Artisan Partners Asset Management NYSE: APAM used its fourth-quarter 2025 earnings call to highlight strong full-year investment performance, record quarterly revenue, and continued progress broadening the firm beyond public equities into credit and alternatives, including the acquisition of a new real estate private equity franchise.
Investment performance and 2025 results
CEO Jason Gottlieb said 2025 featured “significant absolute returns” for clients and strong results for shareholders, with the firm continuing to expand its multi-asset platform. Firm-wide asset-weighted investment returns exceeded 20% net of fees, and strategies generated more than $33 billion in returns for clients. Compared with 2024, Gottlieb said revenue rose 8%, operating income and adjusted operating income increased 9% and 12%, respectively, and assets under management (AUM) grew nearly 12%.
On longer-term performance, Gottlieb said 79% of AUM outperformed benchmarks over three years, 74% over five years, and 92% over 10 years, gross of fees. He also noted that all 12 strategies with track records longer than 10 years have outperformed their benchmark since inception, net of fees.
Several strategies posted notable calendar-year results in 2025, including equity strategies such as Global Equity, Global Value, and Select Equity, which outperformed their benchmarks by 2,422, 1,188, and 1,175 basis points, respectively, net of fees. In credit, the Emerging Markets Local Opportunities strategy returned over 24% for the year, 527 basis points above its benchmark net of fees. In alternatives, management cited net-of-fee returns of nearly 8% for Credit Opportunities, nearly 12% for Global Unconstrained, and over 20% for Antero Peak.
Gottlieb cautioned that one-year performance has been weighed down by underperformance in two of the firm’s largest equity strategies—International Value and Global Opportunities—despite what he described as strong long-term track records for both.
AUM trends: growth in credit and alternatives, equity outflows
Artisan ended 2025 with $180 billion in AUM, an all-time year-end high, driven largely by investment gains exceeding $33 billion, according to Gottlieb. However, flows varied by platform.
- Credit: AUM rose 29% year-over-year to $17.9 billion. Net inflows were $2.8 billion, and organic growth exceeded 20% for the third consecutive year.
- Alternatives: AUM increased 20% to $4 billion, with management pointing to strong organic growth in Global Unconstrained.
- Equities: The platform experienced $15.6 billion of outflows, concentrated in Global Opportunities, U.S. Mid-Cap Growth, and Non-U.S. Small-Mid Growth. Management attributed the redemptions to challenging short-term performance, changing asset allocation preferences, and profit-taking after strong long-term performance.
Gottlieb emphasized that maintaining and growing public equity AUM requires “differentiated and compelling investment performance,” demand from asset allocation, appropriate vehicles and pricing, and effective sales and client service. He said the firm believes it can continue to maintain and grow its equity businesses while expanding credit and alternatives.
Grandview acquisition adds private real estate capability
Management provided additional detail on Grandview Property Partners, a real estate private equity firm that joined Artisan as its 12th autonomous investment franchise. Gottlieb said Grandview specializes in originating, developing, acquiring, and managing middle-market U.S. properties and is led by founding partners Raj Menon, Dean Soter, Eric Freeman, and Jeff Yusko, whose group has worked together for an average of 22 years.
Since forming in 2018, management said Grandview has delivered top-quartile results and consistent DPI realization. The team’s macro-driven approach targets growth markets influenced by demographic shifts and regional supply-demand dynamics, with recent emphasis on industrial, residential, and “power, land” themes. Gottlieb said Grandview has raised three discretionary closed-end drawdown funds and manages approximately $880 million in institutional assets across its flagship funds and co-investment programs.
In Q&A, Gottlieb addressed why Grandview’s AUM was lower than some expected, explaining there were realizations in the fourth quarter in Grandview Fund I, which is fully invested and in a harvesting phase, resulting in distributions to limited partners. He also said Grandview Fund III was about $150 million in committed assets and is nearing the end of its investment period. Looking ahead, management said building Grandview Fund IV is a top 2026 priority, with the firm “effectively launching” it and hoping for a first close in the early-to-mid summer. Gottlieb said the firm expects Fund IV to be “significantly higher” than Fund III.
Fourth-quarter financials, fees, and dividends
CFO C.J. Daley said the firm was “pleased” with fourth-quarter 2025 financial results. Revenue reached a record $336 million, up 11% from the September quarter and up 13% from the prior-year quarter. The quarter included approximately $29 million of performance fees from six different strategies, which Daley said exceeded the company’s third-quarter projections due to strong relative performance in certain performance-fee-eligible accounts. About 3% of AUM was subject to performance fee arrangements as of year-end, with most measured annually at the end of December.
The weighted average fee rate in the quarter was 74 basis points, including performance fees, while the recurring management fee rate was consistent with recent quarters. Daley also noted annual income and capital gain distributions were completed in the quarter, with distributions reinvested in Artisan funds totaling $1.5 billion for the quarter and $2.0 billion for the full year—an $800 million increase from 2024—which he attributed primarily to strong absolute performance in the firm’s two largest equity mutual funds.
Adjusted operating expenses rose 4% from the third quarter and 7% year-over-year, primarily due to higher variable incentive compensation tied to increased revenue. Daley said fixed compensation costs declined modestly, long-term incentive compensation expense was lower due to forfeitures tied to a small number of employee departures, and results also benefited from a quarterly true-up of self-insurance liabilities.
Adjusted operating income increased 23% versus both the prior quarter and the year-ago quarter. Adjusted operating margin was 40.2%, up 400 basis points from the prior quarter. Adjusted net income per adjusted share increased 24% sequentially and 20% year-over-year.
Daley said Artisan ended the year with approximately $214 million of cash, leverage of about 0.4x, and a fully undrawn $100 million revolver. The firm had $152 million of seed capital invested in emerging products, and during the year it realized $20 million of gains from seed investment redemptions in products that no longer required support from firm capital. Daley said those gains are excluded from non-GAAP earnings and can support dividends and future growth.
The board declared a quarterly dividend of $1.01 per share for the December 2025 quarter and a $0.57 year-end special dividend. In total, dividends declared with respect to 2025 cash generation were $3.87 per share, representing a 98% payout ratio relative to adjusted earnings and an 11% increase versus dividends declared on 2024 cash generation. Daley said the year-end special dividend was 14% higher than the prior year and that the dividend yield was 9.5% based on the stock price on Dec. 31.
2026 outlook: expenses, incentives, and growth priorities
Looking ahead, Daley said the board approved a 2026 annual long-term incentive award of approximately $72 million, including $51 million of cash-based franchise capital awards and $21 million of restricted stock awards, with the “vast majority” awarded to investment professionals. As a result, the firm expects long-term incentive amortization expense of approximately $85 million for 2026, excluding mark-to-market impacts.
The Grandview acquisition closed Jan. 2 and is expected to have an immaterial impact on 2026 earnings, though Daley said it is expected to be mildly accretive to earnings per share after the final closing of Grandview’s next flagship drawdown fund. Including about $20 million of increased fixed expenses tied to the incentive grant and Grandview-related costs, fixed expenses are expected to increase at a low single-digit rate in 2026. Daley also reminded investors that fixed compensation and benefits expenses are expected to be about $6 million higher in the first quarter of 2026 than in the fourth quarter of 2025.
In Q&A on broader growth, Gottlieb said the firm is not exclusively focused on M&A and is letting “talent drive the outcome,” while maintaining areas of emphasis including private credit, private equity secondaries, and opportunities to broaden the credit platform across public, private, and hybrid approaches. He added that the firm sees off-market transactions as a more attractive hunting ground than prominently shopped deals.
About Artisan Partners Asset Management NYSE: APAM
Artisan Partners Asset Management Inc is a global investment management firm that specializes in active, fundamental research-driven strategies across a range of equity, fixed income and alternative asset classes. Founded in 1994 by Andrew Ziegler, the company has built a reputation for its team-based approach to portfolio construction, emphasizing deep sector expertise and independent analysis. Its product lineup includes U.S. and international equity strategies, global emerging markets, as well as credit and multisector fixed income offerings.
Artisan Partners serves a diverse client base that spans institutional investors, intermediaries and high-net-worth individuals located in North America, Europe and Asia.
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