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WisdomTree (WT) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Financials· Jul 31, 2026

Source: earnings call transcript

Executive summary

WisdomTree Q2 FY26 — Record AUM and Strong Organic Growth

WisdomTree delivered a strong Q2 FY26, achieving record AUM and robust organic growth driven by diversified inflows across geographies and asset classes. The company's operating model demonstrated significant leverage, translating top-line growth into expanding profitability and EPS growth. Strategic acquisitions like Atlantic House and Cerus are integrating well, while disciplined capital allocation includes share repurchases and debt reduction.

Highlights

5

  • Achieved record AUM of $162.9 billion at quarter end, marking the sixth consecutive quarter of record AUM.

  • Generated $3.1 billion of net inflows in Q2, including $2.1 billion in Europe and $1 billion in the U.S.

  • Year-to-date net inflows totaled $9 billion, representing an annualized organic growth rate of approximately 13%.

  • Adjusted operating margin expanded to 41.1% year-to-date, a 900 basis point increase compared to the prior year.

  • Adjusted net income for the quarter was $48.1 million or $0.31 per share, with EPS growth up 72% YoY and 15% QoQ.

Concerns

2

  • Interest income guidance updated to $8 million from $10 million, reflecting the allocation of a portion of interest-earning assets to share repurchases.

  • Digital assets experienced some outflows this quarter, contributing to general market noise.

Guidance & targets

CategoryTargetConfidence
Diluted shares outstanding
$152 million to $155 million
medium materiality
High
Interest income
$8 million
low materiality
High
New ETF launches from Atlantic House strategies
15 ETFs
medium materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
U.S.
Contributed to overall strong organic growth.
Net inflows: $1 billion
————
Europe
Contributed to overall strong organic growth, with record AUM achieved.
Net inflows: $2.1 billion
————

Product announcements

ProductTypeDetails
Tokenized ETFroadmap

Deals & partnerships

Atlantic House Acquisition of an asset manager specializing in outcome-oriented and derivatives-based investment solutions.

Closed on May 1, expands presence in Europe and enhances capabilities.

Cerus Acquisition of a private assets manager.

Integration continues, with Fund II recently launched and a strong pipeline of over 100 interested investors representing over $100 million of assets.

Risks & headwinds

Interest income reduction Full year FY26

Updated guidance to $8 million from $10 million

Mitigation:Allocation of interest-earning assets to share repurchases, viewed as a more efficient use of capital.

Digital assets market noise and outflows Q2 FY26

Digital assets seem to have a little bit of outflows this quarter

Mitigation:Management remains optimistic about the long-term growth trajectory of the digital asset market and their ability to grow share.

Moderate European trading activity Q2 FY26

Partly offset revenues from Atlantic House

Mitigation:Markets are not as volatile as they once were, impacting transaction fees in European products.

What to watch in Q3 FY26

Cerus Fund II Inflows

next quarter
Current Fund I closed, Fund II launched in June, $5 million flows in Q2
Target Increased inflows into Fund II, reflecting strong pipeline

Why it matters

Indicates successful transition and continued growth in the private assets business, a key strategic area.

On the flows, if you recall, we generated, I think it was $75 million in the first quarter. I suggest that's a nice quarter for us. It was about $5 million this quarter, but we just -- we closed the flagship fund to new investment. We just launched Fund II.

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Q&A highlights

How should we model the cadence of Cerus flows and incentive fees, given potential randomness?

Management explained that Cerus flows are in a transition period due to Fund I closing and Fund II launching, with a strong pipeline for Fund II. Performance fees are seasonal, with $6 million this quarter being a more normalized run rate, and suggested modeling based on AUM and a reasonable rate of return.

“On the flows, if you recall, we generated, I think it was $75 million in the first quarter. I suggest that's a nice quarter for us. It was about $5 million this quarter, but we just -- we closed the flagship fund to new investment. We just launched Fund II. So there's a transition period there with respect to flow cadence.”

asked by Christoph Kotowski · answered by Bryan Edmiston

2 min read 5 chapters

Detailed narrative

Strategic Diversification and Operating Leverage

Management highlighted the success of building a diversified business across geographies, client channels, and investment capabilities, leading to more durable growth. The operating model consistently generated incremental margins of over 50%, contributing to compound annual EPS growth of 30% over the past five years and over 50% over the past three years. This diversification is seen as key to performing across different market environments rather than relying on single products or themes.

Acquisition Integration and Pipeline

The Atlantic House acquisition, closed on May 1, added over $4 billion in AUM and complementary revenue streams, expanding WisdomTree's European presence and liquid alternatives platform. The integration of Cerus continues, with Fund II recently launched and a strong pipeline of over 100 interested investors representing over $100 million in assets. These acquisitions are part of a disciplined M&A strategy focused on accretive and strategically important opportunities.

Capital Allocation Strategy

WisdomTree demonstrated disciplined capital allocation by retiring approximately $127 million principal amount of convertible notes and repurchasing $29 million of common stock, representing 1.7 million shares at an average price of $17.40. Management views these repurchases as a compelling opportunity to create long-term shareholder value, especially given the current valuation, while balancing deleveraging and maintaining flexibility for strategic initiatives.

Tokenization Platform and Digital Assets

The company emphasized its advanced tokenization platform, which spans regulated infrastructure, tokenized investment products, and institutional distribution. Management believes this platform, including the WTGXX money market fund and a novel tokenized ETF filing, is significantly undervalued by the market, estimating a potential $1 billion in unrecognized value. They highlighted the industry's growing interest in tokenization, viewing it as a solution to modern market demands for real-time, 24/7 operations.

Farmland Assets and AI Data Centers

WisdomTree is actively exploring opportunities for its farmland portfolio, including potential AI data center development, driven by the high demand for compute and energy in the global economy. The team is looking at a number of opportunities, which are long-term in nature. Additionally, the company is working towards incorporating private farmland into ETFs, though an exact timeline for this initiative was not provided.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.