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    SEIC
    Earnings call· Mar 2026(Q1 FY26)

    SEI INVESTMENTS Q1 FY26 earnings call SEIC

    Apr 22, 2026 Source

    Executive summary

    SEI Investments Company Q1 FY26 — Record Sales Events and Strong Margin Expansion

    SEI delivered a strong Q1 FY26, marked by record net sales events and significant margin expansion, validating its strategic pillars. The company's focus on core growth engines, particularly in alternative investment management and professional services, drove robust performance. While facing some expected seasonal headwinds and institutional outflows, SEI remains confident in its trajectory, leveraging AI and disciplined capital allocation to drive sustained growth and profitability.

    Highlights

    5

    • Adjusted EPS increased 21% year-over-year to $1.44.

    • Net sales events reached a record $67 million, exceeding the prior quarterly record by over 40%.

    • Consolidated operating margins improved year-over-year and sequentially, reflecting enterprise excellence.

    • Investment Manager Services (IMS) secured two large enterprise mandates, driving over $50 million in sales events and becoming the third-largest fund administrator in North America.

    • Asset Management delivered $1.5 billion of net inflows, its strongest sales events quarter in several years.

    Concerns

    4

    • Sequential decline in adjusted EPS from Q4 due to higher effective tax rate and lower investment income/performance fees from LSV, resulting in a $0.15 headwind.

    • Institutional investors experienced less than $1 billion of net outflows, primarily from a large defined benefit client annuitization.

    • LSV experienced approximately $2 billion of net outflows in the quarter.

    • IMS margins saw a modest sequential decline due to the absence of a revenue accrual true-up (150 bps impact) and onboarding costs for substantial new sales.

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Private Banking
    Reflects continued execution against the 5-Point Plan, including Professional Services growth, increased adoption of Asset Management offerings internationally, and operating leverage from deeper client engagement. Huntington win underscores relevance.
    Operating margins: improved year-over-year and sequentially
    		increased——increased
    Advisors
    First full quarter with Stratos (57.5% owned, fully consolidated). Stratos contributed $20M revenue and $3M operating profit. Excluding Stratos, Advisors margins increased ~50 bps YoY.
    Stratos revenue contribution: $20MStratos operating profit contribution: $3MStratos EBITDA (ex-D&A): $8M
    		healthy start to the yearincreased—declined
    Investment Manager Services (IMS)
    Led sales events with over $50M, driven by large enterprise mandates. Modest sequential margin decline due to absence of Q4 revenue accrual true-up and onboarding costs for new sales. No slowdown in demand, strong pipeline.
    Net sales events: >$50MSequential margin decline: 150 bps (due to revenue accrual true-up absence)Fund administrator ranking (North America): 3rd largest
    		—year-over-year revenue growth—modest sequential decline
    Asset Management (overall)
    Strongest sales events quarter in several years, driven by demand for ETFs, SMAs, and custody-only platform offerings.
    Net sales events: strongest in several yearsNet inflows: $1.5B
    		—year-over-year revenue growth——
    Institutional (within Asset Management)
    Experienced less than $1 billion of net outflows, almost entirely due to a large defined benefit client annuitization. Expect improved flow performance over the balance of the year.
    Net outflows: <$1B
    		negative revenue——improved

    Operational metrics

    17
    Adjusted EPS
    $1.44+21% YoY
    Q1 FY26

    Increased by 21% year-over-year. Sequential decline from Q4 due to higher effective tax rate and lower investment income/performance fees from LSV, resulting in a $0.15 headwind.

    Operating Profit (GAAP)
    increased 21%YoY
    Q1 FY26

    On a GAAP basis, operating profit increased 21% versus Q1 of last year.

    Adjusted Operating Profit
    increased 6%sequentially
    Q1 FY26

    Adjusted operating profit increased 6% sequentially and by 24% year-over-year.

    Adjusted Operating Profit Margin
    improvedvs prior quarter and prior year
    Q1 FY26

    Consolidated adjusted operating profit margins improved versus both the prior quarter and the prior year on both a GAAP and adjusted basis.

    Net Sales Events
    $67Mexceeds prior quarterly record by more than 40%
    Q1 FY26

    Total net sales events in Q1, including $57 million of recurring revenue and $10 million of professional services.

    Professional Services Sales Events
    >1/3
    Q1 FY26

    More than 1/3 of Professional Services sales events generated internationally this quarter.

    Professional Services Sales Events
    $4M
    Q1 FY26

    Generated approximately $4 million of net sales events, including engagements won in conjunction with Private Banking.

    Share Repurchases
    $208M
    Q1 FY26

    Repurchased $208 million of SEI shares.

    Cash Balance
    $363M
    Q1 FY26

    Ended the quarter with $363 million of cash on the balance sheet.

    Assets Under Custody/Administration (AUCA)
    increased 4%
    Q1 FY26

    Assets under administration and on platform increased 4%, driven by strong new business wins and lower mark-to-market sensitivity.

    Private Credit Exposure
    25%
    Q1 FY26

    25% of the 70% alternatives exposure in IMS is private credit.

    Client Recontracting
    8 clients
    Q1 FY26

    Successfully recontracted 8 Private Banking clients, renewing an average contract term of approximately 4 years and retaining $34 million of recurring revenue.

    Cash Revenue from Suite Programs
    3%
    Q1 FY26

    Total cash revenue from suite programs is 3% of the gross revenue of SEI.

    Cash Revenue from Suite Programs
    12%
    Q1 FY26

    Total cash revenue from suite programs is 12% of the total revenues in the Advisor business.

    Margin Recovery
    normal margins
    mid-2027

    Expect to get back to normal margins for the two large IMS deals by mid-2027. Revenue and expense for these deals will be flattish this year.

    Revenue Recognition
    pretty significant revenue
    mid-2027

    Expect to start seeing pretty significant revenue from the two large IMS deals by mid-2027. Revenue for these deals is expected to increase quarter-over-quarter over the next 15 months.

    Assets Under Management (Net Inflows)
    $1.5B
    Q1 FY26

    Net inflows in Asset Management, led by the Advisors Business.

    Industry KPIs

    1
    MetricValueDetails
    Fundraising inflows$1.5BUSD

    Product announcements

    1
    ProductTypeDetails
    Registered Transfer Agency solutionlaunch

    Deals & partnerships

    3
    StratosDeepening SEI's participation in the advice value chain and strengthening reach and relevance of platforms. SEI has 57.5% ownership, fully consolidated.

    First full quarter with Stratos. Several planned transactions also closed during the quarter, so underlying run rate contribution is modestly higher.

    IBMReinforces and accelerates infrastructure modernization, automation, and responsible AI deployment.

    Partnership reinforces and accelerates the direction SEI is taking around infrastructure modernization, automation and responsible AI deployment.

    Huntington BankNew client win, underscoring relevance and credibility in the regional community bank market.

    Announced during the quarter, underscores SEI's relevance and credibility in the regional community bank market, especially at the higher end of that segment.

    Risks & headwinds

    4
    Seasonal Headwinds (Tax Rate, Investment Income, Performance Fees)Q1 FY26 (seasonal in nature)

    $0.15 headwind to EPS relative to Q4.

    Mitigation: Expected and discussed last quarter.

    Institutional Client AnnuitizationQ1 FY26

    Less than $1 billion of net outflows.

    Mitigation: This was a result of SEI advising the client to successfully meet their long-term investment objectives. Expect improved flow performance in this business over the balance of the year.

    LSV Net OutflowsQ1 FY26

    Approximately $2 billion of net outflows.

    Mitigation: LSV had a strong start to the year with key products outperforming benchmarks, more than offsetting market weakness in March.

    IMS Margin Compression (Short-term)Q1 FY26

    Approximately 150 basis points of the decline due to revenue accrual true-up absence.

    Mitigation: Balance reflects onboarding costs associated with substantial sales events. Expected to return to normal margins for these deals by mid-2027.

    What to watch in Q2 FY26

    5

    IMS Sales Events Trend

    Next quarter and coming quarters.
    CurrentRecord $67M net sales events in Q1 FY26, with IMS leading at >$50M.
    TargetContinued year-over-year growth in sales events.

    Why it matters

    Sustained high sales events are crucial for revenue growth and market share expansion, especially in the competitive alternative asset management space.

    So from a pipeline perspective, we're really strong. We are supported by the enterprise mindset from Ryan and Michael and Sanjay, we're all out in the market selling together and we're probably talking to 20 of the top 50 alternative managers right now. So we expect sales events to continue to trend up year-over-year.

    Q&A highlights

    7

    Seeking more color on the competitiveness and nature of the large IMS wins (first-time outsourcers) and whether the Q1 sales run rate is sustainable or lumpy.

    Phil McCabe confirmed two large, complex alternative managers (top 5 and top 15 globally) were won after a year-long competitive process, moving from in-sourcing to outsourcing. These deals were less than 50% of Q1 IMS sales and are expected to grow. Ryan Hicke noted that while some quarters might be lumpy, the overall trend for sales events is expected to grow due to strong pipeline and market positioning.

    “We won 2 of the largest and most complex alternative managers in the entire industry. It was an extremely competitive bake-off that lasted over a period of a full year.”

    asked by Alex Kramm · answered by Phil McCabe

    2 min read6 chapters

    Detailed Narrative

    01

    Strategic Pillars Validation

    Q1 results emphatically validated SEI's five strategic pillars, including investing in proven growth engines like alternative investment managers and professional services, reimagining asset management, enterprise excellence, boosting international returns, and strategic capital allocation. This execution led to a 21% adjusted EPS increase and record net sales events, demonstrating the company's ability to consistently execute its strategy.

    02

    Investment Manager Services Momentum

    IMS saw exceptional sales activity, driven by multiple enterprise-level mandates with first-time outsourcers, including two of the largest and most complex alternative managers globally. These deals, which will become top-five clients, contributed less than 50% of the quarter's IMS sales events and are expected to expand over time⏳, positioning SEI as the third-largest fund administrator in North America. The pipeline remains strong, with expectations for continued year-over-year growth in sales events.

    03

    Asset Management Evolution

    The company's evolved asset management strategy is yielding meaningful results, with Q1 marking its strongest sales events quarter in several years, driven by $1.5 billion in net inflows from RIA and IBD channels. The Stratos integration is progressing, contributing $20 million in revenue and $3 million in operating profit. The institutional business anticipates improved flow performance later in the year despite recent outflows from a successful client annuitization.

    04

    AI and Enterprise Excellence

    SEI views AI as a significant positive and accelerant, having invested in AI-native capabilities and automation for two years. The partnership with IBM reinforces infrastructure modernization and responsible AI deployment, contributing to margin expansion. Clients are increasingly seeking SEI's partnership for scalable AI adoption in regulated environments, seeing it as a driver of growth and efficiency, rather than a disintermediating force.

    05

    Capital Allocation and International Focus

    SEI repurchased $208 million of its stock in Q1, demonstrating a disciplined approach to capital allocation that balances reinvestment, M&A, and consistent returns to shareholders. The company is also boosting international returns, with over one-third of professional services sales events generated internationally this quarter, and continues to build its Singapore presence as part of its global expansion priority.

    06

    Private Banking Execution

    Private Banking delivered a notable increase in revenue and operating margins, reflecting continued execution against its 5-Point Plan. This includes growth in Professional Services, increased adoption of Asset Management offerings internationally, and operating leverage from deeper client engagement, such as the Huntington Bank win. New contracts are being signed with higher margins, supported by GCC initiatives and judicious SaaS expenses.

    AI-generated summary of the company’s earnings call. Not investment advice.