Key Highlights

  • Revenue was $312.5 million, up 3.7% from $301.3 million, while adjusted EPS was $1.03 versus $1.02 a year earlier.
  • GAAP EPS was $1.04, up 11.8% from $0.93, on net income of $75.2 million.
  • Net client cash flows were negative $10.558 billion, and ending AUM fell to $168.744 billion from $183.389 billion.
  • Adjusted operating margin was 35.5%, compared with 36.2% a year ago and 32.9% in the second quarter.
  • The company declared a $0.88 per share dividend, up from $0.80, and held $352.4 million of cash against $190.0 million of borrowings.

Artisan Partners Earnings: Why Did the Dividend Rise Despite Heavy Outflows?

Artisan Partners Asset Management (NYSE:APAM) reported third-quarter results on Tuesday, October 27, with adjusted EPS of $1.03, compared with $1.02 a year earlier, and GAAP EPS of $1.04, compared with $0.93. Revenue rose 3.7% to $312.5 million. The dividend rises because it is a variable payout tied to about 80% of quarterly cash generation, and cash generation held up even as assets under management (AUM) fell.

The board declared $0.88 per Class A share, up from $0.80, payable November 30 to holders of record on November 16. About 20% of cash generation is withheld for a potential special dividend after year-end.

Artisan is an active investment manager running equity and credit strategies. Its earnings call is scheduled for Wednesday, October 28.

APAM Net Outflows: Where Did the $10.558 Billion Leave?

Gross inflows were $7.886 billion and gross outflows were $18.444 billion, leaving net outflows of $10.558 billion, versus $2.329 billion a year ago. Investment returns and other were negative $3.812 billion, versus positive $21.196 billion in the second quarter.

Ending AUM was $168.744 billion, down from $183.389 billion at the start of the quarter and $181.306 billion a year earlier. Average AUM was $180.518 billion.

By team, Global Value had net outflows of $6.401 billion and Growth had $2.076 billion. U.S. Value, wound down on August 30, lost $1.861 billion, and management attributed $5.9 billion of outflows to rebalancing by one large client.

Credit and alternatives took in about $1.1 billion, a 17% annualized rate, and $3.2 billion year to date. EMsights Capital Group added $856 million.

Artisan Partners Margins: Why Did GAAP Improve While the Adjusted Margin Slipped?

GAAP operating income rose 7.9% to $109.8 million, a 35.1% margin versus 33.8%. Adjusted operating income was $110.9 million at a 35.5% margin, below 36.2% a year ago.

Revenue growth came from higher fund fees, while separate account fees were roughly flat. Compensation and benefits were $162.2 million, or 51.9% of revenue by calculation, versus 54.2% a year ago.

Nine-month revenue was $923.4 million, compared with $861.2 million, and year-to-date net outflows were $24.2 billion, compared with $7.0 billion a year earlier.

APAM Balance Sheet: How Much Flexibility Supports the Payout?

Cash and equivalents were $352.4 million, up from $214.4 million at December 31, 2025, against unchanged borrowings of $190.0 million. A new $150 million revolver maturing in September 2031 replaced a $100 million facility due in August 2027, with nothing drawn.

Over 75% of AUM has outperformed benchmarks over five and ten years. International Value, the largest strategy at about $55.0 billion, returned 15.45% over one year gross of fees.

Artisan Partners Outlook: What to Watch After the October 28 Call?

Management described credit and alternatives as the main growth engine and said it cannot engineer short-term flow outcomes. The first ETF share classes are on track to launch in the fourth quarter, and an interval fund for public and private credit is in development. Watch the call for flow trends in Global Value, the pace of credit inflows, and whether the adjusted margin returns toward 36%.