SEI Investments Company Q3 FY2025 earnings call

• Positive feedback received since Investor Day, reinforcing strategic confidence. - Quarterly results: EPS 1.3¢, excluding one-time items an all-time high; net sales events $31M. IMS had a record sales quarter. - Strong wins in investment managers, private banking, and institutional segments. - Confidence in Stratos partnership growing, on track for late 2025/early 2026 closing. - Early adoption of AI and tokenization internally, advancing pilots externally. - Capital allocation: $793M cash, $142M share repurchases in Q3, $50M anchor investment in LSV's hedge fund

Investment Managers Business: Record sales quarter with surging demand for outsourcing and client expansions. Approximately two-thirds of sales events tied to client expansion and two-thirds from alternative managers. Asset Management (Institutional Segment): Single largest mandate win (multibillion-dollar fixed income for a state government client) offset client departures in the segment. Private Banking: Secured a $13M win with a leading super-regional U.S. bank, saw 4% y/y revenue growth due to SWP platform, but had a contract loss. Advisers: Highest y/y revenue growth driven by market appreciation, integrated cash program, and earn-out true-up. Institutional: Revenue and operating profit flat q/q, impacted by lower equity exposure and market appreciation

• Excluding unusual items, EPS growth was robust sequentially and year over year. - Confidence in sales pipelines stronger than Q3 2024. - Near-term focus on use case validation for AI and tokenization initiatives. - Stratos closing expected in late 2025 or early 2026

• Private banking contract loss: One-time event, financial impact modest, not a trend. - Complex contracting process for large alternative asset manager opportunities. - Potential impact of market fluctuations and client strategic shifts on business performance

Q: Crispin Love asked about the composition of alternatives sales events and if they include large vs. small clients.

A: Ryan Hicke and Phil McCabe responded that it's a mix of large and small clients, with no single event exceeding 10% of the total.

Q: Jeff Schmidt inquired about the integrated cash program and private banking expenses.

A: Paul Klauder discussed the integrated cash program's yield and Paul Klauder/Sanjay Sharma addressed private banking expenses as related to backlog delivery.

Q: Alex Bond asked about IMS margins and international sales mix.

A: Sean Denham and Sanjay Sharma responded on IMS margin expectations and early stages of international strategy definition.

Q: Ryan Kenny asked about buybacks and private credit servicing.

A: Sean Denham talked about buyback pace tied to free cash flow and Phil McCabe addressed no significant impact from private credit servicing risks.

Q: Patrick O'Shaughnessy asked about private bank risks and investment in new businesses.

A: Sanjay Sharma and Sean Denham responded on no major risks in private banking and details on the investment in new businesses segment