NASHVILLE - AllianceBernstein L.P. (NYSE: NYSE:AB) reported a robust second quarter with earnings surpassing analyst expectations, despite a slight downturn in its stock following the announcement. The global investment firm announced an adjusted diluted net income of $0.71 per unit, outperforming the analyst estimate of $0.67. Revenue also exceeded forecasts, reaching $1.03 billion against the consensus of approximately $808 million.
The firm's performance reflects a 1.9% increase in net revenues from the same quarter last year, indicating steady growth. However, the stock experienced a modest decline of 2.3% post-earnings release.
AB's President and CEO, Seth P. Bernstein, attributed the successful quarter to the firm's performance amidst solid global equity market gains. "AB posted active net inflows of $1.3 billion, or 1% active organic growth," Bernstein noted, highlighting the company's resilience in the face of continued active equity outflows. He also pointed out the 4% organic growth in the retail channel, driven by a notable 17% growth in municipals and strong investment performance in both equities and fixed income.
The company's adjusted operating income saw a 15% year-over-year increase, and its adjusted operating margin expanded by 380 basis points to 30.8%. Additionally, the firm's assets under management (AUM) grew by 11.3% year-over-year (YoY) to $769.5 billion, bolstered by net inflows and positive investment performance.
Looking ahead, Bernstein expressed optimism, citing the S&P 500's continued highs and the potential for U.S. interest rates to decline later in the year. "While market concentration remains a risk, it also creates opportunity for undervalued sectors where valuations may improve," he concluded.
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