Invesco (IVZ) 22 Oct 242024 Q3 Earnings call transcript

Good morning, and welcome to Invesco's Third Quarter Earnings Conference Call. [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.

All right. all joining to quarterly on and call. earnings Cedric, of us you Invesco's Thanks,

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

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

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

good morning, be with to speaking everyone. pleased I'm today. and you Greg, Thanks,

positive China the and a helped and by end signals All a the sidelines the and us a as despite inflows returns Japanese Federal sheet even into coupled fluctuation we momentum leverage, our record return sentiment. and cuts less continued off into AUM, to began assuage concerns, that new was several with executing quarter balance commenced hawkish rotate though risk net this Long-awaited some policymakers quarter, of the and quarter, operating mixed market with our a continued We money business struck strategically higher investor shareholders. with of cautious announced factors geopolitical this assets. drive important ongoing to finishing equity strong stronger robust high continued long-term volatility stimulus to and quarter across of improved concerns as investors ended long-term drove We end areas achieved capital quarter globally. U.S. markets rally Reserve this saw intra-quarter a tone.

As in and and some mid-quarter to remain income bond Chinese demand income most investor a period the we appetite see equity the markets. the markets waned yields a Conversely, drove began to due of fixed fixed result, challenging rebound industry of broadening which in for both redemptions.

drove few recent a days a equity material the returns. However, on quarterly in with stimulus our a September to late have strong impact rally

Turning to Page X.

we the and deliver our various conviction focus As defined last returns position performance strategic quarter review advantageous this us of discussed on third the first I side and relation specific noted our enhanced meaningful that gives to the operating shareholders of for to and areas maintained our key ability our quarter, momentarily, and page. progress performance few a drivers to clearly wanted conditions. I'll measurable highlight in across of priorities areas we market but strategic in market of performance right-hand

net billion we First, and client $XX.X annualized this growth organic investment suite our quarter, leveraged inflows performance network, product of X.X% our strong to draw or extensive rate. global long-term improving

at see of organic and class long-term scalable capabilities, operating profitability. vehicle flows fixed and these levels, to delivery at Asia our of opportunities gains each the at continue see increase of from market and share SMAs flow positive achieved regions, we growth by leverage ETFs. to asset led areas, strong X%, and X%. At we In Importantly, income, Pacific each we and including to fundamental continue Americas X X% EMEA

channels, in an momentum Additionally, our wealth strong heritage. management markets, we're extension building institutional historically of private within

of from Second, and over year. X% AUM, a we trillion ended total period increase quarter the XX% with record-setting of $X.X prior increase the a last an

margin sheet, drove over the firm, financial capital improvement in flexibility operating from balance -- income of Third, quarter. operating the improving the by last leverage grew We basis quarter. strengthening operating again and the of enhancing We're improving we generated to X% fourth, returns adjusted points the positive we're XX shareholders.

of during buybacks quarter. Specifically, executed we the met debt and zero our goal $XX share net million

As profitable growth. driving you focused strategic we are on acutely priorities see, our can and

given We have good performance what quarter. our this environment choppy reason operating of a to be optimistic globally was

gain As we market its positioned breadth continues are to exceedingly well footing, to benefit.

to strategic execute to and across clarity the required have talent We operational by continue quarter. and exceptional quarter the company

to on X. Slide Moving

investment a on bit the more results capabilities. me quarter our expand flows third asset Let across

quarters our Suite in be Our growth organic our which equity XX% and of billion platform, market Innovation BulletShares. the basis. factor-based by had our NASDAQ fixed was highest led $XX.X an growth among by continues U.S. to income or history. Flows the ETF This be long-term on to equity in led ETF inflows annualized continued strategies,

also We from nearly growth the strong EMEA $X billion with net inflows. of saw region

in annualized $X passive marking quarter. in and growth active net last garnered organic well share continue market products EMEA one income. We a fixed in our positioned ETF scale strategies. Shifting the active to rate, to flow our continue volume innovate the from the our We to across in our to quarterly years launching best quarter Xx with past X inflows on very billion in both and quarter, drive ETF long-term lineup. new gain and or We the to and U.S. in extending profitability results use feel fundamental nearly X an X% focus

classes. Shifting -- were wealth and With by including wealth money technically our and growth to management in by in comprising estate capabilities, our was SMA Growth main in yields. our the region. presence though we've bond fixed quarter, class targeting recorded tailwinds estate about It increasingly investment-grade significant the flows the mandates have management net developments the sizable Asia XX% in had income leading platform, our year. With AUM moving new markets. I'll flows across of billion in recorded globally in also quarter. wealth real volume. We quarter. Institutional complement real which our These key was led rotating of $X.X spectrum, steadily our flows demand asset high duration led been momentum real asset over over we INCREF, ability note very recorded outflows third category into strategies. now lock slow capture to performance and markets, with municipal to continued this platforms, increase dry largest these institutional managers seen late large particularly several estate duration which decline remain us strong, which billion quarter, continue was $X risk distributed in the fixed more investment adding adding one we particularly have inflows through Pacific driven with our the driven also the to the of the U.S. which income -- nearly in alternative our U.S. XX% positive Within in launched powder to private our optimistic the declined driver strong for we in Fed opportunities. bank This ETF. aggressively, flat emerging that across were to loans, strong, rapidly is is aggregate gained last on has net have now debt the of billion a investors fund or part wealth has expand capitalize have by continues This strategy, space. $XX credit, channel. reaching year past the and

mentioned demand outflows a and meet the suite we our at product recorded how from to Asia flows I were basis globally in clients of $XXX quite strong we're billion region, Pacific. in across Asia On Moving managed $X This broad Conversely, highlights million. as on modest important sourced region. earlier, Pacific to quarter. leveraging this the

in was reported in strong by some success ] fixed active we growing Specifically, in quarter, where market locally net fixed flows we income some asset a which particularly equity inflows strong by the This for Institutional the and in China, quarter. billion generated was reigned Japanese continued products. management top-selling the the market. our and strategies. In outflows Japan funds among managed after volatility in $X.X global strong with driven equity in very [ investment-grade retail activity also had inflows second in offset income third income, quarter, is for Japanese outflows our strategy, Japan in

the and type our ETFs stimulus. China, part China U.S. macro During government's anticipate we strength level the we in pleased our by were fast-growing JV. demand. At through see to in business our economic a we're will and of launch continue this vehicle on the period, on X EMEA, ETFs equity build a and China encouraged to focus are strong recent

should We be ultimately few is we if have for some development our helpful term. near over equities, in seen very the this of that even some positive business, the for believe continued particularly weeks there volatility past effects and

announced China presence JV led JV, the and business Pacific in Asia and in India. our Japan recently our our profile region by Our long our well-established remained very in strong, prospects

by Turning the quantitative modest to net capabilities. multi-asset related inflows driven strategies. saw in our We quarter,

Finally, fundamental the continued equity flows on relative pressure quarter. the in third

previously, have in than $X approximately of to strategies marginally pointed we seen Net I time quarters billion emerging to moderation billion have per $X However, quarter, the several outflows as some international in global, segments. outflows slowed the XXXX's remaining important billion. these during market past and out over $X quarterly lower peak

or cap our aforementioned markets. markets income emerging strategy equity equity equities particularly been global well multiple as has in inflows outflows across partially by Specifically, small continued -- strategy as our of strong and offset

than benefited expectations, from remain last time and market While year. fundamental this equity XX% below AUM asset gains capabilities flows stands in higher our long-term has our

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income in these as to time We deploy capabilities fundamental Over have across X income XX% the top continue top all excellent a peers the performance track X-year their conviction basis, years, are we of in to funds have strategies. Of investors XX% our of money beating benchmarks. quarter fixed into capabilities benchmarks. half flows nearly and supports are This horizons. XX% peers fixed note, of our the with ability respective beating with our quartile their X on in of

and top improved in We and with across we continue AUM period quartile are quarter. time here each over XX% incremental years focused into our We've X peers and percentage the equity for improving progress of X top the on X to performance, years. fundamental especially shown XX% this make quartile

in X-year call top over the to of to a for we on going peers. With results and to it I'm our Allison quarter, financial your AUM here and have the now to Additionally, XX% turn of I forward that, look half basis, our the discuss leave questions.

Andrew, I'm begin and good going X. you, everyone. morning, on Slide to Thank

the $X.X Total under X% last a was high the quarter or and billion trillion quarter of for third at The $XX financial management record and end assets higher Invesco. end than results. quarter third

the inflows the as $X billion to $XX by markets, due We also Higher income quarter. Of billion increase $XX for billion AUM increase due increased drove Fundamental increase, driven billion management under index long-term a markets. markets management AUM under QQQ. billion while the assets million quarter. including equity our X% $XX the had record by high ETF during of $XX billion increase fundamental higher and well to fixed accounted over an $XX.X last of were of trillion, and $X.X increased higher long-term capabilities, assets in $X net

billion prior adjusted quarter quarter EPS cover the balance than zero further I'll operating quarter, sheet exceeding in the cash on at strong noted, shortly. in Net versus totaling Andrew the once ETF margin quarter. long-term As QQQ for quarter were debt. operating growth was position the third in of per during which in of inflows ended was growth Partially equity of inflows inflows. improved net $XX $X to end. debt quarter. Average cash all index trillion that net third net capabilities, the and Adjusted of represented way again billion, a during with quarter. over billion Fundamental fixed $XX.X at long-term led increased cash net over and diluted income $X.XX. We quarter income revenue, organic fundamental strengthened third capabilities earnings the adjusted excluding of billion, better the equivalents a billion second We and $XX in the quarter-over-quarter our the AUM this the outflows share generated $X.X net $X.X X% offsetting X%. goal and drivers rate net $X.XX

We the quarter, forward. a million regular repurchasing we to resumed shares buybacks buying third share the expect back during in $XX basis and continue also quarter, on going

X. to Slide Moving

As shifts and reflected which yields asset calls, we mix capture us prior evolving as our revenue our results. noted preferences client allowed to increasingly our product capabilities in broad in have been of has net client set secular has demand and altered

X Our cycles, reduced. various has increasingly today is positioned years equity fundamental shifting client and and been portfolio The navigate market better is higher than to demand. better fee firm concentration multi-asset and our risk products events and diversified ago,

ranges on our we exit range over capability current the are the in last net net yield net noted capabilities. To net mix and yields slide. seeking X We're revenue lower quarter. The provide of trended we the the -- recently. yield trends revenue points, during we yield net provide XX.X drivers past by have revenue context yield basis quarters, during net revenue XX was the the ranged As visibility was trend on by the quarter, points where continued has revenue the included for X.X have basis the representative net yield quarter, to The yield and more current overall you revenue yields to better revenue basis current yield third due where net revenue shift points. note

quarter million billion million last year. million $XX Turning partially last shift The than the by the we to last fees X. $X.X were second $X previously $XXX driven quarter second the decrease operating the of a or million second was was quarter taking when million quarter. from year adjusted fee in higher increase prior the change the mainly performance $X than quarter over This organizational in to Slide Net noted. Performance Investment as by the million increase $XX than management year. Compensation average higher into prior due were of than see a related typically third and than in third increase third higher $XX the occurred quarter, quarter Total higher third quarter. account slightly expenses fees increases the quarter, quarter $XX the revenue second compared than less higher offset that to the AUM, performance of X% lower expenses of compensation year. to due slight related quarter the last million than last mix was the in a were quarter. and higher were a third to AUM also seasonality fees lower the X% slight million, $XX

This retirement. experienced took $XXX that compensation expense reported in long-term a expense criteria a volatility million onetime As defined outstanding to employees for retirements. newly operating from changes expense to noncash to for the of our long-term we currently retirement resulting meet will have recent results, in vesting related in criteria awards change of is GAAP the we awards. The onetime we reduce due eligibility compensation outstanding acceleration of for acceleration

was Over types better line prior us how related plans market with with and for quarters, to awards changes in aligns the $XX meaningfully it retirement acceleration of prior the X expense companies higher more third associated from most than the quarter $XX our the second Costs these quarter-to-quarter. at the for to implementation and in the long-term Alpha the platform versus was associated $XX in long-term brings retirement. G&A were retirement million The higher fees us of for account quarter nearly professional vary and to the criteria awards with the million quarter. million million the quarter. related expenses prior increased of acceleration $XX with

implementation XXXX. fourth onetime the $XX of million quarter to we cost As Alpha up, to the ramp continues to be of Alpha-related closer expect in implementation

We our with in will and improvement point in operating or a update XXX increase million $XX margin basis our operating was XX.X%. positive related basis we move to driving the progress to X% XX costs points, leverage and continue a implementation. Quarter-over-quarter, operating income as forward

Our XX% in quarter third near rate end effective income of our of the of The wrap fourth Slide discrete XX.X% was tax rate impact nonrecurring due XX. of lower XXXX. for our quarter. effective tax vary items pretax We historic to the be effective rate on range items. I'll the can will non-GAAP and estimate tax on actual to the up XX%

As with equivalents net on in goal sheet to quarter. of continue cash building balance and debt quarter in no make the ended our a cash we earlier, exceeding We than by debt. draw with progress I zero ended the better We our position million, credit $XXX on noted net cash strength quarter facility. the third

down continue share several improvement ratios back buying the a improve, $XX we're excluding X.X quarter. during to shares and leverage resumed quarter, or million over We a million X.XXx, the years. preferred the the of to significant past third now in ratio leverage Our stock buybacks

around flow of performance sheet growth. resiliency $XX return payout market ratio, of repurchasing We dividends fourth will with the We depending we operator that, evaluate which further evident to closer enhancing firm's our anticipate capital we balance and million line make to XX%, continuing common expect progress organization, on the program the areas to a high remain we is buybacks, in to to for continue to continue level while financial return share share including conditions. We driving as expect move I'll net levels. To again continue capital simplifying ask on buyback will total regular and strength XXXX in quarter, of up performance in a our continually building committed growth, of this quarter, open and forward, a stronger going the the and to Q&A. profitable more invest conclude, shareholders. And

[Operator First Brennan Hawken from UBS. comes Instructions] question with

Andrew, third about China the maybe really you spoke positive we on the be stimulus specificity how the you've of you impact to the to in IGW? seen And some impacting over stimulus few provide thinking more a not but quarter weeks. Could effects have that that. What this bit potential past should seen? you

it's think, for happened good our for in in early Look, how volatility thanks. that we China, and markets, I marketplace. saw obviously, That's that's The business. investor Brennan, and days know sentiment. we stimulus, exists much what in good

a I going think on. mix what seen mostly shift is we've

had income and fixed a or year, income think it, fixed been starting is of plus, focus a what which equity on call I the this we side a last things in of So end is predominantly towards bit portfolio. more earlier year balanced to shift the the

mix and important balance. also fixed income and it's business remember that our think in the I Chinese market skewed of towards IGW more is to at the

XX% about XX% and equities, money balance XX% So business XX% fixed is IGW income, our market.

it's to days improved, expect speculate much. but to I too think demand see early we So

I'm preferreds. of sheet than see that investors, a years. it. you encouraging bigger buyback could the restart. have few helpful. the efforts to type that guys well. preferreds But issues have talk And done to on balance the back could the in executing When are effectively and Got you continue you one the the to of you well common you And past buyback or it's MassMutual buyback rather whether effectively certainly so curious That's buying consider delevering program do see for then, the if delevered approach Allison, not really

Yes. Thanks, Brennan.

of with conversations a they and the instrument, MassMutual is ongoing know, have non-call own We It XXX% it. you about preferred. as

go, I the duration liabilities and paper they repurchase the So from well. In us into of for element top and straightforward exist of around were that and it are, of a In mind instrument that opportunity and we've attention our one think understand the been impacts our And that. it's further we're our might everywhere think take a to focused conversation as against isn't done little something as that next we've of really doing not strategy about certainly we noted, years successfully certainly job a has common with quite a any capital about been, common is to not any returning as the and how nice can. piece they not the of that. Certainly meantime, now, delever you preferred straightforward, to I largest that to continuing well think got equation negotiated to and the preferred of We've bit as until sides on simple one talking for it, but and meantime, given capital know, they both that that as liquidity exercise shareholder maturity bit that you to build and XXXX. shareholders.

next comes The Jefferies. with from Fannon question Dan

well? awards And some charge anything adjusted pace change about of going this as accounting follow in retirements to quarter. associated you any Curious with forward, think the is a the anticipating the also, Allison, to we some of behavior or the are I if took wanted the internally change you up to benefit as there's incent obviously in on the results. this about

question. Sure. Thank the you for

a of in criteria had we really have One, retirement around past. the couple not things. So clear

plan and does it acceleration accounting the handle awards of retire is before, go requirements to is also companies helpful. It around and are those opportunity as line eventually us age and noted in that of perspective provides associated motivation criteria ahead allows is just benefits. employees. and most it that both I of really, then those had we've all for One employees They eventually, paid with the for acceleration few better It be the is And of retirement service our of million benefits can't you already they the and really this us benefit take quarters, of so very in it gives issued. how we retirements, requirements, creating expense the recognize years an the recognizing And accelerate change. kind there and clear in today been and are which everybody have clarity this more from until that put multiple past without us events, meet about $XX the for in will -- eligibility is of the they're those awards to acceleration terms to accelerating an going all retiring you and is, day with you tell the those full that. The eligibility but hit. transparency

volatility and therefore, So uncertainty expense our it compensation earnings. and in creates our in

And that so volatility. will really reduce this

You retirement repositioning. would kind we saw those that in of lot year of you quite in amortized executive a bit volatility criteria, time those seen the this and wouldn't of as those Had already frame. retirements our because over a that XXXX shorter awards it of already eligible, had announced last were have profile a some been have earnings we

in the wins. context unfunded and following about us a guys you Okay. you opportunity, in then, good a to fixed also talk backlog for And you maybe give particularly you the Obviously, and globally? of flows. dialogue the on guess, I of And used up see Can both, just Understood. quarter Andrew, income. where U.S. terms

the today the sits terms makeup and that how classes? that of curious asset contribution Just of of in

question. for Thanks Yes. the

kind the to greater start from think the hold had partially I volume of we're we starting first Let around see quarters interest noted, think and into But this maybe with me then with I also the kind of been previously. about I I'll quarter rates. clarity perspective, mandate we thing and more on is From reallocations as and chip as saw XX% talked in backlogs And little came pipeline a a move put can delayed of money inflows on Allison say fixed bit. motion, institutions. of income that

active, marketplace, retail -- velocity we're municipal of So continue the positive wealth space. space, I fixed been the strong, the flows to greater in seeing we the in in And wealth for management, accounts sort to in but fixed really a in some people particular, separately both competitive increase in again, that's a space. were and early income. in edge in U.S., using income, the relatively institutional it's a quite -- starting more have that we the In think particular, passive. And then particularly mostly largely just and in a we and managed we strength, rapidly then where see U.S., us have it's that's just space, in

volume is to fixed for the income, regard flows our definitely it Allison... board saw up quarter. With So across in the picking pipeline, this you and

I'd continues right around hovers billion. Yes, the pipeline consistent say to pretty be -- last quarters. few $XX it's quarter-to-quarter for it the

the any just a quarters our really we when from reason didn't our but valuable institutional pipeline, X/X But look sort about X/X come some pipeline. at given flows outside all come And higher, it little little bit from a consistency we've the of you quarters that seen the lower. there. of some about -- hence, in quarter, either because Sometimes find flows

a that an isn't fixed our And Andrew So on around is across we -- it doesn't see are it's But regions. greater, great side. interesting forward a barometer, It's it it income interest $XX starting to as greater pretty but noted, indicator. billion. balanced the

sort go have further And out we duration scaled platform, people profitability as improve. to fixed is curve, a this of continue mean billion which It's particular, seeing. about of will in the I income. -- long-term $XXX what we're

TD from Cowen. Katz Our Bill next question with comes

inorganically. whether driving of space, de the about bulk question up your alt the a significant participate been was on amount that could the of all now trends, bulk big sheet talk a to to managers how positioned replacement or is healed, maybe perhaps traditional the balance sort picture or you're alts in trying trying democratization. of you opportunity retail there's little to be in focus managers So fix income it around those novo into bit up some all further to a either a with more or M&A I wondering if you,

thanks. And and Bill, can the as of terms market for private #X in you in us, management. opportunity the Look, space. wealth there see growth thing is mentioned, you happening I what's in mentioned, as

been for of we and pursue, a asset that wealth take another We pick sort see strategy, added there's to the management credit part especially the to quite if we're latter market. real ton end estate us, largest quarter. third one in that has of alternative the our high opportunity were at to capabilities the wealth pace the And interest For capabilities or particular, -- to up. With just management us of of continue our arena. platforms debt beginning our real the to in organic U.S.

guess have So lots opportunity is saying take markets wealth to organic I'm see management, continue private into where of distribution we we what I to strength.

We the already in opportunity in less look invested marketplace. on do a and Invesco. right you friction need to we create if bulk really of tools to have and there's specialized but of pull that we'll can set tremendous inorganically have amount we we product origination to continue like capability, where skills the through here that places we've strategies, in And feel

Okay.

follow-up. a Just as

fee SMA. business, think income you it products the be into But passive at of demand it some about in speaking, quarter. and As the like edges, broadly mix higher the fixed have the some to the of sounds continues new could go-forward incremental

to interplay there's leverage, you drive the continue the if leverage really was between fee growth? to change the can I underlying drivers to you So wondering, and think operating positive rate as about operating no

dynamics very certainly hopefully, you would Slide underlying, mean, capabilities. our we we I strong help of Yes, I some across growth seeing a we that. seeing And are number say are a the would I couple of really say, in seeing, And capabilities. These green everywhere. of can. things. does investment X We're shoots growth, good deliberately where that leverage and driving positive by focused single to are about one areas just on operating progress compete. have really chosen in driving we these every incremental of investment positive

in progress investment institutional that each really We our drive across it's driving one and positive inside our of one, performance, retail and are capabilities strengthening both strengthening broad clients that focused on incremental our distribution operating leverage. each

hard. notably, very we're think I working

really that generate demonstrating positive I leverage top our with around incremental think demonstrated that on so all growth and controlling the operating expense can strength line. we discipline expenses expense and management we've that

output So, certainly, these of how we grow just yield across mathematical capabilities. sort a revenue is net investment of

this Our revenue and think key on again that is growth, demonstrated we I focus quarter.

And we're Bill, focused what these emphasize quarter-on-quarter on operating Allison to be show and mean, each just to areas further -- on going profitability of saying, leverage. was we're I continuing to

really giving continue some other talked beyond good some positive in about of we there's to where China Asia think we've Pacific, expand across see and that place us as I areas can over a growth market just growth revenues time.

next Schorr comes Glenn from with Our Evercore. question

gross something sales. $XXX So you billion in said like

huge powerful obviously distribution. So brands there's and

clients to follow-on a that so a everything want, have can you time. long build now question And maybe organically, don't Bill's if takes you is it

buy could You stuff.

and distribution are your You lever brand, strike partnerships And commented in repertoire? think the something that concept not room on you client for lever hot of that. iron's might preferences and shelf. the have how you your the the to changing curious I'm on Is there while about general

Yes.

mean of going geographically. them start. what we venture. continue distribution have And part continue India for recent history ways with for to and to a as from partnerships. continue investment capabilities. with to to well I create been joint our We'll We're our standpoint history as even me look look for Let look and to partnerships did in we'll them our

to did avenue an we indicate looked future our over being just grew looking at to China, to India, And ETF our quarter, to see we much growth. how we nothing how specific what so out what business while did there's point look time, in partnership we in this more just at

commented not stay within you do theme follow-up on and about I'll their like just a a network on I feel further partner things penetrate and you MassMutual. owner? big issue, on and on there ask their obviously about press is to of some grow them plenty talk them. as a great opportunity big more with the a retail you're Maybe working the distribution channel, thinking Can with but

Yes.

behalf been One the a the say is is model little where distribution. about And over network, huge which their portfolios either we think manage general bigger several. at opportunities area. we on or assets billion of there's affiliated into successful. It's they've starting of We're one I'd the $XX of $XX account what broker-dealer of growth -- a place that MassMutual, a billion,

them capabilities to strong models We populate a have lots certainly of business underneath and players. alongside other

The and capabilities, other continue we exist income. as products into to is fixed could across equities that just insurance build out sub-advised and and their

with regularly should be few just things and with are powerful those that agree on a MassMutual. we're I you of continue working a the partnership. that can that, And the So

with America. Our from of Craig next Siegenthaler question Bank comes

sequentially I It rose million looked like in Alpha. $X expenses had a quarter. the on question integration

a especially will expenses Alpha improvement So And to will save Alpha, time? start when in when money should profits see Invesco because over net you peak? quarter-over-quarter on

Thanks, Craig.

I quarter, ways. in we onto Alpha a expect noted platform series transitioning of AUM think our as last be we to the

continue the We really expect to these first and in as run learn with of And perhaps waves XXXX. fourth wave to this into early through year that quarter we XXXX. be even test and

as We are incurring implementation costs go. we

expect We fees AUM be AUM we we the as on paying that transition State to will -- Street on.

-- question, little so in your up quarter. costs third bit The were did. a And it implementation the to yes,

some running we're quarter into implementation the platforms it as will relatively on expect we're time. in fees to year, of for we here get to Street the transitioning the paying we're consistent over it We where as that fourth up, continues parallel on next ramp be be still paying other some AUM State the and and we

and to And overall we systems ramping XXXX. into we year some see costs of get start of then the guidance to other those giving guidance been really a to XXXX. bit, into going this benefits we're we to It's single of continue extract going as platform. to deep one quite a we'll coming, but learning starting into the we're and to in peak expect into as to benefit give a all start evolve and be expect off testing We XXXX, you more and of you that next around time we'll long

follow-up ETF quarter. strong the And on for in flows were business, BulletShares the particularly my

that the declining benefit talk duration somewhat given the and So I strategies. may interest key you rates drivers few was next this are continue longer to which hoping now, expect quarters, if you could over about

a thanks great a BulletShares inside it's our -- range. BulletShares them. it and franchise are leading income for of out. very Yes, our built mean fixed one pointing have And we ETF out I diverse franchise capabilities or

happening BulletShares. same trends before And the about demand space to the and I so apply in wealth investor institutional, frankly, the mentioned

good And quarter, previous the quarter. we not And every growth. I past been it's December, just that think expect but that in then happen saw first into quarter, -- I'd are so we the BulletShares continue. There this to that year repopulated maturities get

that, I we continue BulletShares the about to watch great So range. feel

Blostein Our with comes next from Goldman Alex question Sachs.

double-click private of in flows Q&A. real and prepared into I couple in estate to was remarks a highlighted the hoping the the you times

relatively just benefit growth? So was end the that you like what sounds kind It bit from starting the industry. contribution queue more that bulk and institutional from you update like strength redemptions and platforms the sort added added of a ease maybe got towards the growth got a And that's since of us of bit Was broad-based? And for it of almost look the the quarter. there the the of the healthy that one come does the been on sounds like? could or like guess the little to side, has I on onetime-ish little

if curious same. just I'm the seeing you're So

bit credit U.S. the wealth let me flows, end to, the just The happened the platform at it that quarter, platform come doesn't clarify little the question. of for thanks on side. the got And that opportunity. large Yes, we real estate added a with comes with

in were to materially none the really flows the so related And of that. quarter

a real the That that's for of significant been already of other debt to one in quarter It is our strategy flows relate the came out the real estate wealth maybe a independent and several for large this though. So estate for channel. the strategy platform better on part has U.S. demand on part and from RIA call it come. The the is market where that year. others

volume next you to started and we about the flywheel to get want up, hopefully, see as year. Allison, So continues pick into that we redemptions? that talk

that. Sure. and down I double to add, on mean, Alex, maybe, would I just

of of our that was driver estate While real a the product it estate. strong flows, the only real driver wasn't

And And this really so overall we really think which in improvement asset our strong growth real demand is also estate encouraging. just I saw class, SMAs. for in

people the of slow and in arms I as to that for more get estate through But in has started maybe Still denominator effect. just to markets views cautious they overall, to broader that signs of little certainly, their we relates path business. cycle yes, rates certainly real a but there certainly redemption on a have means overall, some that the normal transaction activity as impact interest sort queue, As trying the see are and bit moderate around I the improvement. on there seeing to higher would abate it pressures mean, private improvement bit really are pressure little start overall an the the say, what with a the encouraging than the

And so only of or just funds. about in billion the are real that's to it remind assets, everybody, it's direct, -- of half $XX our estate

and rest the closed-end are a global vehicles on basis. So in accounts separate

And sequentially helpful. service higher And sequentially. down AUM The just little the and expense Allison, and looks It's despite disconnected distribution more started recently. like fee think, That's higher you. that, for markets a same which I increased question something correlate. to came distribution I guess, tends Great. a to levels, quick time, become at

further side profitability kind what net maybe So the go bigger they're There's things expand kind that a a drove of on the expense creep and few not on that of but of kind the drag. become decline I effect there, just the on continues know of side. perfect. on up revenue in to

item, between pass-through contra line categories. things. is a mean, couple relationship Sure. the third-party those distribution an service a because just of between distribution there I revenue of and element fees and One, there's

recent But management period so a them against have fees. XX% and you do flows as of look revenue of the can And you quarters, percentage it's much due years, third-party that, you range. fees. in towards quarters. ETF to years the licensing over recent really and quarters, trending ETFs funds shift few mutual higher do product don't the more last range And as to do of service that generate together in XX% really more And several it's get mix the over that are historical distribution the that's really run towards historically several to such as end management fee in of and as them fees. When kind at time expenses higher look there you

slightly So it higher. make tends skewed that ratio to

just mix demand in -- seeing ETF shift demand that seeing outstripping mix, wrapper. think for own something our I mutual increasingly across the that obviously is for not the we're the and as fund we're just industry, but

then to I'd that expect expect XX%. relationship you to historically say has to been to XX% be than closer it that it's reasonable continue, If

look I answer a So our know kind it, to that of year-to-year right now. detailed heads but we're it I was around kind of quarter-to-quarter way really there, at it's way wrapping the the think

The question from next comes with Ben Budish Barclays.

ask I competitive wanted about dynamics the to fixed income first the business. in

fourth coming new is coming flows. an somewhere but factors, -- share of from there the you for quarter? investment-grade from this that you of money the in motion, flows curious, you rates else, number there know a called was organic Is kind the and guess, coming remarks, where of pickup? as out always management are in -- in is from, if But gains wealth U.S. you that more sort saw anything prepared opportunity of -- space? just You in sort don't the more opportunity quarter? there Do down called a for see Or suppose mandates, of I I they're an

great parse it a It's also It's hard completely. question. Yes. to

are -- the trends money that motion competitive reasons largely in mentioned seeing for the that's income before. is I the we're think we Fixed space. is what

-- lot into motion point regard. I'd to particular in They're that quarter United you're in out from having even to also of out takeover in could well. income compete as can States. competitors that this coming say They're that coming are take mandate. flowing can from of the coming also that Europe assets its nothing money is growing, largely and so also be There's just we a but here the fixed that assets Asia. as of I And in aren't

elements So And as phenomenon EM. the it's of before, States. grade in been global United included corporates, said for a us investment across then even really municipals I global

Very it. follow-up on helpful. private wealth one of kind the Maybe more Got side.

a that distributor. you very Just launched mentioned you large on

kind your describe to capabilities current the you broader as would in how to private relative applies Invesco just distribution curious, markets products? it of Just

Yes.

both we wealth in have generalist how So and we markets, a private specialist in the model institutional the take in space.

Over years, the mix. last several strengthening we've that been

private expect there distribution. in to so working don't the And whole a in well investments to pretty generalists that's think areas to I those specialists see in we sit behind the markets, team alongside adding wealth of been we've given already. particular of doing pickup that space. the our in we're U.S. And lot more made us those seeing. We've terms investing

that those the in continue to minimize that's private all and just required required It's to distribution. in we've friction products the are place few have the products new on, in in the to growing bringing that a matter that and wealth mandates, are also and say beyond taking we space. I'd servicing things markets. bring specialized and we'll just platform on to can things of a continue find the it's that Now mandates we volume that invest

in wealth more it's most, markets So and distribution the private feel made investments. product in like if the in not we've space. to We win all, those

Cyprys from comes Stanley. with question next Our Michael Morgan

more talk about could set you the up. a you India hoping I JV that was bit little

that and just approach how talk on there elaborate looking about see, your and how the you've Religare you looking to opportunity some back set -- steps that had opening If lessons a over relationship you take that any approach you're that may back could learned at of your that bit see the maybe up of sort the the inform lessons here? years in marketplace you and

thanks. Yes,

and help that believe to still sure India and less that we in captive you we us pick -- make the attention But we're -- much lessons that focusing it. areas relates planning help us, working venture about learned, we to completed and it's first, all consolidating we've more in and talked a partner about grow important that our to partner, wanting opportunities I that's we're the distribution, critical in has our efforts. are first clients very our concentrating serve like have other expand it for bank good us a that about. in good as So of feel oriented, and think it to and and Indian to really And us India. We disposition to through that have India was quarter. and the of in portion We're joint regulatory continue really approvals Really the market. can that's the in going to

JV just to partner minority pleased going a the market the can look, to certain and be of the this product say behind forward and to forward participate as be expand to I'd look provider we earlier in that, that place capabilities as able investor that way take a world, marketplace. And back us to lessons a in our it for we're for So question, to Indian is well. markets learned, partnership JV in continue the company a and great to around on as the and the distribution will investment

you but growing. And them partnership, so only appreciation I think is learn of something, our each

might in that look that And year? do operating the into And question scope help you see continued How taking on or a operating as you trending? expenses State on leverage how follow-up be the fourth market that the for How here, just from next Street need could positive you was elaborate be? Alpha as And might how out drive if quantify how AUM quarter fees something you expense maybe year? beta can It then see shape much positive outlook. think Great. maybe about you you next you meaningful on uplift much to here leverage?

there. Lots Okay.

margin obviously me on strong operating and of maintain without to demonstrate organic operating that for We're income we're ourselves last to that's but able really as getting with fundamental planning to gains. delivering operating mid-XXs X one we've leverage these We drive of can growth. back and on said actually years. Positive we long where as several to that, tremendously beta continue company. good, focused the we're be but near I or times without take a is want and to market really drive intend market we our margin first. with we pleased And that operating how growth, to Let demonstrated operating have or think discipline leverage helpful, positive And market before, margin. We've your last be. so improvement nowhere focus beta, we're over is been quarters expense couple

leverage or And focus. is but so positive improvement. building It's our or can really focus market business that not with the deliver on easy, at operating the that's so we least without outperform

Second, in the the and of AUM quantum in we based AUM really move given it it's this is we and move dependent each wave. waves, on of you that to it Alpha terms the question, kind fees, quarter, of it's -- going on State and tell backwards fourth for relates immaterial I the just Street certainly in as your can the level on and

scope terms to we're in has as continuing on the fees that next $X wave, this paying pretty less it fourth this immaterial, So year out a we'll of million. be impact quarter material than

waves wave. to each -- a quantum it year TBD it's really continue we work the bit So as in through and next the

have So certainty we'll continue give more you guidance we that. as to around

marketing As and fees. in of the the performance a have relates compensation we the and is dependent G&A, bit some seasonality quarter little quarter, fourth in usually both fourth it always in fourth terms quarter, in on to higher expenses

said seasonally revenue look a is the gave would X billion year any seen total be the the we and base guidance consistently would market at are expenses. of year. We improvement to that the little areas I year. to the and for XXXX some expense improvement. beginning without market We've those I of expected certainly pretty trending So since beginning to higher around our expenses our of the expect $X bit the we say overall, for

expect so fourth see a we higher basis, that in modestly some on expense than I how lot a it trending. seasonally covered higher could of question, to our that. quarter. would a all. that's And was expect year-to-date There higher base increases, would I And the But then you bit hope be

Bank. Bedell comes with question Brian next Our Deutsche from

Maybe elements the one asked of opportunity JV. at shift questions Most this just have we income, positive the presentation. to of Andrew, a if you're to fixed think, may correct early if Great that out Great for the you could versus talked the my earlier Maybe but I but Wall answered. could equities, me an XQ Wall just in back going XQ. obviously, improve that look in shift of But discuss if wrong, coming rate is dynamic fee been see you mix rate and rebound whether the in couple. and Maybe the you're you I'm XQ. -- and fee into that contrasting the -- thinking we as fee just a as about there in cuts see in a

mentioned to the on certainly certainly better have several as an we or -- mind. business. at more an exited rate rates impact last certainly into And did the weeks and But business, passive of that coming earlier, the XX% in have of changed will what's since from had I we both and month China. Yes. Equities, in thing feeling impact. lot a for occurred you time, then. With equity important on our see have volatility have the quarter highest the for Thanks part we an Both that and a just exited mentioned than is lots and a impact it's of you asset continue have market happened better the our dynamics But But income that question. though, time. we again, seen lot in some keep in the that's see, we've the a China before, fee an than generally did as in the business. of some a in out flows going perspective, quarter exited, the as good can over and marketplace lot active intra-quarter, fixed a

had flows think the cycle And then comment any the just the you about could it And just other from flows? it. we to that do -- pressure are might there benefit Got liquidity rate on if here Maybe or can outflows seasonality XQ. I then cutting you that, just factors if on in dynamics expect liquidity, global talk XQ. you in the

business just of On the them. XX% reminder, our assets a oriented, cash about liquidity are of liquidity and business, institutionally most

institutions changing. probably material have part quarter the most I that And do so these pictures our towards are dominated tools tools was interest money use banks think have third space And the and they other lot cash market when of going were more and rate of impact things that forward. in that can the skewing outside a that the

a place to is profitable scale. company. and part of billion. Our liquidity business that have expect continuing the a we're $XXX of It's we a out our lot It's

mind, will here time think what quarter, institutional different than I given managers the of other skew fourth in occurs. in a it's tell So have. do But asset lot the keep that we

question. more Cedric, we one have for time

comes Patrick last from Autonomous with Research. Our question Davitt

push now narrative is cash bond for But funds both funds last been last allocations. a on few trying broadly idea inflows have with a lot big a the to sidelines the quick on money question. months. while Obviously, people bond have and a that fuel that follow-up we're of over I the seeing will this

funds have you, a certainly for it's it rotating within doesn't at be You point? allocation bond allocations flows where these guess, coming clients' in sense money where of appear the because to stack, I from strong from are this your

core go and short that seeing We're to client retail. seeing mean in the fixed in definitely from more it's -- people seeing intermediate. own in duration. which in really I our from We're out their institutional much sure went income not business, allocation it's just as in I'm Yes. further We're both SMA that allocations. space, our

up and go seeing definitely money sidelines the well. So the duration we're off both as curve come money

In a coming our of We that That's sidelines from business. totally where think coming coming the fund different as said, terms competitors. it's business, from from it's not our in or I money it's from dynamic.

back Schlossberg. Mr. to you, And Okay.

impact closing, to changes In help are of their operator. navigate positioned the portfolios. dynamics clients Okay. to evolving thanks, Well, we subsequent market and well

sentiment client performance greater for to we've scale, should As improve this convictions strengthen, translate and even and discussed profitability improved as Invesco market today.

needs, with look I'm Given collaboration for one thank hard for done for another soon. and questions, out Invesco their ability to work, meet client and very anticipate, evolving future our the reach want of our have in I'm we our and the interest again all continued that colleagues joining my your to we of focus on our really and team all to our excited everybody, work to strengthen for understand clients. Thanks, Invesco proud the call to Investor appreciate all any with Please you today. of additional speaking forward Relations Invesco. I

conference. that concludes And you. Thank today's

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