Q1 2026 Federated Hermes Inc Earnings Call Transcript
Key Points
- Federated Hermes Inc (FHI) ended Q1 with record assets under management of $907 billion, driven by gains in equity and money market strategies.
- Equity assets reached a record high of $101 billion, with gross equity sales hitting a record $9.1 billion in Q1.
- The MDT US Equity UCITS fund, launched in June 2025, saw strong demand from clients outside the US, growing to about $800 million in assets.
- The acquisition of an 80% interest in FCP Fund Manager LP added $3.2 billion of managed assets, enhancing FHI's real estate capabilities.
- FHI is actively developing digital initiatives to enhance distribution efficiency and operational automation, including the upcoming launch of a Money Market Management Digital Treasury Fund.
- Fixed income assets decreased by $329 million from year-end, with Q1 net redemptions of $422 million.
- The alternative private markets category saw a slight decrease in assets in Q1 due to the impact of FX rates.
- Equity strategies are expected to have net redemptions of about $1.4 billion, primarily due to a client internalizing asset management.
- Total revenue for Q1 decreased by $3.9 million or 1% compared to the prior quarter.
- Q1 operating expenses increased by $5.4 million or 2% from the prior quarter, driven by higher compensation and related expenses.
Greetings. Welcome to the Federated Hermes Q1 analyst call and webcast. (Operator Instructions)
Please note, this conference is being recorded.
I will now turn the conference over to your host, Ray Hanley, President of Federated Investors Management Company. You may begin.
Thank you, and welcome to all. Thank you for joining us. Leading today's call will be Chris Donahue, CEO and President of Federated Hermes; and Tom Donahue, Chief Financial Officer. Joining us for the Q&A are Saker Nusseibeh, CEO of Federated Hermes Limited; and Debbie Cunningham, our Chief Investment Officer for Money Markets.
During today's call, we may make forward-looking statements, and we want to note that Federated Hermes' actual results may be materially different than the results implied by such statements. Please review the risk disclosures in our SEC filings. No assurance can be given as to future results, and Federated Hermes assumes no duty to update any of
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