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WESTWOOD HOLDINGS GROUP INC (WHG)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $23.1M, essentially flat QoQ (-0.6%) and up 1.9% YoY; diluted EPS rose to $0.12 from $0.05 in Q1 and from a loss of $0.27 in Q2 2024 on lower OpEx and absence of prior-year contingent consideration losses .
  • Non-GAAP Economic Earnings improved to $2.8M ($0.32/share) vs. $2.5M ($0.29/share) in Q1 and an Economic Loss of $0.5M last year; management declared a $0.15 quarterly dividend payable Oct 1, 2025 .
  • AUM/AUA reached $18.3B (AUM $17.3B, AUA $0.9B) with AUM net outflows of $200M offset by $600M market appreciation; MDST ETF surpassed $100M AUM and reached ~$$124M by July 30, 2025, underpinning product momentum .
  • Strategic catalysts: Russell 2000 index inclusion, strongest intermediary sales quarter since 2022, and WEBs launch of 11 Defined Volatility sector ETFs; these broaden access, distribution and product breadth .

What Went Well and What Went Wrong

What Went Well

  • EPS inflected to $0.12 as compensation timing reduced OpEx; Economic EPS rose to $0.32, demonstrating improving profitability despite flat revenues .
  • Product momentum: MDST exceeded $100M AUM with a 10.2% annualized distribution rate; WEBs launched 11 sector ETFs, expanding volatility-managed offerings and distribution reach .
  • Index inclusion: “We delivered exceptional progress” with AUM up to $18.3B and addition to the Russell 2000—“enhancing our institutional accessibility” (CEO) .

What Went Wrong

  • Net flows mixed: Institutional net outflows of $60M and AUM net outflows of $200M, partially due to sub-advisory rebalancing; trust fees fell QoQ ($5.07M vs. $5.43M) .
  • Revenue remained flat QoQ ($23.1M vs. $23.3M), limiting operating leverage; Other income was minimal vs. prior-year’s elevated other income .
  • No formal quantitative guidance provided; YoY tax expense increased, partially offsetting benefits from prior-year contingent consideration effects .

Financial Results

Core P&L vs prior periods

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Millions)$22.688 $23.252 $23.120
Diluted EPS ($)$(0.27) $0.05 $0.12
Net Income ($USD Millions, attributable)$(2.243) $0.478 $1.019
EBIT / Net Operating Income ($USD Millions)$(4.178) $(0.068) $0.868
EBIT Margin %2.77%*-0.29%*3.75%*
Net Income Margin %-9.89%*2.06%*4.41%*

Values with asterisks retrieved from S&P Global.

Revenue composition

Revenue Component ($USD Millions)Q2 2024Q1 2025Q2 2025
Advisory fees – Asset-based$17.139 $17.731 $17.955
Trust fees$5.227 $5.429 $5.069
Other, net$0.322 $0.092 $0.096
Total Revenues$22.688 $23.252 $23.120

KPIs and Balance Sheet Highlights

KPIQ4 2024Q1 2025Q2 2025
AUM ($B)$16.6 $17.0 $17.3
AUA ($B)$1.0 $1.0 $0.9
AUM Net Flows ($B)$(0.8) FY 2024 +$0.6 (quarter) $(0.2) (quarter)
Cash & Liquid Investments ($M)$44.6 $26.9 $33.1
Dividend per share ($)$0.15 (payable Apr 1, 2025) $0.15 (payable Jul 1, 2025) $0.15 (payable Oct 1, 2025)
MDST ETF AUM ($M)$73 (YE 2024) >$100 threshold discussed ~$124 (as of Jul 30, 2025)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per shareQ3 payout timing$0.15 payable Jul 1, 2025 $0.15 payable Oct 1, 2025 Maintained
Institutional DC plan fundingQ4 2025Not previously scheduledFunding anticipated in Q4 2025 New timing indication
Revenue, margins, OpEx2H 2025NoneNone providedNo formal guidance

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
ETF platform expansionWEBs partnership launch; MDST $73M AUM (YE 2024); BFRE launch; MDST 10.5% ann. distribution (Q1) MDST surpassed $100M AUM; WEBs launched 11 Defined Volatility sector ETFs Accelerating product breadth and distribution
Institutional pipeline/wins8 mandates funded in 2024; Q1 gross sales $960.5M, net inflows $758.8M Q2 gross sales $251M, net outflows $60M; DC plan funding expected Q4 Mixed quarterly flows; pipeline intact
AUM/AUA trajectory$17.6B at Q4 2024 $18.0B at Q1 2025 $18.3B at Q2 2025
Wealth management evolutionTech/CRM/client portal upgrades (Q1) Transition to multifamily office model in Texas UHNW segment Strategic repositioning
Energy & real assetsStrength in energy strategies (Q4); MDST/WEEI traction (Q1) MDST 10.2% ann. distribution; energy secondaries raised $82M YTD Continued momentum
Macro volatility, tariffsGeneral market commentary (Q4) Tariff shocks and 90-day pause; index highs by quarter-end Heightened macro focus
Index inclusion—Russell 2000 inclusion Broader investor access
TXSE investmentForm 1 application highlighted (Q1) Reiterated enthusiasm in remarks Ongoing initiative

Management Commentary

  • CEO: “We delivered exceptional progress… addition to the Russell 2000 index… MDST ETF surpassed the $100 million threshold… strongest intermediary sales quarter since 2022… continued momentum across our diversified platform.”
  • CFO: “Total revenues of $23.1M… income of $1.0M or $0.12 per share… lower operating expenses primarily related to timing of compensation and benefits… cash and liquid investments totaling $33.1M… dividend of $0.15 per share.”

Q&A Highlights

  • No analyst Q&A on the Q2 2025 call; prepared remarks emphasized expense timing, pipeline visibility, ETF/WEBs momentum, and dividend continuity .
  • Prior quarter context: Q1 Q&A focused on leveraging a nearly $1B SmallCap Value sub-advisory win and platform approvals for MDST to drive distribution scale .

Estimates Context

  • S&P Global consensus for Q2 2025 EPS and revenue was unavailable; the data feed returned actual revenue only and no consensus means or estimate counts. As a result, estimate comparison is not possible at this time (coverage appears limited for WHG) [Values retrieved from S&P Global].
  • Actuals: Revenue $23.1M and diluted EPS $0.12 .
  • Implication: In absence of consensus, investors should anchor on sequential improvement in EPS and Economic Earnings, and monitor flows and ETF traction as near-term drivers .

Actual vs Consensus (Q2 2025)

MetricActualConsensus MeanSurprise
Revenue ($USD Millions)$23.120 N/A*N/A
Primary EPS ($)$0.12 N/A*N/A

Values with asterisks retrieved from S&P Global.

Key Takeaways for Investors

  • Profitability inflected: EPS rose to $0.12 and Economic EPS to $0.32 on lower OpEx timing; watch sustainability of margin improvement given flat revenue QoQ .
  • Distribution and product scale are catalysts: Russell 2000 inclusion, MDST >$100M AUM, and WEBs sector ETFs should broaden reach and improve sales velocity in intermediary channels .
  • Flows mixed in Q2: Institutional net outflows ($60M) and AUM net outflows ($200M) were offset by market appreciation; pipeline and expected Q4 DC funding provide visibility into 2H activity .
  • Balance sheet remains conservative: $33.1M cash and liquid investments; no debt; $0.15 dividend maintained—supportive for yield-oriented holders .
  • Near-term trading lens: Absence of consensus coverage may limit “beat/miss” volatility; incremental catalysts likely tied to ETF approvals/asset growth, wealth model transition progress, and institutional mandate funding .
  • Medium-term thesis: Continued diversification across value, multi-asset, energy, and volatility-managed ETFs positions WHG to benefit if market leadership broadens beyond mega-cap tech; execution on intermediary distribution and MIS/infrastructure strategies is key .
  • Monitor expense cadence and trust fee trends: Expense timing aided Q2 earnings; trust fees dipped QoQ—track operational efficiencies and fee mix in 2H .