T. Rowe Price (TROW) Q1 2025 Earnings
How Did TROW Stock React to Q1 2025 Earnings?
S&P 500 over the same 30 days: +5.15%.
Did TROW Beat Earnings? Q1 2025 Results
Yes. T. Rowe Price reported Q1 2025 earnings of $2.23 a share on May 2, 2025, beating the $2.13 consensus estimate by 4.7%. Revenue was $1.8B against a $1.8B estimate.
T. Rowe Price delivered a mixed first quarter for 2025, beating on earnings while falling just short on revenue, as market volatility and shifting client flows complicated the picture. Adjusted diluted EPS came in at $2.23, clearing the $2.13 consensus estimate by 4.68%, though revenue of $1.76 billion trailed expectations by 0.70% despite rising 0.8% year-over-year. The most consequential drag was a sharp reversal in capital allocation-based income, which swung from $47.10 million in Q1 2024 to negative $1.20 million as weaker market returns eroded accrued carried interest. Meanwhile, GAAP net income fell 14.5% year-over-year to $490.50 million, weighed down by significantly lower non-operating income. Assets under management declined to $1.57 trillion after net client outflows of $8.60 billion and market depreciation of $31.70 billion pressured the firm's fee base. On the cost side, adjusted operating expenses rose 5.9% as compensation, technology, and distribution costs all climbed. As a <a href="https://247wallst.com/investing/2025/04/08/3-undervalued-dividend-aristocrats-to-buy-before-they-soar-2/">long-standing dividend payer</a>, T. Rowe returned $506.00 million to shareholders in the quarter, while management guided to a full-year GAAP tax rate of 23.5% to 27.5%.
- Investment advisory fees increased 4.0% year-over-year driven by higher average AUM
- Effective fee rate declined 1.6 bps YoY to 40.0 bps due to mix shift toward lower-fee asset classes
- Capital allocation-based income swung to negative $1.2 million from $47.1 million a year ago due to lower market returns
- Non-operating income fell to $70.7 million from $188.9 million in Q1 2024 due to weaker investment gains
- Net client outflows of $8.6 billion during the quarter
“We are making important progress and are extending our reach—leveraging our world class investment platform, our leadership position in retirement, and the strength of our brand. As of March 31, we had $1.57 trillion in AUM and net outflows of $8.6 billion in the quarter. We are well positioned to navigate periods of uncertainty and to help our clients to do the same.”
T. Rowe Price CEO, on the earnings call
What Was T. Rowe Price's Outlook in Q1 2025?
The firm estimates its effective tax rate for full year 2025 will be in the range of 23.5% to 27.5% on a U.S. GAAP basis, and 24.0% to 27.0% on an adjusted basis. CEO Rob Sharps stated the firm is well positioned to navigate periods of uncertainty.
TROW YoY Financials
| Metric | Q1 2025 | Q1 2024 | Year over year |
|---|---|---|---|
| Revenue | $1.8B | $1.8B | +0.8% |
| Operating Income | $596.3M | $586.6M | +1.7% |
| Net Income | $490.5M | $573.8M | −14.5% |
TROW Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.