T. Rowe Price Group (NASDAQ:TROW) earnings and revenue continued to decline in the last quarter of 2022 as recession worries and expectations for further rate hikes at central banks drove investor caution.
Net client outflows, though, lessened from the prior quarter. Assets under management dropped 25% during the year, but managed to rise in Q4.
Q4 adjusted EPS of $1.74 vs. the $1.71 average analyst estimate, $1.86 in Q3 and $3.17 in Q4 2021.
Net revenue of $1.52B, vs. $1.59B consensus, fell from $1.59B in the prior quarter and from $1.96B in the year-ago period.
“While many of our growth equity strategies continue to experience lagging performance, we are seeing stronger relative performance in many of our core and value-oriented equity products and some of our fixed income products,” said CEO and President Rob Sharps.
Investment advisory fees of $1.37B vs. $1.44B in the prior quarter and $1.81B a year ago. The investment advisory effective fee rate was 42.3 basis points vs. 42.5 bp in Q3 and 43.4 bp in Q4 2021.
Net client outflows of $17.1B vs. outflows of $24.6B in Q3. Outflows were largely driven by T. Rowe Price’s (TROW) growth equity strategies, Sharps said.
Adjusted operating expenses rose to $1.07B from $1.03B in the prior quarter and $1.04B in the year-ago period.
Assets under management ended the quarter at $1.27T vs. $1.23T at the end of Q3.
“While headwinds are likely to persist in 2023, we expect more constructive markets, improved performance in key strategies, and traction in our growth initiatives will return the firm to positive organic growth over time,” Sharps said.
Earlier, T. Rowe Price (TROW) non-GAAP EPS of $1.74 beats by $0.03, revenue of $1.52B misses by $10M