Abacus Global Management, Inc. Q2 FY2026 earnings call

Strategic Vision & Market Opportunity

• Management frames Abacus as a data and technology infrastructure provider for lifespan-linked finance, positioned to capture share of the $124 trillion multi-decade generational wealth transfer, where most current wealth planning relies on imprecise longevity estimates.
• The firm compares its model to Amazon: the core origination platform is its primary commerce engine, while LifeArk (the firm's personalized longevity modeling platform) acts as its AWS-like scalable third-party service arm.

Q2 2026 Operational Milestones

• Received SEC approval and launched the ABX Longevity Growth and Income Fund (ABXGX), the first registered interval fund dedicated to the longevity asset class, opening access to individual investors and their advisors for the first time.
• Began implementing asset tokenization for life insurance policies, creating an immutable on-chain record of ownership, liens, and cash flow rights to improve transparency and tradability in the historically opaque secondary life insurance market; tokenization of enforced policies is already underway.
• Capital deployed in Q2 reached ~$197.9 million, up 62% year-over-year, bringing year-to-date capital deployed to $362 million. Total policies reviewed year-to-date surpassed 50,000, driven by AI improvements to lead generation and underwriting review time.
• Longevity funds raised $544.2 million in the first half of 2026, exceeding the firm's $500 million H1 target, compared to ~$604 million in full year 2025.
• Annualized portfolio turnover on the balance sheet reached 2x, at the top of the firm's 1.5x-2x long-term target range, with an average realized gain on policy sales of 25% (comfortably above the 20% long-term target) and an average holding period of 230 days for sold policies.

Partnership & Integration Progress

• Early operational integration with Manning and Napier (investment closed May 2026) is proceeding as planned: a live referral channel is active, with Abacus unqualified leads converted to Manning and Napier wealth management clients, and Manning and Napier's existing book of business mined for untapped qualified life settlement policies. LifeArk rollout to the Manning and Napier advisor network is underway.
• LifeArk, the firm's longevity data platform, grew from 4 million to over 6 million tracked lives quarter-over-quarter, with significant outreach from large RIA firms and even government agencies related to the platform's mortality verification capabilities.

Business Model Flywheel

• The firm's integrated model relies on a shared origination/underwriting infrastructure: the balance sheet originates and validates policy assets (with realized cash returns proving valuation, in contrast to current market debate over marked private assets), while third-party funds draw on this infrastructure to let outside investors access the asset class, growing recurring fee revenue without proportional balance sheet growth. Management targets fee-weighted revenue will reach 70% of total revenue by 2030, up from ~13% currently.

Total company revenue grew 30% year-over-year to $73 million for Q2 2026. 1. Life Solutions: Grew 38.3% year-over-year to $65.4 million, contributing approximately 89.6% of total Q2 revenue. 2. Asset Management: Revenue declined primarily due to lower AUM and outflows in ETF strategies, offset by robust inflows into longevity funds; Q2 2026 longevity fund inflows totaled $256.1 million, with Q2 management and servicing fees for longevity funds reaching $6.5 million. Total fee-paying AUM across the platform is $3.2 billion, and total AUM is $3.5 billion. Technology service fees reached approximately $1 million year-to-date, representing a small early portion of total revenue. Adjusted net income for the company was $27.1 million (28 cents per diluted share), and adjusted EBITDA was $40 million, a 27% year-over-year increase with a 55% adjusted EBITDA margin. Adjusted return on equity was 25%, 400 basis points higher year-over-year.

• Q3 2026: Management guides adjusted net income of $26 to $28 million, and adjusted EPS of $0.26 to $0.28 per share, above consensus analyst expectations. Capital deployment is now expected to reach $150 to $175 million in Q3, up from the prior target range of $130 to $150 million.
• Full year 2026: Management maintains the prior updated guidance range of $100 to $106 million adjusted net income, and $1.00 to $1.05 adjusted EPS (the original call text notes a typo of $1 to $1.5, clarified in context as $1 to $1.05), with management noting it expects full year results will land at the top end of this range, and the maintained full year range reflects conservative guidance rather than expected weakness in Q4.
• Guidance presentation is updated to include both pre-tax gross adjusted figures and after-tax net figures (with a 25% approximate tax rate for reconciling the two) to reduce investor confusion, with a planned future transition to guiding solely on a net basis.

• Current market stress in private credit markets, driven by redemptions, liquidity mismatches, and debate over asset valuation, is not expected to impact Abacus, as its longevity-linked assets have returns tied to mortality rather than interest rates, economic cycles, or corporate borrower performance, creating uncorrelated returns that are attractive to diversified investors. The firm's interval fund structure is also purpose-built to match investor liquidity with underlying illiquid asset terms, avoiding the liquidity mismatch impacting other alternative investment vehicles.
• Outflows and AUM declines in the firm's legacy ETF business pressured total asset management revenue in Q2, though management notes this drag is expected to reverse as the portfolio shifts to higher-fee longevity-focused products.
• Higher-than-average quarterly tax rate in Q2 (and Q1) is expected to normalize for the full year, landing below 30%.

Q: The company beat Q2 guidance and guided Q3 above consensus, but kept full year guidance unchanged. Is this due to expected Q4 weakness, or just conservatism?

A: The unchanged full year guidance reflects intentional conservatism. Management expects full year results will land at the top end of the current range, and the Q3 guidance update reflects near-term momentum, with similar strong performance expected to continue into Q4.

Q: Can you share updates on LifeArk adoption beyond internal use and Manning and Napier, and what is its revenue model?

A: LifeArk has already received significant outreach from large RIA firms across the U.S. and has grown tracked lives from 4 million to over 6 million quarter-over-quarter, with interest also from government entities for its mortality verification capabilities. The primary near-term focus is completing rollout to Manning and Napier. The revenue model will be a recurring revenue-sharing model rather than per-user subscription, and the firm is currently in negotiations with potential external partners, with more updates to come as deals finalize.

Q: What is the expected long-term range for realized gains on policy sales, and how is competition for policies impacting gains and supply?

A: Historically, realized gains have consistently tracked a 20% to 25% range, after an outlier 37% gain quarter last year, and management expects this range to hold near-term. Future gains could expand slightly if the firm completes planned securitizations that lower its cost of capital. The addressable market for life settlements is extremely large ($14 trillion of total in-force life insurance, with ~$250 billion annually addressable, and the industry currently penetrates less than 1.5% of this market), so even with increased competition, there is more than enough supply to meet current demand, and Abacus's scale as the only public firm in the space positions it well to capture this opportunity.

Q: How will the firm reach its target of $5 billion+ AUM by end of 2026, and is most of this growth driven by longevity funds?

A: AUM growth will come primarily from longevity funds, with the newly launched interval fund expected to be a major contributor. The firm is tracking on target to hit the full year AUM goal alongside hitting earnings guidance. The Life solutions business continues to grow steadily, while the asset management business is additive incremental growth, building a recurring revenue profile that management believes deserves a higher market multiple than the firm's current single-digit to low double-digit valuation.