We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
T. Rowe Price Stock Down 6.4% as Q4 Earnings Miss, Expenses Rise Y/Y
Read MoreHide Full Article
Key Takeaways
TROW's Q4 adjusted EPS of $2.44 missed estimates but rose 15.1% year over year.
Net revenues grew 6% to $1.93B, aided by higher advisory fees and capital allocation income.
Total AUM reached $1.77T, with strong liquidity of $3.38B supporting capital distributions.
T. Rowe Price Group, Inc.’s (TROW - Free Report) fourth-quarter 2025 adjusted earnings per share (EPS) of $2.44 missed the Zacks Consensus Estimate of $2.47. Nevertheless, the bottom line increased 15.1% year over year.
Shares of the company lost nearly 6.4% in the early trading session following the release of lower-than-expected results. A full day’s trading session will depict a clearer picture.
TROW’s results were affected by higher expenses. Nonetheless, an increase in investment advisory fees and capital allocation-based income supported the results. Also, higher assets under management (AUM) were another positive.
The results included certain items. After considering those, net income attributable to T. Rowe Price (on a GAAP basis) was $445.3 million, which rose 1.2% from the prior-year quarter.
In 2025, adjusted earnings of $9.72 per share missed the consensus estimate of $9.75 but rose 4.2% year over year. Net income attributable to T. Rowe Price was $2.1 billion, down nearly 1% year over year.
TROW’s Revenues Increase, Expenses Rise
Net revenues rose 6% year over year to $1.93 billion. Further, the top line surpassed the Zacks Consensus Estimate of $1.92 billion.
In 2025, net revenues were $7.31 billion, up 3.1% year over year. Also, the top line surpassed the Zacks Consensus Estimate of $7.30 billion.
Investment advisory fees rose 4.2% year over year to $1.74 billion.
Capital allocation-based income increased to $40.8 million from a loss of $5.2 million in the prior-year quarter.
Total operating expenses increased 16.5% year over year to $1.46 billion in the reported quarter. On an adjusted basis, operating expenses were $1.25 billion, up 2.2% year over year.
TROW’s AUM Rises, Liquidity Position Strong
As of Dec. 31, 2025, total AUM grew 10.5% year over year to $1.77 trillion.
In the fourth quarter, net market appreciation and income of $33.9 billion favorably impacted T. Rowe Price’s AUM, partially offset by net cash outflows of $25.5 billion.
The company had substantial liquidity, including cash and cash equivalents of $3.38 billion as of Dec. 31, 2025, up from $2.65 billion as of Dec. 31, 2024. This will enable TROW to keep investing.
TROW’s Capital Distribution Activities
T. Rowe Price distributed a total of $426 million to shareholders through common stock dividends and share repurchases in the fourth quarter.
Our View on TROW
TROW’s solid AUM balance, broadening distribution reach and efforts to diversify business through acquisitions and product enhancements are likely to support top-line growth. However, an elevated expense base and excessive reliance on investment advisory fees are concerns. The current tough operating environment is a headwind. Nonetheless, a solid liquidity position enables sustainable capital distributions.
T. Rowe Price Group, Inc. Price, Consensus and EPS Surprise
Invesco’s (IVZ - Free Report) fourth-quarter 2025 adjusted earnings of 62 cents per share surpassed the Zacks Consensus Estimate of 57 cents. The bottom line increased 19.2% from the prior-year quarter.
The results of IVZ have been primarily aided by an increase in adjusted revenues. Moreover, growth in the assets under management reached record levels, supporting the results to an extent. However, an increase in adjusted operating expenses was a headwind.
SEI Investments Co.’s (SEIC - Free Report) fourth-quarter 2025 earnings of $1.38 per share beat the Zacks Consensus Estimate of $1.34. Moreover, the bottom line reflected a rise of 16% from the prior-year quarter.
SEIC’s results were aided by higher revenues and a rise in assets under management. However, higher expenses acted as a spoilsport.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
T. Rowe Price Stock Down 6.4% as Q4 Earnings Miss, Expenses Rise Y/Y
Key Takeaways
T. Rowe Price Group, Inc.’s (TROW - Free Report) fourth-quarter 2025 adjusted earnings per share (EPS) of $2.44 missed the Zacks Consensus Estimate of $2.47. Nevertheless, the bottom line increased 15.1% year over year.
Shares of the company lost nearly 6.4% in the early trading session following the release of lower-than-expected results. A full day’s trading session will depict a clearer picture.
TROW’s results were affected by higher expenses. Nonetheless, an increase in investment advisory fees and capital allocation-based income supported the results. Also, higher assets under management (AUM) were another positive.
The results included certain items. After considering those, net income attributable to T. Rowe Price (on a GAAP basis) was $445.3 million, which rose 1.2% from the prior-year quarter.
In 2025, adjusted earnings of $9.72 per share missed the consensus estimate of $9.75 but rose 4.2% year over year. Net income attributable to T. Rowe Price was $2.1 billion, down nearly 1% year over year.
TROW’s Revenues Increase, Expenses Rise
Net revenues rose 6% year over year to $1.93 billion. Further, the top line surpassed the Zacks Consensus Estimate of $1.92 billion.
In 2025, net revenues were $7.31 billion, up 3.1% year over year. Also, the top line surpassed the Zacks Consensus Estimate of $7.30 billion.
Investment advisory fees rose 4.2% year over year to $1.74 billion.
Capital allocation-based income increased to $40.8 million from a loss of $5.2 million in the prior-year quarter.
Total operating expenses increased 16.5% year over year to $1.46 billion in the reported quarter. On an adjusted basis, operating expenses were $1.25 billion, up 2.2% year over year.
TROW’s AUM Rises, Liquidity Position Strong
As of Dec. 31, 2025, total AUM grew 10.5% year over year to $1.77 trillion.
In the fourth quarter, net market appreciation and income of $33.9 billion favorably impacted T. Rowe Price’s AUM, partially offset by net cash outflows of $25.5 billion.
The company had substantial liquidity, including cash and cash equivalents of $3.38 billion as of Dec. 31, 2025, up from $2.65 billion as of Dec. 31, 2024. This will enable TROW to keep investing.
TROW’s Capital Distribution Activities
T. Rowe Price distributed a total of $426 million to shareholders through common stock dividends and share repurchases in the fourth quarter.
Our View on TROW
TROW’s solid AUM balance, broadening distribution reach and efforts to diversify business through acquisitions and product enhancements are likely to support top-line growth. However, an elevated expense base and excessive reliance on investment advisory fees are concerns. The current tough operating environment is a headwind. Nonetheless, a solid liquidity position enables sustainable capital distributions.
T. Rowe Price Group, Inc. Price, Consensus and EPS Surprise
T. Rowe Price Group, Inc. price-consensus-eps-surprise-chart | T. Rowe Price Group, Inc. Quote
Currently, TROW carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of T. Rowe Price’s Peers
Invesco’s (IVZ - Free Report) fourth-quarter 2025 adjusted earnings of 62 cents per share surpassed the Zacks Consensus Estimate of 57 cents. The bottom line increased 19.2% from the prior-year quarter.
The results of IVZ have been primarily aided by an increase in adjusted revenues. Moreover, growth in the assets under management reached record levels, supporting the results to an extent. However, an increase in adjusted operating expenses was a headwind.
SEI Investments Co.’s (SEIC - Free Report) fourth-quarter 2025 earnings of $1.38 per share beat the Zacks Consensus Estimate of $1.34. Moreover, the bottom line reflected a rise of 16% from the prior-year quarter.
SEIC’s results were aided by higher revenues and a rise in assets under management. However, higher expenses acted as a spoilsport.