Artisan Partners Asset Management (NYSE:APAM) reported record quarter-end assets under management in the second quarter of 2026, supported by market appreciation and investment performance, while client outflows remained concentrated in its U.S. value and growth investment teams.
Assets under management ended the quarter at $183 billion, up 6% from the first quarter and 5% from a year earlier. Average AUM was $182 billion, flat sequentially and 9% higher year over year. Revenue rose 2% from the first quarter to $308 million and increased 9% from the prior-year period, primarily reflecting higher average AUM.
Artisan said equity performance improved over shorter periods, with 81% of AUM outperforming over one year and 84% outperforming over three years, both gross of fees. Gottlieb said global equity markets rebounded sharply during the quarter before volatility returned in June.
Outflows Concentrated in U.S. Value and Growth
Net client outflows totaled $10.5 billion in the second quarter, including $6.4 billion from the U.S. value team and $2.8 billion from the growth team. The two franchises accounted for approximately 90% of total quarterly outflows.
The company previously announced it would wind down its U.S. value team after losing two large U.S. sub-advisory mandates. Gottlieb said the wind-down is expected to be largely completed by the end of the third quarter, with resources being redeployed to areas that management views as having greater long-term opportunity.
Chief Financial Officer Charles Daley said the U.S. value wind-down is expected to reduce third-quarter earnings by approximately $0.03 per share compared with the second quarter. The U.S. value business was slightly accretive during the second quarter because the wind-down began midway through the period, while the third quarter is expected to reflect a minimal loss before results normalize, he said.
Daley added that fixed expenses should decline in the third quarter as seasonal costs continue to roll off and employee-separation and other wind-down expenses fall. The company maintained its full-year fixed-expense outlook of mid-single-digit growth, excluding Grandview Property Partners and previously guided long-term incentive compensation expense.
Addressing potential redemption risk in the growth franchise, Gottlieb said the company does not see a “brewing or looming cliff” of assets at risk. He said the business is diversified across strategies and within strategies, although global portions of the growth team have faced the most difficult intersection of performance challenges and AUM pressure.
He highlighted improved results in mid-cap growth and noted changes within the global growth business, including the addition of Jason White as a key decision-maker in mid-cap growth and Angela Wu to assist Jim Hamel in global opportunities. The firm has also added analysts and associate portfolio managers to the team.
Credit and Alternatives Post Positive Organic Growth
Credit strategies produced nearly $700 million in net inflows, marking the company’s 16th consecutive quarter of positive organic growth. The annualized organic growth rate in credit was 15%, according to management. Alternative strategies gathered about $300 million in net inflows, representing a 25% annualized organic growth rate and the fifth quarter of positive organic growth in the past six quarters.
Within equities, Artisan secured a $1 billion institutional mandate for its Global Discovery strategy. Gottlieb also said the sustainable emerging markets strategy continued to attract new capital, with a robust pipeline of client activity in emerging markets.
Management said clients have shown demand for differentiated emerging-markets capabilities, while the tone around broader global equity risk assets has become somewhat more cautious. Gottlieb said clients have been rebalancing after strong market returns and are increasingly considering credit, income-oriented strategies and alternatives.
On credit performance, Gottlieb said recent relative underperformance has not been dramatic and followed several years of strong results. He attributed some short-term pressure to the team’s limited energy exposure, as energy-related companies benefited from market developments that the investment team did not seek to anticipate. He also disclosed an approximately $150 million institutional mandate for the firm’s floating-rate credit strategy.
Grandview Fundraising and Platform Expansion
Artisan is building out Grandview Property Partners following its acquisition earlier this year. Gottlieb said Grandview’s prior Fund III had approximately $150 million of committed capital and that the firm stopped accepting additional commitments as it prepared to partner with Artisan and focus on Fund IV.
Grandview expects to launch its flagship Fund IV later this summer or in early fall, with management in advanced discussions with an anchor institutional investor and engaging prior limited partners. Gottlieb said the company expects Fund IV to be multiples of the size of Fund III, though it did not provide a target figure.
The company recently hired a dedicated institutional business leader to support Grandview fundraising and expand investor relationships. Gottlieb said Grandview has identified investment opportunities across its planned themes as well as potential opportunistic investments, including in more distressed real estate sectors.
More broadly, Artisan is considering expansion in credit, alternatives and private markets, including hedged equity, equity secondaries, infrastructure and real assets. Management also said it is pursuing additional investment vehicles, including collective investment trusts, private funds, UCITS products and potentially exchange-traded funds. Artisan has received exemptive relief related to ETFs but has not announced what it may launch or when.
Profitability, Capital and Dividend
Adjusted operating income increased 8% sequentially to $101.4 million, while adjusted operating margin expanded 180 basis points to 32.9%. Adjusted earnings per share were $0.94, up 13% from the second quarter of 2025. For the first half, adjusted operating income rose 10% to $195.6 million and adjusted EPS increased 9% to $1.81.
The company ended the quarter with $335 million of cash and redeemed approximately $20 million of seed capital, leaving about $100 million of seed investments on its balance sheet. Daley said Artisan retained more than $180 million of excess capital after funding its quarterly dividend.
The board declared a quarterly dividend of $0.80 per share, up 4% from the prior quarter and 10% from a year earlier. Management said excess capital could support organic growth initiatives, potential acquisitions or further returns to shareholders through the company’s year-end special dividend.
About Artisan Partners Asset Management (NYSE:APAM)
Artisan Partners Asset Management Inc is a global investment management firm that specializes in active, fundamental research-driven strategies across a range of equity, fixed income and alternative asset classes. Founded in 1994 by Andrew Ziegler, the company has built a reputation for its team-based approach to portfolio construction, emphasizing deep sector expertise and independent analysis. Its product lineup includes U.S. and international equity strategies, global emerging markets, as well as credit and multisector fixed income offerings.
Artisan Partners serves a diverse client base that spans institutional investors, intermediaries and high-net-worth individuals located in North America, Europe and Asia.
