PRICE T ROWE GROUP INC
For the period ended Mar 31, 2026. Filed Apr 30, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed Apr 30, 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-Q
Period ended 2025-09-30; filed 2025-10-31.
0001628280-25-047751
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-04-30.
0001628280-26-028712
Item 2. 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 139 previous paragraphs and 131 current paragraphs.
50 unchanged; 55 reworded; 23 added; 31 removed; 3 previous and 3 current paragraphs rearranged.
Tables are not compared: 20 previous and 18 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 (23)
Current report
Global financial markets experienced increased volatility during the first quarter of 2026. In the U.S., equity markets produced mixed results during the quarter. Equity prices advanced early in the quarter amid solid corporate earnings and generally favorable economic data. Later in the quarter, heightened geopolitical tensions disrupted global energy supply conditions, leading to a sharp increase in oil prices and a corresponding reassessment of inflation risks. This shift contributed to increased market volatility and downward pressure on equity valuations, particularly toward the end of the quarter.
Current report
Performance varied across market capitalizations and investment styles. Small- and mid-capitalization stocks outperformed large-cap stocks, and value-oriented equities outperformed growth equities across capitalization ranges. Energy stocks significantly outperformed amid higher commodity prices along with materials and utilities. In contrast, consumer discretionary, financials, information technology, and communication services underperformed.
Current report
Developed international and emerging equity markets were modestly negative for the quarter. Early gains were offset by late-quarter declines as higher energy costs weighed on growth expectations, particularly in regions dependent on imported energy.
Current report
Global bond returns were modestly negative in the first quarter of 2026. In the U.S., fixed income markets were relatively flat during the quarter. Earlier gains were reversed later in the period as rising energy prices contributed to upward pressure on inflation expectations. Heightened geopolitical uncertainty increased interest rate volatility and complicated expectations regarding the duration of restrictive monetary policy. The Federal Reserve maintained its policy rate during the quarter, reflecting a continued data-dependent stance amid evolving economic and geopolitical conditions.
Current report
Mortgage-backed and asset-backed securities outperformed, while corporate bonds underperformed as credit spreads widened later in the quarter. Treasury securities posted modest losses. The U.S. dollar weakened early in the quarter amid shifting global capital flows before strengthening later as risk aversion increased.
Current report
International fixed income markets posted negative returns for the quarter, driven primarily by rising sovereign yields late in the period. Earlier gains supported by easing inflation trends were offset as geopolitical developments led to sharp increases in energy prices and a broad reassessment of inflation outlooks and anticipated central bank policy actions across major regions.
Current report
Emerging market bonds also declined during the quarter. Hard-currency sovereign bonds were negatively affected by widening credit spreads as investors reassessed sovereign credit risk amid tighter global financial conditions. Local-currency emerging market debt experienced additional pressure from rising domestic yields and currency depreciation later in the period, reflecting increased risk aversion and U.S. dollar strength. Earlier supportive conditions for emerging market fixed income were outweighed as geopolitical risks intensified toward quarter-end.
Current report
Assets under management ended the first quarter of 2026 at $1,709.7 billion, a decrease of $65.9 billion from December 31, 2025. The decrease was driven by market depreciation of $52.2 billion and net cash outflows of $13.7 billion.
Current report
Compared to the first quarter of 2025, the increase in U.S. GAAP and adjusted operating expenses was driven by higher technology, occupancy, and facilities costs. Also, U.S. GAAP expenses were impacted by lower mark-to-market related to our deferred compensation liabilities and lower acquisition-related amortization costs, partially offset by the restructuring charge. These costs are not included in our non-GAAP operating expenses. See the GAAP to non-GAAP reconciliation at the end of the Results of Operations section of this Management's Discussion and Analysis.
Current report
Diluted earnings per share was $2.23 for the first quarter of 2026 compared to $2.15 for the first quarter of 2025. The increase was primarily driven by a lower tax rate and lower weighted average shares outstanding compared to the 2025 period.
Current report
Investment advisory fees in the first quarter of 2026 increased 5.3% over the comparable 2025 quarter as average assets under management increased $155.5 billion, or 9.6%, to $1,775.8 billion.
Current report
Performance-based advisory fees in the first quarter of 2026 were primarily earned from alternative strategies, whereas in the 2025 comparative period fees were earned across equity and alternative strategies.
Current report
Administrative, distribution, servicing, and other fees in the first quarter of 2026 were $138.4 million, a decrease of $17.9 million, or 11.5%, from the comparable 2025 quarter. The decrease primarily reflects the reporting change implemented in Q3 2025, in which revenue earned from managed account - model delivery assets and certain other advisory services began being reported within investment advisory fees, as well as the timing of cost reimbursements from the U.S. mutual funds.
Current report
(3) In Q1 2026, we began reporting technology-related professional fees and servicing costs from general, administrative, and other costs to technology, occupancy, and facilities costs to better align with the nature of the expenses following the outsourcing and expansion of our technology capabilities through trusted vendor partnerships. Prior periods were recast to reflect this change. The amount reclassified for the first quarter of 2025 was $13.6M.
Current report
Compensation, benefits, and related costs were $655.1 million for the first quarter of 2026, a decrease of $2.8 million, or 0.4%, compared to the 2025 quarter. The decrease was primarily due to lower salaries and related benefits, partially offset by higher long-term incentive compensation.
Current report
Advertising and promotion costs were $18.4 million in the first quarter of 2026, a decrease of $7.7 million, or 29.5%, compared to the $26.1 million recognized in the 2025 quarter. The decrease was primarily due to timing of media spend and events.
Current report
Product and recordkeeping related costs were $74.3 million in the first quarter of 2026, a decrease of $9.5 million, or 11.3%, compared to the 2025 quarter. The decrease was primarily due to the timing of costs reimbursed by our U.S. mutual funds. The offsetting reimbursement is recognized in administrative, distribution, servicing, and other fees revenue.
Current report
Technology, occupancy, and facility costs were $204.4 million in the first quarter of 2026, an increase of $23.2 million, or 12.8%, compared to the $181.2 million recognized in the 2025 quarter. The increase from the 2025 quarter was primarily due to higher technology costs, including cloud services, depreciation, and our decision in the prior year to outsource certain technology capabilities.
Current report
General, administrative, and other expenses were $92.4 million in the first quarter of 2026, an increase of $2.7 million, or 3.0%, compared to the $89.7 million recognized in the 2025 quarter. The increase was primarily due to higher external research and other general and administrative costs.
Current report
Acquisition-related amortization and impairment costs. As part of the purchase accounting for our acquisitions, we identified and separately recognized, at fair value, certain intangible assets. During the first quarter of 2026, we recognized $18.0 million in amortization and impairments compared to $28.7 million in the 2025 period. The decrease primarily reflects amortization and impairments recognized over time, which reduced the remaining carrying value of the related definite-lived intangibles.
Current report
On an adjusted basis, non-operating income (loss) consists of investment gains/losses generated from our cash and discretionary investment portfolio. Lower investment gains earned by our investment portfolio during the first quarter of 2026 compared to the 2025 period was primarily due to overall lower market returns, partially offset by higher dividend income from higher cash and investment balances.
Current report
Our effective tax rate will continue to experience volatility in future periods due to, among other things, the impact market fluctuations in our stock price have on stock-based compensation tax benefits, changes in the mix of our earnings among countries with differing tax laws or rates, and changes in the valuation allowances of foreign-based deferred tax assets.
Current report
CRITICAL ACCOUNTING POLICIES AND ESTIMATES.
Removed paragraphs (31)
Previous report
Major stock indexes rose in the third quarter of 2025. Initially, equities were supported by generally favorable economic data and second-quarter corporate earnings reports, as well as some positive tariff-related news in the form of U.S. trade agreements with other nations. In August, however, a weaker-than-expected nonfarm payroll employment report for July—which included significant downward revisions to employment data for May and June—raised fears of an economic slowdown. Nevertheless, equities were buoyed by growing hopes that the Federal Reserve would resume reducing short-term interest rates; the last rate cut was in December 2024. Indeed, Fed officials decided in mid-September to reduce the fed funds target rate by 25 basis points and indicated there could be two additional rate cuts by the end of the year.
Previous report
Developed non-U.S. equity markets also produced gains. Markets in several eurozone countries advanced more than 8% in U.S. dollar terms, while UK shares rose about 6%. Developed Asian markets were mostly positive in dollar terms, led by Hong Kong, Singapore, and Japan.
Previous report
Stocks in emerging markets outperformed equities in developed non-U.S. markets. In emerging Asia, Chinese stocks climbed more than 20%, helped by cash-rich households seeking higher returns. In Latin America, most markets produced positive returns in dollar terms. In the emerging Europe, Middle East, and Africa (EMEA) region, markets were broadly positive. South African shares surged more than 20%, helped by rising metals prices and mining industry strength.
Previous report
Global bond returns were mostly positive in the third quarter of 2025. In the U.S., Treasury bill yields declined in anticipation of a Federal Reserve interest rate cut in mid-September. On September 17, the central bank reduced the federal funds target rate from the 4.25% to 4.50% range to the 4.00% to 4.25% range. Intermediate- and long-term U.S. Treasury yields fell to a lesser extent. The 10-year U.S. Treasury note yield decreased from 4.24% to 4.16%.
Previous report
In the investment-grade bond universe, sector performance was broadly positive. Corporate bonds and mortgage-backed securities performed best, while non-agency commercial mortgage-backed securities, asset-backed securities, and Treasuries lagged. Tax-free municipal bonds and high yield corporate bonds outperformed the taxable investment-grade bond market.
Previous report
Bonds in developed non-U.S. markets produced slight negative returns in U.S. dollar terms. In the eurozone, longer-term bond yields rose in many countries, while the European Central Bank (ECB) kept key interest rates steady. In the UK, longer-term bond yields also increased, but the Bank of England reduced its key interest rate in August. The euro was little changed versus the greenback, but the British pound fell close to 2% versus the dollar. In Japan, long-term government bond yields increased, but the Bank of Japan kept the benchmark interest rate at 0.50%. The yen fell more than 2% versus the dollar. Emerging markets bonds produced positive returns in U.S. dollar terms. Dollar-denominated bonds outperformed bonds denominated in local currencies, as developing markets currencies were mixed versus the U.S. dollar.
Previous report
Assets under management ended the third quarter of 2025 at $1,767.2 billion, an increase of $90.4 billion from June 30, 2025. The increase was primarily driven by market appreciation and income, net of distributions not reinvested, of $89.1 billion, offset by net cash outflows of $7.9 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 June 30, 2025 and December 31, 2024.
Previous report
For the nine months ended September 30, 2025, the increase in assets under management was primarily driven by market appreciation, net of distributions not reinvested, of $182.8 billion, offset by net cash outflows of $31.4 billion.
Previous report
(4)Amount represents the net assets as of July 1, 2025 and all activity for the quarter is reflected in the lines that follow.
Previous report
(2)2024 performance-based advisory fees are reported separately from investment advisory fees to align with the presentation in 2025.
Previous report
Compared to the third quarter of 2024, the increase in U.S. GAAP operating expenses was driven by a few items, including the restructuring charge, primarily compensation and related, associated with our ongoing plan to reduce expense growth and realign resources to invest in existing and future capabilities. Additionally, higher technology and facilities costs and accrued carried interest compensation contributed to the rise in U.S. GAAP operating expenses and were the main drivers of the increase in non-GAAP operating expenses over the 2024 period. Given the non-recurring nature of the restructuring charge, we have excluded this charge from our non-GAAP operating expenses measures.
Previous report
Operating margin in the third quarter of 2025 was 34.0% on a U.S. GAAP basis, compared to 34.4% in the third quarter of 2024. The restructuring charge was the primary driver of the decrease in the operating margin.
Previous report
Diluted earnings per share was $2.87 for the third quarter of 2025 compared to $2.64 for the third quarter of 2024. The increase was primarily driven by higher operating income, higher investment gains, and fewer weighted average shares outstanding compared to the 2024 period.
Previous report
Results Overview - Year-to-Date ended September 30, 2025
Previous report
Operating expenses on a U.S. GAAP basis were $3,662.9 million in the nine months ended September 30, 2025, compared with $3,504.2 million over the comparable 2024 period. On a non-GAAP basis, operating expenses were $3,416.7 million, a 4.3% increase over the comparable 2024 period.
Previous report
Compared to the nine months ended September 30, 2024, the increase in U.S. GAAP operating expenses were primarily due to compensation and related costs, the restructuring charge, technology and facility costs, and distribution and servicing costs. The drivers of the increase in non-GAAP operating expenses were the same as U.S. GAAP with the exception of the restructuring charge, which is excluded from our non-GAAP operating expenses measures.
Previous report
Diluted earnings per share was $7.25 for the nine months ended September 30, 2025, compared to $7.23 for 2024 period. On a non-GAAP basis, adjusted diluted earnings per share was $7.28 for the nine months ended September 30, 2025, compared to $7.21 for the 2024 period. The increase was primarily due to fewer weighted average shares outstanding and higher investment gains, which were partially offset by lower operating income.
Previous report
(2)2024 performance-based advisory fees are reported separately from investment advisory fees to align with the 2025 presentation.
Previous report
Investment advisory fees in the third quarter of 2025 increased 4.4% over the comparable 2024 quarter while average assets under management increased $133.5 billion, or 8.4%, to $1,723.0 billion. For the nine months ended September 30, 2025, investment advisory revenues increased 2.8% over the comparable 2024 period as average assets under management increased $108.2 billion, or 7.0%, to $1,644.4 billion.
Previous report
Performance-based advisory fees in the third quarter of 2025 and 2024 were earned primarily from alternatives strategies, and from alternatives and equity strategies for the nine months ended September 30, 2025 and 2024.
Previous report
Administrative, distribution, services, and other fees in the third quarter of 2025 were $146.4 million, a decrease of $1.7 million, or 1.1%, from the comparable 2024 quarter. For the nine months ended September 30, 2025, these fees were $452.4 million, an increase of $7.6 million, or 1.7%, from the 2024 period. In the third quarter of 2025, we began reporting revenue from managed account model delivery assets and certain other advisory services in investment advisory fees, which was over $13 million in Q3 2025. This reclassification was the primary driver of the decline in administrative, distribution, services, and other fees, partially offset by higher transfer agents services compared to the 2024 period. For the nine months ended September 30, 2025, the increase was primarily due to higher recordkeeping fees and higher transfer agent services.
Previous report
Compensation, benefits, and related costs were $632.5 million in the third quarter of 2025, a decrease of $0.4 million, or 0.1%, compared to the 2024 quarter. For the nine months ended September 30, 2025, these costs were $1,939.2 million, an increase of $41.2 million, or 2.2%, compared to the 2024 period.
Previous report
For the third quarter of 2025, the decrease was due to lower temporary personnel, offset by higher salaries and related benefits and lower capitalized labor. For the nine months ended September 30, 2025, the increase was primarily due to higher salaries and related benefits, higher long-term incentive compensation, and lower capitalized labor. These increases were partially offset by lower temporary personnel and other employee related costs.
Previous report
Product and recordkeeping related costs were $78.7 million in the third quarter of 2025, an increase of $3.7 million, or 4.9%, compared to $75.0 million in the 2024 quarter. For the nine months ended September 30, 2025, these costs were $237.3 million, an increase of $14.3 million, or 6.4%, from $223.0 million recognized in the comparable 2024 period. The increases in both periods were primarily due to higher recordkeeping fees and other product related costs. Also contributing to the nine month increase was higher custody fees related to our trust products.
Previous report
Technology, occupancy, and facility costs were $183.2 million in the third quarter of 2025, an increase of $19.2 million, or 11.7%, compared to the $164.0 million recognized in the 2024 quarter. For the nine months ended September 30, 2025, these costs were $530.2 million, an increase of $55.4 million, or 11.7%, compared with the 2024 period. The increases in both periods were primarily due to higher technology costs, including hosted solutions and depreciation. Also contributing to the nine month increase was higher occupancy and facility costs related to our new corporate headquarters, which was occupied in March 2025, and a non-recurring cost benefit related to our UK facility in the first quarter of 2024.
Previous report
General, administrative, and other expenses were $101.7 million in the third quarter of 2025, a decrease of $2.5 million, or 2.4%, compared to the $104.2 million recognized in the 2024 quarter. For the nine months ended September 30, 2025, these costs were $314.5 million, an increase of $9.0 million, or 2.9%, compared with the 2024 period. For the third quarter of 2025, the decrease was primarily related to a non-recurring cost recovery recognized during the quarter. For the nine months ended September 30, 2025, the increase was primarily driven by higher professional fees, information services, and other administrative costs. These increases were partially offset by the non-recurring cost recovery recognized in the third quarter of 2025 and lower external research fees.
Previous 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. For the third quarter of 2025, we recognized $26.8 million in amortization and impairments related to intangible assets, compared to $51.5 million in the 2024 quarter. For the nine months ended September 30, 2025, we recognized $86.7 million in amortization and impairments related to intangible assets, compared to $125.3 million, in the 2024 period. For the 2024 periods, intangible asset impairment charges totaled $25.6 million for the third quarter and $59.7 million for the year-to-date period. If conditions that led us to recognize impairment charges worsen, additional impairments may be recognized in future periods.
Previous report
Higher investment gains earned by our investment portfolio during the three- and nine-month periods ended September 30, 2025 compared to the 2024 periods were primarily due to higher cash and investment holdings coupled with stronger overall market returns.
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
Our effective tax rate will continue to experience volatility in future periods due to tax benefits recognized from stock-based compensation being influenced by market fluctuations in our stock price, and changes in deferred tax asset valuation allowances, primarily in foreign jurisdictions, being impacted by the sufficiency of taxable income in future periods. Our U.S. GAAP rate will also be 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.
Previous report
CRITICAL ACCOUNTING POLICIES.
Reworded paragraphs (55)
Previous 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 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
The following tables detail changes in our assets under management, by asset class, during the three- and nine-month periods ended September 30, 2025:
Current wording
The following table details changes in our assets under management, by asset class, during the first quarter of 2026:
Previous wording
(1)Includes assets in which T. Rowe Price and its affiliates have full discretionary authority along with managed account - model delivery assets.
Current wording
(1) Includes fee earning assets in which T. Rowe Price and its affiliates have full discretionary authority along with managed account - model delivery assets.
Previous 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, or have absolute return as its investment objective. Generally, only those strategies with longer than daily liquidity are included. Unfunded capital commitments were $22.0 billion at September 30, 2025, $18.6 billion at June 30, 2025, and $16.2 billion at December 31, 2024, and are not reflected in fee basis 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, private equity, or have absolute return as its investment objective. Generally, only those strategies with longer than daily liquidity are included. Unfunded capital commitments were $20.9 billion at March 31, 2026 and $21.6 billion at December 31, 2025 and are not reflected in fee basis AUM above.
Previous wording
(5)Includes net distributions not reinvested for the three- and nine-month periods ended September 30, 2025 of $0.4 billion and $1.3 billion, respectively.
Current wording
(4)Includes net distributions not reinvested for the first quarter of 2026 of $0.6.
Previous wording
Investment advisory clients outside the United States account for 8.7% of our assets under management at September 30, 2025 and June 30, 2025 and 8.8% at December 31, 2024.
Current wording
Investment advisory clients outside the United States account for 8.6% of our assets under management at March 31, 2026 and 8.8% at December 31, 2025.
Previous wording
Assets under management in our target date retirement portfolios, which are included in the multi-asset totals shown above, were $552.9 billion at September 30, 2025, $520.3 billion at June 30, 2025, and $475.6 billion at December 31, 2024. Net flows into these portfolios were $2.6 billion and $10.6 billion in the three- and nine-month periods ended September 30, 2025, respectively.
Current wording
Assets under management in our target date retirement products, which are included in the multi-asset totals shown above, were $561.3 billion at March 31, 2026, compared with $561.4 billion at December 31, 2025. Net flows into these portfolios were $4.9 billion in the first quarter of 2026.
Previous wording
The firm’s 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 $25.2 billion at September 30, 2025, compared with $24.1 billion at June 30, 2025.
Current wording
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 March 31, 2026 and December 31, 2025.
Previous wording
We provide participant accounting and plan administration for retirement plans that primarily invest in the firm's U.S. mutual funds, collective investment trusts and products outside of the firm's complex. As of September 30, 2025, our assets under administration were $315 billion, of which $178 billion are 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 our complex. As of March 31, 2026, our assets under administration were $314 billion, of which $176 billion are assets we manage.
Previous wording
As of September 30, 2025, 63 of 142 (44.4%) 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, 59%(6) of AUM in the firm's rated U.S. mutual funds (across primary share classes) ended September 30, 2025 with an overall rating of 4 or 5 stars.
Current wording
As of March 31, 2026, 68 of 140 (48.6%) 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, 61.0%(6) of AUM in the firm's rated U.S. mutual funds (across primary share classes) ended March 31, 2026 with an overall rating of 4 or 5 stars.
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 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 $337B for 1 year, $328B for 3 years, $326B for 5 years, and $325B 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 $306B for 1 year, $294B for 3 years, $293B for 5 years, and $292B 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 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 $284B for 1 year, $275B for 3 years, $269B for 5 years, and $261B 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 $293B for 1 year, $244B for 3 years, $239B for 5 years, and $231B 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 $1,567B for 1 year, $1,559B for 3 years, $1,554B for 5 years, and $1,518B 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 $1,501B for 1 year, $1,494B for 3 years, $1,487B for 5 years, and $1,453B for 10 years.
Previous wording
The following table and discussion sets forth information regarding our consolidated financial results for the three- and nine-month periods ended September 30, 2025 and 2024 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, if any.
Current wording
The following table and discussion sets forth information regarding our consolidated financial results for the first quarter of 2026 and 2025 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
(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 wording
(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.
Previous wording
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 for the nine months ended September 30, 2025 are related to investment advisory fees. Total net revenues were $5,380.7 million in the nine months ended September 30, 2025, a 2.1% increase over $5,269.1 million in the 2024 period. The increase was primarily driven by a 2.8% increase in investment advisory fee revenue as average assets under management increased by 7.0% and a $7.6 million increase in non-advisory revenues, partially offset by a $16.8 million decrease in performance-based advisory fees and a $11.4 million decrease in capital allocation-based income (change in accrued carried interest) earned from investments in certain affiliated funds.
Current wording
Net revenues consist of investment advisory revenues; performance-based advisory fees; administrative, distribution, servicing, 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 $1,857.0 million in the first quarter of 2026, a 5.3% increase over $1,763.9 million in the first quarter of 2025. The increase was primarily driven by a 5.3% increase in investment advisory fee revenue as higher overall markets increased average assets under management by 9.6% and a $29.3 million increase in capital allocation-based income (change in accrued carried interest) earned from investments in certain affiliated funds.
Previous wording
Operating expenses on a U.S. GAAP basis were $1,250.3 million in the third quarter of 2025, a 6.7% increase over the comparable 2024 period. On a non-GAAP basis, operating expenses were $1,134.4 million, a 3.2% increase over the comparable 2024 period.
Current wording
Operating expenses on a U.S. GAAP basis were $1,176.5 million in the first quarter of 2026, a 0.8% increase over the comparable 2025 period. On a non-GAAP basis, adjusted operating expenses were $1,155.2 million, a 1.8% increase over the comparable 2025 period.
Previous wording
Operating margin in the nine months ended September 30, 2025 was 31.9% on a U.S. GAAP basis, compared to 33.5% earned in the 2024 period. The decrease was primarily driven by operating expense growth outpacing net revenue growth.
Current wording
Operating margin in the first quarter of 2026 was 36.6% on a U.S. GAAP basis, compared to 33.8% earned in the first quarter of 2025. The increase in our operating margin for the first quarter of 2026 compared to the 2025 period was driven by net revenue growth outpacing operating expense growth primarily due to higher investment advisory fees.
Previous wording
On a non-GAAP basis, diluted earnings per share was $2.81 for the third quarter of 2025 as compared to $2.57 for the third quarter of 2024. The increase was primarily due to higher adjusted operating income and fewer weighted average shares outstanding compared to the 2024 period.
Current wording
On a non-GAAP basis, diluted earnings per share was $2.52 for the first quarter of 2026 compared to $2.23 for the first quarter of 2025. The increase was primarily due to higher adjusted operating income and lower weighted average shares outstanding compared to the 2025 period.
Previous wording
The average annualized effective fee rate earned for the three- and nine-month periods ended September 30, 2025 declined from the comparable 2024 periods primarily due to client flows and transfers shifting assets under management toward lower-fee strategies and products.
Current wording
The average annualized effective fee rate earned for the first quarter of 2026 declined from the comparable 2025 period due to client flows and transfers creating a mix shift in assets under management toward lower fee products and asset classes.
Previous wording
Capital allocation-based income includes the change in accrued carried interest along with acquisition-related amortization and impairments. In the third quarter of 2025, the change in accrued carried interest increased net revenues by $56.2 million compared to $35.1 million in the 2024 period. For the nine months ended September 30, 2025, the change in accrued carried interest increased net revenues by $101.9 million compared to $121.6 million for the 2024 period. The difference in the change in accrued carried interest for the 2025 periods compared to the 2024 periods was due to relative market impacts and performance. The decrease in acquisition-related amortization and impairments for the 2025 periods from the comparable 2024 periods was primarily due to higher impairments recognized in prior periods.
Current wording
Capital allocation-based income includes the change in accrued carried interest along with acquisition-related amortization and impairments. For the 2026 quarter, accrued carried interest increased net revenues by $31.3 million, compared to $9.2 million in 2025, reflecting relative investment performance. The decrease in acquisition-related amortization and impairments from the comparable 2025 period primarily reflects amortization and impairments recognized over time, which reduced the remaining carrying value of the acquired-assets. We realized carried interest of $41.0 million in the first quarter of 2026 compared to $43.1 million in the 2025 period.
Previous wording
A portion of the capital allocation-based income is passed through to certain associates as compensation and the related expense recognized in compensation and related costs with the unpaid amount reported as non-controlling interest on the unaudited consolidated balance sheets.
Current wording
A portion of the capital allocation-based income is passed through to certain associates as compensation and the related expense is recognized in compensation and related costs with the unpaid amount reported as non-controlling interest on the unaudited consolidated balance sheet.
Previous wording
investment products. The corresponding expenses recognized by these products, which are consolidated in our financial statements, were also eliminated from operating expenses. For the third quarter, we eliminated net revenue of $0.8 million in 2025 and $1.3 million in 2024. For the nine months ended September 30, we eliminated net revenue of $3.6 million in 2025 and $3.0 million in 2024.
Current wording
investment products. The corresponding expenses recognized by these products, and consolidated in our financial statements, were also eliminated from operating expenses. For the first quarter, we eliminated net revenue of $1.1 million in 2026 and $1.4 million in 2025.
Previous wording
The firm employed 7,830 associates at September 30, 2025, a decrease of 2.9% from 8,063 associates at June 30, 2025, a decrease of 4.0% from the end of 2024, and a decrease of 3.4% from September 30, 2024. The decrease in associates over each period is primarily driven by the workforce action in July 2025.
Current wording
The firm employed 7,507 associates at March 31, 2026, a decrease of 3.4% from the end of 2025 and a decrease of 7.1% from March 31, 2025. The average associate headcount for the first quarter of 2026 was 7,617, a decrease of 6.0% compared to the 2025 period.
Previous wording
Distribution and servicing costs were $95.8 million for the third quarter of 2025, an increase of $4.2 million, or 4.6%, from $91.6 million recognized in the 2024 quarter. For the nine months ended September 30, 2025, these costs were $281.9 million, an increase of $20.7 million, or 7.9%, from $261.2 million recognized in the comparable 2024 period. The increases in both periods were primarily driven by higher average assets under management distributed through intermediaries.
Current wording
Distribution and servicing costs were $99.3 million for the first quarter of 2026, an increase of $5.7 million, or 6.1%, from $93.6 million recognized in the 2025 quarter. The increase was primarily driven by higher average assets under management distributed through intermediaries.
Previous 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 distribution revenue we earn and report in net revenues: 12b-1 revenue is recognized in administrative, distribution, services, and other fees for the Advisor and R share classes of the U.S. mutual funds and investment advisory fee revenue for our international products and ETFs.
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, servicing, and other fees.
Previous wording
Restructuring charge of $28.5 million for three- and nine-month periods ended September 30, 2025 reflects compensation costs, primarily severance, incurred in connection with the July workforce action. This was related to our previously announced broad and ongoing plan to reduce expense growth and realign resources. This ongoing effort is designed to support investment in both existing and future capabilities.
Current wording
Restructuring charge of $10.0 million in the first quarter of 2026 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 reflects compensation‑related costs, primarily severance.
Previous wording
Non-operating income for the third quarter of 2025 was $238.4 million compared to $212.5 million in the 2024 quarter. The following table details the components of non-operating income for both the three- and nine-month periods ended September 30, 2025 and 2024.
Current wording
The following table details the components of non-operating income (loss) for both the first quarter of 2026 and 2025.
Previous wording
The table above shows the net investment income of the underlying portfolios of the consolidated investment products, not just the income from our ownership share. The table below displays how consolidated investment products affected the individual lines of our unaudited consolidated income statements and the portion attributable to our interest.
Current wording
sponsored investment products and not just the net investment income related to our ownership interest in the products. The table below shows the impact that the consolidated investment products had on the individual lines of our unaudited consolidated statements of income and the portion attributable to our interest:
Previous wording
The GAAP effective tax rate for the third quarter of 2025 was 22.1% compared with 22.5% in the third quarter of 2024. These quarterly rates were the result of an overall year-to-date rate of 22.8% for 2025 and 23.5% for 2024. The following table reconciles the statutory federal income tax rate to our effective tax rate on a U.S. GAAP basis for the nine months ended September 30, 2025 and 2024:
Current wording
The following table reconciles the statutory federal income tax rate to our effective tax rate on a U.S. GAAP basis for the three months ended March 31, 2026 and 2025:
Previous wording
(2)Net income attributable to redeemable non-controlling interests represents the portion of earnings held in the firm's consolidated investment products, which are not taxable to the firm despite being included in pre-tax income.
Current wording
(1)Net income attributable to redeemable non-controlling interests represents the portion of earnings held in our consolidated investment products that are not taxable to the us despite being included in pre-tax income.
Previous wording
The adjusted effective tax rate primarily adjusts for the impact of the consolidated investment products, including the net income attributable to the redeemable non-controlling interests. The decrease in the year-to-date 2025 U.S. GAAP and adjusted effective tax rates compared to 2024 was primarily due to the reversal of a U.S. foreign tax credit carryover valuation allowance and lower state taxes. The impact of redeemable non-controlling interest also contributed to the lower U.S. GAAP effective tax rate compared to the 2024 period.
Current wording
The adjusted effective tax rate primarily adjusts for the impact of the consolidated investment products, including the net income attributable to redeemable non-controlling interests. Our adjusted effective tax rate was 23.7% in the first quarter of 2026 compared with 24.7% in 2025. The decrease in both the U.S. GAAP and adjusted effective tax rate is primarily due to lower state taxes resulting from prior period settlements and the reversal of certain deferred tax asset valuation allowances. The impact of these decreases on the U.S. GAAP effective tax rate were partially offset by a lower impact related to the net income attributable to redeemable noncontrolling interests.
Previous wording
We currently estimate that our effective tax rate for the full year 2025, on a U.S. GAAP basis, will be in the range of 23.0% to 26.0%. On an adjusted basis, the range is 23.5% to 25.5%.
Current wording
We currently estimate that our effective tax rate for the full year 2026, on a U.S. GAAP and adjusted basis, will be in the range of 23.0% to 26.0%.
Previous wording
(2) This non-GAAP adjustment eliminates the compensation expense impact from market valuation changes in deferred compensation liabilities, including the supplemental savings plan and, starting in Q4 2024, restricted fund units, and the related net gains (losses) on investments used as economic hedges against the related liabilities. The liabilities are adjusted based on the performance of hypothetical investments selected by participants. We use investment products to economically hedge the market risk associated with the supplemental savings plan liability and the expected settlement value of unvested restricted fund units. We believe it is useful to offset the non-operating investment income (loss) of the hedges against the related compensation expense and remove the net impact to help the reader's ability to understand the firm's core operating results and to increase comparability period to period.
Current wording
(2) This non-GAAP adjustment eliminates the compensation expense impact from market valuation changes in deferred compensation liabilities, including the supplemental savings plan and restricted fund units, and the related net gains (losses) on investments used as economic hedges against the related liabilities. The liabilities are adjusted based on the performance of hypothetical investments selected by participants. We use investment products to economically hedge the market risk associated with the supplemental savings plan liability and the expected settlement value of unvested restricted fund units. We believe it is useful to offset the non-operating investment income (loss) of the hedges against the related compensation expense and remove the net impact to help the reader's ability to understand the our core operating results and to increase comparability period to period.
Previous wording
(3) This non-GAAP adjustment removes compensation expenses, primarily severance, incurred 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.
Current wording
(3) This non-GAAP adjustment removes the impact of 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.
Previous wording
(4) This non-GAAP adjustment removes the impact of the consolidated investment products by adding back their operating expenses and subtracting their investment income. The operating expense adjustment represents their operating expenses net of related investment advisory and administrative fees. The adjustment to net income attributable to T. Rowe Price Group, Inc. represents the consolidated investment products' net income, net of redeemable non-controlling interests. We believe this adjustment helps the reader’s ability to understand our core operating results and increases comparability period to period.
Current wording
(4) This non-GAAP adjustment removes the impact of the consolidated investment products by adding back their operating expenses and subtracting their investment income. The operating expense adjustment represents their operating expenses net of related investment advisory and administrative fees. The adjustment to net income attributable to T. Rowe Price Group represents the consolidated investment products' net income, net of redeemable non-controlling interests. We believe this adjustment helps the reader’s ability to understand our core operating results and increases comparability period to period.
Previous wording
(5) This non-GAAP adjustment removes non-operating income (loss) earned on those investments that are not economic hedges for the deferred compensation liabilities and are not part of the cash and discretionary investment portfolio. We retain gains from cash and discretionary investments in our non-GAAP measures, as they are considered part of our core operations. We believe adjusting for the remaining non-operating income (loss) helps the reader’s ability to understand the firm's core operating results and increases comparability period to period. Additionally, we do not emphasize this portion of non-operating income (loss) when assessing the firm's performance.
Current wording
(5) This non-GAAP adjustment removes non-operating income (loss) earned on those investments that are not economic hedges for the deferred compensation liabilities and are not part of the cash and discretionary investment portfolio. We retain gains from cash and discretionary investments in our non-GAAP measures, as they are considered part of our core operations. We believe adjusting for the remaining non-operating income (loss) helps the reader’s ability to understand our core operating results and increases comparability period to period. Additionally, we do not emphasize this portion of non-operating income (loss) when assessing our performance.
Previous wording
(6) The income tax impacts were calculated in order to achieve an overall year-to-date non-GAAP effective tax rate of 23.8% in 2025 and 24.1% in 2024. As such, the non-GAAP effective tax rate for the third quarter was 23.4% in 2025 and 23.8% in 2024.
Current wording
(6) The income tax impacts were calculated in order to achieve an overall year-to-date non-GAAP effective tax rate. As such, the non-GAAP effective tax rate for the three months ended March 31, 2026 and 2025 was 23.7% and 24.7%, respectively.
Previous wording
(7) This non-GAAP measure was calculated by applying the two-class method to adjusted net income attributable to T. Rowe Price Group, Inc. divided by the weighted-average common shares outstanding assuming dilution. The calculation of adjusted net income allocated to common stockholders is as follows:
Current wording
T. Rowe Price Group divided by the weighted-average common shares outstanding assuming dilution. The calculation of adjusted net income allocated to common stockholders is as follows:
Showing the first 40 of 55 pairs. Open the source sections for the rest.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
(1) n/m - the percentage change is not meaningful.
Current report — wording carried from elsewhere
The table above includes the net investment income of the underlying portfolios included in the consolidated
Current report — wording carried from elsewhere
(7) This non-GAAP measure was calculated by applying the two-class method to adjusted net income attributable to
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Net revenues consist of investment advisory revenues; performance-based advisory fees; administrative, distribution, services, and other fees; and capital allocation-based income. About 90% of our net revenues are related to investment advisory fees. Total net revenues were $1,893.5 million in the third quarter of 2025, a 6.0% increase compared to $1,785.6 million in the 2024 quarter. The increase was driven primarily by higher investment advisory fees on higher average assets under management and capital allocation-based income.
Previous report — wording carried elsewhere
(1)n/m - The percentage change is not meaningful.
Previous report — wording carried elsewhere
The following schedules reconcile certain U.S. GAAP financial measures to non-GAAP financial measures for the nine months ended September 30, 2025 and 2024.