Abacus Global Management, Inc. Q2 FY2026 earnings call

Strategic Vision and Core Opportunity

• Management identifies a $124 trillion generational wealth transfer over 30 years as a transformative industry opportunity, centered on replacing generic average lifespan assumptions in financial planning with personalized data.
• Abacus positions LifeARC, its personalized lifespan modeling platform built on 20 years of medical, genetic, and biometric data, as the foundational infrastructure for the emerging longevity-linked finance market, analogous to AWS for Amazon.

Q2 2026 Operational Milestones

• Launched the ABX Longevity Growth and Income Fund (ABXGX), the first SEC-registered interval fund dedicated to the longevity asset class, opening access to individual investors and their advisers for the first time.
• Deployed ~$197.9 million of capital in Q2, up 62% year-over-year, bringing year-to-date capital deployed to $362 million. AI augmentation helped the firm review over 50,000 total policies year-to-date, with 9,314 qualified policies reviewed in Q2.
• Completed early operational integration with Manning & Napier following the May 2026 investment: established a live referral channel, identified untapped qualified policies in Manning & Napier's existing client base, and began rolling out LifeARC to the firm's adviser network.
• Began tokenizing in-force life insurance policies on-chain to improve transparency and tradability in the secondary life insurance market, as a financial infrastructure upgrade not a crypto-focused strategy.
• Increased tracked lives in the LifeARC platform from 4 million to over 6 million quarter-over-quarter, driven by adoption from pension funds and insurance companies.

Financial Performance Highlights

• Adjusted net income was $27.1 million ($0.28 per diluted share), beating the prior Q2 guidance range of $24 million to $26 million and $0.24 to $0.26 adjusted EPS.
• Adjusted EBITDA grew 27% year-over-year to $40 million, with a healthy 55% adjusted EBITDA margin.
• Adjusted return on equity reached 25%, 400 basis points higher year-over-year. Average realized gain on policy sales was 25%, comfortably above the long-term 20%+ target, with annualized portfolio turnover of 2x at the top of the 1.5x to 2x target range.
• The firm continues to repurchase its own shares based on management's view of visible future growth and current undervaluation.

1. Life Solutions: Grew 38.3% year-over-year to $65.4 million, contributing 89.6% of total Q2 2026 revenue. This segment owns the core origination platform for longevity-linked life insurance assets.
2. Asset Management: Total fee-paying AUM across the platform reached $3.2 billion, with total AUM at $3.5 billion. Longevity funds generated $6.5 million in management and servicing fees for Q2, with $256.1 million in Q2 inflows and $544.2 million in first half 2026 inflows, surpassing the $500 million half-year target. ETF strategies saw AUM declines from market conditions and outflows that pulled down overall asset management fee revenue this quarter. Technology service fees (from LifeARC and mortality verification products) reached nearly $1 million year-to-date, on track to hit $3 million for the full year 2026. Asset management and technology fees currently make up ~13% of total revenue, with a long-term target of 70% by 2030. Total company revenue grew 30% year-over-year to $73 million for Q2 2026.

• Third quarter 2026: Adjusted net income guidance of $26 million to $28 million, with adjusted EPS guidance of $0.26 to $0.28 per share. Management expects capital deployed in Q3 to come in between $150 million to $175 million, up from the prior target range of $130 million to $150 million.
• Full year 2026: Reiterates the prior guided range for adjusted net income of $100 million to $106 million, and adjusted EPS of $1 to $1.05 per share, with management noting it expects to deliver results at the top end of the full-year range.
• The firm is transitioning to guidance on a net (tax-affected) basis from its historical gross basis, and is currently providing both gross and net figures to ease the transition, with an approximate 25% tax rate for reconciliation.

• Forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from projections, with additional detail available in the firm's SEC filings.
• Broader alternative investment market stress focused on private credit liquidity and asset valuation is not expected to impact Abacus, as its assets are uncorrelated to interest rates, economic cycles, and corporate borrower performance, but general market volatility could indirectly impact investor appetite for new asset classes.
• Competitive entry into the longevity asset market is possible, but management notes the $14 trillion total addressable market for life insurance settlements remains vastly underpenetrated, with the industry capturing only ~1.5% of annual opportunity, limiting near-term competitive pressure on supply.

Q: The firm beat Q2 guidance and guided 3Q above consensus, but kept full-year guidance unchanged. Is this due to expected weakness in Q4, or just conservative framing?

A: Management confirmed the unchanged full-year guide is purely a conservative approach, not a sign of expected Q4 weakness. The firm expects to deliver full-year results at the top end of the guided range, based on current growth momentum from the first half.

Q: What is the early adoption outlook for the newly launched ABXGX interval fund, and are there new distribution partnerships in the pipeline?

A: Early interest is strong from both existing partners including Dynasty Financial Partners and Manning & Napier, as well as external large RIA firms and institutional pension clients. The product offers rare uncorrelated yield at a time of high investor demand for this profile, and the firm expects significant inflows to the fund starting in Q3 and accelerating into Q4.

Q: What is the commercial progress of LifeARC beyond internal use and Manning & Napier, and what is its revenue model?

A: LifeARC has seen significant outreach from large RIA firms across the U.S. following recent public launches and media coverage, and the firm is currently negotiating revenue-sharing agreements with prospective partners. The primary near-term focus remains on successful rollout to Manning & Napier, where it is already driving value for large multi-million dollar client accounts. LifeARC uses a recurring revenue sharing model, not per-user individual subscriptions.

Q: What is the path to hit the $5 billion year-end 2026 AUM target, and how much will come from the new interval fund?

A: Most of the growth to hit the $5 billion target will come from longevity-focused funds, with the new interval fund expected to be a significant contributor. Growth in asset management AUM is additive to, not a replacement for, the continuing growth of the core Life Solutions segment. Hitting the AUM target is also expected to drive multiple expansion for the stock, as it builds out the firm's recurring revenue profile toward peer asset management valuations.