Invesco (IVZ) 23 Apr 242024 Q1 Earnings call transcript

Welcome to Invesco's First Quarter Earnings Conference Call. [Operator Instructions] This call will last 1 hour. [Operator Instructions] As a reminder, today's call is being recorded.

Now I'd like to turn the call over to Greg Ketron, Invesco's Head of Investor Relations. Sir, you may begin.

right. All to on and call joining everyone operator, the us today. Thanks,

press we to we a The can are be our the This addition going Relations website, have on plan and our available press address. found topics In information the section release, provided of invesco.com. website. presentation covers presentation to to by release Investor that the

these review of forward-looking to Our and certain the regarding Please will the measures. X Slide include for statements and well the today GAAP. as on presentation financial disclosures appendix measures as statements presentation non-GAAP the reconciliations appropriate

Finally, our our Chief over Invesco's up for the responsible earnings website. Andrew does webcast Andrew. parties. and of morning, will Allison and our provided nor present and transcripts authorized call this call open not third Schlossberg, by edit is not teleconference President the and The to accuracy on guarantee CEO; located the we'll only turn for Financial Officer, then now Dukes, questions. I'll are results

Thank I'm rise. year, gained with again pleased Bank quarter. during expectations this you, Central even remained continue conditions markets it though making to to XXX best-performing resilient And relatively for everyone. morning today. Index. Economic the speaking this you cuts be The diminished quarter, and S&P equity equity to good Greg, XX% this the major

weak some U.S. signs income significantly recorded the improve bottoming. U.S. In Fed prices and outside economic to was large-cap continue are of markets this As markets lead showing tech indicators market dropping modest began with Fixed China, changed. as continue lag, progressed, although but gains in the a to quarter breadth expectations developed markets market the quarter growth were generally and rally. to in of stocks sentiment growth equity More

long-term of ended period in sentiment flow continued of and to drove and client signs assets $X.X levels organic for billion delivered We with $X.X this we demand improving quarter in assets growth During rate the X.X%. and nearly in increase Organic Invesco management. overall. higher inflows again see net under an quarter, the growth markets at trillion

revenue we asset increase. growth were respectively, where take that investor against operating net up our saw reflects from will resulting clarity, X% profile. X%, participation more risk duration, growth and levels, with to will QX and We remain and which continue a diversified Our global-oriented of and market mix increasing broadening assets hold appetite for optimistic market on income adjusted

positioned across business to are of We benefit our environment. well this in type

X each this Page highlight presentation market investment results against capabilities. we to the on of and moving backdrop, in Now of our

yield those comments. which You'll last several note her conjunction portfolio expand our we've these on quarters, categories will disclosures, later aligned net with in been revenue highlighting and in Allison with the presented and migration

where our of we present within of components and way the of in potential to all advantages of understanding is business their order disclosures performance capabilities. aligning our these drive cycle speak are have better market our investment the view of are had more to We about and it. is the as the and and our investment drive Invesco of our foster a a disclosure our in different its market life each holistic to profitable position view conviction areas part resources growth. plans enhanced business with various we clearer of a about and these a consistent capabilities The of our trajectories, capabilities different a in though and our to encompasses invested objective in whole, that And

our ongoing Index strong each ETF growth driver platform. these of of Now key An turning a and is into look across deeper flow to organic QX capabilities. our

innovative outside QQQM. direct annual in Suite, nearly This fee we product long-term and billion high relatively During date In become our leverages in this we short best market of a XX% was a to our Innovation our fund, product share, earn billion This hit product AUM. Growth benefits. a largest of gain with one QQQ. of QQQ equity net this flows, as our to But growth by quarter, was time, we third $XX.X a rate. led it $XXX recording on in popularity. instead record marketing continued notably flow fund this representing ETF our significant the our long-term has quarters quarter suite the

Additionally, expand into investment our and ETF Index active to we teams leverage continue and our franchise.

across in U.S.-listed both advantages a AUM over now billion active exceed passive XX income. fixed ETFs our multiple $XX strategies and teams classes. our focus and formats Invesco clients. Shifting and for active products in asset The to Our incorporating ETFs of remain

nearly continue as risk protracted and profiles more Though We of drivers growth Leading strategies may this momentum positioned flows. We municipal delivered X% through delivered flows as on into shift asset mixed annual the that see net income shoots, platforms. fixed economic SMA beginning fund duration and investors believe a rate strategies. well investment-grade anticipated rate. well gains did income income range green the fundamental bond of channels included continued inflation signals and out their institutional their and in with be of duration through as of our and $X.X clarity given Bank long-term interest strategies move extend wider see policy, fixed across classes we're allocations organic late. capture into Central mutual to first quarter a of greater our billion the We're cash they'll to to fixed or

is billion growing investment-grade well. and of capabilities, income in fixed income-related quarter starting an income seeing We're as Beyond top-selling extension with interest and we're tax-exempt annual expanding organic our fixed intermediate into see which rate intermediate to strategy, and $X.X the nearly taxable $XX strategies. Important demand of being rapidly additional our in in industry flowed SMA is SMA one XX%, billion retail story growing of to offering, growth our duration our fixed AUM. with Index ETF fundamental this of our assets the strategies an assets the

for platform support especially the grow to client We intermediary to delivery market. retail wealth well our are demand this U.S. positioned continue vehicle SMA structure, to

long-dated a equity represents SMA SMAs. active we and track forward continuing only income, record custom of not also our to have platform share equity fixed with and this and on see traditional progress a that space We We but index in established you. our opportunity lot look to

with markets. to our net momentum on first credit private billion flows strategies, loans. Moving into by long-term inflows We driven the $X of notably bank quarter made in

focused non-exchange positive wealth has estate, debt modest last real the into since We driven which traded by real estate which on good private momentum space advisory direct REIT also in year. primarily INCREF, had markets, saw launch is flows our its the

our greater going that has powder capitalize of required team we growth. market of Additionally, on real is it's significant last estate before to and $X several opportunities emerging clarity begin from quarters. important the dry demand of to billion to dislocation But return the note can market see be to

progresses. of systems our it asset to to X JV was fast-growing some assets. this China our matures did augmented that and leading market generate as could of a We the Despite world's our sentiment the recovery by conviction development maintain launch with largest in remaining management China as and China in second capital signs bode for position of long-term within well new equities, Pacific-managed ETF positive in by the Asia Moving overall a our continue lineup. local particularly more early believe market relatively in flows XXXX net driven This retirement client industry and on we modest constructive economy. the market products, weak, we in

also capabilities, Indian more This a capability Hinduja our and company to our by the will serve partnership also net Beyond China, with to quantitative domestic market. In by GTR which in remaining were the led our of Indian joint which close inflows related assets with Group to strategies U.K., offset our we saw year. enable in in in India our we us market. We for investors in recently equity business. a decided nets generated we in continue that multi-asset expand last business the outflows funds distribution venture other leading to our announced

Finally, the equity fundamental relative continued. pressure flows on

certain we've particularly and moderation flows, pointed I out equity in active of as the market emerging international However, segments. previously, global, areas in seen some

in believe Our quarterly that capabilities the peak XXXX flows moderated $X in delivered billion during breadth our an our to market. which tripled nearly it's continue asset have to to quarters the fundamental of demonstrate our serve and growing equity strategy, us past lower net standout industry. the and strategies and billion. One of among markedly diverse these billion outflows flows cycles. retail has was first several Japanese perform fund $X that needs in than the funds positions various year. Overall, the our rapid past quarter, in the outflows to in in quarter notable the well our front market $X.X AUM in in active income of $X global offer quarter net first equity billion This flows this of incremental evolution through top-selling per clients' the underway in we We is

Our drivers product asset investment deliver a sustained engagement. client to Notably differentiation competitive the flows. on we strong advantage team value breadth quality, remains focused and that exceptional and create believe

AUM around in solid peers company overall in key So first firm benchmarks all of and We're on our of basis, priority is results and X- a as across quarter XX%, peers a XX% is this and comparable Slide showing our performance, half periods. XX%, and which driving our top in to displayed capabilities, where moving of X-, performance as to to on information our investment its readily on AUM top more beating of benchmark XX% well as X, is outcomes. Overall, and X-year meaningful the the performance was investment always slide. is respectively, relative and

a top mark last a performance considerable that X-year now hitting a have funds improvement the of which over on in quarters. number also We with the that quartile is several are XX% basis, significant of

many the Fundamental of performance of over results investors We've and on beating fixed capabilities to our equity We benchmark with with XX% a basis the across across X-year deploy money and supporting to are XX% performance income our years. excellent X- over meaningfully time X-year top attract equities ability of as global into peers nearly our on flow strengthening a basis. top in in continue horizons, well. seen strategies has conviction as their domestic XX% past these fixed our all the in capabilities half improved strong have and X and fundamental income X-year year, quartile strategies. XX%

performance So hopefully, this and approach investment results, Invesco our investment useful our more and and straightforward think potential. its capability more as about you streamlined you find discussing to

to going business, and to allocation look in the the and simplify forward over enable to continue to investment will our I which capabilities. With discipline results that, to also we we I'm growth for discuss of your financial financial focus our innovation and our the turn are questions. As resources tightening drive call Allison to our quarter,

I'm inflows Andrew, Higher including markets, with nearly begin QQQ. management $XX billion end Of in first under $XX and markets, $XX drove everyone. than increase long-term markets. Slide increase was due higher higher quarter the AUM quarter AUM on trillion or to driven $XX assets first end. billion you, by by Thank the the equity X. Total quarter. of ETF during driven Fundamental was morning, going last higher $XX were at the the billion to billion billion good by the coupled net $X.X

largely outflows the growth net share of As inflows that the quarter. cover offsetting this $X.X quarter. equity $X.XX improved excluding improvement driven during margin were for I'll $X.X all flows long-term operating the Partially net organic for net fundamental generated adjusted first Net the the and we billion noted, billion inflows ETFs, earnings shortly. Adjusted income by diluted revenues, operating per from of the were fourth in drivers was quarter. $XX.X in quarter, and billion adjusted in was first QQQ. ETF X.X%. Long-term Andrew

savings, We scale strengthened previously. XX. the expected organizational organization we annual in for incremental and streamline further quarter, $XX net $X this position million savings simplify matured net on than year, sheet of that redeeming for the profitability efforts We of expenses had of our the an senior result continue $XXX in million of change better $XX and incur Overall, achieved million managed. We also exceeding by to $X we January related These balance expenses more future. million greater improved XXXX. to operating the Invesco notes goal remained will the million in well did

we're year. we still with usage and this of seasonal-related fully on cash, in million and had cash quarter, $XXX redeem to of used we net expected, notes. other $XXX As our second on half in facility approach during the $XXX approximately net ended of million the debt We the drew the track debt we as X credit quarter to

Moving to had the more coupled our since asset asset on demand recent dynamics across significant acquisition X. industry mix and client managed OppenheimerFunds. Secular of impact Slide have with a shifts market the

over billion to from liquidity, our average overall ETF AUM, to areas of to index acquisition, back net billion total AUM the yield. of compared QQQ, also in of $X.X or product carry in in average management from, XXXX or from quarter. The overall AUM. average provide We've marketing after a our trillion no of XX% excluding have than net $XXX Going of AUM average fees first XX% or $XX $X.X more QQQ, X% substantial These from in billion XX% in to very billion $XXX lower to grown of global earn growing and XX% size has billion but time, benefit we first or or XXXX the growing the a billion yields in AUM quarter. product the trillion our X% revenue growth tripled this $XX strong revenue seen $XXX to AUM average $XXX does

we've time as as This pressure coupled GTR risk-off markets revenue. which for sparked in weaker and of experienced been has driven higher the frame, closure fundamental During well in part XXXX, multi-asset early demand seen net the was developing we equities the the products, equities by carry that in and global our capabilities. with sentiment same

XX% portfolio of was declined AUM. the of over time X% $XXX to equity billion or of had fundamental By that also frame. $XXX portfolio our Our Multi-asset X% AUM AUM. in XX% from average quarter, to average declined first or our XXXX billion this average

QQQ quarter as we compared Looking has ETFs multi-asset 'XX flat results of continue at the from the of created to our growing last these grew X%, several XX% AUM, the XX%, over by at the The fourth and to first average weighed XX% of and experience XX% XX% to quarter from equities to with similar while 'XX, and respectively. dynamics result headwinds remained revenue fundamental of dynamics years. on

experienced ETFs from excellent revenue offset like to outlet. fundamental not lower and growth and and fee liquidity we've While is the capabilities higher enough organic loss global equity fee multi-asset

the revenue investment within in net mix, meaningfully has has during time that decrease the been overall our asset driven investment on Net ranges the revenue not Our have our been provided in degradation but declined this the by frame, in yield stable shift by slide. strategy yield strategies. relatively yields

The want multiyear other and shift been preferences point our that results. in I this to secular in recaptured emphasize is that have client

cycles, the a well Further, for market and events mix, portend growth revenue challenging better various improvement. client marginal future have business is profitability our and higher now fundamental manage risk they occur years dynamics, today portfolio better been though multi-asset shifting concentration reduced. Our and as have we equities more fee which positions and should than X to to These through diversified demand. defined navigate ago and firm

due third-party AUM, $XX fund-related lower through fees $XX distribution that the performance AUM quarter quarter than by average in Slide $XX this than to from advisory decline to of quarter from are expense driven and from was higher The X. distribution investment $X by to fees the prior primarily $X.XX shift $XX higher to million and shift invest of revenue year $XX the offset offset [ in fees. The due lower but service and seasonal quarter Net fees ] last revenue first distribution third-party and and discussed. Service the asset increase million due higher our service million the to a in higher expenses and billion in the to due mix incremental million Service by fees. of first fourth distribution, was management was due decline just fees But a fund-related higher service million were turning and fees largely asset 'XX, fees by advisory partially and fee increased the Now mix increased apply. million largely 'XX. to is passed management increase distribution, expenses. offset which

as expenses, now Before in the The I our the back G&A office no and either quarter, to nature included property expenses These classified net marketing revenues, expenses. to income reclassified operating I cover by expenses. We've show that operating impact more been income. to operating reclassified the reported previously and want of they've were on X-year for appendix the total note certain portray as operating expenses the were look or the did expenses, had first reclassifications or technology impact operating category. reclassification accurately a on expense

will in quarter I operating million the totaled million as the adjusted operating of due $X are G&A lower have by G&A in was an approximately -- benefit of expenses. Adjusting and last expenses, from fourth in offset $X quarter recorded expense quarter variances million see these would in of in of impact change 'XX, changes year. the related Employee of first in lower Alpha and other resets payroll expenses and fourth $XX I'll integration reclass seasonal and to the lower $XXX we restructuring operating costs expenses quarter quarter expenses quarter million. Total the $XX quarter higher higher the which the $X typically me, expense of which first of Included that our the to driver in were the platform-related excuse included for in than million expenses, compensation on last expense. quarter. year. Total tax discussing $XXX touch driven the for year. in last quarter fourth largely the comparability, quarter the not first shortly. G&A $X This were than year's quarter was lower organizational and of been $XX were first first decline of X be adjusted professional first lower fees organizational G&A transaction, services is of Lower first first higher related last million, For first were largely this include expenses, primary categories to expenses first operating quarter quarters increase million year million items, last the than implementation were and million the quarter quarter, by expenses. this partially the in

lower to implementation, related million We spending last than platform Alpha also had quarter. $X incurred million the in $XX our

items. we costs with was to onetime quarter-to-quarter. in The approximately be fluctuation quarter implementation forward, implementation of the estimate to effective between tax and to $XX tax in effective quarter. rate for actual income costs tax continue rate non-GAAP continue expect on impact first Going our related the second per We'll XX.X% Alpha quarter The move our to effective We the discrete XX% on of and items to forward. as tax vary the be rate we 'XX, pretax can some occurring and progress XX% update due XXXX.

X. Slide to Moving

with revenue full million growth time of from recovery. in significant any over expecting related we're have savings, benefits in incremental the $XX realize simplification first basis, organizational savings an further exceeding million quarter changes. $X XXXX. first while The seen currently for costs We as And and the generate net we quarter, margin associated expenses be net the achieved $X not organizational to we change have did related our will in an million million our in these efforts efforts. we On restructuring annualized target expense $XX

of we manage the trending to XX% range in to the AUM on to the of compensation has X. been discover net range, a our XX% for the current ratio end expect At in be practices. Historically, finish industry Slide above range the would periods ratio revenue towards revenue. performance levels, competitive this of we full higher XXXX. I'll slightly to end compensation upper and year variable and lower the As outcome company

million on cash $XXX ago, continue our on XX, ended first as that an million to net a in preferred quarter to debt accomplish nearly in million on the X.XXx, drawn ended this. is quarter ratio improvement in line high on $XXX with drawing $XXX These excluding the January leverage in compared a building make $XXX $XXX $XXX and leverage facility quarter the the in seasonally now note a million the to the ratios, the We a redeemed cash million sheet year using in to progress improvement with all actions senior $XXX over quarter. We balance resulted cash credit years. several and million We of first down matured expectations. and strength facility quarter. usage the our with million, our past the we're significant of We

year. the second the the zero net pay facility credit our we this third of to expect as move in and debt of We quarters, down half second approaching through goal

continue sheet, stable pleased We conclude note the also firm we we this move stock reflects on to quarter, $X.XXX this of the hope stock our in resiliency to our balance simplifying again investing quarter. share common To of also the progress an areas to of performance increase This Board cash and cash balance in is program a organization begin and evident a position buyback quarterly to more make approved dividend net our regular building stronger per that while growth. sheet as the goal. We're towards effective and flows this strength flows.

and growth to do and I'd up high have we so. And the We performance, a to open like are profitable it with driving Q&A. of financial level strategic to to positioning that, committed right

Dan [Operator Instructions] comes Jefferies. with first Fannon question The from

versus quarter quarter, levels. I deltas The the the ratio revenues more expense, understand of similarly third-party first But higher a question. they way. and because negative Allison, last this guess, also went service to distribution directionally start went in asset maybe directionally opposite are modeling was the higher

facts more that of think trying detailed how behind and So the just prospectively. we about should other what understand that to kind are

a was anomaly an fund trustees. fee new which quarter. occurrence. We've necessary to that to expense. up elect really a as That's elevated a of those fund-related board pretty $XX expenses, a shareholder determined There's infrequent this meeting in got The definitely of that fund proxy related bit Sure. shows items a and million an was line

But the In the that was fund-related distribution XXXX. offset third-party as in that there's paid million revenue. be majority occurred fund, up a for recorded there's offset, service shows last fact, the it expense that in a $XX -- that of It's revenue. was and that $XX time would and million by as is result, contra

was maybe when quarter-over-quarter you we change not at I year-over-year look you the expect the -- be you're about item. the in to at is that think it a just look time usually XXXX. When relation trajectory. the If with we're higher and the the revenue again, the this runs relationship, XX% that will the be anomaly somewhere high. of expect it obviously just around and lower there's given the as relatively just due end -- some I would of year, in year, above about management quarter, line So that think fees. revenue, right, to lower cost I to something see would to higher sequential you third-party last large the XX%, ratio contra fixed of XX% end running But occur years coming inside into starting is at revenue on look

back of it then. be in look back you similar as If at kind reference, a range a would XXXX

way think about I it, to think So Dan. one that's

helpful. That's Okay.

rate up a bucket. long year-over-year. X% deal. you and as continued represents this since that and the it's trends the Just wouldn't if highest beta been a assets is fee But guess gives to But quarter-over-quarter. been if rates why are the fee I still fee going of Oppenheimer have mix has of what going That and disclosures you confidence I back your that's trend look I see fundamental and not headwind that still understanding kind the kind equity on, and the have and degradation. we outflow removed flat still -- know still

So is would the still I fundamental us continued headwind? a what mean, equity it say I question be a gives continued could of that confidence headwind.

continues manage change industry-wide our as gives exposure obviously that the we is market what trend. active. if to client a as look here continue think that that the at it capabilities We or in down to down more that trajectory effectively trend. to as expect for manage an That confidence demand we is are from continues overall I be passive well don't

organic So And AUM we seeing we markets we there can as there create that trends magnitude exposure developing good into less challenges to necessarily asset not grow mix trend to categories. The be fundamental headwinds, favor, overall well, progress the we this, focused are the equities the of are expecting in so our as we least thing geopolitical not performance. underlying Andrew and long other a have there. we as fundamental as -- component decompose be and the is continue an things I other are will equities, we the geopolitical do demonstrating on behind quality headwind some be will in of continue there. to a underlying of touched on we're there that make equities could some for to think the strongly that in there focus to which given that which -- to into continues to the strong challenges are and of are of a making class to and the progress is is continue to global client diminish tailwind, we but categories. we've growth rates continue fundamental strong turn significant it And clear, headwind our investment the on, noted, continue one equities, we many and know of underlying sure not we several our out go it continue preference the and investment Very becomes

their market of top that, comes we're Global demand international the as are. world, and emerging positioned firm's is equities and of fundamental Allison where in priorities Delivering those take advantage spans Yes. in back. to demand one the outlined well equities, particular,

quality which outlined can and quality so the control, of around And teams. the we'll we things Allison manage investment

Our next Worthington from question JPMorgan. with Ken comes

level, at is down were lagged of and stock MSCI of the Invesco this High since World and S&P beginning has at end 'XX. price the year all-time highs March.

issues this XX XX discussion then what But touched have a impacted morning. maybe can last You first, approaching and perform allow review over evaluate have earnings your together, moderation on your you and of allow points that you those the as the price all Allison, stock negatively performed Can mix price better? the stock grow months, the earnings moderated. better that to over it assessment? And to series that better of is to highlighted us the mix pulling level help is better

share not strong. control. that to Yes. of that starting we've we're the that has the the price market clearly, areas we in I We're hard look, point, pleased Several improve with where mean, as been, demand things a is. been were working can

whether passives, growth places ETFs, and fixed So income and areas indexing, in Pacific. out like Asia Japan that's in like

Some the we've places of come where market place where needs global flows to to in client continue assets large of demand is not be back demand international China portion our with i.e. picked in headwinds up emerging some feel terms and areas a back. well equities, but asset demand in of has like had the positioned, that that flow places we

rotate to we the an continuing on which some standpoint. areas, be are the base from anticipate growth hide. expense a to going that using focused expense disciplined we'll those standpoint, of and to forward, with grow things opportunities to So we our base, expense we're And continue from

and So higher. going those are drive to that we're things share the the profitability of continue price hopefully do to the the company to

mix on just I'll the And moderation. Ken, touch,

our is based happened of tipping you there have. about sort we net there a as think on at where mix composition sort look, of point, just and effective is some today revenue yield that AUM the I point think, mathematical

terminal what to go be demand to We, As it is our to a gets continues fundamental of closer disappear. There expect value is, there. passive yield no a closer in bit our entirely net way there's revenue there. and strong to

net revenue is growth. Fundamental In But quite net if fact, growth. terminal of organic there become we mix our of markets, even a sales index creates income, headwinds and our to there you gross portfolio positive a diversify greater there positive seeing see our the it and were growth ETF percentage continue value headwind. as towards start fixed strong. But are of pressures, and given particularly look some overall exposure we developing revenue the as and an again, the at our global to lot underlying tilt is creating

by We just to be headwinds not liquidity. entirely, lot a just at demand moderately of offset to net in and allocation. revenue global but equities. see fundamental diminish growth good offset, asset will some And client point, Those continues continue this given

I positive sitting want the at things have is cash clarity been, on add broaden into that at markets sideline. has as more we think to some inside There to has greater -- client that the even a comes demand see thing do indexes, only as Yes. are we'll been amount we know, mean as demand, the a have the remain of the I out. start rate, all as narrow other markets

How follow-up, a Allison And think tipping point? do is Okay. Excellent. future just far or you point to close the maybe that already that that tipping there. as comment. we are in we're How

net of if yield look, client lot at driven. points that than so of XX kind we hard I net a were our And XX basis We're demand say ETF to index our think you basis again, passive revenue it of revenue because at It's yield XX.X whole and XX.X points. to to about look and just closer at is XX.

So don't that exactly, getting new that to say annualized really but do stabilization the there that and we I revenue match allow the will to closer start then take it we believe hold, net revenue organic means and because tipping there's closer. in know -- can organic growth to we're stabilization think see true would I growth and growth flows. Hard I is and believe

quarter optimistic obviously of variety We April markets are we're of haven't we And are look at trends. into because as this hurt. was, look modestly a as year. challenged has helpful. not the But are optimistic terrific. we We been markets

and organic continue across the pockets it. asset in year. almost We throughout growth And all see the both encouraged Our are be see quarter very of strong. continues trends we classes, against our managed the what by growth we well growth terms frankly, to first know in expenses very of we're organic

feel reasonably to starting markets confident hold. that reach demand what pivot be I just actually So a client we're certain we and can't point.

UBS. from Hawken comes next question Our Brennan with

eventually expenses. maybe and model into and shift I'd a Does some these with streamlined? be expenses adjusted in the of start like expenses or G&A signaling to slim could shift of that the method is as operating the cut down

was shift question belonged truly belong shift the no, it marketing, a I I the didn't entertainment belong. if not mean, way -- understood not -- correctly. your better they where was Well, saying It to of in reclassifying like expenses G&A. Things travel,

to get they where be. it So need expenses really to trying was

nature expenses true we in of those not a reflect better necessarily and any the So way. signal

right. All

on to one Another out little disclosure. this more Hopefully, be question a turns fruitful.

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kind and had this of very been yes, were others in -- couple that you and yield. the XX.X, a encouraging here are our format. disclosures to with us terms the disclosures press release of several So Yes, we've in things. of net of continue above consistent One, the to we've the revenue

it going we it's more you helpful so And more We as hope find well. forward. think helpful

disclosures, the in In we the the which to terms in of fee provided way that. provide continue will rates range here this we be

longer one these categories each range, We those and on of ranges demand. client no will are that accurate, see the be ranges we the again, dependent Should do right very prove ranges. to they adjust but actually really operating within

any of different of that these barbell there. the As are hit that ranges have strategies do do kind really within we categories, the of

very dependent on it's demand. client so And

history provide So the these we presentation. did by categories in a

ranges well, see back the we've change. So and the but some by flows ranges fee of the category. then ranges going we go will got the you update as can forward there as And

-- Okay. the And just too? sorry. with to -- this is are monthly AUM going disclosure is align

Yes, they are.

from Blostein The question comes with Goldman Sachs. next Alex

This behalf is Luke of on Alex.

while markets the for components of disclosure. the of the maybe another how the just Just you through major Can growth private big is? in topic we're business, bucket you're on run each this how updated part question business? about outlook thinking And the

be would starting major estate The it real be Sure. real maybe would -- estate. be direct with would -- buckets

billion. would around $XX $XX listed billion be So around that's which estate, real

those which loans billion, billion, So just then them. and would private real at north about and which our funds, then direct of primarily $X two $XX the billion And components little $X a maybe estate. be distressed credit, about bank total is lending between of

that have is now institutional strategies side, what's and market and rate And abating. continue side, don't that maybe opportunity of the growth, now, be we products wealth and in one to terms Both credit I'll recently, across platforms. the wealth as real estate and those the more well continue of then bringing to see market mentioned taking and this floating bank real look, earlier, we're right recognized debt we've picked few recently, few by us been vehicle terms equity market greatest space up more franchise mentioned our of it have years strategies the now strategy. estate right been loans in into they're a And on also been And what picked debt demand, in in in in growth and be space the an one for for then estate the that by our strategy leaders in our -- platforms of all the about. And real wealth I types. a talking we quarter largely up we

continues pretty active participant. we can demand space, in we as think So that a be

the you. Got helpful. That's I color. appreciate

maybe back the like rate Just one more, dynamics. fee on circling

trajectory prior the with about the of continued expansion fee pace over You and But expense guys the just frame expectations. slightly highlighted can better than XX rate, the months? of margin savings XX to next degradation you

then that of mean I the would degradation revenue. fee degradation And the remind Sure. doesn't rate of the necessarily

and revenue Page still is real unpack in from. growth And disclosures no so categories fee trying to higher the We we're and one degradation the on ETFs coming some of great growth growth strong fee rate as X, we things where refine that's and can the continue to of see have but strong growth. organic see in our

important those we're trying provide disclosures. that's remember the again most where and So thing to to

don't So are we want our as we expect we I on here. to be where expenses continue organizational changes. further costs guiding weren't to What manage to won't I aggressively do think create we and actively, we we expect here? very I things change will And thoughtfully to to do from opportunities That continue doesn't go we from to. significant said manage clear any organizational mean -- I is find necessarily expenses. we mean -- while and

the and we'll the organization, a and in to refine forward since organizational a been can decisions continue day You we in to we have of are program, of opportunities year those should as midst the more expenses year every the major for we're midst realigning not first in expect because ago. of but advantage we make the streamline business take looking last

operating starting on demand markets quarter. I no be to really a create it happen headwinds. markets could be believe to have as opportunity Markets not to to much demand continues depending will client to this was what do believe so markets will the of a continued perspective headwind. we we said, see and that opportunities have a impact but couldn't to our through from We the we've leverage. quarter, on to geopolitical got year particular. here. last from a client headwind the exposure some has developing we create But leverage that of opportunity absolutely and we changes, positive in We the I continue to see this have series be have business. streamline reason continued just to positive step and changes We operating through clear, continue step really

streamlined We that that mentioning And we're growth in do you continue really able as in invest several been the a also see results, from these standpoint, we've been last we've to capabilities behind the quarters. seeking and in to an mind. market that's flexible, organization base organization need where more in different conditions, that term to us that that's with allows to we the and focused create an long to rotate but more expense

And the Evercore. from comes with Glenn next question Schorr

peel there, success can active you -- of one I Maybe things on growth high-demand know you're had ETFs. the solutions, little back you've what in a one and the in doing, in sorry. on what the on two bit SMA spirit onion platform driving both

both. mean me about talk let I Yes.

active there. And there's been that We're custom what think where strategies, income. less SMA supply across that indexes platform, ETF we is the of going and a offering. that bring the to continue of in a the few the seeing allow the a which years to mentioned, we together is time, which strategies, On supply billion, and built, will have we've just ago. success but vehicle in strategies decent the introducing off fixed $XX they're to into which be there's about fixed SMA multiples to as higher other drop now platform. in preferred where then had up than a platform, us quantitatively been immediate piece elements space, More fundamental SMA strategies grown slow the the of or kind market and opportunity demand we've in income been it's like fundamental I developed lot think we've is there's of pick having The more recently,

XX growth in So going modern a it in we've years ago. as SMA we're way one lot been set businesses been as scales way, And a ETFs, we're operational of XX -- up a in the more of We've stages active ETFs ago. On technology space. than did active the think early to far or two back platform to in the that pioneers better SMAs. think now decade we in I starting and

We in an has about have, connected to active of billion doesn't I remarks, team my which have just mean that funds. AUM $XX as active mentioned it, we

and to of active or active were bring the our sense, to going the loans on platforms, strategies, given defined but our think we And but like I quantitative continue the is strategies that the in our of is by classically of ETF well working investment passive-oriented wealth not our depth half traditional also of active, bank about teams, ETFs range. to in think in we and set ones that combine continue meaning which will in which recognition examples that. And scaled strategies, So are to up quality one supported other large and things of we're we with active investment, multi-asset half chassis alternative there a drive active and approaches. growth. have just the think And fundamental be the leader the ETF this is

opportunity think lot about, both to. are capability that I bring excited vehicles there's a our So to we're of and areas

comes And question our Katz Bill Cowen. TD with from next

platform. There's be first. picture terms different about now a the question couple in heard of I Maybe articles when of big to bit a JV. little It just a India your streamlining seemed of sort just

areas about how little Just earnings. sort or back streamline might you growth talk just opportunity the to to and bit globally to of faster could into reinvest ultimately to a continue that wondering if

Great.

cost And about middle way and worth Indian what think grow Hinduja Hinduja continue and we'll to India, have we been well-recognized Group. behind financial were a going forming that, And the interest, India -- very And the profile think suited ways enterprise Let interest components -- large office it better places few sorts we we fund also in as to Hinduja combined and last to company base a announced venture large expense. in in grow that where will us our with services of accelerate a deploy think And an that we operating business. to business capital development about we weeks to go we're is the there, be pace joint continue which streamline time. Separate over that regard. And us one could think of for called looking market-by-market, helps help Indian the you Group has I and was that invest can and of office, the so business in start, minority are and those a of pick place company things mentioning. can a that minority us then have bought for Indian resources, a our and a to of as are different a both continue in interest. to where XX% I'll We in we me or our can that's we we use -- Allison Indian have we're up. phenomenal Two back India center. as

net next the And I XX.X-basis-point to you're this discussion. I go then And of of fee little my what sort Allison, rethink it, the capital costs? At be would you rate sort to to now. of sort trading might fund apply return way. half second going particularly but that the you average just understand what because for unique the zero bit. is quarter. mentioned And taking the stock where [indiscernible] distribution question make we can exit of want Okay. be to buyback, a if I back sure you rate anticipate year, for to able be by normalize it should to was the sort point back the along of you maybe and notes the

the that Sure. is of that meaningful. distribution, I don't net third-party know the

there, million you've there. to then Not proxy $X I as you that as and about effectively that's was a related recap about by yield. just said So contra terribly go got Invesco net of think borne revenue back revenue, and if event million so was what $XX recorded that I million meaningful third-party that recorded $XX kind revenue

that to to I it revenue to a contra bit I a being an don't about right to into bit proxy something anomaly. expect revenue environment. is of relationship So back the And XX% guide percentage of to to you though, revenue trying range, but a the XX% of of in know not it's fees I'm meaningful of a don't and terribly down the it continue improves, I confusing, should thinking way third-party as -- is would question, and your as management to net yield. I know around that kind think about come that XX% revenue dodge that

it net of debt, missed question, approach And our to capital, sorry, target to when might Again, think Buybacks. zero As I'm I we relates our buybacks as and have that expect return might resume. of which been be we expectations. in I pleased middle, are with our far back much to what being in able of with cash half very year. line do thoughtful we very overall, so our management and this we've very

buybacks. We of back expect year, regular we'll more reach be hope resuming it to middle to we share half this do and

question I've I would payout to lower our in of sort I of I end expect that that environment the noted in earnings Bill. covered Hopefully, think XX% be range to range. might on and the there, the ratio XX% the it be past, just higher total

question comes next The from with Deutsche Bedell Bank. Brian

ETFs to appetite you're from the rate the fee I guess yield you your you're management fee Or growing in ETFs, a of fundamental back they of are create on come fundamental active and strategies. either capture guess ETF And as in or I fundamental the to -- that clones that question ETF them, ETFs is, would cloning is can be strategies active the just on a included similar to those those strategies, net or the strategies? or types To what And are revenue Maybe these bucket? you similar unit buckets? question. fundamental the are extent the

Yes.

on We'll is particular. are mean or can fundamental them very in what we last where bring up in to I offer that that and by And by much demand. start, that there Allison we'll pick me driven same ones the part interest and It's forward. client is Let them offer today. that similar strategies

a into date. so where wrapper ETF new either the have completely active makes sense. to best of. to much capabilities been But bring variant it haven't They've a We continue seen strategy or that we'll we the

going see I in come of industry the some You're to that, through think, conversions.

going of see you're the funds. lots many a as for newly investors of as as come to or active wrapper deploying cloned You're into have it. ways preferred really that originated But different of I some ETF to going see ultimately, think, to

quantitative, I are As going before, to of variety fundamentals, be some that some both. some saying was a

unique see So of is a on think of it. I to I decent to and the above strategy a think from product us. I the be some We've have each mentioned, and amount all there's development, that going going probably firm you'll attributes different of got

fee they're included, it the of terms leave In to I'll rates and where Allison.

it the up category. as -- they And we and investment we changes as that, on and So would adjust disclosures. to that and fee index the But range. critical to ways as range those that as and when in a capability in actually would start there a that if the well just rate, change show creating we've math grow would in go ETFs we got as embark and create

franchise. color. on just good the then That's classic And Okay. ETF

you to in lines. expect the that that of And always we about your your maybe be you're growth outsized if making in to margins over we contributing talk that. should clearly, positively can view to product see investments -- Just But across time? you if how franchise, scalability continue

Yes. I'll I'll and let Allison, up. you start, pick

some to it the outflows our contributing I'd is It's mean, on fundamental the just Well, positively question, your offset today. margin on equity. of by yes, bottom part I say and of the

clear, a I focus our to we're of of just continuing starting it stands scratching ETF overall to and accretive benefits is the grow it as for scale, think very us. and although we are today, true So the see that traditional margin franchise surface to be is

plays us we Really get big a mean, part. Technology a allows about larger, ecosystem or there's often scaling But a we we in Capital products. across -- part. whole new a I operating to all plays it, part. Operations product leverage. as -- plays existing have when part behind big continue talk product to markets origination, big which

these business have. decades the are of ETF advantages some on having having we think in for scale have and size the we I multiple been of the

scale margins improve and should time. does it So well incremental over

from Siegenthaler Bank comes question final of the America. with And Craig

is one first My on Asia.

APAC where positive you net your the had JV in overall China had India, and from flows business So outflows.

So what this sources were by APAC the largest quarter? past I and was geography in of redemptions curious product

a could pick be so confusing, Yes, Allison it let bit I up. little I'll know

Page I Japanese do we by have have X, let think me outflows net flows in So negative in on see a first had region? the that the region, driven some that managed positive equity that assets capability in is the quarter. the distinguish, we you the

maybe X. why regional Allison, a So that on from managed Asia was negative you don't up? pick Pacific perspective, the Page of only impact we on call what But assets driver

sourced perspective, inflows. From were a we in

it fact, over was to of In see for our lot success inflows about organic success of billion $X inflows, Fund. We've with of largely a quarters. a pretty strong, by growth in in Global $X.X Henley That continues the Equity Income that first billion noted and the garnered so on driven several last Japan X.X% rate, Japan some quarter.

$X billion JV, under in inflows of positive as India, success Continued in as the we in India, just flows noted well. China

growth strong overall, So in the a region from perspective. sourced

show sourced flow see some perspective. a XX it we that can on on appendix, And of the you in Page Craig,

my it. just follow-up. Got And

see flows, outflows. know, there were Does include exclude realization net redemptions billion realizations billion some you of outflow net of because and definition and $X you as long-term flow from I had both the can private You market your $X.X definition. of

Yes.

and redemptions realizations. include Ours

direct you our as at estate well when so loans, in of see be noted, We would $X and realizations. markets, inflows billion that by in Andrew real net look private real driven in I bank think the over it's flows And largely bank a which side on loans. did estate, little

on the of listed side outflows were and real the some of Some actually listed the estate.

their in improves, subsequent even to and believe translate greater clients help dynamics of sentiment into the improved market joining. market Well, probability. impact that And as reiterate And we're closing, portfolios. that change positioned thanks want I scale, everybody should to performance All this to to right. navigate well for and evolving very much really

in Given forward the our excited to questions. Thank evolving again additional today, Invesco. I to reach for very you. team work strengthen very thank your soon. I'm Investor we want and interest continue and meet speaking we've Invesco future for to the and done joining to any the our appreciate everybody for to client ability Relations anticipate, needs look understand to call out And please of

today's concludes that conference. And

all this may You disconnect at time.