Release Date: May 02, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- WisdomTree Inc (WT, Financial) achieved record assets under management (AUM) of $115.8 billion, marking a 5.5% increase from the previous quarter.
- The company reported net inflows of $3 billion, reflecting an annualized organic growth rate of 11%, with significant contributions from both US and European markets.
- The launch of the WisdomTree European Defence Fund was highly successful, attracting $770 million in Q1 and over $700 million in April, making it one of the most successful launches in the company's history.
- WisdomTree's model portfolios business showed strong performance with assets under advisement (AUA) reaching $4 billion, reflecting a nearly 20% annualized organic growth rate.
- The company is expanding its digital assets presence, with WisdomTree Prime and WisdomTree Connect gaining traction, and plans to enable on-chain transfers for users in the coming months.
Negative Points
- Revenue for the quarter was $108 million, slightly down from the previous quarter due to fewer trading days and lower average fee capture.
- Adjusted net income was impacted by seasonal compensation expenses, including payroll taxes and year-end bonuses.
- The market environment remains volatile, which could pose challenges for maintaining growth momentum.
- The regulatory environment for digital assets in the US remains restrictive, limiting the company's ability to expand its crypto offerings domestically.
- Despite the success of new fund launches, the company faces ongoing competition and pressure to innovate in a rapidly evolving market.
Q & A Highlights
Q: Can you provide more details about the on and off-ramp opportunities for WisdomTree Prime and the expected rollout timeline?
A: Bryan Edmiston, CFO, explained that the on and off-ramps are crucial for interacting with stablecoins and other crypto assets. They plan to roll out these features over the summer, with a more extensive rollout in September, which will allow them to target the crypto-native community more effectively.
Q: Are there any anticipated partner announcements related to WisdomTree Prime in September?
A: Bryan Edmiston stated that while they are in discussions with potential partners and have seen early success with $100 million in flows through partner relationships, there are no specific forecasts or announcements planned for partnerships at this time.
Q: How is AI being deployed at WisdomTree, and what impacts are expected?
A: R. Jarrett Lilien, President and COO, mentioned that AI is being used across the company to enhance customer experience, growth, efficiency, and decision-making. They are seeing results in various departments, including sales, research, marketing, tech, and legal, aiming to improve performance and speed.
Q: Can you update us on the development of your crypto funds and digital assets over the next year or two?
A: Jeremy Schwartz, Global Chief Investment Officer, highlighted that in Europe, they have launched a broad 20-coin basket product with significant early capital. In the US, they are focusing on Bitcoin and exploring more offerings as the regulatory environment evolves. They are also excited about the synergy between crypto ETPs and tokenization.
Q: How does the pipeline look for new ETFs?
A: Jonathan Steinberg, CEO, mentioned that while they can't discuss specifics, they are continuously expanding their product offerings, focusing on themes like the European Defence Fund. They are excited about their diversified product range and its resilience in the current market.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
