Silvercrest Asset Management Group Q2 Earnings Call Highlights

Key Points

• Second-quarter revenue was $30.8 million, while consolidated net income was $0.5 million and adjusted EBITDA was $3.4 million. Expenses increased 12% year over year to $29.8 million, reflecting higher compensation and investment in international expansion.
• Discretionary AUM rose 6.9% sequentially to a record $24.7 billion, while total AUM reached $37.0 billion. Organic new client flows improved to $111 million, although seasonal tax withdrawals and institutional outflows partly offset market appreciation.
• Silvercrest is nearing completion of European and Australian distribution infrastructure, including its Irish MiFID license, UCITS vehicle and Australian unit trust. Management said its institutional pipeline totals potential opportunities “well into the billions of dollars,” while startup-related costs are expected to decline as licensing initiatives conclude.

Silvercrest Asset Management Group NASDAQ: SAMG reported second-quarter 2026 revenue of $30.8 million and consolidated net income of $0.5 million as the wealth and institutional asset manager continued investing in international distribution, licensing and personnel.

Chairman and CEO Rick Hough said discretionary assets under management, the primary driver of the company’s revenue, rose 6.9% during the quarter to $24.7 billion as of June 30, from $23.1 billion at the end of March. Discretionary AUM was up 4.2% from $23.7 billion a year earlier. Total AUM increased 3.6% during the quarter to $37.0 billion.

The increase in discretionary AUM reflected market appreciation, partly offset by net client outflows. Hough said second-quarter outflows were largely related to seasonal high-net-worth client withdrawals for tax payments, as well as institutional withdrawals. More than $200 million of outflows had no revenue impact because they were associated with flat-fee or other arrangements, he said.

AUM, Client Flows and Institutional Expansion

Organic new client account flows totaled $111 million in the second quarter, compared with $81 million in the first quarter and $80 million in the prior-year period. Although revenue was essentially flat year over year, Hough said the company entered the third quarter with discretionary AUM materially above the level that generated second-quarter billing.

“Our discretionary AUM is now at an all-time high for the firm,” Hough said.

Silvercrest said it received an AUD 500 million contribution, or approximately $350 million, to its Global Value strategy during the week of the call. The strategy now manages $2.5 billion, according to Hough. Institutional AUM stood at $9.8 billion, up from $8.7 billion at the end of the first quarter, while its outsourced chief investment officer, or OCIO, business managed $2.9 billion.

Hough said the company’s institutional pipeline had grown substantially, particularly across its global and international equity strategies. He said potential opportunities in the pipeline were “well into the billions of dollars,” though he cautioned that it was difficult to assign probabilities to that figure.

In response to questions about client outflows, Hough said the company’s high-net-worth clients generally maintain long-term wealth-management relationships and do not typically move assets based on a risk-on or risk-off market environment. He said most institutional outflows were in the value business, which had faced relative performance challenges, though performance had improved.

International Infrastructure and Licensing

Management said it was approaching the revenue phase of its global infrastructure and distribution investments. Silvercrest expects to complete its MiFID license through the Central Bank of Ireland by the end of the third quarter. The company has also established an Australian unit trust and is nearing completion of a UCITS vehicle and European licensing process.

Hough said these efforts are intended to expand distribution access, while administrative and legal costs tied to their establishment should decline after completion. He said Silvercrest had obtained important third-party ratings for its strategies and vehicles and was pursuing further ratings with major global consultants.

The company also plans to add personnel in Dublin, with its head of office and first Dublin-based portfolio manager scheduled to join shortly after the call.

Beginning next quarter, Silvercrest expects to revise its reporting of non-discretionary AUM, likely eliminating the category. Hough said the change would substantially reduce reported non-discretionary and total AUM on a one-time basis but would not affect revenue, since non-discretionary assets are associated with only a small portion of the company’s revenue.

Quarterly Results and Expenses

CFO Scott Gerard said second-quarter revenue increased by $0.1 million from a year earlier, driven by market appreciation and partly offset by net client outflows. Expenses rose $3.2 million, or 12%, year over year.

• Compensation and benefits expense increased $1.7 million, or 8.9%, to $20.5 million. The expense represented 66.6% of quarterly revenue.
• General and administrative expense rose $1.5 million, or approximately 19.3%, reflecting higher professional fees, travel and entertainment related to global initiatives, and portfolio and systems costs.
• Net income attributable to Class A shareholders was approximately $0.2 million, or $0.02 per basic and diluted Class A share.
• Adjusted EBITDA was approximately $3.4 million, or 11.2% of revenue.
• Adjusted net income was approximately $1.2 million, or $0.10 per adjusted basic and diluted share.

For the first half of 2026, revenue increased $0.1 million year over year, while expenses increased $6.8 million, or 12.8%. First-half adjusted EBITDA totaled $7.2 million, or 11.5% of revenue, and adjusted net income was $2.6 million, or $0.22 per adjusted basic and diluted share.

At June 30, Silvercrest had total assets of approximately $139.9 million, cash and cash equivalents of $20.7 million, borrowings of $9.5 million and total Class A stockholders’ equity of approximately $46 million.

Cost Outlook

Management said the elevated compensation ratio reflects a deliberate investment program, including hiring, equity-based compensation and international expansion. Hough said the company intends to make equity grants to professionals involved in building the business and executing its strategy.

Asked about the outlook for general and administrative expenses, Hough declined to provide a specific run-rate estimate but said costs should decline directionally as startup-related professional fees associated with Australian and European licensing initiatives are completed. He noted that some recurring expenses, including statutory subsidiary audits, legal, accounting and administrative costs, would remain.

About Silvercrest Asset Management Group (NASDAQ:SAMG)

Silvercrest Asset Management Group Inc, headquartered in New York City, is an independent registered investment adviser that specializes in delivering customized wealth and asset management solutions for high-net-worth individuals, family offices and institutional clients. Founded in 2002 by senior professionals from leading financial institutions, Silvercrest has built its reputation on a disciplined, research-driven investment process and a commitment to personalized client service.

The firm's core offerings include discretionary and non-discretionary portfolio management across equities, fixed income, hedge funds and alternative investments.

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