Affiliated Managers Group Q3 profit falls to $173M
AMG's assets under management were $973.9 billion, and nine-month aggregate fees rose 41%.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
10-Q
Affiliated Managers Group, Inc. (AMG) reported third-quarter 2026 consolidated revenue of $595.2 million, up from $528.0 million a year earlier. Net income attributable to controlling interest was $173.3 million, down from $212.4 million, while diluted earnings per share were $6.64 versus $6.87. The quarter included no affiliate transaction gains, compared with $127.6 million a year earlier; equity method income was $159.2 million versus $88.5 million.
For the nine months ended September 30, 2026, revenue was $1,780.8 million versus $1,517.8 million, and net income attributable to controlling interest was $469.6 million versus $369.0 million. Diluted earnings per share were $17.38 versus $11.83. Assets under management were $973.9 billion, up 21%, and aggregate fees were $5,329.0 million, up 41%. Operating cash flow was $899.8 million versus $716.8 million.
In the second quarter, myCIO completed the divestiture of an advisor team managing $5.6 billion in client assets; AMG received $24.5 million in cash for its controlling-interest portion and may receive additional contingent cash consideration. In January 2026, AMG settled conversion obligations on junior convertible securities for $514.6 million in cash and incurred an approximately $56 million current cash tax liability. Debt was $3,179.4 million at September 30, 2026, including $825.0 million outstanding under the revolver.
3 points · 0 major0 major · 1 point
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointThird-quarter revenue reached $595.2 million, versus $528.0 million a year earlier.
- Moderate pointNine-month controlling-interest income: $469.6 million, versus $369.0 million.
- Moderate pointNine-month operating cash flow: $899.8 million, versus $716.8 million.
Negative
- Moderate pointThird-quarter controlling-interest income fell to $173.3 million from $212.4 million.
Filing Explained
Of $555.4 million in Affiliate payments contingent on financial targets, $44.8 million was recorded as a liability at September 30, 2026.
Form 10-Q is an unaudited quarterly report; this one reports AMG’s position at
As of September 30,
Key Figures
Consolidated revenue: $595.2 million
Net income attributable to controlling interest: $173.3 million
Diluted earnings per share: $6.64 per share
+5 more
8 metrics
Consolidated revenue
$595.2 million
Three months ended September 30, 2026; $528.0 million in 2025
Net income attributable to controlling interest
$173.3 million
Three months ended September 30, 2026; $212.4 million in 2025
Diluted earnings per share
$6.64 per share
Three months ended September 30, 2026; $6.87 in 2025
Net income attributable to controlling interest
$469.6 million
Nine months ended September 30, 2026; $369.0 million in 2025
Assets under management
$973.9 billion
As of September 30, 2026; 21% change from 2025
Aggregate fees
$5,329.0 million
Nine months ended September 30, 2026; 41% change from 2025
Cash flow from operating activities
$899.8 million
Nine months ended September 30, 2026; $716.8 million in 2025
Debt
$3,179.4 million
As of September 30, 2026; includes $825.0 million outstanding under the revolver
Key Terms
equity method, assets under management, revolver, unfunded commitments, +1 more
5 terms
equity method financial
"Equity method income (net)"
An equity method investment is an accounting approach used when a company owns enough of another business to influence its decisions but not control it (commonly around 20–50% ownership). Instead of counting only dividends, the investor records its share of the other company’s profits and losses on its own income statement and adjusts the investment’s value on the balance sheet—like tracking a friend’s joint project by noting your share of their gains or setbacks. For investors, this matters because it can significantly affect reported earnings, asset values, and the apparent strength of a company’s financial results.
assets under management financial
"our aggregate assets under management were approximately $974 billion"
Assets under management (AUM) is the total value of all the investments that a financial company or fund is responsible for overseeing on behalf of its clients. It’s like a big bucket that shows how much money the firm is managing for people or organizations. A higher AUM often indicates a larger, more trusted company, and it can influence how much money they earn and the services they can offer.
revolver financial
"the Company's senior unsecured multicurrency revolving credit facility (the “revolver”)"
A revolver is a revolving credit facility — a line of borrowing a company can draw, repay and draw again as needed, similar to a corporate credit card for short-term cash needs. It matters to investors because it provides liquidity and flexibility to cover expenses, smooth cash flow swings, or bridge financing gaps; the size, cost and covenants of the revolver affect a company’s interest costs, financial health and default risk.
unfunded commitments financial
"the Company's unfunded commitments attributed to investments measured at NAV"
Unfunded commitments are promises by investors to provide capital to an investment vehicle or fund that have been agreed upon but not yet called or paid. They matter because they represent future cash obligations and potential buying power—like agreeing to pay for future work on a house—which affects an investor’s liquidity, risk exposure and a fund’s ability to make new investments or meet obligations.
contingent payment obligations financial
"the fair value of the expected future settlement amounts related to the Company's investments"
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What did AMG receive from the myCIO divestiture?
AMG received $24.5 million in cash for its controlling-interest portion of the divestiture of an advisor team managing $5.6 billion in client assets. AMG may receive additional contingent cash consideration.
How much did AMG pay to settle junior convertible conversion obligations?
AMG settled applicable conversion obligations in cash for an aggregate $514.6 million in January 2026. The settlement resulted in a $9.3 million incremental expense related to the forward sale contract, and AMG incurred an approximately $56 million current cash tax liability.
What are the terms of AMG's revolver?
AMG amended and restated its $1.25 billion revolver in June 2026, extending maturity to June 9, 2031. Subject to certain conditions, AMG may increase commitments by up to an additional $750.0 million.
AI-generated analysis. How Rhea-AI works. Not financial advice.
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Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One) | ||
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2026
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number 001-13459
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
(Address of principal executive offices)
(800 ) 345-1100
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Table of Contents
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be
submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a
smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the
Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐
No ☒
There were 24,688,879 shares of the registrant’s common stock outstanding on November 5, 2026.
Table of Contents
FORM 10-Q
TABLE OF CONTENTS
PART I | FINANCIAL INFORMATION | 2 | ||||
Item 1. | Financial Statements (unaudited) | 2 | ||||
Consolidated Statements of Income | 2 | |||||
Consolidated Statements of Comprehensive Income | 3 | |||||
Consolidated Balance Sheets | 4 | |||||
Consolidated Statements of Changes in Equity | 5 | |||||
Consolidated Statements of Cash Flows | 7 | |||||
Notes to Consolidated Financial Statements | 8 | |||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 28 | ||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 43 | ||||
Item 4. | Controls and Procedures | 43 | ||||
PART II | OTHER INFORMATION | 44 | ||||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 44 | ||||
Item 6. | Exhibits | 44 | ||||
SIGNATURES | 46 | |||||
2
Table of Contents
PART I—FINANCIAL INFORMATION
Item 1.Financial Statements
AFFILIATED MANAGERS GROUP, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share data)
(unaudited)
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Consolidated revenue | $ | $ | $ | $ | |||
Consolidated expenses: | |||||||
Compensation and related expenses | |||||||
Selling, general and administrative | |||||||
Intangible amortization and impairments | |||||||
Interest expense | |||||||
Depreciation and other amortization | |||||||
Other expenses (net) | |||||||
Total consolidated expenses | |||||||
Equity method income (net) | |||||||
Affiliate transaction gains (Notes 8 and 9) | |||||||
Investment and other income | |||||||
Income before income taxes | |||||||
Income tax expense | |||||||
Net income | |||||||
Net income (non-controlling interests) | ( | ( | ( | ( | |||
Net income (controlling interest) | $ | $ | $ | $ | |||
Average shares outstanding (basic) | |||||||
Average shares outstanding (diluted) | |||||||
Earnings per share (basic) | $ | $ | $ | $ | |||
Earnings per share (diluted) | $ | $ | $ | $ | |||
The accompanying notes are an integral part of the Consolidated Financial Statements.
3
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AFFILIATED MANAGERS GROUP, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in millions)
(unaudited)
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Net income | $ | $ | $ | $ | |||
Other comprehensive income (loss), net of tax: | |||||||
Foreign currency translation gain (loss) | ( | ( | |||||
Change in net realized and unrealized gain (loss) on derivative financial instruments | ( | ( | |||||
Change in net unrealized gain (loss) on available-for-sale debt securities | |||||||
Other comprehensive income (loss), net of tax | ( | ( | |||||
Comprehensive income | |||||||
Comprehensive income (non-controlling interests) | ( | ( | ( | ( | |||
Comprehensive income (controlling interest) | $ | $ | $ | $ | |||
The accompanying notes are an integral part of the Consolidated Financial Statements.
4
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AFFILIATED MANAGERS GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(in millions)
(unaudited)
December 31, 2025 | September 30, 2026 | ||
Assets | |||
Cash and cash equivalents | $ | $ | |
Receivables | |||
Investments | |||
Goodwill | |||
Acquired client relationships (net) | |||
Equity method investments in Affiliates (net) | |||
Fixed assets (net) | |||
Other assets | |||
Total assets | $ | $ | |
Liabilities and Equity | |||
Payables and accrued liabilities | $ | $ | |
Debt | |||
Deferred tax liability (net) | |||
Other liabilities | |||
Total liabilities | |||
Commitments and contingencies (Note 7) | |||
Redeemable non-controlling interests | |||
Equity: | |||
Common stock ($ 2025 and September 30, 2026) | |||
Additional paid-in capital | |||
Accumulated other comprehensive loss | ( | ( | |
Retained earnings | |||
Less: Treasury stock, at cost ( September 30, 2026, respectively) | ( | ( | |
Total stockholders' equity | |||
Non-controlling interests | |||
Total equity | |||
Total liabilities and equity | $ | $ |
The accompanying notes are an integral part of the Consolidated Financial Statements.
5
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AFFILIATED MANAGERS GROUP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in millions, except dividends per share)
(unaudited)
Three Months Ended September 30, 2025 | Total Stockholders’ Equity | |||||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock at Cost | Non- controlling Interests | Total Equity | ||||||||
June 30, 2025 | $ | $ | $( | $ | $( | $ | $ | |||||||
Net income | — | — | — | — | ||||||||||
Other comprehensive income (loss), net of tax | — | — | — | — | ( | |||||||||
Share-based compensation | — | — | — | — | — | |||||||||
Common stock issued under share-based incentive plans | — | ( | — | — | ( | — | ( | |||||||
Share repurchases, inclusive of excise tax | — | — | — | — | ( | — | ( | |||||||
Dividends ($ | — | — | — | ( | — | — | ( | |||||||
Affiliate equity-related activities: | ||||||||||||||
Affiliate equity expense | — | — | — | — | ||||||||||
Issuances | — | ( | — | — | — | |||||||||
Purchases | — | — | — | — | — | |||||||||
Changes in redemption value of Redeemable non- controlling interests | — | ( | — | — | — | — | ( | |||||||
Capital contributions and other | — | — | — | — | — | ( | ( | |||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | |||||||
September 30, 2025 | $ | $ | $( | $ | $( | $ | $ | |||||||
Three Months Ended September 30, 2026 | Total Stockholders’ Equity | |||||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock at Cost | Non- controlling Interests | Total Equity | ||||||||
June 30, 2026 | $ | $ | $( | $ | $( | $ | $ | |||||||
Net income | — | — | — | — | ||||||||||
Other comprehensive loss, net of tax | — | — | ( | — | — | ( | ( | |||||||
Share-based compensation | — | — | — | — | — | |||||||||
Common stock issued under share-based incentive plans | — | ( | — | — | — | |||||||||
Share repurchases, inclusive of excise tax | — | — | — | — | ( | — | ( | |||||||
Dividends ($ | — | — | — | ( | — | — | ( | |||||||
Affiliate equity-related activities: | ||||||||||||||
Affiliate equity expense | — | — | — | — | ||||||||||
Issuances | — | ( | — | — | — | |||||||||
Purchases | — | — | — | — | ( | |||||||||
Changes in redemption value of Redeemable non- controlling interests | — | ( | — | — | — | — | ( | |||||||
Capital contributions and other | — | — | — | — | — | ( | ( | |||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | |||||||
September 30, 2026 | $ | $ | $( | $ | $( | $ | $ | |||||||
The accompanying notes are an integral part of the Consolidated Financial Statements.
6
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AFFILIATED MANAGERS GROUP, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in millions, except dividends per share)
(unaudited)
Nine Months Ended September 30, 2025 | Total Stockholders' Equity | |||||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock at Cost | Non- controlling Interests | Total Equity | ||||||||
December 31, 2024 | $ | $ | $( | $ | $( | $ | $ | |||||||
Net income | — | — | — | — | ||||||||||
Other comprehensive income, net of tax | — | — | — | — | ||||||||||
Share-based compensation | — | — | — | — | — | |||||||||
Common stock issued under share-based incentive plans | — | ( | — | — | ( | — | ( | |||||||
Share repurchases, inclusive of excise tax | — | — | — | — | ( | — | ( | |||||||
Dividends ($ | — | — | — | ( | — | — | ( | |||||||
Affiliate equity-related activities: | ||||||||||||||
Affiliate equity expense | — | — | — | — | ||||||||||
Issuances | — | ( | — | — | — | |||||||||
Purchases | — | — | — | — | ( | ( | ||||||||
Changes in redemption value of Redeemable non- controlling interests | — | ( | — | — | — | — | ( | |||||||
Transfers from Redeemable non-controlling interests | — | — | — | — | — | |||||||||
Capital contributions and other | — | — | — | — | — | ( | ( | |||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | |||||||
September 30, 2025 | $ | $ | $( | $ | $( | $ | $ | |||||||
Nine Months Ended September 30, 2026 | Total Stockholders' Equity | |||||||||||||
Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock at Cost | Non- controlling Interests | Total Equity | ||||||||
December 31, 2025 | $ | $ | $( | $ | $( | $ | $ | |||||||
Net income | — | — | — | — | ||||||||||
Other comprehensive loss, net of tax | — | — | ( | — | — | ( | ( | |||||||
Share-based compensation | — | — | — | — | — | |||||||||
Common stock issued under share-based incentive plans | — | ( | — | — | ( | — | ( | |||||||
Conversion premium on junior convertible securities | — | — | — | — | — | |||||||||
Share repurchases, inclusive of excise tax | — | — | — | — | ( | — | ( | |||||||
Dividends ($ | — | — | — | ( | — | — | ( | |||||||
Affiliate equity-related activities: | ||||||||||||||
Affiliate equity expense | — | — | — | — | ||||||||||
Issuances | — | ( | — | — | — | |||||||||
Purchases | — | ( | — | — | — | ( | ( | |||||||
Changes in redemption value of Redeemable non- controlling interests | — | ( | — | — | — | — | ( | |||||||
Capital contributions and other | — | — | — | — | — | ( | ( | |||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | |||||||
Affiliate transactions | — | — | — | — | — | ( | ( | |||||||
September 30, 2026 | $ | $ | $( | $ | $( | $ | $ | |||||||
The accompanying notes are an integral part of the Consolidated Financial Statements.
7
Table of Contents
AFFILIATED MANAGERS GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions)
(unaudited)
For the Nine Months Ended September 30, | |||
2025 | 2026 | ||
Cash flow from (used in) operating activities: | |||
Net income | $ | $ | |
Adjustments to reconcile Net income to cash flow from (used in) operating activities: | |||
Intangible amortization and impairments | |||
Depreciation and other amortization | |||
Deferred income tax expense (benefit) | ( | ||
Equity method income (net) | ( | ( | |
Distributions received from equity method investments | |||
Affiliate transaction gains | ( | ( | |
Share-based compensation and Affiliate equity expense | |||
Net realized and unrealized gains on investment securities | ( | ( | |
Other non-cash items | ( | ||
Changes in assets and liabilities: | |||
Purchases of securities by consolidated Affiliate-sponsored investment products | ( | ( | |
Sales of securities by consolidated Affiliate-sponsored investment products | |||
Increase in receivables | ( | ( | |
(Increase) decrease in other assets | ( | ||
Increase in payables, accrued liabilities, and other liabilities | |||
Cash flow from operating activities | |||
Cash flow from (used in) investing activities: | |||
Investments in Affiliates | ( | ( | |
Proceeds from Affiliate transactions | |||
Return of capital from equity method investments in Affiliates | |||
Purchases of fixed assets | ( | ( | |
Purchases of investment securities | ( | ( | |
Maturities and sales of investment securities | |||
Cash flow used in investing activities | ( | ( | |
Cash flow from (used in) financing activities: | |||
Borrowings of senior bank debt | |||
Repayments of senior bank debt | ( | ( | |
Repayments of junior convertible securities | ( | ||
Conversion payments on junior convertible securities | ( | ||
Repurchases of common stock, net | ( | ( | |
Distributions to non-controlling interests | ( | ( | |
Affiliate equity purchases, net | ( | ( | |
Taxes paid on shares withheld on share-based awards | ( | ( | |
Other financing items | ( | ||
Cash flow used in financing activities | ( | ( | |
Effect of foreign currency exchange rate changes on cash and cash equivalents | ( | ||
Net decrease in cash and cash equivalents | ( | ( | |
Cash and cash equivalents at beginning of period | |||
Effect of consolidation (deconsolidation) of Affiliate-sponsored investment products | ( | ||
Cash and cash equivalents at end of period | $ | $ | |
Supplemental disclosure of non-cash investing and financing activities: | |||
Shares received from Affiliate transactions | $ | $ | |
Payables recorded for Affiliate equity purchases | |||
Stock issued upon vesting of restricted stock units and exercise of stock options | |||
Stock received for tax withholdings on share-based payments | |||
Stock received for the exercise of stock options | |||
The accompanying notes are an integral part of the Consolidated Financial Statements.
8
Table of Contents
AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
1.Basis of Presentation and Use of Estimates
prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”) for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the
recurring adjustments considered necessary for a fair statement of the Company’s interim financial position and results of
operations have been included and all intercompany balances and transactions have been eliminated. Certain reclassifications
interim periods are not necessarily indicative of the results that may be expected for any other period or for the full year. The
Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 includes additional information about its
operations, financial position, and accounting policies, and should be read in conjunction with this Quarterly Report on
Form 10-Q.
that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
otherwise indicated.
2.Accounting Standards and Policies
In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”)
2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40):
Disaggregation of Income Statement Expenses, which requires improved disclosure of the nature and disaggregation of income
statement expenses. The standard is effective for annual periods beginning after December 15, 2026 and interim periods
beginning after December 15, 2027. The Company is currently evaluating the potential impact that this standard may have on
its Consolidated Financial Statements.
In May 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810):
Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which revises guidance on how an entity
should identify the accounting acquirer in a business combination in which the legal acquiree is a variable interest entity. The
standard is effective for annual periods beginning after December 15, 2026 and interim periods within those annual reporting
periods. The Company currently does not expect the adoption to have a material impact on its Consolidated Financial
Statements.
In September 2025, the FASB issued ASU 2025-06, Intangibles — Goodwill and Other — Internal-Use Software
(Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which increases the operability of the
recognition guidance considering different methods of software development. The standard is effective for annual periods
beginning after December 15, 2027 and interim periods within those annual reporting periods. The Company is currently
evaluating the potential impact that this standard may have on its Consolidated Financial Statements.
In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting
Improvements, which amends certain aspects of the hedge accounting guidance to more closely align hedge accounting with the
economics of an entity’s risk management activities. The standard is effective for annual reporting periods beginning after
December 15, 2026 and interim periods within those annual reporting periods. The Company currently does not expect the
adoption to have a material impact on its Consolidated Financial Statements.
In September 2026, the FASB issued ASU 2026-03, Fair Value Measurement (Topic 820): Investment companies with
equity securities subject to contractual sale restrictions, which requires investment companies within the scope of Topic 946,
Financial Services — Investment Companies to consider the effect of a contractual sale restriction when measuring an equity
security’s fair value. The standard is effective for annual reporting periods beginning after December 15, 2027 and interim
periods within those annual reporting periods. The Company currently does not expect the adoption to have a material impact
on its Consolidated Financial Statements.
9
Table of Contents
AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
3.Investments
December 31, 2025 | September 30, 2026 | |||
Marketable securities | ||||
Equity securities | $ | $ | ||
Debt securities | ||||
Total marketable securities | ||||
Other investments | ||||
Investments measured at NAV as a practical expedient | ||||
Investments without readily determinable fair values | ||||
Total other investments | ||||
Investments | $ | $ |
Marketable Securities
Equity Securities
equity securities:
December 31, 2025 | September 30, 2026 | |||
Cost | $ | $ | ||
Unrealized gains | ||||
Unrealized losses | ( | ( | ||
Fair value | $ | $ |
As of December 31, 2025 and September 30, 2026, investments in equity securities include consolidated Affiliate-
sponsored investment products with fair values of $9.2 million and $13.1 million, respectively.
For the three and nine months ended September 30, 2025, the Company recognized net unrealized gains on equity
securities still held as of September 30, 2025 of $1.4 million and $5.7 million, respectively. For the three and nine months
ended September 30, 2026, the Company recognized net unrealized gains on equity securities still held as of September 30,
2026 of $8.1 million and $11.8 million, respectively.
Debt Securities
consolidated Affiliate-sponsored investment products:
December 31, 2025 | September 30, 2026 | |||
Cost | $ | $ | ||
Unrealized gains | ||||
Unrealized losses | ( | ( | ||
Fair value | $ | $ |
For the three and nine months ended September 30, 2025, the Company recognized net unrealized gains (losses) on debt
securities still held as of September 30, 2025 of $(0.4 ) million and $1.8 million, respectively. For the three and nine months
ended September 30, 2026, the Company recognized net unrealized losses on debt securities still held as of September 30, 2026
of $1.7 million and $2.2 million, respectively.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Other Investments
Investments Measured at NAV as a Practical Expedient
expedient:
December 31, 2025 | September 30, 2026 | ||
Investments with limited liquidity(1) | $ | $ | |
Investments with periodic liquidity(2) | |||
Total(3) | $ | $ |
___________________________
(1)The Company expects to receive distributions related to its interests in investments with limited liquidity as the underlying
assets are liquidated over the life of the investments, which is generally up to 15 years. The Company accounts for the
majority of its interests in investments with limited liquidity one quarter in arrears (adjusted for current period calls and
distributions).
(2)Investments with periodic liquidity are generally redeemable on a daily, monthly, or quarterly basis.
(3)Investments measured at NAV as a practical expedient primarily invest in a broad range of private markets. Fair value
attributable to the controlling interest was $456.6 million and $527.2 million as of December 31, 2025 and September 30,
2026, respectively.
As of December 31, 2025 and September 30, 2026, the Company’s unfunded commitments attributed to investments
measured at NAV as a practical expedient were $283.0 million and $263.2 million, respectively. As of September 30, 2026, the
Company’s unfunded commitments attributed to investments with structures yet to be determined were $75.0 million.
Investments Without Readily Determinable Fair Values
in a private corporation where it does not exercise significant influence, and does not have a readily determinable fair value:
December 31, 2025 | September 30, 2026 | ||
Cost | $ | $ | |
Cumulative unrealized gains | |||
Carrying amount | $ | $ |
For the three and nine months ended September 30, 2025 and 2026, the Company did not
gains or losses on the underlying investment.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
For the Three Months Ended September 30, | ||||||||||||||||
2025 | 2026 | |||||||||||||||
Measured at NAV as a Practical Expedient | Debt Securities | Without Readily Determinable Fair Values | Total | Measured at NAV as a Practical Expedient | Debt Securities | Without Readily Determinable Fair Values | Total | |||||||||
Balance, beginning of period | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||
Purchases and commitments funded | ||||||||||||||||
Sales and distributions | ( | ( | ( | ( | ||||||||||||
Net realized and unrealized gains | ||||||||||||||||
Effect of deconsolidation | ( | ( | ||||||||||||||
Balance, end of period | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||
For the Nine Months Ended September 30, | ||||||||||||||||
2025 | 2026 | |||||||||||||||
Measured at NAV as a Practical Expedient | Debt Securities | Without Readily Determinable Fair Values | Total | Measured at NAV as a Practical Expedient | Debt Securities | Without Readily Determinable Fair Values | Total | |||||||||
Balance, beginning of period | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||
Purchases and commitments funded | ||||||||||||||||
Sales and distributions | ( | ( | ( | ( | ||||||||||||
Net realized and unrealized gains (losses) | ( | |||||||||||||||
Effect of deconsolidation | ( | ( | ||||||||||||||
Balance, end of period | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
4.Fair Value Measurements
Fair Value Measurements | |||||||
December 31, 2025 | |||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||
Financial Assets(1) | |||||||
Investments in equity securities | $ | $ | $ | $ | |||
Investments in debt securities | |||||||
Financial Liabilities(2) | |||||||
Contingent payment obligations | $ | $ | $ | $ | |||
Affiliate equity purchase obligations | |||||||
Fair Value Measurements | |||||||
September 30, 2026 | |||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||
Financial Assets(1) | |||||||
Investments in equity securities | $ | $ | $ | $ | |||
Investments in debt securities | |||||||
Financial Liabilities(2) | |||||||
Affiliate equity purchase obligations | $ | $ | $ | $ | |||
___________________________
(1)Amounts are recorded in Investments on the Consolidated Balance Sheets.
(2)Amounts are recorded in Other liabilities on the Consolidated Balance Sheets.
Level 3 Financial Assets and Liabilities
assets:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||
2025 | 2026 | 2025 | 2026 | |||||
Balance, beginning of period | $ | $ | $ | $ | ||||
Purchases and commitments funded | ||||||||
Sales and distributions | ||||||||
Net realized and unrealized losses(1) | ( | |||||||
Effect of deconsolidation | ( | ( | ||||||
Balance, end of period | $ | $ | $ | $ | ||||
Net change in unrealized losses relating to instruments still held at the reporting date(1) | $ | $ | $ | $ | ||||
___________________________
(1)Gains and losses resulting from changes to unrealized gains (losses) are included in Investment and other income in the
Consolidated Statements of Income.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
For the Three Months Ended September 30, | ||||||||
2025 | 2026 | |||||||
Contingent Payment Obligations | Affiliate Equity Purchase Obligations | Contingent Payment Obligations | Affiliate Equity Purchase Obligations | |||||
Balance, beginning of period | $ | $ | $ | $ | ||||
Purchases and issuances(1) | ||||||||
Settlements and reductions | ( | ( | ( | |||||
Net realized and unrealized losses(2) | ||||||||
Balance, end of period | $ | $ | $ | $ | ||||
Net change in unrealized (gains) losses relating to instruments still held at the reporting date(2) | $ | $ | $ | $ | ||||
For the Nine Months Ended September 30, | ||||||||
2025 | 2026 | |||||||
Contingent Payment Obligations | Affiliate Equity Purchase Obligations | Contingent Payment Obligations | Affiliate Equity Purchase Obligations | |||||
Balance, beginning of period | $ | $ | $ | $ | ||||
Purchases and issuances(1) | ||||||||
Settlements and reductions | ( | ( | ( | ( | ||||
Net realized and unrealized (gains) losses(2) | ( | |||||||
Balance, end of period | $ | $ | $ | $ | ||||
Net change in unrealized (gains) losses relating to instruments still held at the reporting date(2) | $( | $ | $ | $ | ||||
___________________________
(1)Affiliate equity purchase obligation activity includes transfers from Redeemable non-controlling interests.
(2)Gains and losses resulting from changes to expected payments related to contingent payment obligations and the accretion
of these obligations are included in Other expenses (net) and included in Interest expense, respectively, in the Consolidated
Statements of Income. Changes to the redemption value of Affiliate equity purchase obligations are included in
Compensation and related expenses in the Consolidated Statements of Income.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Company’s recurring Level 3 fair value measurements:
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||
December 31, 2025 | September 30, 2026 | ||||||||||||||
Valuation Techniques | Unobservable Input | Fair Value | Range | Weighted Average(1) | Fair Value | Range | Weighted Average(1) | ||||||||
Contingent payment obligations | Monte Carlo simulation | Volatility | $ | $ | |||||||||||
Discount rates | |||||||||||||||
Affiliate equity purchase obligations | Discounted cash flow | Growth rates(2) | $ | ( | $ | ( | |||||||||
Discount rates | |||||||||||||||
Monte Carlo simulation | Volatility | $ | $ | ||||||||||||
Discount rates | |||||||||||||||
___________________________
(1)Calculated by comparing the relative fair value of a security or an obligation to its respective total.
(2)Represents growth rates of asset- and performance-based fees.
Contingent payment obligations represent the fair value of the expected future settlement amounts related to the
Company’s investments in its consolidated Affiliates. Changes to assumed volatility and discount rates change the fair value of
contingent payment obligations. Increases to the volatility rates used would result in higher fair values, while increases to the
discount rates used would result in lower fair values.
Affiliate equity purchase obligations include agreements to purchase Affiliate equity and represent the fair value of the
expected future settlement amounts. When using a discounted cash flow valuation technique, increases to the assumed growth
rates used would result in higher fair values, while increases to the discount rates used would result in lower fair values. When
using a Monte Carlo valuation technique, changes to assumed volatility and discount rates change the fair value of Affiliate
equity purchase obligations. Increases to the volatility rates used would result in higher fair values, while increases to the
discount rates used would result in lower fair values.
Other Financial Assets and Liabilities Not Carried at Fair Value
December 31, 2025 | September 30, 2026 | ||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | Fair Value Hierarchy | |||||
Senior notes | $ | $ | $ | $ | Level 2 | ||||
Junior subordinated notes | Level 2 | ||||||||
The carrying amount of Cash and cash equivalents, Receivables, Payables and accrued liabilities, and certain Other
liabilities approximates fair value because of the short-term nature of these instruments. The carrying value of the revolver (as
defined in Note 6) approximates fair value because the revolver has variable interest based on selected short-term rates.
5.Investments in Affiliates and Affiliate-Sponsored Investment Products
In evaluating whether an investment must be consolidated, the Company evaluates the risk, rewards, and significant terms
of each of its Affiliates and other investments to determine if an investment is considered a voting rights entity (“VRE”) or a
variable interest entity (“VIE”). An entity is a VRE when the total equity investment at risk is sufficient to enable the entity to
finance its activities independently, and when the equity holders have the obligation to absorb losses, the right to receive
residual returns, and the right to direct the activities of the entity that most significantly impact its economic performance. An
entity is a VIE when it lacks one or more of the characteristics of a VRE, which, for the Company, are Affiliate investments
structured as partnerships (or similar entities) where the Company is a limited partner and lacks substantive kick-out or
substantive participation rights over the general partner. Assessing whether an entity is a VRE or VIE involves judgment.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Upon the occurrence of certain events, management reviews and reconsiders its previous conclusion regarding the status of an
entity as a VRE or a VIE.
The Company consolidates VREs when it has control over significant operating, financial, and investing decisions of the
entity. When the Company lacks such control, but is deemed to have significant influence, the Company accounts for the VRE
under the equity method. Investments with readily determinable fair values in which the Company does not have rights to
exercise significant influence are recorded at fair value on the Consolidated Balance Sheets, with changes in fair value included
in Investment and other income.
The Company consolidates VIEs when it is the primary beneficiary of the entity, which is defined as having the power to
direct the activities that most significantly impact the VIE’s economic performance and the obligation to absorb losses of, or the
right to receive benefits from, the entity that could potentially be significant to the VIE. Substantially all of the Company’s
consolidated Affiliates considered VIEs are controlled because the Company holds a majority of the voting interests or it is the
managing member or general partner. Furthermore, an Affiliate’s assets can be used for purposes other than the settlement of
the respective Affiliate’s obligations. The Company applies the equity method of accounting to VIEs where the Company is
not the primary beneficiary, but has the ability to exercise significant influence over operating and financial matters of the VIE.
Investments in Affiliates
Substantially all of the Company’s Affiliates are considered VIEs and are either consolidated or accounted for under the
equity method. A limited number of the Company’s Affiliates are considered VREs and most of these are accounted for under
the equity method.
When an Affiliate is consolidated, the portion of the earnings attributable to Affiliate management’s and any co-investor’s
equity ownership is included in Net income (non-controlling interests) in the Consolidated Statements of Income.
Undistributed earnings attributable to Affiliate management’s and any co-investor’s equity ownership, along with their share of
any tangible or intangible net assets, are included in Non-controlling interests on the Consolidated Balance Sheets. Affiliate
equity interests where the holder has certain rights to demand settlement are presented, at their current redemption values, as
Redeemable non-controlling interests or Other liabilities on the Consolidated Balance Sheets. The Company periodically
issues, sells, and purchases the equity of its consolidated Affiliates. Because these transactions take place between entities that
are under common control, any gains or losses attributable to these transactions are required to be included in Additional paid-
in capital on the Consolidated Balance Sheets, net of any related income tax effects in the period the transaction occurs.
When an Affiliate is accounted for under the equity method, the Company’s share of an Affiliate’s earnings or losses, net
of intangible amortization and impairments and tax, is included in Equity method income (net) in the Consolidated Statements
of Income and the carrying value of the Affiliate is recorded in Equity method investments in Affiliates (net) in the
Consolidated Balance Sheets.
The Company periodically performs assessments to determine if the fair value of an investment may have declined below
its related carrying value for its Affiliates accounted for under the equity method for a period that the Company considers to be
other-than-temporary. The Company performs these assessments if certain triggering events occur or annually during the
fourth quarter. The Company first considers whether certain qualitative factors indicate an increased likelihood of a decline in
the fair value of an Affiliate during the reporting period. If such a decline is identified, and it is likely that an investment’s fair
value may have declined below its carrying value, the Company performs a quantitative assessment to determine if an
impairment exists. Impairments are recorded as an expense in Equity method income (net) to reduce the carrying value of the
Affiliate to fair value.
The Company’s Affiliates are consolidated or accounted for under the equity method, depending upon the underlying
structure of and relationship with each Affiliate. Substantially all of the Company’s consolidated Affiliates are VIEs. The
Company’s Affiliates accounted for under the equity method considered VIEs generally require minimal levels of working
capital on each Affiliate’s balance sheet. Certain of the Company’s Affiliates accounted for under the equity method hold
general partner and seed investments, which may be significant. As of December 31, 2025 and September 30, 2026, the
Company’s carrying value attributable to its Affiliates accounted for under the equity method considered VIEs was $2,763.6
million and $2,813.0 million, respectively. As of December 31, 2025 and September 30, 2026, including arrangements more
fully described in Note 7, the Company’s maximum exposure to loss attributable to its Affiliates accounted for under the equity
method considered VIEs was $3,245.3 million and $3,368.4 million, respectively.
As of December 31, 2025 and September 30, 2026, the carrying value for all of the Company’s Affiliates accounted for
under the equity method was $2,870.4 million and $2,980.4 million, respectively, including Affiliates accounted for under the
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
equity method considered VREs of $106.8 million and $167.4 million, respectively. As of December 31, 2025 and
September 30, 2026, including arrangements more fully described in Note 7, the maximum exposure to loss for all of the
Company’s Affiliates accounted for under the equity method was $3,352.1 million and $3,535.8 million, respectively, including
Affiliates accounted for under the equity method considered VREs of $106.8 million and $167.4 million, respectively.
The Company’s Affiliates sponsor various investment products where the Affiliate also acts as the investment adviser.
These investment products are typically owned primarily by third-party investors; however, certain products are funded with
general partner and seed capital investments from the Company and its Affiliates.
Third-party investors in Affiliate-sponsored investment products are generally entitled to substantially all of the economics
of these products, except for the asset- and performance-based fees earned by the Company’s Affiliates or any gains or losses
attributable to the Company’s or its Affiliates’ investments in these products. As a result, the Company generally does not
consolidate these products. However, for certain products, the Company’s consolidated Affiliates, as the investment manager,
have the power to direct the activities of the investment product and have an exposure to the economics of the product that is
more than insignificant, though generally only for a short period while the product is established and has yet to attract
significant third-party investors. When the products are consolidated, the Company retains the specialized investment company
accounting principles of the underlying products, and all of the underlying investments are carried at fair value in Investments,
with corresponding changes in the investments’ fair values included in Investment and other income. Purchases and sales of
securities are included in purchases and sales by consolidated Affiliate-sponsored investment products in the Consolidated
Statements of Cash Flows, respectively, and the third-party investors’ interests are recorded in Redeemable non-controlling
interests. When the Company or its consolidated Affiliates no longer control these products, due to a reduction in ownership or
other reasons, the products are deconsolidated with only the Company’s or its consolidated Affiliate’s investment in the product
reported from the date of deconsolidation.
The Company’s carrying value and maximum exposure to loss from unconsolidated Affiliate-sponsored investment
products with few initial investors to mature products with a large population of investors. As of December 31, 2025 and
September 30, 2026, the Company’s carrying value attributable to Affiliate-sponsored investment products, which are
unconsolidated VIEs, was $88.9 million and $257.6 million, respectively. As of December 31, 2025 and September 30, 2026,
including arrangements more fully described in Note 7, the Company’s maximum exposure to loss attributable to Affiliate-
sponsored investment products, which are unconsolidated VIEs, was $158.7 million and $371.4 million, respectively.
6.Debt
presented on the Consolidated Balance Sheets:
December 31, 2025 | September 30, 2026 | ||
Senior bank debt | $ | $ | |
Senior notes | |||
Junior subordinated notes | |||
Junior convertible securities | |||
Total carrying value | |||
Debt issuance costs | ( | ( | |
Debt | $ | $ |
The Company’s debt instruments are carried at amortized cost. Unamortized discounts and debt issuance costs associated
with its debt instruments, with the exception of the Company’s senior unsecured multicurrency revolving credit facility (the
“revolver”), are presented on the Consolidated Balance Sheets as an adjustment to the carrying value of the associated debt.
Senior Bank Debt
As of September 30, 2026, the Company had a $1.25 billion revolver. The Company amended and restated the revolver in
June 2026, extending the maturity from November 15, 2029 to June 9, 2031. Subject to certain conditions, the Company may
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
increase the commitments under the revolver by up to an additional $750.0 million. The Company pays interest on any
outstanding obligations under the revolver at a specified rate, currently based either on an applicable term-SOFR, or prime rate,
plus a marginal rate determined based on its credit rating. As of December 31, 2025, the Company had no outstanding
borrowings under the revolver. As of September 30, 2026, the Company had outstanding borrowings under the revolver of
$825.0 million and the weighted-average interest rate on outstanding borrowings was 4.79 %.
Senior Notes
As of September 30, 2026, the Company had senior notes outstanding. The carrying values of the senior notes are accreted
to their principal amount at maturity over the remaining life of the underlying instrument. The principal terms of the senior
notes outstanding as of September 30, 2026 are presented and described below:
2030 Senior Notes | 2034 Senior Notes | 2036 Senior Notes | ||||
Issue date | June 2020 | August 2024 | December 2025 | |||
Maturity date | June 2030 | August 2034 | February 2036 | |||
Par value (in millions) | $ | $ | $ | |||
Stated coupon | ||||||
Coupon frequency | Semi-annually | Semi-annually | Semi-annually | |||
Call price | As defined | As defined | As defined |
In addition to customary event of default provisions, the indenture governing the senior notes, including the applicable
supplemental indentures with respect to the 2030, 2034, and 2036 senior notes, limits the Company’s ability to consolidate,
merge, or sell all or substantially all of its assets, and requires the Company to make an offer to repurchase the applicable senior
notes at 101
repurchase, upon certain change of control triggering events. The senior notes may be redeemed, in whole or in part, at a make-
whole redemption price (plus accrued and unpaid interest), at any time prior to March 15, 2030, in the case of the 2030 senior
notes, at any time prior to May 20, 2034, in the case of the 2034 senior notes, and at any time prior to November 15, 2035, in
the case of the 2036 senior notes. The make-whole redemption price, in each case, is equal to the greater of 100
principal amount of the notes to be redeemed and the remaining principal and interest payments on the notes being redeemed
(excluding accrued but unpaid interest to, but not including, the redemption date) discounted to their present value as of the
redemption date on a semi-annual basis at the applicable Treasury rate plus 0.40 %, in the case of the 2030 senior notes, and
plus 0.25 %, in the case of the 2034 and 2036 senior notes. In addition, the 2030, 2034, and 2036 senior notes may be
redeemed, in whole or in part, at any time, on or after March 15, 2030, May 20, 2034, and November 15, 2035, respectively, at
a redemption price equal to 100
to, but not including, the redemption date.
Junior Subordinated Notes
are presented and described below:
2059 Junior Subordinated Notes | 2060 Junior Subordinated Notes | 2061 Junior Subordinated Notes | 2064 Junior Subordinated Notes | |||||
Issue date | March 2019 | September 2020 | July 2021 | March 2024 | ||||
Maturity date | March 2059 | September 2060 | September 2061 | March 2064 | ||||
Par value (in millions) | $ | $ | $ | $ | ||||
Stated coupon | ||||||||
Coupon frequency | Quarterly | Quarterly | Quarterly | Quarterly | ||||
Call price | As defined | As defined | As defined | As defined | ||||
NYSE Symbol | MGR | MGRB | MGRD | MGRE |
As of September 30, 2026, each of the 2059, 2060, and 2061 junior subordinated notes could be redeemed at any time, in
whole or in part. The 2064 junior subordinated notes may be redeemed at any time, in whole or in part, on or after March 30,
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
2029. In each case, the junior subordinated notes may be redeemed at 100 % of the principal amount of the notes being
redeemed, plus any accrued and unpaid interest thereon. Prior to March 30, 2029, at the Company’s option, the 2064 junior
subordinated notes may also be redeemed, in whole but not in part, at 100 % of the principal amount, plus any accrued and
unpaid interest, if certain changes in tax laws, regulations, or interpretations occur; or at 102 % of the principal amount, plus any
accrued and unpaid interest, if a rating agency makes certain changes relating to the equity credit criteria for securities with
features similar to the notes.
The Company may, at its option, and subject to certain conditions and restrictions, defer interest payments subject to the
terms of the junior subordinated notes.
Junior Convertible Securities
On December 8, 2025, the Company delivered notice that it had elected to redeem all of its outstanding 5.15 % junior
convertible trust preferred securities (the “junior convertible securities”) on December 29, 2025 (the “Redemption Date”), and
announced its intention to settle any and all conversion obligations in cash. Substantially all holders of the junior convertible
securities delivered requests to convert their securities prior to the Redemption Date. On December 15, 2025 (the “Election
Date”), the Company made an irrevocable election to settle its conversion obligations in cash by reference to the daily volume
weighted average price of the Company’s common stock during each applicable ten trading day conversion reference period.
These conversions resulted in a settlement value in excess of the associated carrying value (the “conversion premium”). As of
December 31, 2025, the conversion premium of $155.5
reduction to Additional paid-in capital. In addition, the conversion resulted in a reduction to Deferred tax liability (net) on the
Consolidated Balance Sheets of $38.9
election to settle each applicable conversion premium in cash using a ten-day reference period was accounted for as a forward
sale contract, which resulted in a $9.2 million expense recorded in Other expenses (net), in the fourth quarter of 2025.
On the Redemption Date, the Company redeemed $1.1 million of junior convertible securities which were not converted,
reflecting the principal amount of the redeemed securities, plus accrued and unpaid interest, up to, but not including, the
Redemption Date.
In January 2026, the Company settled each of its applicable conversion obligations in cash for an aggregate amount of
$514.6 million which resulted in an incremental expense related to the forward sale contract of $9.3 million. The junior
convertible securities were considered contingent payment debt instruments under federal income tax regulations, which
required the Company to deduct interest in an amount greater than its reported interest expense (“excess interest expense
deductions”). As a result of the settlement of these securities, the Company incurred a current cash tax liability of
approximately $56 million, reflective of the recapture of excess interest expense deductions.
Prior to their redemption by the Company or requests for conversion by the holders, as applicable and described above, the
junior convertible securities bore interest at a rate of 5.15 % per annum, which interest payments were payable quarterly in cash.
For the three months ended September 30, 2025, the Company recorded interest expense of $4.5 million, in connection with the
junior convertible securities, including contractual interest expense and amortization of debt issuance costs of $4.4 million and
$0.1 million, respectively. For the nine months ended September 30, 2025, the Company recorded interest expense of $13.4
million, in connection with the junior convertible securities, including contractual interest expense and amortization of debt
issuance costs of $13.2 million and $0.2 million, respectively. For the three and nine months ended September 30, 2025, the
effective interest rate was 5.21
7.Commitments and Contingencies
From time to time, the Company and its Affiliates may be subject to claims, legal proceedings, and other contingencies in
the ordinary course of their business activities. Any such matters are subject to various uncertainties, and it is possible that
some of these matters may be resolved in a manner unfavorable to the Company or its Affiliates. The Company and its
Affiliates establish accruals, as necessary, for matters for which the outcome is probable and the amount of the liability can be
reasonably estimated. For matters for which the outcome is probable but not reasonably estimable or where the outcome is
reasonably possible but not probable, the Company provides disclosure related to such matters, as necessary.
The Company has committed to co-invest in certain Affiliate-sponsored investment products. As of September 30, 2026,
these unfunded commitments were $338.2 million and may be called in future periods.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
As of September 30, 2026, the Company was obligated to make deferred payments of $83.5 million related to certain of its
investments in Affiliates accounted for under the equity method, of which $55.2 million is payable during the remainder of
2026 and $28.3 million is payable in 2027. Deferred payment obligations are included in Other liabilities.
As of September 30, 2026, the Company was contingently liable to make payments of $555.4 million related to the
achievement of specified financial targets by certain of its Affiliates accounted for under the equity method, of which $391.3
million may become payable in 2027, $52.5 million may become payable in 2028, $39.8
of 2029 and 2030, and $32.0 million may become payable in 2031. As of September 30, 2026, the Company determined that
certain of these payments are probable and has recorded a liability of $44.8 million, which represents the present value of two
future payments, totaling $47.8 million, of which $23.9
Affiliate equity interests provide holders at consolidated Affiliates with a conditional right to put their interests to the
Company over time. See Note 12.
The Company and certain of its consolidated Affiliates operate under regulatory authorities that require the maintenance of
minimum financial or capital requirements. The Company’s management is not aware of any significant violations of such
requirements.
8.Goodwill and Acquired Client Relationships
Goodwill | ||
Balance, as of December 31, 2025 | $ | |
Affiliate transactions(1) | ( | |
Foreign currency translation | ( | |
Balance, as of September 30, 2026 | $ |
_______________________
(1)Represents goodwill attributable to the myCIO Transaction as of the closing date, including $1.7 million attributable to the
non-controlling interests.
As of September 30, 2026, the Company completed its annual impairment assessment on goodwill and no impairment was
indicated.
Acquired Client Relationships (Net) | |||||||||
Definite-lived | Indefinite-lived | Total | |||||||
Gross Carrying Value | Accumulated Amortization | Net Carrying Value | Carrying Value | Carrying Value | |||||
Balance, as of December 31, 2025 | $ | $( | $ | $ | $ | ||||
Affiliate transactions(1) | ( | ( | — | ( | |||||
Intangible amortization and impairments | — | ( | ( | ( | ( | ||||
Foreign currency translation | ( | — | ( | ( | |||||
Transfers(2) | — | ( | |||||||
Balance, as of September 30, 2026 | $ | $( | $ | $ | $ | ||||
_______________________
(1)Represents acquired client relationships attributable to the myCIO Transaction as of the closing date, including $0.4 million
attributable to the non-controlling interests.
(2)In 2026, transfers reflect the reclassification of indefinite-lived relationships to definite-lived relationships.
Definite-lived acquired client relationships at the Company’s consolidated Affiliates are amortized over their expected
period of economic benefit. The Company recorded amortization expense in Intangible amortization and impairments in the
Consolidated Statements of Income for these relationships of $6.3 million and $19.0 million for the three and nine months
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
ended September 30, 2025, respectively and $7.2 million and $20.6 million for the three and nine months ended September 30,
2026, respectively. Based on relationships existing as of September 30, 2026, the Company estimates that its consolidated
amortization expense will be approximately $7 million during the remainder of 2026, $25
$15 million in 2029, and $10
In the first quarter of 2025, the Company completed an impairment assessment of the indefinite-lived acquired client
relationships for certain mutual fund assets and determined that the fair value of the assets had declined below their carrying
values. Accordingly, the Company recorded an expense in Intangible amortization and impairments of $59.2 million
attributable to the controlling interest ($70.0 million in aggregate) to reduce the carrying value of the assets to fair value. The
decline in the fair value was a result of current and projected declines in assets under management that decreased the forecasted
revenue associated with the assets. The most relevant assumptions used in these analyses were revenue growth rates over the
next five years ranging from (21 )% to 0 %, long-term revenue growth rates of 0 %, and discount rates of 11.0 %.
In the first quarter of 2025, the Company also recorded an expense in Intangible amortization and impairments of
$4.0 million attributable to the controlling interest ($7.0 million in aggregate) to reduce the carrying value of an indefinite-lived
acquired client relationship to zero due to the closure of one of its Affiliate’s mutual fund products.
In the first quarter of 2026, the Company completed an impairment assessment of the indefinite-lived acquired client
relationships for certain mutual fund assets, and determined that the fair value of an asset had declined below its carrying value.
Accordingly, the Company recorded an expense in Intangible amortization and impairments of $30.5 million attributable to the
controlling interest ($43.0 million in aggregate) to reduce the carrying value of the asset to fair value. The decline in the fair
value was primarily the result of current and projected declines in assets under management and the related reduction in
forecasted revenue associated with the asset. The most relevant assumptions used in this analysis related to the projected
trajectory of assets under management and associated revenue, as well as a discount rate of 10.5 %.
In the second quarter of 2026, myCIO Wealth Partners, LLC (“myCIO”) completed the divestiture of an advisor team (the
“myCIO Transaction”) that managed $5.6 billion in client assets. Pursuant to the terms of the agreement, the Company
received cash consideration of $24.5 million for its controlling interest portion of the divestiture, and may, in the future, receive
additional contingent cash consideration. The Company’s gain from the transaction was $14.6 million, which is recorded in
Affiliate transaction gains on the Consolidated Statements of Income, and was taxable at closing.
9.Equity Method Investments in Affiliates
Certain of the Company’s investments in Affiliates are accounted for under the equity method. The Company had 22 and
majority of these Affiliates are partnerships with structured interests that define how the Company will participate in Affiliate
earnings, typically based upon a fixed percentage of the Affiliate’s revenue less agreed-upon expenses. The partnership
agreements generally do not define a fixed percentage for the Company’s ownership of the equity of the Affiliate. These
percentages would be subject to a separate future negotiation if an Affiliate were to be sold or liquidated. The financial results
of certain Affiliates accounted for under the equity method are recognized in the Consolidated Financial Statements one quarter
in arrears.
The Company has determined that one of its Affiliates accounted for under the equity method is significant under Rule
10-01(b)(1) of Regulation S-X. For the nine months ended September 30, 2025 and 2026, this Affiliate recognized revenue of
$662.1 million and $1,484.4 million, respectively, and net income of $357.8 million and $1,096.5 million, respectively.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Equity Method Investments in Affiliates (Net) | |
Balance, as of December 31, 2025(1) | $ |
Investments in Affiliates | |
Earnings, net of tax | |
Intangible amortization and impairments | ( |
Distributions of earnings | ( |
Return of capital | ( |
Foreign currency translation | ( |
Other | |
Balance, as of September 30, 2026(1) | $ |
_______________________
(1)Includes undistributed earnings of $280.4 million and $164.9 million as of December 31, 2025 and September 30, 2026,
respectively.
In the first quarter of 2026, the Company completed its agreement with Brown Brothers Harriman (“BBH”) to acquire a
minority equity interest in BBH Credit Partners, BBH’s taxable fixed income and credit franchise, its additional minority
investment in Garda Capital Partners LP (“Garda”), a liquid alternatives manager specializing in fixed income relative value
strategies and an Affiliate since 2019, and its minority investment in HighBrook Investors (“HighBrook”), a private markets
manager specializing in real estate assets. The majority of the consideration paid for Garda and a portion of the consideration
paid for HighBrook will be deductible for U.S. tax purposes over a 15-year life. Following the close of the transaction, the
Company’s investment in Garda continues to be accounted for under the equity method. The Company’s preliminary purchase
price allocations for each investment were measured using discounted cash flow analyses that included assumptions of expected
market performance, net client cash flows, and discount rates.
In the third quarter of 2026, the Company recorded a liability in Other liabilities of $44.8 million, with a corresponding
increase to the carrying value of the Affiliate in Equity method investments in Affiliates (net), as a result of a probable payment
related to the achievement of specified financial targets by the Affiliate. See Note 7.
Definite-lived acquired client relationships at the Company’s Affiliates accounted for under the equity method are
amortized over their expected period of economic benefit. The Company recorded amortization expense for these relationships
of $24.6 million and $70.2 million for the three and nine months ended September 30, 2025, respectively, and $27.9 million and
$83.8 million for the three and nine months ended September 30, 2026, respectively. Based on relationships existing as of
September 30, 2026, the Company estimates the amortization expense attributable to its Affiliates will be approximately $30
million for the remainder of 2026, $115 million in 2027, $100 million in 2028, and $85
2031.
In the first quarter of 2026, the Company recorded an $8.0 million expense to reduce the carrying value of an Affiliate to
fair value based on market indicators that its fair value had declined below its carrying value.
In the third quarter of 2025, the Company completed the sale of its minority equity interest in Peppertree Capital
Management, Inc. (“Peppertree”), as part of the announced acquisition of Peppertree by TPG Inc. (“TPG”), a public company
listed on the Nasdaq Global Select Market (the “Peppertree Transaction”). Pursuant to the terms of the transaction agreement
with TPG, under which the Company and each of the other owners agreed to sell their respective equity interests in Peppertree,
the Company received total consideration of $253.2 million, net of transaction costs, which included $99.8 million in cash and
results through the closing date and the Company’s gain on the transaction was $127.6 million, which is recorded in Affiliate
transaction gains. The after-tax net proceeds from the transaction were $218.1 million.
10.Related Party Transactions
The Company has related party transactions in association with its deferred and contingent payment obligations, and
Affiliate equity transactions, as more fully described in Notes 7, 11, and 12.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
From time to time, certain funds of the Company’s consolidated Affiliates may make tax distributions to partners subject to
clawback. The total receivable was $68.6 million and $63.6 million as of December 31, 2025 and September 30, 2026,
respectively, and was included in Other assets on the Consolidated Balance Sheets. The total payable was $99.3 million and
$87.3 million as of December 31, 2025 and September 30, 2026, respectively, and was included in Other liabilities. These
amounts were primarily attributable to the non-controlling interests.
A prior owner of one of the Company’s consolidated Affiliates retains interests in certain of the Affiliate’s private equity
partnerships and, as a result, is a related party of the Company. The prior owner’s interests are included in Other liabilities and
were $11.7 million and $7.1 million as of December 31, 2025 and September 30, 2026, respectively.
The Company may invest from time to time in funds or products advised by its Affiliates. The Company’s executive
officers and directors may invest from time to time in funds advised or products offered by its Affiliates, or receive other
investment services provided by its Affiliates, on substantially the same terms as other participating investors. The Company
and its Affiliates earn asset- and performance-based fees and incur distribution and other expenses for services provided to
Affiliate-sponsored investment products. In addition, the Company and its Affiliates earn fees or incur expenses related to the
Company’s efforts to develop and distribute Affiliate products. Affiliate management owners and the Company’s officers may
serve as trustees or directors of certain investment vehicles from which the Company or an Affiliate earns fees.
From time to time, the Company may enter into ordinary course engagements for capital markets, banking, brokerage, and
other services with beneficial owners of 5 % or more of the Company’s voting securities.
11.Redeemable Non-Controlling Interests
Affiliate equity interests provide holders with an equity interest in one of the Company’s consolidated Affiliates, consistent
with the structured partnership interests in place at the respective Affiliate. Affiliate equity holders generally have a conditional
right to put their interests to the Company at certain intervals (between five years and 15 years from the date the equity interest
is received by the Affiliate equity holder or on an annual basis following an Affiliate equity holder’s departure). Prior to
becoming redeemable, the Company’s Affiliate equity is included in Non-controlling interests. Upon becoming redeemable,
these interests are reclassified to Redeemable non-controlling interests at their current redemption values. Changes in the
current redemption value are recorded to Additional paid-in capital. When the Company has an unconditional obligation to
purchase Affiliate equity interests, the interests are reclassified from Redeemable non-controlling interests to Other liabilities at
current fair value. Changes in fair value are recorded to Other expenses (net).
Redeemable Non-controlling Interests | ||
Balance, as of December 31, 2025(1) | $ | |
Decrease attributable to consolidated Affiliate-sponsored investment products | ( | |
Transfers to Other liabilities | ( | |
Changes in redemption value | ||
Balance, as of September 30, 2026(1) | $ |
___________________________
(1)As of December 31, 2025 and September 30, 2026, Redeemable non-controlling interests includes consolidated Affiliate-
sponsored investment products primarily attributable to third-party investors of $32.2 million and $30.5 million,
respectively.
12.Affiliate Equity
Affiliate equity interests are allocated income in a manner that is consistent with the structured partnership interests in
place at the respective Affiliate. The Company’s consolidated Affiliates generally pay quarterly distributions to Affiliate equity
holders. Distributions paid to non-controlling interest Affiliate equity holders were $205.5 million and $212.3 million for the
nine months ended September 30, 2025 and 2026, respectively.
The Company periodically purchases Affiliate equity from and issues Affiliate equity to the Company’s consolidated
Affiliate partners and other parties under agreements that provide the Company a conditional right to call and Affiliate equity
holders the conditional right to put their Affiliate equity interests to the Company at certain intervals. The Company has the
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
right to settle a portion of these purchases in shares of its common stock. For Affiliates accounted for under the equity method,
the Company does not typically have such put and call arrangements. For the nine months ended September 30, 2025 and
2026, the amount of cash paid for purchases was $51.8 million and $65.6 million, respectively. For the nine months ended
September 30, 2025 and 2026, the total amount of cash received for issuances was $1.8 million and $4.2 million, respectively.
Sales and purchases of Affiliate equity generally occur at fair value; however, the Company also grants Affiliate equity to
its consolidated Affiliate partners and other parties as a form of compensation. If the equity is issued for consideration below
the fair value of the equity, or purchased for consideration above the fair value of the equity, the difference is recorded as
compensation expense in Compensation and related expenses over the requisite service period.
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Controlling interest | $ | $ | $ | $ | |||
Non-controlling interests | |||||||
Total | $ | $ | $ | $ | |||
In the second quarter of 2025, the terms of certain equity awards at an Affiliate were modified. The modification included
a mandatory repurchase provision upon termination of employment that changed the awards classification from equity to
liability. As a result, for the nine months ended September 30, 2025, the Company recorded incremental Affiliate equity
expense of $30.5 million attributable to the controlling interest.
Controlling Interest | Remaining Life | Non-controlling Interests | Remaining Life | ||||
December 31, 2025 | $ | $ | |||||
September 30, 2026 |
The Company records amounts receivable from, and payable to, Affiliate equity holders in connection with the transfer of
Affiliate equity interests that have not settled at the end of the period. The total receivable was $4.7 million and $5.5 million as
of December 31, 2025 and September 30, 2026, respectively, and was included in Other assets. The total payable was $161.2
million and $232.6 million as of December 31, 2025 and September 30, 2026, respectively, and was included in Other
liabilities.
Effects of Changes in the Company’s Ownership in Affiliates
The Company periodically acquires interests from, and transfers interests to, Affiliate equity holders. Because these
transactions do not result in a change of control, any gain or loss related to these transactions is recorded to Additional paid-in
capital, which increases or decreases the controlling interest’s equity. No gain or loss related to these transactions is recorded in
the Consolidated Statements of Income or the Consolidated Statements of Comprehensive Income.
with changes in the current redemption value increasing or decreasing the controlling interest’s equity over time, the following
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
table presents the cumulative effect that ownership changes had on the controlling interest’s equity related only to Affiliate
equity transactions that occurred during the applicable periods:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Net income (controlling interest) | $ | $ | $ | $ | |||
Decrease in controlling interest paid-in capital from Affiliate equity issuances | ( | ( | ( | ( | |||
Decrease in controlling interest paid-in capital from Affiliate equity purchases | ( | ( | ( | ( | |||
Net income (controlling interest) including the net impact of Affiliate equity transactions | $ | $ | $ | $ | |||
13.Share-Based Compensation
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Share-based compensation expense | $ | $ | $ | $ | |||
Tax benefit | |||||||
As of December 31, 2025, the Company had unrecognized share-based compensation expense of $70.2 million. As of
September 30, 2026, the Company had unrecognized share-based compensation expense of $56.6 million, which will be
recognized over a weighted average period of approximately three years (assuming no forfeitures).
Restricted Stock
Restricted Stock Units | Weighted Average Grant Date Value Per Unit | ||
Unvested units, as of December 31, 2025 | $ | ||
Units granted | |||
Units vested | ( | ||
Units forfeited | ( | ||
Performance condition changes | |||
Unvested units, as of September 30, 2026 | $ |
For the nine months ended September 30, 2025 and 2026, the Company granted restricted stock units with fair values of
$54.7 million and $33.7 million, respectively. These restricted stock units were valued based on the closing price of the
Company’s common stock on the grant date and the number of shares expected to vest. Restricted stock units containing
vesting conditions generally require service over a period of three years to four years and may also require the satisfaction of
certain performance conditions. For awards with performance conditions, the number of restricted stock units expected to vest
may change over time depending upon the performance level expected to be achieved.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
Stock Options
Stock Options | Weighted Average Exercise Price Per Option | Weighted Average Remaining Contractual Life (Years) | |||
Unexercised options outstanding, as of December 31, 2025 | $ | ||||
Options granted | |||||
Options exercised | ( | ||||
Options forfeited | |||||
Options expired | |||||
Performance condition changes | |||||
Unexercised options outstanding, as of September 30, 2026 | $ | ||||
Exercisable at September 30, 2026 | $ |
The Company did not
generally vest over a period of four years to five years and expire seven years after the grant date. All stock options have been
granted with exercise prices equal to the closing price of the Company’s common stock on the grant date. Substantially all of
the Company’s outstanding stock options contain both service and performance conditions. For awards with performance
conditions, the number of stock options expected to vest may change over time depending upon the performance level expected
14.Income Taxes
The Company’s consolidated income tax provision includes taxes attributable to the controlling interest and, to a lesser
extent, taxes attributable to the non-controlling interests.
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Controlling interest(1) | $ | $ | $ | $ | |||
Non-controlling interests | |||||||
Income tax expense | $ | $ | $ | $ | |||
Income before income taxes (controlling interest) | $ | $ | $ | $ | |||
Effective tax rate (controlling interest)(2) | |||||||
___________________________
(1)For the three months ended September 30, 2025 and 2026, income tax expense (controlling interest) included intangible-
related deferred tax expense of $14.2 million and $17.0 million, respectively. For the nine months ended September 30,
2025 and 2026, income tax expense (controlling interest) included intangible-related deferred tax expense of $29.7 million
and $37.6 million, respectively.
(2)Taxes attributable to the controlling interest divided by income before income taxes (controlling interest).
The Company’s effective tax rate (controlling interest) for the three months ended September 30, 2025 was lower than the
marginal tax rate of 24.5%, primarily due to tax windfalls attributable to share-based compensation, partially offset by an
expense attributable to certain equity awards at an Affiliate for which no tax benefit was recorded. The Company’s effective
tax rate (controlling interest) for the nine months ended September 30, 2025 was higher than the marginal tax rate of 24.5%,
primarily due to an expense attributable to certain equity awards at an Affiliate for which no tax benefit was recorded.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
The Company’s effective tax rate (controlling interest) for the three and nine months ended September 30, 2026 was higher
than the marginal tax rate of 24.5%, primarily due to an expense attributable to certain equity awards at an Affiliate for which
no tax benefit was recorded.
The Company’s effective tax rate reflects the relative contributions of earnings in the jurisdictions in which the Company
and its Affiliates operate and is impacted by changes in the jurisdictional mix of income before taxes.
15.Earnings Per Share
The calculation of Earnings per share (basic) is based on the weighted average number of shares of the Company’s
common stock outstanding during the period. Earnings per share (diluted) is similar to Earnings per share (basic), but adjusts
for the dilutive effect of the potential issuance of incremental shares of the Company’s common stock.
share available to common stockholders:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Numerator | |||||||
Net income (controlling interest) | $ | $ | $ | $ | |||
Income (loss) from hypothetical settlement of Redeemable non-controlling interests, net of taxes | ( | ||||||
Interest expense on junior convertible securities, net of taxes | |||||||
Net income (controlling interest), as adjusted | $ | $ | $ | $ | |||
Denominator | |||||||
Average shares outstanding (basic) | |||||||
Effect of dilutive instruments: | |||||||
Stock options and restricted stock units | |||||||
Hypothetical issuance of shares to settle Redeemable non-controlling interests | |||||||
Assumed issuance of junior convertible securities shares | |||||||
Average shares outstanding (diluted) | |||||||
Average shares outstanding (diluted) in the table above excludes stock options and restricted stock units that have not met
certain performance conditions and instruments that have an anti-dilutive effect on Earnings per share (diluted). The following
is a summary of items excluded from the denominator in the table above:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
2025 | 2026 | 2025 | 2026 | ||||
Stock options and restricted stock units | |||||||
Shares issuable to settle Redeemable non-controlling interests | |||||||
For the three and nine months ended September 30, 2026, under its authorized share repurchase programs, the Company
repurchased 1.1 million and 2.3 million shares of its common stock at an average price per share of $361.08 and $334.58 ,
respectively.
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AFFILIATED MANAGERS GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
16.Comprehensive Income
For the Three Months Ended September 30, | |||||||||||
2025 | 2026 | ||||||||||
Pre-Tax | Tax Expense | Net of Tax | Pre-Tax | Tax Benefit | Net of Tax | ||||||
Foreign currency translation gain (loss) | $ | $( | $ | $( | $ | $( | |||||
Change in net realized and unrealized gain (loss) on derivative financial instruments | ( | ( | ( | ( | |||||||
Other comprehensive income (loss) | $ | $( | $ | $( | $ | $( | |||||
For the Nine Months Ended September 30, | |||||||||||
2025 | 2026 | ||||||||||
Pre-Tax | Tax Expense | Net of Tax | Pre-Tax | Tax Benefit | Net of Tax | ||||||
Foreign currency translation gain (loss) | $ | $( | $ | $( | $ | $( | |||||
Change in net realized and unrealized gain (loss) on derivative financial instruments | |||||||||||
Change in net unrealized gain (loss) on available-for-sale debt securities | |||||||||||
Other comprehensive income (loss) | $ | $( | $ | $( | $ | $( | |||||
Foreign Currency Translation Adjustment | Realized and Unrealized Gains (Losses) on Derivative Financial Instruments | Total | |||
Balance, as of December 31, 2025 | $( | $( | $( | ||
Other comprehensive income (loss) before reclassifications | ( | ( | |||
Amounts reclassified | ( | ( | |||
Net other comprehensive income (loss) | ( | ( | |||
Balance, as of September 30, 2026 | $( | $ | $( |
17.Segment Information
The Company operates in one segment. Accordingly, the Company’s Consolidated revenue, Net income, and Total assets
reflect the revenue, profit, and assets of the Company’s single segment, respectively.
The Company’s President and Chief Executive Officer is the chief operating decision maker (“CODM”). The CODM uses
Net income in assessing the performance and in determining the allocation of resources of the Company’s reportable segment.
The CODM is regularly provided expense information consistent with the expense categories presented in the Company’s
Consolidated Statements of Income.
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Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
Certain matters discussed in this Quarterly Report on Form 10-Q, in our other filings with the Securities and Exchange
Commission, in our press releases, and in oral statements made with the approval of an executive officer may constitute
“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements
include, but are not limited to, statements related to our expectations regarding the performance of our business, our financial
results, our liquidity and capital resources, and other non-historical statements, and may be prefaced with words such as
“outlook,” “guidance,” “believes,” “expects,” “potential,” “preliminary,” “continues,” “may,” “will,” “should,” “seeks,”
“approximately,” “predicts,” “projects,” “positioned,” “prospects,” “intends,” “plans,” “estimates,” “pending
investments,” “anticipates,” or the negative version of these words or other comparable words. Such statements are subject to
certain risks and uncertainties, including, among others, the factors discussed under the caption “Item 1A. Risk Factors” in our
Annual Report on Form 10-K for the year ended December 31, 2025, and from time to time, as applicable, our Quarterly
Reports on Form 10-Q. These factors (among others) could affect our financial condition, business activities, results of
operations, cash flows, or overall financial performance and cause actual results and business activities to differ materially
from historical periods and those presently anticipated and projected. Forward-looking statements speak only as of the date
they are made, and we will not undertake and we specifically disclaim any obligation to release publicly the result of any
revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of such
statements or to reflect the occurrence of events, whether or not anticipated. In that respect, we caution readers not to place
undue reliance on any such forward-looking statements.
Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction
with our Consolidated Financial Statements and the notes thereto contained elsewhere in this Quarterly Report on Form 10-Q.
References throughout this report to “AMG,” “we,” “us,” “our,” the “Company,” and similar references refer to
Affiliated Managers Group, Inc., unless otherwise stated or the context otherwise requires.
Executive Overview
AMG is a strategic partner to leading independent investment firms globally. Our strategy is to generate long-term value
by investing in high-quality independent partner-owned firms, which we refer to as “Affiliates,” through a proven partnership
approach, and allocating resources across our unique opportunity set to the areas of highest growth and return. With their
entrepreneurial, investment-centric cultures and alignment of interests with clients through direct equity ownership by firm
principals, independent firms have fundamental competitive advantages in offering unique return streams to the marketplace.
Through AMG’s distinctive approach, we enhance these advantages to magnify the long-term success of our Affiliates and
actively support their independence. Our innovative model enables each Affiliate’s management team to retain autonomy
and significant equity ownership in their firm, while they leverage our strategic capabilities and insight, including access to
growth capital, product strategy and development, capital formation capabilities, incentive alignment and succession
planning, and strategic advisory to expand their reach, diversify their business, and enhance their long-term success. As of
September 30, 2026, our aggregate assets under management were approximately $974 billion across a diverse range of
private markets, liquid alternative, and differentiated long-only investment strategies.
In the first quarter of 2026, we completed our agreement with Brown Brothers Harriman (“BBH”) to acquire a minority
equity interest in BBH Credit Partners, BBH’s taxable fixed income and credit franchise, our additional minority investment
in Garda Capital Partners LP (“Garda”), a liquid alternatives manager specializing in fixed income relative value strategies
and an Affiliate since 2019, and our minority investment in HighBrook Investors (“HighBrook”), a private markets manager
specializing in real estate assets. Following the close of the transactions, Affiliate management continues to hold a majority
of the equity of the respective businesses and directs the day-to-day operations, and, with respect to Garda, our investment
continues to be accounted for under the equity method.
Operating Performance Measures
Under accounting principles generally accepted in the U.S. (“GAAP”), we are required to consolidate certain of our
Affiliates and use the equity method of accounting for others. Whether we consolidate an Affiliate or use the equity method of
accounting, we maintain the same innovative partnership approach and provide support and assistance in substantially the same
manner for all of our Affiliates. Furthermore, all of our Affiliates are investment managers and are impacted by similar
marketplace factors and industry trends. Therefore, certain key aggregate operating performance measures are important in
providing management with a comprehensive view of the operating performance and material trends across our entire business.
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The following table presents our key aggregate operating performance measures:
As of and for the Three Months Ended September 30, | As of and for the Nine Months Ended September 30, | |||||||||||
(in billions, except as noted) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | ||||||
Assets under management | $803.6 | $973.9 | 21% | $803.6 | $973.9 | 21% | ||||||
Average assets under management | 786.9 | 956.9 | 22% | 745.2 | 919.8 | 23% | ||||||
Aggregate fees (in millions) | 1,346.0 | 1,757.6 | 31% | 3,789.8 | 5,329.0 | 41% | ||||||
Assets under management, and therefore average assets under management, include the assets under management of our
consolidated and equity method Affiliates. Assets under management is presented on a current basis without regard to the
timing of the inclusion of an Affiliate’s financial results in our operating performance measures and Consolidated Financial
Statements. Average assets under management reflects the timing of the inclusion of an Affiliate’s financial results in our
operating performance measures and Consolidated Financial Statements. Average assets under management for equities and
similar investment products generally represents an average of the daily net assets under management, while for liquid
alternatives and multi-asset and fixed income products, average assets under management generally represents an average of the
assets at the beginning or end of each month during the applicable period. Average assets under management for private
markets products generally represents total commitments or invested assets under management.
Aggregate fees consist of the total asset- and performance-based fees earned by all of our consolidated and equity method
Affiliates. In the case of our equity method Affiliates, asset- and performance-based fees are presented net of certain expense
reimbursements paid by the underlying products. For certain of our Affiliates accounted for under the equity method, we report
the Affiliate’s aggregate fees one quarter in arrears. Aggregate fees are provided in addition to, but not as a substitute for,
Consolidated revenue or other GAAP performance measures.
Assets Under Management
Our Affiliates manage capital on behalf of clients across a diverse range of investment strategies. Our Affiliates earn asset-
based fees on the capital that they manage and certain of our Affiliates’ strategies earn performance-based fees based on the
performance generated by their investment products. For the three months ended September 30, 2026, assets under
management increased $31.5 billion or 3%, and for the nine months ended September 30, 2026, assets under management
increased $160.6 billion or 20%. These increases were driven by net client cash flows and investment performance, and for the
nine months ended September 30, 2026, the increase was also due to the addition of assets associated with new Affiliate
investments. We continue to see client demand for alternative strategies; broad-based demand for our Affiliates’ liquid
alternative and private markets strategies generated strong net inflows in the quarter, while our Affiliates’ equity strategies
experienced net outflows in line with trends across the industry. As we continue to execute our growth strategy by investing in
new and existing Affiliates, as well as in AMG’s strategic capabilities, we expect our business mix to further evolve and
diversify, expanding our exposure to in-demand strategies in both private markets and liquid alternatives, and better positioning
AMG to continue to benefit from industry growth trends.
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The following tables present changes in our assets under management by strategy for the three and nine months ended
September 30, 2026:
Alternatives | Differentiated Long-Only | |||||||||
(in billions) | Private Markets | Liquid Alternatives | Equities | Multi-Asset & Fixed Income | Total | |||||
June 30, 2026 | $153.3 | $293.2 | $321.9 | $174.0 | $942.4 | |||||
Client cash inflows and commitments | 9.8 | 33.4 | 9.8 | 9.3 | 62.3 | |||||
Client cash outflows | (0.2) | (11.5) | (21.7) | (8.2) | (41.6) | |||||
Net client cash flows | 9.6 | 21.9 | (11.9) | 1.1 | 20.7 | |||||
Affiliate transactions(1) | (1.3) | — | — | — | (1.3) | |||||
Market changes | 0.1 | 17.0 | (0.6) | (3.5) | 13.0 | |||||
Foreign exchange(2) | (0.2) | (0.0) | (0.1) | (0.0) | (0.3) | |||||
Realizations and distributions (net) | (0.4) | (0.0) | (0.0) | (0.2) | (0.6) | |||||
Other(3) | — | 5.7 | (5.7) | (0.0) | (0.0) | |||||
September 30, 2026 | $161.1 | $337.8 | $303.6 | $171.4 | $973.9 | |||||
Alternatives | Differentiated Long-Only | ||||||||
(in billions) | Private Markets | Liquid Alternatives | Equities | Multi-Asset & Fixed Income | Total | ||||
December 31, 2025 | $146.0 | $227.2 | $312.1 | $128.0 | $813.3 | ||||
Client cash inflows and commitments | 22.2 | 95.2 | 35.0 | 35.3 | 187.7 | ||||
Client cash outflows | (0.5) | (27.5) | (70.6) | (32.9) | (131.5) | ||||
Net client cash flows | 21.7 | 67.7 | (35.6) | 2.4 | 56.2 | ||||
New investments(4) | 2.6 | 10.1 | — | 47.1 | 59.8 | ||||
Affiliate transactions(5) | (1.3) | — | — | (5.6) | (6.9) | ||||
Market changes | (0.2) | 26.1 | 35.1 | 2.0 | 63.0 | ||||
Foreign exchange(2) | (0.7) | (0.9) | (2.1) | (0.6) | (4.3) | ||||
Realizations and distributions (net) | (5.0) | (0.1) | (0.2) | (0.3) | (5.6) | ||||
Other(3) | (2.0) | 7.7 | (5.7) | (1.6) | (1.6) | ||||
September 30, 2026 | $161.1 | $337.8 | $303.6 | $171.4 | $973.9 | ||||
_________________________
(1)Attributable to the divestment of our equity interest in Vesterra Capital Partners, LP, formerly Comvest Private Equity, in
the third quarter of 2026 (the “Vesterra Transaction”).
(2)Foreign exchange reflects the impact of translating the assets under management of our Affiliates whose functional
currency is not the U.S. dollar into our functional currency.
(3)Other includes product transitions predominantly resulting from changes in product mandates at a single Affiliate.
(4)Attributable to BBH Credit Partners and HighBrook as of their respective closing dates.
(5)Attributable to the myCIO and Vesterra Transactions.
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The following tables present performance of our investment strategies, where available, measured by the percentage of
assets under management ahead of their relevant benchmark:
AUM Weight | % of AUM Ahead of Benchmark(1) | |||||
IRR Latest Vintage | IRR Last Three Vintages | |||||
Private markets(2) | 16 % | 66 % | 77 % | |||
AUM Weight | % of AUM Ahead of Benchmark(1) | |||||||
3-year | 5-year | 10-year | ||||||
Liquid alternatives(3) | 35 % | 93 % | 91 % | 92 % | ||||
Equities(3) | 31 % | 42 % | 44 % | 64 % | ||||
Multi-asset and fixed income(4) | 18 % | N/A | N/A | N/A | ||||
___________________________
(1)Past performance is not indicative of future results. Performance and AUM information is as of September 30, 2026 and is
based on data available at the time of calculation. Product returns are sourced from Affiliates while benchmark returns are
generally sourced via third-party subscriptions.
(2)For private markets products, performance is reported as the percentage of assets that have outperformed benchmarks on a
since-inception internal rate of return basis. Benchmarks utilized include a combination of public market equivalents, peer
medians, and absolute returns where benchmarks are not available. For purposes of investment performance comparisons,
the latest vintage comparison includes the most recent vehicles and strategies (traditional long-duration investment funds,
customized vehicles, and other evergreen vehicles and product structures) where meaningful performance is available and
calculable. In order to illustrate the performance of our private markets product category over a longer period of history,
the last three vintages comparison incorporates the latest vintage vehicles and the prior two vintages for traditional long-
duration investment funds, as well as additional vehicles and strategies launched during the equivalent time period as the
last three vintages of traditional long-duration investment funds. Due to the nature of these investments and vehicles,
reported performance is typically on a three- to six-month lag basis.
(3)For liquid alternative and equity products, performance is reported as the percentage of assets that have outperformed
benchmarks across the indicated periods, and excludes market-hedging products. For purposes of investment performance
comparisons, products are an aggregation of portfolios (separate accounts, investment funds, and other products) that each
represent a particular investment objective, using the most representative portfolio for the performance comparison.
Performance is presented for products with a three-, five-, and/or ten-year track record and is measured on a consistent
basis relative to the most appropriate benchmarks. Benchmark appropriateness is generally reviewed annually to reflect
any changes in how underlying portfolios/mandates are managed. Product and benchmark performance is reflected as total
return and is annualized. Reported product performance is gross-of-fees for institutional and high-net-worth separate
accounts, and generally net-of-fees across retail funds and other commingled vehicles such as hedge funds.
(4)Multi-asset and fixed income products are mainly our wealth management and solutions offerings. These investment
products are primarily customized toward wealth preservation, estate planning, and liability and tax management, and
therefore are typically not measured against a benchmark.
Aggregate Fees
Aggregate fees consist of asset- and performance-based fees of our consolidated and equity method Affiliates. In the case
of our equity method Affiliates, asset- and performance-based fees are presented net of certain expense reimbursements paid by
the underlying products. Asset-based fees include advisory and other fees earned by our Affiliates for services provided to their
clients and are typically determined as a percentage of the value of a client’s assets under management, generally inclusive of
uncalled commitments. Asset-based fees are generally impacted by the level of average assets under management and the
composition of these assets across our strategies with different asset-based fee ratios. Our asset-based fee ratio is calculated as
asset-based fees divided by average assets under management.
In some cases, if product returns exceed certain performance thresholds, we will participate in performance-based fees.
Performance-based fees are based on investment performance, typically on an absolute basis or relative to a benchmark or a
hurdle rate, and are generally recognized when it is improbable that there will be a significant reversal in the amount of revenue
recognized. Performance-based fees are generally recognized less frequently than asset-based fees and will vary from period to
period because they inherently depend on investment performance. As of September 30, 2026, approximately 27% of our total
assets under management could potentially earn performance-based fees. These percentages were approximately 13% and 38%
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of our assets under management for our consolidated Affiliates and Affiliates accounted for under the equity method,
respectively. We anticipate performance-based fees will be a recurring component of our aggregate fees; however, we do not
anticipate these fees to be a significant component of our Consolidated revenue as these fees are predominantly earned by our
Affiliates accounted for under the equity method.
Aggregate fees were $1,757.6 million for the three months ended September 30, 2026, an increase of $411.6 million or
31% as compared to the three months ended September 30, 2025. The increase in aggregate fees was due to a $421.0 million or
31% increase from asset-based fees, partially offset by a $9.4 million decrease from performance-based fees, primarily in liquid
alternative strategies. The increase in asset-based fees was principally due to an increase in our Affiliates’ average assets under
management, primarily in liquid alternative and private markets strategies, the impact of our investments in new Affiliates and
market appreciation, and changes in the composition of our assets under management, including net client cash flows from our
Affiliates managing alternative strategies, which typically have higher fee rates.
Aggregate fees were $5,329.0 million for the nine months ended September 30, 2026, an increase of $1,539.2 million or
41% as compared to the nine months ended September 30, 2025. The increase in aggregate fees was due to a $1,259.1 million
or 33% increase from asset-based fees and a $280.1 million or 8% increase from performance-based fees, primarily in liquid
alternative strategies. The increase in asset-based fees was principally due to an increase in our Affiliates’ average assets under
management, primarily in liquid alternative and private markets strategies, the impact of our investments in new Affiliates and
market appreciation, and changes in the composition of our assets under management, including net client cash flows from our
Affiliates managing alternative strategies, which typically have higher fee rates.
Financial and Supplemental Financial Performance Measures
The following table presents our key financial and supplemental financial performance measures:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||
(in millions) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | ||||||
Net income | $290.9 | $244.3 | (16)% | $526.1 | $628.0 | 19% | ||||||
Net income (controlling interest) | 212.4 | 173.3 | (18)% | 369.0 | 469.6 | 27% | ||||||
Adjusted EBITDA (controlling interest)(1) | 250.9 | 353.7 | 41% | 698.8 | 987.0 | 41% | ||||||
Economic net income (controlling interest)(1) | 179.7 | 247.9 | 38% | 497.6 | 694.0 | 39% | ||||||
___________________________
(1)Adjusted EBITDA (controlling interest) and Economic net income (controlling interest) are non-GAAP performance
measures and are discussed in “Supplemental Financial Performance Measures.”
Net income (controlling interest) decreased $39.1 million or 18% for the three months ended September 30, 2026. This
decrease was primarily due to $127.6 million of Affiliate transaction gains in the third quarter of 2025, which did not recur,
partially offset by a $70.7 million increase in Equity method income (net).
Net income (controlling interest) increased $100.6 million or 27% for the nine months ended September 30, 2026. This
increase was primarily due to a $202.0 million increase in Equity method income (net), partially offset by a $113.0 million
decrease in Affiliate transaction gains.
Adjusted EBITDA (controlling interest) is an important supplemental financial performance measure for management.
Our Adjusted EBITDA (controlling interest) increased $102.8 million or 41% for the three months ended September 30, 2026,
primarily due to a $411.6 million or 31% increase in aggregate fees.
Adjusted EBITDA (controlling interest) increased $288.2 million or 41% for the nine months ended September 30, 2026,
primarily due to a $1,539.2 million or 41% increase in aggregate fees.
We believe Economic net income (controlling interest) is an important supplemental financial performance measure
because it represents our performance before non-cash expenses relating to the acquisition of interests in Affiliates and
improves comparability of performance between periods. For the three months ended September 30, 2026, our Economic net
income (controlling interest) increased $68.2 million or 38%, primarily due to a $102.8 million or 41% increase in Adjusted
EBITDA (controlling interest).
Economic net income (controlling interest) increased $196.4 million or 39% for the nine months ended September 30,
2026, primarily due to a $288.2 million or 41% increase in Adjusted EBITDA (controlling interest).
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Results of Operations
The following discussion includes the key operating performance measures and financial results of our consolidated and
equity method Affiliates. Our consolidated Affiliates’ financial results are included in Consolidated revenue, Consolidated
expenses, and Investment and other income, and our share of our equity method Affiliates’ financial results is reported, net of
intangible amortization and impairments and tax, in Equity method income (net) in our Consolidated Statements of Income.
Consolidated Revenue
The following table presents our consolidated Affiliates’ average assets under management and Consolidated revenue:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
(in millions, except as noted) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | |||||
Consolidated Affiliate average assets under management (in billions) | $419.8 | $431.2 | 3% | $405.3 | $429.4 | 6% | |||||
Consolidated revenue | $528.0 | $595.2 | 13% | $1,517.8 | $1,780.8 | 17% | |||||
Consolidated revenue increased $67.2 million or 13% for the three months ended September 30, 2026, due to a $55.6
million or 11% increase from asset-based fees, and an $11.6 million or 2% increase from performance-based fees, primarily in
private markets strategies. The increase in asset-based fees was principally due to an increase in our consolidated Affiliates’
average assets under management, primarily in private markets and multi-asset and fixed income strategies, including the
impact of market appreciation, and changes in the composition of our assets under management.
Consolidated revenue increased $263.0 million or 17% for the nine months ended September 30, 2026, due to a $196.9
million or 13% increase from asset-based fees and a $66.1 million or 4% increase from performance-based fees, primarily in
private markets strategies. The increase in asset-based fees was principally due to an increase in our consolidated Affiliates’
average assets under management, primarily in private markets and multi-asset and fixed income strategies, including the
impact of market appreciation, and changes in the composition of our assets under management.
Consolidated Expenses
The following table presents our Consolidated expenses:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
% Change | % Change | ||||||||||
(in millions) | 2025 | 2026 | 2025 | 2026 | |||||||
Compensation and related expenses | $253.5 | $269.7 | 6% | $747.6 | $872.9 | 17% | |||||
Selling, general and administrative | 100.5 | 120.7 | 20% | 290.8 | 335.5 | 15% | |||||
Intangible amortization and impairments | 6.3 | 7.5 | 19% | 96.0 | 63.9 | (33)% | |||||
Interest expense | 33.2 | 40.7 | 23% | 101.8 | 119.6 | 17% | |||||
Depreciation and other amortization | 2.6 | 1.5 | (42)% | 7.9 | 6.2 | (22)% | |||||
Other expenses (net) | 13.1 | 11.9 | (9)% | 34.7 | 46.6 | 34% | |||||
Total consolidated expenses | $409.2 | $452.0 | 10% | $1,278.8 | $1,444.7 | 13% | |||||
Compensation and related expenses increased $16.2 million or 6% for the three months ended September 30, 2026,
primarily due to a $21.2 million increase in compensation accruals. This increase was partially offset by a $3.4 million
decrease in Affiliate equity expense and a $1.6 million decrease in share-based compensation.
Compensation and related expenses increased $125.3 million or 17% for the nine months ended September 30, 2026,
primarily due to a $138.9 million increase in compensation accruals. This increase was partially offset by a $7.3 million
decrease in Affiliate equity expense and a $6.3 million decrease in share-based compensation.
Selling, general and administrative expenses increased $20.2 million or 20% for the three months ended September 30,
2026, primarily due to an $11.4 million increase in distribution and investment-related expenses, principally as a result of the
increase in average assets under management on which these expenses are incurred, and a $7.0 million increase in professional
fees.
Selling, general and administrative expenses increased $44.7 million or 15% for the nine months ended September 30,
2026, primarily due to a $28.8 million increase in distribution and investment-related expenses, principally as a result of the
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increase in average assets under management on which these expenses are incurred, and a $13.1 million increase in professional
fees.
Intangible amortization and impairments increased $1.2 million or 19% for the three months ended September 30, 2026,
primarily due to a $0.8 million increase in amortization expense due to an increase in actual and expected client attrition for
certain definite-lived acquired client relationships.
Intangible amortization and impairments decreased $32.1 million or 33% for the nine months ended September 30, 2026,
primarily due to a $33.7 million decrease in expenses to reduce the carrying value of indefinite-lived acquired client
relationships for certain mutual fund assets to fair value. This decrease was partially offset by a $1.7 million increase in
amortization expense due to an increase in actual and expected client attrition for certain definite-lived acquired client
relationships.
Interest expense increased $7.5 million or 23% for the three months ended September 30, 2026, primarily due to a $7.3
million increase from borrowings under our senior unsecured multicurrency revolving credit facility (the “revolver”) and a $5.9
million increase from our 5.50% senior unsecured notes issued in December 2025 (the “2036 senior notes”). These increases
were partially offset by a $4.5 million decrease due to the repayment of our junior convertible securities in January 2026 and a
$1.1 million decrease due to the maturity of our 3.50% senior notes in August 2025 (the “2025 senior notes”).
Interest expense increased $17.8 million or 17% for the nine months ended September 30, 2026, primarily due to a $20.7
million increase from borrowings under the revolver and a $17.8 million increase from the 2036 senior notes. These increases
were partially offset by a $13.4 million decrease due to the repayment of our junior convertible securities in January 2026 and a
$7.5 million decrease due to the maturity of the 2025 senior notes.
There were no significant changes to Depreciation and other amortization for the three and nine months ended
September 30, 2026.
There were no significant changes to Other expenses (net) for the three months ended September 30, 2026.
Other expenses (net) increased $11.9 million or 34% for the nine months ended September 30, 2026, primarily due to a
$9.3 million increase in expenses related to the settlement of conversions with respect to our junior convertible securities (see
Note 6 of our Consolidated Financial Statements), a $1.8 million increase in rent and related office costs, and a $0.8 million
increase in expenses related to changes in the values of contingent payment obligations.
Equity Method Income (Net)
For our Affiliates accounted for under the equity method, we use structured partnership interests in which we contractually
share in the Affiliate’s revenue or revenue less agreed-upon expenses. Our share of pre-tax earnings or losses from Affiliates
accounted for under the equity method (“pre-tax equity method earnings”), net of intangible amortization and impairments and
tax, is included in Equity method income (net). For certain of our Affiliates accounted for under the equity method, we report
the Affiliate’s financial results in our Consolidated Financial Statements one quarter in arrears.
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The following table presents our equity method Affiliates’ average assets under management and equity method Affiliate
revenue, net of certain expense reimbursements paid by the underlying products (“equity method revenue, net”), as well as pre-
tax equity method earnings, equity method intangible amortization, equity method intangible impairments, if any, and equity
method income tax, which in aggregate form Equity method income (net):
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
(in millions, except as noted) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | |||||
Operating Performance Measures | |||||||||||
Equity method Affiliate average assets under management (in billions) | $367.1 | $525.7 | 43% | $339.9 | $490.4 | 44% | |||||
Equity method revenue, net | $818.0 | $1,162.4 | 42% | $2,272.0 | $3,548.2 | 56% | |||||
Financial Performance Measures | |||||||||||
Pre-tax equity method earnings | $118.2 | $190.3 | 61% | $311.9 | $533.4 | 71% | |||||
Equity method intangible amortization | (24.6) | (27.9) | 13% | (70.2) | (83.8) | 19% | |||||
Equity method intangible impairments | — | — | —% | — | (8.0) | N.M.(1) | |||||
Equity method income tax | (5.1) | (3.2) | (37)% | (12.2) | (10.1) | (17)% | |||||
Equity method income (net) | $88.5 | $159.2 | 80% | $229.5 | $431.5 | 88% | |||||
___________________________
(1)Percent change is not meaningful.
Equity method revenue, net increased $344.4 million or 42% for the three months ended September 30, 2026, due to a
$365.4 million or 45% increase from asset-based fees, partially offset by a $21.0 million or 3% decrease from performance-
based fees, primarily in liquid alternative and private markets strategies. The increase in asset-based fees was principally due to
an increase in our equity method Affiliates’ average assets under management, primarily in liquid alternative strategies, the
impact of our investments in new Affiliates and market appreciation, and changes in the composition of our assets under
management, including net client cash flows from our equity method Affiliates managing alternative strategies, which typically
have higher fee rates.
For the three months ended September 30, 2026, pre-tax equity method earnings increased $72.1 million or 61%, primarily
due to a $344.4 million or 42% increase in equity method revenue, net. Pre-tax equity method earnings increased more than
equity method revenue, net on a percentage basis primarily due to margin expansion at certain Affiliates.
Equity method intangible amortization increased $3.3 million or 13% for the three months ended September 30, 2026,
primarily due to a $6.7 million increase in amortization expense due to investments in new Affiliates. This increase was
partially offset by a $2.4 million decrease due to certain Affiliate transactions and a $1.1 million decrease in amortization
expense related to certain definite-lived assets being fully amortized.
Equity method revenue, net increased $1,276.2 million or 56% for the nine months ended September 30, 2026, due to a
$1,062.2 million or 47% increase from asset-based fees and a $214.0 million or 9% increase from performance-based fees,
primarily in liquid alternative strategies. The increase in asset-based fees was principally due to an increase in our equity
method Affiliates’ average assets under management, primarily in liquid alternative strategies, the impact of our investments in
new Affiliates and market appreciation, and changes in the composition of our assets under management, including net client
cash flows from our equity method Affiliates managing alternative strategies, which typically have higher fee rates.
For the nine months ended September 30, 2026, pre-tax equity method earnings increased $221.5 million or 71%, primarily
due to a $1,276.2 million or 56% increase in equity method revenue, net. Pre-tax equity method earnings increased more than
equity method revenue, net on a percentage basis primarily due to margin expansion at certain Affiliates.
Equity method intangible amortization increased $13.6 million or 19% for the nine months ended September 30, 2026,
primarily due to a $27.1 million increase in amortization expense due to investments in new Affiliates. This increase was
partially offset by a $7.5 million decrease in amortization expense related to certain definite-lived assets being fully amortized
and a $6.9 million decrease in amortization expense due to certain Affiliate transactions.
Equity method intangible impairments increased $8.0 million for the nine months ended September 30, 2026. See Note 9
of our Consolidated Financial Statements.
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There were no significant changes to equity method income tax for the three and nine months ended September 30, 2026.
Affiliate Transaction Gains
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
(in millions) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | |||||
Affiliate transaction gains | $127.6 | $— | N.M.(1) | $127.6 | $14.6 | (89)% | |||||
___________________________
(1)Percent change is not meaningful.
For the three and nine months ended September 30, 2025, we recorded a gain of $127.6 million on the sale of our minority
equity interest in Peppertree Capital Management, Inc. (the “Peppertree Transaction”). For the nine months ended
September 30, 2026, we recorded a $14.6 million gain related to the divestiture of an advisor team at myCIO Wealth Partners,
LLC in the second quarter of 2026 (the “myCIO Transaction”). See Notes 8 and 9 of our Consolidated Financial Statements.
Investment and Other Income
The following table presents our Investment and other income:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
(in millions) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | |||||
Investment and other income | $27.6 | $20.8 | (25)% | $64.7 | $41.2 | (36)% | |||||
Investment and other income decreased $6.8 million or 25% for the three months ended September 30, 2026, primarily due
to a $6.9 million decrease in net realized and unrealized gains on marketable securities and a $1.1 million decrease in interest
income. These decreases were partially offset by a $3.3 million increase in net realized and unrealized gains on other
investments.
Investment and other income decreased $23.5 million or 36% for the nine months ended September 30, 2026, primarily due
to an $8.8 million decrease in interest income, an $8.5 million decrease in net realized and unrealized gains on other
investments, and a $3.3 million decrease in net realized and unrealized gains on marketable securities.
Income Tax Expense
The following table presents our Income tax expense:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
(in millions) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | |||||
Income tax expense | $71.6 | $78.9 | 10% | $134.7 | $195.4 | 45% | |||||
Our consolidated income tax provision includes taxes attributable to the controlling interest and, to a lesser extent, taxes
attributable to the non-controlling interests.
Income tax expense increased $7.3 million or 10% for the three months ended September 30, 2026. Our effective tax rate
(controlling interest) for the three months ended September 30, 2026 was 30.2% as compared to 24.4% for the three months
ended September 30, 2025. The increase in the effective tax rate (controlling interest) is primarily due to lower tax windfalls
attributable to share-based compensation for the three months ended September 30, 2026.
Income tax expense increased $60.7 million or 45% for the nine months ended September 30, 2026. Our effective tax rate
(controlling interest) for the nine months ended September 30, 2026 was 28.4% as compared to 25.6% for the nine months
ended September 30, 2025. The increase in the effective tax rate (controlling interest) is primarily due to lower tax windfalls
attributable to share-based compensation, partially offset by a lower expense attributable to certain equity awards at an Affiliate
for which no tax benefit was recorded for the nine months ended September 30, 2026.
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Net Income
The following table presents Net income, Net income (non-controlling interests), and Net income (controlling interest):
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||||||
(in millions) | 2025 | 2026 | % Change | 2025 | 2026 | % Change | |||||
Net income | $290.9 | $244.3 | (16)% | $526.1 | $628.0 | 19% | |||||
Net income (non-controlling interests) | 78.5 | 71.0 | (10)% | 157.1 | 158.4 | 1% | |||||
Net income (controlling interest) | 212.4 | 173.3 | (18)% | 369.0 | 469.6 | 27% | |||||
Net income (controlling interest) decreased $39.1 million or 18% for the three months ended September 30, 2026,
primarily due to Affiliate transaction gains in the third quarter of 2025, which did not recur, partially offset by an increase in
Equity method income (net).
Net income (controlling interest) increased $100.6 million or 27% for the nine months ended September 30, 2026,
primarily due to an increase in Equity method income (net), partially offset by a decrease in Affiliate transaction gains.
Supplemental Financial Performance Measures
As supplemental information to our GAAP performance measures, including Net income (see Note 17 of our Consolidated
Financial Statements), we provide non-GAAP performance measures of Adjusted EBITDA (controlling interest), Economic net
income (controlling interest), and Economic earnings per share. We believe that many investors use our Adjusted EBITDA
(controlling interest) when comparing our financial performance to other companies in the investment management industry.
Management utilizes these non-GAAP performance measures to assess our performance before our share of certain non-cash
GAAP expenses primarily related to the acquisition of interests in Affiliates and to improve comparability between periods.
Economic net income (controlling interest) and Economic earnings per share are used by management and our Board of
Directors as our principal performance benchmarks, including as one of the measures for determining executive compensation.
These non-GAAP performance measures are provided in addition to, but not as a substitute for, Net income, Net income
(controlling interest), Earnings per share, or other GAAP performance measures.
Adjusted EBITDA (controlling interest)
Adjusted EBITDA (controlling interest) represents our performance before our share of interest expense, income and
certain non-income based taxes, depreciation, amortization, impairments, gains and losses related to Affiliate transactions, and
non-cash items such as certain Affiliate equity-related activities, gains and losses on our contingent payment obligations, and
unrealized gains and losses on seed capital, general partner commitments, and other strategic investments. Adjusted EBITDA
(controlling interest) is also adjusted to include realized economic gains and losses related to these seed capital, general partner
commitments, and other strategic investments.
The following table presents a reconciliation of Net income (controlling interest) to Adjusted EBITDA (controlling
interest):
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
(in millions) | 2025 | 2026 | 2025 | 2026 | |||
Net income (controlling interest) | $212.4 | $173.3 | $369.0 | $469.6 | |||
Interest expense | 33.2 | 40.7 | 101.7 | 119.5 | |||
Income taxes(1) | 73.7 | 78.0 | 139.1 | 196.6 | |||
Intangible amortization and impairments(2) | 28.7 | 32.8 | 145.5 | 135.9 | |||
Affiliate transactions(3) | (133.8) | — | (133.8) | (14.6) | |||
Other items(4) | 36.7 | 28.9 | 77.3 | 80.0 | |||
Adjusted EBITDA (controlling interest) | $250.9 | $353.7 | $698.8 | $987.0 | |||
___________________________
(1)Income taxes include equity method income tax.
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(2)Intangible amortization and impairments in our Consolidated Statements of Income include amortization attributable to the
non-controlling interests of our consolidated Affiliates. For our Affiliates accounted for under the equity method, we do
not separately report intangible amortization and impairments in our Consolidated Statements of Income. Our share of
these Affiliates’ amortization and impairments is included in Equity method income (net). The following table presents the
Intangible amortization and impairments shown above:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
(in millions) | 2025 | 2026 | 2025 | 2026 | |||
Consolidated intangible amortization and impairments | $6.3 | $7.5 | $96.0 | $63.9 | |||
Consolidated intangible amortization and impairments (non-controlling interests) | (2.2) | (2.6) | (20.7) | (19.8) | |||
Equity method intangible amortization and impairments | 24.6 | 27.9 | 70.2 | 91.8 | |||
Total | $28.7 | $32.8 | $145.5 | $135.9 | |||
(3)The three and nine months ended September 30, 2025 include a gain of $127.6 million related to the Peppertree
Transaction and realized gains of $6.2 million on Class A common shares of TPG Inc. (“TPG”), a public company listed on
the Nasdaq Global Select Market, which we received in connection with the Peppertree Transaction. The nine months
ended September 30, 2026 includes a gain of $14.6 million related to the myCIO Transaction. Peppertree and myCIO
Transaction gains are recorded in Affiliate transaction gains, and realized gains on TPG Class A common shares are
recorded in Investment and other income in our Consolidated Statements of Income.
(4)Other items include certain non-income based taxes, depreciation, and non-cash items such as certain Affiliate equity-
related activities, gains and losses on our contingent payment obligations, unrealized gains and losses on seed capital,
general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed
capital, general partner commitments, and other strategic investments. For the three and nine months ended September 30,
2025 and 2026, other items were predominantly the result of Affiliate equity-related activities. See Note 12 of our
Consolidated Financial Statements.
Economic Net Income (controlling interest) and Economic Earnings Per Share
Under our Economic net income (controlling interest) definition, we adjust Net income (controlling interest) for our share
of pre-tax intangible amortization and impairments related to intangible assets (including the portion attributable to equity
method investments in Affiliates) because these expenses do not correspond to the changes in the value of these assets, which
do not diminish predictably over time. We also adjust for deferred taxes attributable to intangible assets because we believe it
is unlikely these accruals will be used to settle material tax obligations. Further, we adjust for gains and losses related to
Affiliate transactions, net of tax, and other economic items.
Economic earnings per share represents Economic net income (controlling interest) divided by the Average shares
outstanding (adjusted diluted). In this calculation, we exclude the potential shares issued upon settlement of Redeemable non-
controlling interests from Average shares outstanding (adjusted diluted) because we intend to settle those obligations without
issuing shares, consistent with all prior Affiliate equity purchase transactions. The potential share issuance in connection with
our former junior convertible securities is measured using a “treasury stock” method. Under this method, only the net number
of shares of common stock equal to the value of the junior convertible securities in excess of par, if any, are deemed to be
outstanding. We believe the inclusion of net shares under a treasury stock method best reflects the benefit of the increase in
available capital resources (which could be used to repurchase shares of our common stock) that occurs when these securities
are converted and we are relieved of our debt obligation.
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The following table presents a reconciliation of Net income (controlling interest) to Economic net income (controlling
interest) and Economic earnings per share:
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | ||||||
(in millions, except per share data) | 2025 | 2026 | 2025 | 2026 | |||
Net income (controlling interest) | $212.4 | $173.3 | $369.0 | $469.6 | |||
Intangible amortization and impairments(1) | 28.7 | 32.8 | 145.5 | 135.9 | |||
Intangible-related deferred taxes(2) | 15.6 | 15.0 | 29.5 | 33.0 | |||
Affiliate transactions(3) | (101.1) | — | (101.1) | (11.0) | |||
Other economic items(4) | 24.1 | 26.8 | 54.7 | 66.5 | |||
Economic net income (controlling interest) | $179.7 | $247.9 | $497.6 | $694.0 | |||
Average shares outstanding (diluted) | 32.9 | 26.1 | 33.0 | 26.8 | |||
Hypothetical issuance of shares to settle Redeemable non-controlling interests | (2.0) | — | (1.6) | (0.1) | |||
Assumed issuance of junior convertible securities shares | (1.7) | — | (1.7) | — | |||
Dilutive impact of junior convertible securities shares | 0.2 | — | 0.1 | — | |||
Average shares outstanding (adjusted diluted) | 29.4 | 26.1 | 29.8 | 26.7 | |||
Economic earnings per share | $6.10 | $9.50 | $16.68 | $26.00 | |||
___________________________
(1)See note (2) to the table in “Adjusted EBITDA (controlling interest).”
(2)Income taxes include equity method deferred taxes.
(3)The three and nine months ended September 30, 2025 include a gain of $127.6 million related to the Peppertree
Transaction and realized gains of $6.2 million on TPG Class A common shares, net of $32.7 million income tax expense.
The nine months ended September 30, 2026 includes a gain of $14.6 million related to the myCIO Transaction, net of
$3.6 million income tax expense.
(4)Other economic items include certain Affiliate equity-related activities, gains and losses related to contingent payment
obligations, tax windfalls and shortfalls from share-based compensation, unrealized gains and losses on seed capital,
general partner commitments, and other strategic investments, and realized economic gains and losses related to these seed
capital, general partner commitments, and other strategic investments. For the three and nine months ended September 30,
2025 and 2026, other economic items were predominantly the result of Affiliate equity-related activities. See Note 12 of
our Consolidated Financial Statements.
Liquidity and Capital Resources
We generate long-term value by investing in new Affiliate partnerships, existing Affiliates, and strategic value-add
capabilities through which we can leverage our scale and resources to benefit our Affiliates and enhance their long-term growth
prospects. Given our annual cash generation from operations, in addition to investing for growth in our business, we are also
able to return excess capital to shareholders primarily through share repurchases. We continue to manage our capital structure
consistent with an investment grade company and are currently rated A3 by Moody’s Investor Services and BBB+ by S&P
Global Ratings.
Cash and cash equivalents were $436.1 million as of September 30, 2026 and were attributable to both our controlling and
the non-controlling interests. In the nine months ended September 30, 2026, we met our cash requirements primarily through
cash generated by operating activities and senior bank debt borrowings. Our principal uses of cash in the nine months ended
September 30, 2026 were for investments in new Affiliates, the return of excess capital through share repurchases, settlement of
each of our conversion obligations with respect to our former junior convertible securities, repayment of debt, and distributions
to Affiliate equity holders.
We expect investments in new Affiliates, investments in existing Affiliates, primarily through purchases of Affiliate equity
interests and general partner and seed capital investments, the return of capital through share repurchases and the payment of
cash dividends on our common stock, repayment of debt, distributions to Affiliate equity holders, payment of income taxes, and
general working capital to be the primary uses of cash on a consolidated basis for the foreseeable future. We anticipate that our
current cash balance, cash flows from operations, and borrowings under the revolver will be sufficient to support our uses of
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cash for the foreseeable future. In addition, we may draw funding from the debt and equity capital markets, and our credit
ratings, among other factors, allow us to access these sources of funding on favorable terms.
The following table presents operating, investing, and financing cash flow activities:
For the Nine Months Ended September 30, | |||
(in millions) | 2025 | 2026 | |
Operating cash flow | $716.8 | $899.8 | |
Investing cash flow | (258.6) | (258.6) | |
Financing cash flow | (948.6) | (785.3) | |
Operating Cash Flow
Operating cash flows are calculated by adjusting Net income for other significant sources and uses of cash, significant non-
cash items, and timing differences in the cash settlement of assets and liabilities.
For the nine months ended September 30, 2026, Cash flows from operating activities were $899.8 million, primarily from
distributions of earnings received from equity method investments of $630.3 million and Net income of $628.0 million adjusted
for non-cash items of $265.6 million. These items were partially offset by timing differences in the cash settlement of
receivables, other assets, and payables, accrued liabilities, and other liabilities of $61.5 million. For the nine months ended
September 30, 2026, operating cash flows were primarily attributable to the controlling interest.
Investing Cash Flow
For the nine months ended September 30, 2026, Cash flows used in investing activities were $258.6 million, primarily due
to $253.1 million of investments in Affiliates and $122.4 million of purchases of investment securities. These items were
partially offset by $81.7 million of maturities and sales of investment securities and $37.2 million of proceeds received from
Affiliate transactions. For the nine months ended September 30, 2026, investing cash flows were primarily attributable to the
controlling interest.
Financing Cash Flow
For the nine months ended September 30, 2026, Cash flows used in financing activities were $785.3 million, primarily due
to $767.4 million of repurchases of common stock, net, the settlement of junior convertible securities of $514.6 million,
repayment of senior bank debt borrowings of $245.0 million, $212.3 million of distributions to non-controlling interests,
$61.4 million of Affiliate equity purchases, net of issuances, and $46.7 million of taxes paid on shares withheld for share-based
awards. These items were partially offset by senior bank debt borrowings of $1,070.0 million. For the nine months ended
September 30, 2026, financing cash flows were primarily attributable to the controlling interest.
Affiliate Equity
We periodically purchase Affiliate equity from and issue Affiliate equity to our consolidated Affiliate partners and other
parties under agreements that provide us with a conditional right to call and Affiliate equity holders with a conditional right to
put their Affiliate equity interests to us at certain intervals. We have the right to settle a portion of these purchases in shares of
our common stock. For Affiliates accounted for under the equity method, we do not typically have such put and call
arrangements. The purchase price of these conditional purchases is generally calculated based upon a multiple of the Affiliate’s
cash flow distributions, which is intended to represent fair value. In certain cases, Affiliate equity holders are also permitted to
sell their equity interests to Affiliate partners or other parties, subject to our approval or other restrictions.
As of September 30, 2026, the current redemption value of Affiliate equity interests was $510.1 million, of which $277.5
million was presented as Redeemable non-controlling interests (including $30.5 million of consolidated Affiliate-sponsored
investment products primarily attributable to third-party investors), and $232.6 million was included in Other liabilities on the
Consolidated Balance Sheets. Although the timing and amounts of these purchases are difficult to predict, we paid $65.6
million for Affiliate equity purchases and received $4.2 million for Affiliate equity issuances during the nine months ended
September 30, 2026, and we expect net purchases of approximately $30 million of Affiliate equity during the remainder of
2026. In the event of a purchase, we become the owner of the cash flow associated with the purchased equity. See Notes 11
and 12 of our Consolidated Financial Statements.
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Share Repurchases
Our Board of Directors authorized share repurchase programs in July 2024 and January 2026 to repurchase up to 5.4
million and 4.2 million shares of our common stock, respectively, and these authorizations have no expiry. Purchases may be
made from time to time, at management’s discretion, in the open market or in privately negotiated transactions, including
through the use of trading plans, as well as pursuant to accelerated share repurchase programs or other share repurchase
strategies that may include derivative financial instruments. During the three and nine months ended September 30, 2026, we
repurchased 1.1 million and 2.3 million shares of our common stock at an average price per share of $361.08 and $334.58,
respectively. As of September 30, 2026, we had repurchased all of the shares in the repurchase program authorized in July
2024, and there were a total of 3.9 million shares available for repurchase under our January 2026 share repurchase program.
Debt
The following table presents the carrying value of our outstanding indebtedness and a reconciliation to Debt as presented
on our Consolidated Balance Sheets:
(in millions) | December 31, 2025 | September 30, 2026 | |
Senior bank debt | $— | $825.0 | |
Senior notes | 1,172.0 | 1,172.2 | |
Junior subordinated notes | 1,216.1 | 1,216.2 | |
Junior convertible securities | 340.6 | — | |
Total carrying value | 2,728.7 | 3,213.4 | |
Debt issuance costs | (37.4) | (34.0) | |
Debt | $2,691.3 | $3,179.4 |
As of September 30, 2026, the weighted average maturity of our outstanding senior and junior subordinated notes is 21
years, all of which is maturing in 2030 and beyond. Our nearest term maturity with respect to our senior and junior
subordinated notes relates to our $350.0 million senior notes due June 2030 (the “2030 senior notes”). See Note 6 of our
Consolidated Financial Statements.
Senior Bank Debt
As of September 30, 2026, we had a $1.25 billion revolver. The Company amended and restated the revolver in June 2026,
extending the maturity from November 15, 2029 to June 9, 2031. Subject to certain conditions, we may increase the
commitments under the revolver by up to an additional $750.0 million.
As of September 30, 2026, we had outstanding borrowings under the revolver of $825.0 million, and we could borrow all
remaining capacity and maintain compliance with all of the terms of the revolver.
Senior Notes
As of September 30, 2026, we had senior notes outstanding, the respective principal terms of which are presented and
described below:
2030 Senior Notes | 2034 Senior Notes | 2036 Senior Notes | ||||
Issue date | June 2020 | August 2024 | December 2025 | |||
Maturity date | June 2030 | August 2034 | February 2036 | |||
Par value (in millions) | $350.0 | $400.0 | $425.0 | |||
Stated coupon | 3.30% | 5.50% | 5.50% | |||
Coupon frequency | Semi-annually | Semi-annually | Semi-annually |
In addition to customary event of default provisions, the indenture governing the senior notes, including the applicable
supplemental indentures with respect to the 2030, 2034, and 2036 senior notes, limits our ability to consolidate, merge, or sell
all or substantially all of our assets, and requires us to make an offer to repurchase the applicable senior notes at 101% of the
principal amount (plus any accrued and unpaid interest), upon certain change of control triggering events. The senior notes
may be redeemed, in whole or in part, at a make-whole redemption price (plus accrued and unpaid interest), at any time prior to
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March 15, 2030, in the case of the 2030 senior notes, at any time prior to May 20, 2034, in the case of the 2034 senior notes,
and at any time prior to November 15, 2035, in the case of the 2036 senior notes. In addition, the 2030, 2034, and 2036 senior
notes may be redeemed at par (plus accrued and unpaid interest), in whole or in part, at any time, on or after March 15, 2030,
May 20, 2034, and November 15, 2035, respectively. We may also repurchase senior notes in the open market or in privately
negotiated transactions from time to time at management’s discretion.
Junior Subordinated Notes
As of September 30, 2026, we had junior subordinated notes outstanding, the respective principal terms of which are
presented and described below:
2059 Junior Subordinated Notes | 2060 Junior Subordinated Notes | 2061 Junior Subordinated Notes | 2064 Junior Subordinated Notes | |||||
Issue date | March 2019 | September 2020 | July 2021 | March 2024 | ||||
Maturity date | March 2059 | September 2060 | September 2061 | March 2064 | ||||
Par value (in millions) | $300.0 | $275.0 | $200.0 | $450.0 | ||||
Stated coupon | 5.875% | 4.75% | 4.20% | 6.75% | ||||
Coupon frequency | Quarterly | Quarterly | Quarterly | Quarterly | ||||
NYSE Symbol | MGR | MGRB | MGRD | MGRE |
As of September 30, 2026, each of the 2059, 2060, and 2061 junior subordinated notes could be redeemed at any time, in
whole or in part. The 2064 junior subordinated notes may be redeemed at any time, in whole or in part, on or after March 30,
2029. In each case, the junior subordinated notes may be redeemed at 100% of the principal amount of the notes being
redeemed, plus any accrued and unpaid interest thereon. Prior to March 30, 2029, at our option, the 2064 junior subordinated
notes may also be redeemed, in whole but not in part, at 100% of the principal amount, plus any accrued and unpaid interest, if
certain changes in tax laws, regulations, or interpretations occur; or at 102% of the principal amount, plus any accrued and
unpaid interest, if a rating agency makes certain changes relating to the equity credit criteria for securities with features similar
to the notes.
Junior Convertible Securities
On December 8, 2025, we delivered notice that we had elected to redeem all of our outstanding 5.15% junior convertible
trust preferred securities (the “junior convertible securities”) on December 29, 2025 (the “Redemption Date”), and announced
our intention to settle any and all conversion obligations in cash. Substantially all holders of the junior convertible securities
delivered requests to convert their securities prior to the Redemption Date. On December 15, 2025 (the “Election Date”), we
made an irrevocable election to settle our conversion obligations in cash by reference to the daily volume weighted average
price of our common stock during each applicable ten trading day conversion reference period. These conversions resulted in a
settlement value in excess of the associated carrying value (the “conversion premium”). As of December 31, 2025, the
conversion premium of $155.5 million was recorded within Other liabilities, with a corresponding reduction to Additional paid-
in capital. In addition, the conversion resulted in a reduction to Deferred tax liability (net) on the Consolidated Balance Sheets
of $38.9 million, with a corresponding increase to Additional paid-in capital. Our election to settle each applicable conversion
premium in cash using a ten-day reference period was accounted for as a forward sale contract, which resulted in a $9.2 million
expense recorded in Other expenses (net), in the fourth quarter of 2025.
On the Redemption Date, we redeemed $1.1 million of junior convertible securities which were not converted, reflecting
the principal amount of the redeemed securities, plus accrued and unpaid interest, up to, but not including, the Redemption
Date.
In January 2026, we settled each of our applicable conversion obligations in cash for an aggregate amount of
$514.6 million which resulted in an incremental expense related to the forward sale contract of $9.3 million. The junior
convertible securities were considered contingent payment debt instruments under federal income tax regulations, which
required us to deduct interest in an amount greater than our reported interest expense (“excess interest expense deductions”).
As a result of the settlement of these securities, we incurred a current cash tax liability of approximately $56 million, reflective
of the recapture of excess interest expense deductions.
Prior to their redemption or requests for conversion by the holders, as applicable and described above, the junior
convertible securities bore interest at a rate of 5.15% per annum, which interest payments were payable quarterly in cash.
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Equity Distribution Program
In the first quarter of 2025, we entered into an equity distribution agreement and forward sale agreements with several
major securities firms under which we may, from time to time, issue and sell shares of our common stock (immediately or on a
forward basis) having an aggregate sales price of up to $500.0 million (the “equity distribution program”). This equity
distribution program superseded and replaced our prior equity distribution program. As of September 30, 2026, no sales had
occurred under the equity distribution program.
Commitments
See Note 7 of our Consolidated Financial Statements.
Other Contingent Commitments
See Notes 4 and 7 of our Consolidated Financial Statements.
Leases
As of September 30, 2026, our lease obligations were $7.2 million for the remainder of 2026, $61.8 million from 2027
through 2028, $58.2 million from 2029 through 2030, and $64.0 million thereafter. The portion of these lease obligations
attributable to the controlling interest were $0.9 million for the remainder of 2026, $7.4 million from 2027 through 2028, $7.2
million from 2029 through 2030, and $12.2 million thereafter.
Recent Accounting Developments
See Note 2 of our Consolidated Financial Statements.
Critical Accounting Estimates and Judgments
Our 2025 Annual Report on Form 10‑K includes additional information about our Critical Accounting Estimates and
Judgments, and should be read in conjunction with this Quarterly Report on Form 10‑Q.
Item 3.Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes to our Quantitative and Qualitative Disclosures About Market Risk for the nine
months ended September 30, 2026. Please refer to Item 7A of our 2025 Annual Report on Form 10-K.
Item 4.Controls and Procedures
We carried out an evaluation under the supervision and with the participation of our management, including our Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and
procedures during the quarter covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, our Chief
Executive Officer and Chief Financial Officer concluded that, as of the end of the quarter covered by this Quarterly Report on
Form 10-Q, our disclosure controls and procedures are effective in ensuring that (i) the information required to be disclosed by
us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is
recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s
rules and forms, and (ii) such information is accumulated and communicated to our management, including our principal
executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In
designing and evaluating our disclosure controls and procedures, we recognize that any controls and procedures, no matter how
well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our
management necessarily was required to apply its judgment in evaluating and implementing possible controls and procedures.
Our disclosure controls and procedures were designed to provide reasonable assurance of achieving their stated objectives, and
our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were
effective at the reasonable assurance level. We review on an ongoing basis and document our disclosure controls and
procedures, and our internal control over financial reporting, and we may from time to time make changes in an effort to
enhance their effectiveness and ensure that our systems evolve with our business.
No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act) occurred during the quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably
likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
(a)None.
(b)None.
(c)Purchases of Equity Securities by the Issuer:
Period | Total Number of Shares Purchased(1) | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Average Price Paid Per Share | Maximum Number of Shares that May Yet Be Purchased Under Outstanding Plans or Programs(2) | |||||
July 1-31, 2026 | 157,666 | $352.90 | 157,666 | $352.90 | 4,836,706 | |||||
August 1-31, 2026 | 264,238 | 365.14 | 263,977 | 365.12 | 4,572,729 | |||||
September 1-30, 2026 | 686,152 | 361.40 | 686,152 | 361.40 | 3,886,577 | |||||
Total | 1,108,056 | $361.08 | 1,107,795 | $361.08 |
___________________________
(1)Includes shares surrendered to the Company in connection with certain stock swap and option exercise transactions, if any.
(2)Our Board of Directors authorized share repurchase programs in July 2024 and January 2026 to repurchase up to 5.4
million and 4.2 million shares of our common stock, respectively, and these authorizations have no expiry. Purchases may
be made from time to time, at management’s discretion, in the open market or in privately negotiated transactions,
including through the use of trading plans, as well as pursuant to accelerated share repurchase programs or other share
repurchase strategies that may include derivative financial instruments. As of September 30, 2026, we had repurchased all
of the shares authorized in July 2024, and there were a total of 3.9 million shares available for repurchase under our
January 2026 share repurchase program.
Item 6.Exhibits
The exhibits are listed on the Exhibit Index below.
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EXHIBIT INDEX
Exhibit No. | Description | |
31.1 | Certification of Registrant’s Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
31.2 | Certification of Registrant’s Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002* | |
32.1 | Certification of Registrant’s Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | |
32.2 | Certification of Registrant’s Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | |
101 | The following financial statements from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2026 are filed herewith, formatted in XBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Statements of Income for the nine-month periods ended September 30, 2026 and 2025, (ii) the Consolidated Statements of Comprehensive Income for the nine-month periods ended September 30, 2026 and 2025, (iii) the Consolidated Balance Sheets at September 30, 2026 and December 31, 2025, (iv) the Consolidated Statements of Changes in Equity for the nine-month periods ended September 30, 2026 and 2025, (v) the Consolidated Statements of Cash Flows for the nine-month periods ended September 30, 2026 and 2025, and (vi) the Notes to the Consolidated Financial Statements | |
104 | The cover page from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2026, formatted in XBRL (Inline eXtensible Business Reporting Language) and contained in Exhibit 101 |
*Filed herewith
**Furnished herewith
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
AFFILIATED MANAGERS GROUP, INC. (Registrant) | |
November 9, 2026 | /s/ DAVA E. RITCHEA |
Dava E. Ritchea on behalf of the Registrant as Chief Financial Officer (and also as Principal Financial and Principal Accounting Officer) |