates at the end of July. In the emerging markets fixed income universe, dollar-denominated bonds produced gains in U.S. dollar terms, but local currency bonds produced negative returns, as most developing markets currencies declined versus the dollar.
Previous report
ASSETS UNDER MANAGEMENT.
Previous report
We provide strategic investment advice solutions for certain portfolios. These advice solutions, the vast majority of which are overseen by our multi-asset division, may include strategic asset allocation, and in certain portfolios, asset selection and/or tactical asset allocation overlays. We also offer advice solutions through retail separately managed accounts and separately managed accounts model delivery. As of December 31, 2024, total assets in these solutions were $557 billion, of which $542 billion are reported in assets under management in the tables above.
Previous report
INVESTMENT PERFORMANCE(1).
Previous report
(1)The percentage change is not meaningful (n/m).
Previous report
(2) Performance-based advisory fees were previously included in investment advisory fees. Prior periods were recast to reflect this change.
Previous report
(4)See the reconciliation to the comparable U.S. GAAP measures at the end of the Results of Operations section of this Management's Discussion and Analysis.
Previous report
Investment advisory fees earned in 2023 decreased 3.7% over the comparable 2022 period as average assets under our management decreased $36.1 billion, or 2.6%, to $1,362.3 billion.
Previous report
Operating expenses were $4,474.3 million in 2023, an increase of 8.7% over the comparable 2022 period. The impact of market movements on the supplemental savings plan liability accounted for about 70% of the increase in U.S. GAAP operating expenses. Non-operating income has a corresponding increase due to our economic hedge of the liability.
Previous report
On a non-GAAP basis, operating expenses were $4,260.7 million, a 4.2% increase over the comparable 2022 period. The increase in our non-GAAP operating expenses was primarily driven by higher costs across compensation and benefits, accrued carried interest related compensation expense, technology, facility, advertising, and professional fees. These increases were offset in part by higher capitalized labor, lower stock-based compensation, and a non-recurring recovery of general and administrative costs incurred in 2022.
Previous report
Operating margin was 30.7% in 2023, compared to 36.6% in 2022. The decrease in our operating margin in 2023 compared to 2022 is primarily driven by a decrease in investment advisory fees as a result of lower average assets under management and higher operating expenses.
Previous report
Diluted earnings per share. Diluted earnings per share was $7.76 in 2023 compared to $6.70 in 2022. The increase in 2023 GAAP basis diluted earnings per share from 2022 was primarily due to net investment income in 2023 compared to net investment losses in 2022. These increases were partially offset by lower operating income and a higher effective tax rate.
Previous report
On a non-GAAP basis, diluted earnings per share was $7.59 in 2023 compared to $8.02 in 2022. The decrease in 2023 was primarily due to lower operating income and a higher effective tax rate. These decreases were offset by net investment income earned on our cash and discretionary investment portfolio in 2023 compared to net investment losses in 2022.
Previous report
(2)Performance-based advisory fees were previously included in investment advisory fees. Prior periods were recast to reflect this change.
Previous report
In 2023, the decline in overall advisory revenues was driven by lower average AUM and a mix shift toward lower fee asset classes and vehicles. A lower starting AUM and net outflows in 2023 were the primary drivers of a lower average AUM in 2023. These impacts were partially offset by stronger overall market returns in 2023.
Previous report
For 2023, capital allocation-based income increased net revenues by $161.9 million. This amount includes an increase of $223.2 million in accrued carried interest, partially offset by $61.3 million of non-cash amortization and impairments related to the difference in the acquisition closing date fair value and the carrying value on the date they were acquired.
Previous report
For 2023, the decrease was primarily driven by lower transfer agent servicing activities provided to the T. Rowe Price mutual funds, and lower 12b-1 revenue earned from the Advisor and R share classes of the U.S. mutual funds as a result of lower average assets under management in these share classes. The decrease in 12b-1 revenue was offset entirely by a decrease in the costs paid to third-party intermediaries that source these assets and is reported in distribution and servicing expense.
Previous report
For 2023, compensation, benefits and related costs were $2,450.7 million, an increase of $44.9 million, or 1.9%, compared to 2022. The increase was driven by $99.1 million in higher salaries and related benefits as a result of base salary increases in January 2023 and July 2022. These increases were offset by higher capitalized labor, lower non-cash stock-based compensation, and lower other employee-related costs.
Previous report
For 2023, distribution and services costs were $289.9 million, a decrease of $11.6 million, or 3.8%, compared to 2022. The decrease was primarily driven by lower average assets under management in certain share classes of the U.S. mutual funds that earn 12b-1 fees and SICAVs. These decreases were partially offset by higher costs incurred to distribute certain products through U.S. intermediaries as the average assets under management in these products were higher.
Previous report
For 2023, advertising and promotion costs were $114.2 million, an increase of $16.9 million, or 17.4%, compared to 2022. The increase was primarily driven by higher media advertising and agency costs in 2023.
Previous report
For 2023, technology, occupancy, and facility costs were $632.6 million, an increase of $72.1 million or 12.9%, compared to 2022. The increase was primarily due to ongoing investment in our technology capabilities, including depreciation and hosting solution licenses, and increased office facility costs, mainly related to rent expense associated with a new London office that we began leasing in the second half of 2022 and occupied in September 2023.
Previous report
For 2023, general, administrative, and other costs were $421.3 million, an increase of $9.1 million or 2.2% compared to 2022. The increase was primarily due to higher professional fees and travel costs, partially offset by a $20.8 million recovery of nonrecurring costs that were incurred in 2022.
Previous report
For 2023, we recognized acquisition-related amortization and impairment costs of $134.2 million, a decrease of $149.3 million, compared to 2022. The decrease was primarily driven by an insignificant amount of impairment charges in 2023 for certain intangibles compared to $175.1 million in 2022.
Previous report
In 2024 and 2023, strong market returns contributed to the increased valuation and gains of our investment portfolio, along with higher cash balances and interest rates increased dividend income. In 2022, our overall investment portfolio valuations were negatively impacted by market declines caused by the continued elevated inflation, supply chain disruptions, and a more aggressive pace of Federal Reserve interest rate increases.
Previous report
(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.
Previous report
For 2023, the increase in our effective tax rate from 2022 was primarily due to an increase in the valuation allowances recorded mainly against UK-based deferred tax assets, including net operating losses, and a decrease in discrete tax benefits associated with option exercises and restricted stock vests. These unfavorable impacts were partially offset by a favorable impact of net gains attributable to redeemable non-controlling interests held in our consolidated investment products and state tax liability settlements.
Reworded paragraphs (78)
Previous wording
Our revenues and net income are derived primarily from investment advisory services provided to individual and institutional investors in a broad range of investment solutions across equity, fixed income, multi-asset, and alternative capabilities. We also provide certain investment advisory clients with related administrative services, including distribution, mutual fund transfer agent, accounting, and shareholder services; participant recordkeeping and transfer agent services for defined contribution retirement plans; brokerage; trust services; and non-discretionary advisory services.
Current wording
Our revenues and net income are derived primarily from investment advisory services provided globally to individual and institutional investors in a broad range of investment solutions across equity, fixed income, multi-asset, and alternatives capabilities. We also provide certain investment advisory clients with related administrative services, including distribution, mutual fund transfer agent, accounting, and shareholder services; participant recordkeeping and transfer agent services for defined contribution retirement plans; brokerage; trust services; and other advisory services.
Previous wording
Investment advisory fees depend largely on the total value and composition of assets under our management. Accordingly, fluctuations in financial markets and in the composition of assets under management affect our revenues and results of operations.
Current wording
Investment advisory fees depend largely on the total value and composition of our assets under management. Accordingly, fluctuations in financial markets and in the composition of assets under management affect our revenues and results of operations.
Previous wording
The investment management industry has been evolving and industry participants are facing challenging trends including passive investments taking market share from traditional active strategies; continued downward fee pressure; demand for new investment vehicles to meet client needs; and an ever-changing regulatory landscape. In this regard, we have ample liquidity and resources that allow us to take advantage of attractive growth opportunities. We are investing in key capabilities, including investment professionals, distribution professionals, technologies, and new product offerings in order to provide our clients with strong investment management expertise and service.
Current wording
The investment management industry continues to evolve and face challenging trends, including the shift in market share from traditional active strategies to passive products, persistent downward fee pressure, demand for lower cost investment vehicles, and an ever-changing regulatory landscape. In this environment, we maintain ample liquidity and resources that allow us to take advantage of attractive growth opportunities and deliver new capabilities that meet the evolving needs of our clients globally. At the same time, we have developed a broad and ongoing plan to further align our expense growth with our anticipated revenue growth, which will allow us to realign resources and continue investing in existing and future capabilities.
Previous wording
In the U.S. investment-grade universe, sector performance was broadly positive. Non-agency commercial mortgage-backed securities and asset-backed securities produced solid gains. Corporate bonds rose to a lesser degree. Mortgage-backed securities performed in line with the broad investment-grade market. Treasuries lagged with slight positive returns. Tax-free municipal bonds slightly trailed the broad taxable bond market. High yield corporate bonds produced solid gains and strongly outperformed the investment-grade bond market.
Current wording
In the U.S. investment-grade bond universe, mortgage-backed securities performed best, but corporate bonds and non-agency commercial mortgage-backed securities also did well. Treasuries and asset-backed securities slightly lagged. Tax-free municipal bonds underperformed taxable bonds, but high yield corporates outperformed the investment-grade bond market.
Previous wording
Assets under management ended 2024 at $1,606.6 billion, an increase of $162.1 billion from the end of 2023. This increase was driven by net market appreciation and income, net of distributions not reinvested, of $205.3 billion, offset by net cash outflows of $43.2 billion.
Current wording
Assets under management ended 2025 at $1,775.6 billion, an increase of $169.0 billion from the end of 2024. This increase was driven by net market appreciation and income, net of distributions not reinvested, of $216.7 billion, offset by net cash outflows of $56.9 billion. Beginning on July 1, 2025, assets under management include managed account - model delivery portfolios assets, which had $9.2 billion in assets as of that date, and are reflected in the increase from December 31, 2024.
Previous wording
(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.
Current wording
(2)The underlying assets under management of the multi-asset products have been aggregated and presented in this category and not reported in the equity and fixed income columns.
Previous wording
(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 of $16.2 billion at December 31, 2024, $11.6 billion at December 31, 2023, and $10.5 billion at December 31, 2022 are not reflected in AUM above.
Current wording
(3)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 were $21.6 billion at December 31, 2025, $16.2 billion at December 31, 2024, and $11.6 billion at December 31, 2023, and are not reflected in fee basis AUM above.
Previous wording
(3) Reflects net distributions not reinvested of $5.9 billion in 2024, $2.9 billion in 2023, and $3.3 billion in 2022.
Current wording
(4)Includes net distributions not reinvested of $6.8 billion in 2025, $5.9 billion in 2024, and $2.9 billion in 2023.
Previous wording
Investment advisory clients outside the U.S. accounted for 8.8% of our assets under management at December 31, 2024, 8.6% at December 31, 2023, and 9.1% at December 31, 2022.
Current wording
Investment advisory clients outside the United States account for 8.8% of our assets under management at December 31, 2025 and December 31, 2024 and 8.6% at December 31, 2023.
Previous wording
Our net cash outflows in 2024 were driven primarily by growth-oriented equity strategies and a multi-asset sub-advised variable annuity outflow. These outflows were partially offset by net cash inflows in our target date retirement products, fixed income and alternative strategies. Financial intermediaries were the main sources of net outflows in 2024. Geographically, while the EMEA and APAC regions experienced net inflows, these were outweighed by outflows in the Americas. For 2023, net outflows were driven primarily by our growth-oriented equity strategies sourced from Americas financial intermediaries and institutional clients. These outflows were partially offset by net cash inflows in our multi-asset strategies, predominately our target date retirement products, and alternative strategies. From a geography perspective, net outflows were predominantly from U.S. clients invested in equity strategies though all regions experienced net outflows. For 2022, net outflows were driven primarily by our growth-oriented equity strategies sourced from U.S. intermediaries. These outflows were partially offset by net cash inflows in our international fixed income, multi-asset, and alternative strategies. From a geographical perspective, the Americas and EMEA regions experienced net outflows predominantly in equities, while APAC had positive net flows.
Current wording
Our net cash outflows in 2025 were driven primarily by growth-oriented equity strategies. These outflows were partially offset by net cash inflows in fixed income, target date retirement products, and alternatives strategies. Financial intermediaries and institutional clients were the main sources of net outflows in 2025. From a geography perspective, net outflows were predominantly from U.S. clients invested in equity strategies, though all regions experienced net outflows. For 2024, net outflows were driven primarily by growth-oriented equity strategies and a multi-asset sub-advised variable annuity outflow. These outflows were partially offset by net cash inflows in our target date retirement products, fixed income and alternatives strategies. Financial intermediaries were the main sources of net outflows in 2024. Geographically, while the EMEA and APAC regions experienced net inflows, these were outweighed by outflows in the Americas. For 2023, net outflows were driven primarily by our growth-oriented equity strategies sourced from Americas financial intermediaries and institutional clients. These outflows were partially offset by net cash inflows in our multi-asset strategies, predominately our target date retirement products, and alternatives strategies. From a geography perspective, net outflows were predominantly from U.S. clients invested in equity strategies, though all regions experienced net outflows.
Previous wording
We provide participant accounting and plan administration for defined contribution retirement plans that primarily invest in the firm's U.S. mutual funds, collective investment trusts and funds managed outside of the firm's complex. As of December 31, 2024, our assets under administration were $282 billion, of which $159 billion were assets we manage.
Current wording
We provide participant accounting and plan administration for defined contribution retirement plans that primarily invest in our U.S. mutual funds, collective investment trusts and funds managed outside of the our complex. As of December 31, 2025, our assets under administration were $314 billion, of which $178 billion were assets we manage.
Previous wording
Strong investment performance and brand awareness is a key driver to attracting and retaining assets—and to our long-term success. The following table presents investment performance for the one-, three-, five-, and 10-years ended December 31, 2024. Past performance is no guarantee of future results.
Current wording
Strong investment performance and brand awareness is a key driver to attracting and retaining assets—and to our long-term success. Our performance disclosures include specific asset classes, assets under management weighted performance, U.S. fund performance against passive peers, and composite performance against benchmarks. The following tables present investment performance for the one-, three-, five-, and 10-years ended December 31, 2025. Past performance is not a guarantee nor a reliable indicator of future performance.
Previous wording
As of December 31, 2024, 54 of 90 (60.0%) of our rated U.S. mutual funds (across primary share classes) received an overall rating of 4 or 5 stars. By comparison, 32.5% of Morningstar's fund population is given a rating of 4 or 5 stars(6). In addition, 63.0%(6) of AUM in our rated U.S. mutual funds (across primary share classes) ended 2024 with an overall rating of 4 or 5 stars.
Current wording
As of December 31, 2025, 68 of 141 (48.2%) of the firm's rated U.S. mutual funds (across primary share classes) received an overall rating of 4 or 5 stars. By comparison, 32.5% of Morningstar's fund population is given a rating of 4 or 5 stars(6). In addition, 60.4%(6) of AUM in the firm's rated U.S. mutual funds (across primary share classes) ended 2025 with an overall rating of 4 or 5 stars.
Previous wording
(1)The investment performance reflects that of T. Rowe Price sponsored mutual funds and composites AUM.
Current wording
(1)The investment performance reflects that of T. Rowe Price U.S. mutual funds, ETFs, and composites.
Previous wording
(3) Source: Morningstar. Primary share class only. Excludes money market mutual funds, funds with an operating history of less than one year, T. Rowe Price passive funds, and T. Rowe Price funds that are clones of other funds. The top chart reflects the percentage of T. Rowe Price funds with 1 year, 3 year, 5 year, and 10 year track record that are outperforming the Morningstar category median. The bottom chart reflects the percentage of T. Rowe Price funds AUM that has outperformed for the time periods indicated. Total Fund AUM included for this analysis includes $322B for 1 year, $318B for 3 years, $317B for 5 years, and $316B for 10 years.
Current wording
(3) Source: Morningstar. Primary share class only. Excludes money market mutual funds, funds with an operating history of less than one year, T. Rowe Price passive funds, and T. Rowe Price funds that are clones of other funds. The top chart reflects the percentage of T. Rowe Price funds with 1 year, 3 year, 5 year, and 10 year track record that outperformed the Morningstar category median. The bottom chart reflects the percentage of T. Rowe Price funds AUM that has outperformed for the time periods indicated. Total AUM included for this analysis includes $329B for 1 year, $319B for 3 years, $317B for 5 years, and $316B for 10 years.
Previous wording
(4) Passive Peer Median was created by T. Rowe Price using data from Morningstar. Primary share class only. Excludes money market mutual funds, funds with an operating history of less than one year, funds with fewer than three peers, T. Rowe Price passive funds, and T. Rowe Price funds that are clones of other funds. This analysis compares T. Rowe Price active funds with the applicable universe of passive/index open-end funds and ETFs of peer firms. The top chart reflects the percentage of T. Rowe Price funds with 1 year, 3 year, 5 year, and 10 year track record that are outperforming the passive peer universe. The bottom chart reflects the percentage of T. Rowe Price funds AUM that has outperformed for the time periods indicated. Total AUM included for this analysis includes $306B for 1 year, $302B for 3 years, $262B for 5 years, and $257B for 10 years.
Current wording
(4) Passive Peer Median was created by T. Rowe Price using data from Morningstar. Primary share class only. Excludes money market mutual funds, funds with an operating history of less than one year, funds with fewer than three peers, T. Rowe Price passive funds, and T. Rowe Price funds that are clones of a retail fund.This analysis compares T. Rowe Price active funds with the applicable universe of passive/index open-end funds and ETFs of peer firms. The top chart reflects the percentage of T. Rowe Price funds with 1 year, 3 year, 5 year, and 10 year track record that outperformed the passive peer universe. The bottom chart reflects the percentage of T. Rowe Price funds AUM that has outperformed for the time periods indicated. Total AUM included for this analysis includes $272B for 1 year, $262B for 3 years, $260B for 5 years, and $252B for 10 years.
Previous wording
(5)Composite net returns are calculated using the highest applicable separate account fee schedule. Excludes money market composites. All composites compared to official GIPS composite primary benchmark. The top chart reflects the percentage of T. Rowe Price composites with 1 year, 3 year, 5 year, and 10 year track record that are outperforming their benchmarks. The bottom chart reflects the percentage of T. Rowe Price composite AUM that has outperformed for the time periods indicated. Total AUM included for this analysis includes $1,423B for 1 year, $1,420B for 3 years, $1,418B for 5 years, and $1,367B for 10 years.
Current wording
(5)Composite net returns are calculated using the highest applicable separate account fee schedule. Excludes money market composites. All composites compared to official GIPS composite primary benchmark. The top chart reflects the percentage of T. Rowe Price composites with 1 year, 3 year, 5 year, and 10 year track record that are outperforming their benchmarks. The bottom chart reflects the percentage of T. Rowe Price composite AUM that has outperformed for the time periods indicated. Total AUM included for this analysis includes $1,565B for 1 year, $1,557B for 3 years, $1,551B for 5 years, and $1,512B for 10 years.
Previous wording
The following table and discussion set forth information regarding our consolidated financial results for 2024, 2023 and 2022 on a U.S. GAAP basis and a non-GAAP basis. The non-GAAP basis adjusts for the impact of our consolidated investment products, the impact of market movements on the deferred compensation liabilities and related economic hedges, investment income related to certain other investments, acquisition-related amortization and costs, impairment charges, and certain nonrecurring charges and gains, if any.
Current wording
The following table and discussion set forth information regarding our consolidated financial results for 2025, 2024 and 2023 on a U.S. GAAP and a non-GAAP basis. The non-GAAP basis adjusts for the impact of our consolidated investment products, the impact of market movements on the deferred compensation liabilities and related economic hedges, investment income related to certain other investments, acquisition-related amortization and costs, impairment charges, and certain nonrecurring charges and gains, including the restructuring charges.
Previous wording
(3)Capital allocation-based income represents the change in accrued carried interest.
Current wording
(2)Capital allocation-based income represents the change in accrued carried interest.
Previous wording
Investment advisory fees are earned based on the value and composition of our assets under management, which change based on fluctuations in financial markets and net cash flows. As our average assets under management increase or decrease in a given period, the level of our investment advisory fees for that same period generally fluctuates in a similar manner. Our annualized effective fee rates can be impacted by market or cash flow related shifts among asset and share classes, price changes in existing products, and asset level changes in products with tiered-fee structures.
Current wording
Investment advisory fees are generally earned based on the value and composition of our assets under management, which change based on fluctuations in financial markets and net cash flows. As our average assets under management increase or decrease in a given period, the level of our investment advisory fee revenue for that same period generally fluctuates in a similar manner. Our annualized effective fee rates can be impacted by market or cash flow related shifts among asset classes and products, including those with tiered-fee structures, along with price changes we make in existing products.
Previous wording
We currently estimate our 2025 non-GAAP operating expenses, excluding non-GAAP accrued carried interest compensation, will grow in the range of 4%-6% from the 2024 amount of $4,456.3 million. We could elect to adjust our expense growth should unforeseen circumstances arise, including significant market movements.
Current wording
We currently estimate our 2026 non-GAAP operating expenses, excluding non-GAAP accrued carried interest compensation, will grow in the range of 3%-6% from the 2025 amount of $4,608.0 million. We could elect to adjust our expense growth should unforeseen circumstances arise, including significant market movements.
Previous wording
On a non-GAAP basis, operating expenses were $4,498.8 million, an increase of 5.6% compared to 2023. The increase in our non-GAAP operating expenses was primarily driven by higher costs across compensation and benefits, distribution and servicing, advertising, professional fees, and a non-recurring recovery of general and administrative costs recognized in 2023. These increases were partially offset by lower external research fees, lower accrued carried interest compensation, and higher capitalized labor. In 2024, the firm changed its approach to paying for external research, consistent with regulations and general industry practice.
Current wording
On a non-GAAP basis, operating expenses were $4,498.8 million, an increase of 5.6% compared to 2023. The increase in our non-GAAP operating expenses was primarily driven by higher costs across compensation and benefits, distribution and servicing, advertising, professional fees, and a nonrecurring recovery of general and administrative costs recognized in 2023. These increases were partially offset by lower external research fees, lower accrued carried interest compensation, and higher capitalized labor. In 2024, the firm changed its approach to paying for external research, consistent with regulations and general industry practice.
Previous wording
In 2024, the increase in investment advisory fees was due to higher average AUM as stronger market returns and appreciation were offset by net outflows over the last two years.
Current wording
For 2025 and 2024, the increases in investment advisory fees were due to higher average AUM as stronger market returns and appreciation were slightly offset by net outflows in each of the last two years.
Previous wording
Performance-based advisory fees in each period were primarily related to alternative strategies.
Current wording
Performance-based advisory fees in each period were primarily from alternatives strategies, and the decline in 2025 from prior periods were primarily related to lower overall market returns.
Previous wording
Capital allocation-based income increased net revenues by $46.6 million. The 2024 amount includes an increase of $134.1 million in accrued carried interest from investments in affiliated investment funds, partially offset by $87.5 million of non-cash amortization and impairments related to acquisition-date asset basis differences. Impairments recognized in 2024 were $36.6 million, and should market and performance conditions deteriorate, additional impairments may be recognized in future periods. The firm realized carried interest of $139.6 million compared to $109.8 million in the 2023 period.
Current wording
For 2024, capital allocation-based income increased net revenues by $46.6 million. This amount includes an increase of $134.1 million in accrued carried interest from investments in affiliated investment funds, partially offset by $87.5 million of non-cash amortization and impairments related to acquisition-date asset basis differences. Impairments recognized in 2024 were $36.6 million. The firm realized carried interest of $139.6 million compared to $109.8 million in 2023.
Previous wording
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. In 2024, the compensation expense was $5.4 million, consisting of $42.5 million related to the accrued carried interest offset in part by $37.1 million in amortization and impairment charges. For 2023, we recognized compensation expense of $44.6 million, consisting of $70.0 million in compensation expense related to the accrued carried interest offset in part by $25.4 million in amortization and impairment charges.
Current wording
A portion of the capital allocation-based income is passed through to employees and recognized in compensation and related costs, with the unpaid amount reported as non-controlling interest in the consolidated balance sheet. In 2025, we recognized compensation expense of $30.8 million, consisting of $58.5 million related to the change in accrued carried interest offset in part by $27.7 million in amortization and impairment charges. For 2024, we recognized compensation expense of $5.4 million, consisting of $42.5 million related to the change in accrued carried interest offset in part by $37.1 million in amortization and impairment charges.
Previous wording
Administrative, distribution, and servicing fees in 2024 were $588.0 million, an increase of $37.1 million compared to 2023. The increase was primarily driven by higher average assets on which we earn non-discretionary advisory services revenue and higher transfer agent servicing activities provided to the T. Rowe Price mutual funds.
Current wording
For 2024, the increase was primarily driven by higher average assets on which we earn non-discretionary advisory services revenue and higher transfer agent servicing activities provided to the T. Rowe Price mutual funds.
Previous wording
Net revenues are presented after the elimination of $3.6 million for 2024, $2.1 million for 2023, and $2.0 million for 2022, earned from our consolidated investment products. The corresponding expenses recognized by these consolidated investment products were also eliminated from operating expenses.
Current wording
Net revenues are presented after the elimination of $4.2 million for 2025, $3.6 million for 2024, and $2.1 million for 2023, earned from our consolidated investment products. The corresponding expenses recognized by these consolidated investment products were also eliminated from operating expenses.
Previous wording
Compensation, benefits and related costs were $2,603.4 million, an increase of $152.7 million, or 6.2%, compared to 2023. The increase was driven by a higher bonus pool on an increase in revenue and higher salaries and related benefits partially offset by higher capitalized labor and lower other employee related costs. The firm employed 8,158 associates at December 31, 2024, an increase of 3.2% from the end of 2023.
Current wording
For 2024, compensation, benefits, and related costs were $2,603.4 million, an increase of $152.7 million, or 6.2%, compared to 2023. The increase was driven by a higher bonus pool on an increase in revenue and higher salaries and related benefits partially offset by higher capitalized labor and lower other employee related costs.
Previous wording
Distribution and servicing costs were $354.1 million for 2024, an increase of $64.2 million, or 22.1%, compared to $289.9 million in 2023. The increase was primarily driven by higher average assets under management distributed through intermediaries.
Current wording
Distribution and servicing costs were $383.5 million for 2025, an increase of $29.4 million, or 8.3%, compared to $354.1 million in 2024. For 2024, distribution and services costs were $354.1 million, an increase of $64.2 million, or 22.1%, compared to 2023. The increases in 2025 and 2024 were primarily driven by higher average assets under management distributed through intermediaries.
Previous wording
The costs in this expense category primarily include amounts paid to third-party intermediaries that source the assets of certain share classes of our U.S. mutual funds, ETFs and our international products, such as our Japanese ITMs and SICAVs. These costs were offset entirely by the distribution revenue we earn and report in net revenues: 12b-1 revenue is recognized in administrative, distribution, and servicing fees for the Advisor and R share classes of the U.S. mutual funds and investment advisory fees for our international products.
Current wording
The costs in this expense category include amounts paid to third-party intermediaries that source the assets of certain share classes of our U.S. mutual funds, ETFs, and our international products, such as our Japanese ITMs and SICAVs. These costs are offset entirely by the investment advisory revenue we earn from these products, or in the case of the Advisor and R share classes of the U.S. mutual funds are recognized in administrative, distribution, services, and other fees.
Previous wording
Advertising and promotion costs were $129.6 million for 2024, an increase of $15.4 million, or 13.5%, compared to 2023. The increase was primarily driven by higher media advertising.
Current wording
For 2024, advertising and promotion costs were $129.6 million, an increase of $15.4 million, or 13.5%, compared to 2023. The increase was primarily driven by higher media advertising.
Previous wording
Product and recordkeeping related costs were $297.5 million for 2024, an increase of $6.5 million, or 2.2%, compared to 2023. The increase was primarily driven by higher product related costs to be reimbursed from our sponsored investment products partially offset by lower recordkeeping related costs.
Current wording
For 2024, product and recordkeeping related costs were $297.5 million for 2024, an increase of $6.5 million, or 2.2%, compared to 2023. The increase was primarily driven by higher product related costs to be reimbursed from our sponsored investment products partially offset by lower recordkeeping related costs.
Previous wording
Technology, occupancy, and facility costs were $644.1 million for 2024, an increase of $11.5 million or 1.8%, compared to 2023. The increase was due to ongoing investment in our technology capabilities, primarily hosted solutions, partially offset by lower facility costs as 2023 included the rent cost of two London facilities until we occupied our new building in September 2023.
Current wording
For 2024, technology, occupancy, and facility costs were $644.1 million, an increase of $11.5 million or 1.8%, compared to 2023. The increase was due to ongoing investment in our technology capabilities, primarily hosted solutions, partially offset by lower facility costs as 2023 included the rent cost of two London facilities until we occupied our new building in September 2023.
Previous wording
General, administrative, and other costs were $433.8 million for 2024, an increase of $12.5 million or 3.0%, compared to 2023. The increase was primarily due to a cost recovery recognized in 2023 that did not recur in 2024, higher professional fees and travel costs. These increases were partially offset by lower external research fees and other general and administrative costs. In 2024, the firm changed its approach to paying for external research, consistent with regulations and general industry practice.
Current wording
For 2024, general, administrative, and other expenses were $433.8 million, an increase of $12.5 million or 3.0% compared to 2023. The increase was primarily due to a cost recovery recognized in 2023 that did not recur in 2024, higher professional fees and travel costs. These increases were partially offset by lower external research fees and other general and administrative costs. In 2024, the firm changed its approach to paying for external research, consistent with regulations and general industry practice.
Previous wording
Change in fair value of contingent consideration. Our contingent consideration consists of an earnout arrangement as part of the 2021 acquisition of OHA in which additional purchase price may be due to the sellers upon satisfying or exceeding certain defined revenue targets. Each reporting period, we record the fair value of the contingent consideration due under this arrangement. Reduced revenue expectations have resulted in a reduction in the fair value of the contingent consideration liability of $13.4 million in 2024, $82.4 million in 2023, and $161.2 million in 2022. The fair value of the contingent consideration liability as of December 31, 2024 is zero.
Current wording
Change in fair value of contingent consideration. Our contingent consideration consists of an earnout arrangement as part of the 2021 acquisition of OHA in which additional purchase price may be due to the sellers upon satisfying or exceeding certain defined revenue targets. Each reporting period, we record the fair value of the contingent consideration due under this arrangement. Reduced revenue expectations resulted in a reduction in the fair value of the contingent consideration liability of $13.4 million in 2024 and $82.4 million in 2023. The fair value of the contingent consideration liability as of December 31, 2025 and 2024 is zero.
Previous wording
Acquisition-related amortization and impairment costs primarily relate to the indefinite- and definite-lived intangible assets identified and separately recognized, at fair value, on acquisition date. In 2024, we recognized acquisition-related amortization and impairment costs of $156.7 million, an increase of $22.5 million or 16.8%, compared to 2023. The increase was primarily driven by impairment charges related to the trade name intangible asset.
Current wording
For 2024, we recognized acquisition-related amortization and impairment costs of $156.7 million, an increase of $22.5 million, compared to 2023. The increase was primarily driven by impairment charges related to the trade name intangible asset.
Previous wording
The impairment charges for both periods were the result of reduced growth expectations for both investment management and incentive fees and higher discount rate compared to when the acquisition closed in 2021.
Current wording
The impairment charges in all periods were the result of reduced growth expectations for both investment management and incentive fees compared to when the acquisition closed in 2021.
Previous wording
The remaining weighted average amortization period for our definite-lived intangible assets is 3.7 years. Should conditions that led us to recognize these impairment charges worsen, additional impairments may be recognized in future periods.
Current wording
The remaining weighted average amortization period for our definite-lived intangible assets is 2.8 years. Should conditions that led us to recognize impairment charges worsen, additional impairments may be recognized in future periods.
Previous wording
Non-operating income was $486.3 million in 2024 compared to $504.1 million in 2023 and a non-operating loss of $425.5 million in 2022. Non-operating activity for the years ended December 31, 2024, 2023 and 2022 are as follows:
Current wording
Non-operating activity for the years ended December 31, 2025, 2024 and 2023 are as follows:
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Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Our U.S. GAAP effective tax rate is also impacted by changes in the proportion of net income that is attributable to our redeemable non-controlling interests and non-controlling interests reflected in permanent equity.
Current report — wording carried from elsewhere
Given the availability of our financial resources and cash expected to be generated through future operations, we do not maintain an available external source of additional liquidity.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
The average annualized effective fee rate earned on our assets under management was 41.9 basis points in 2023, compared to 42.6 basis points earned in 2022. Our effective fee rate has declined largely due to a mix shift toward lower fee asset classes and vehicles as a result of net equity outflows, partially offset by higher market returns. The average annualized fee rate earned on our assets under management was 41.5 basis points for the fourth quarter of 2023.
Previous report — wording carried elsewhere
For 2023, product and recordkeeping related costs were $291.0 million for 2023, a decrease of $9.1 million, or 3.0%, compared to 2022. The decrease was driven by lower recordkeeping related costs.
Previous report — wording carried elsewhere
(1)See the reconciliation to the comparable U.S. GAAP measures at the end of the Results of Operations section of this Management's Discussion and Analysis.
Previous report — wording carried elsewhere
(2) This non-GAAP adjustment removes acquisition-related transactions costs. We believe adjusting for these charges helps the reader's ability to understand our core operating results and increases comparability period to period.