T. Rowe Price 10-Q 2025-03-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

For the quarterly period ended March 31, 2025

OR

For the transition period from to

Commission File Number: 000-32191

T. ROWE PRICE GROUP, INC.

(Exact name of registrant as specified in its charter)

1307 Point Street, Baltimore, Maryland 21231

(Address, including Zip Code, of principal executive offices)

(410) 345-2000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

The number of shares outstanding of the issuer’s common stock ($0.20 par value), as of the latest practicable date, April 30, 2025, is 220,316,088.

The exhibit index is at Item 6 on page 37.

PART I – FINANCIAL INFORMATION

UNAUDITED CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

The accompanying notes are an integral part of these statements.

Page 2

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except per-share amounts)

Showing the first 8K of 75K characters. Open the full section

OVERVIEW.

Our revenues and net income are derived primarily from investment advisory services provided to individual and institutional investors in a broad range of investment solutions across equity, fixed income, multi-asset, and alternatives capabilities. We also provide certain investment advisory clients with related administrative services, including distribution, mutual fund transfer agent, accounting, and shareholder services; participant recordkeeping and transfer agent services for defined contribution retirement plans; brokerage; trust services; and non-discretionary advisory services.

Investment advisory fees depend largely on the total value and composition of assets under our management. Accordingly, fluctuations in financial markets and in the composition of assets under management affect our revenues and results of operations.

We incur significant expenditures to develop new products and services and improve and expand our capabilities and distribution channels in order to attract new clients and additional investments from our existing clients. These efforts often involve costs that precede any future revenues we may recognize from an increase to our assets under management.

The investment management industry has been evolving and industry participants are facing challenging trends including passive investments taking market share from traditional active strategies; continued downward fee pressure; demand for new investment vehicles to meet client needs; and an ever-changing regulatory landscape. In this regard, we have ample liquidity and resources that allow us to take advantage of attractive growth opportunities. We are investing in key capabilities, including investment professionals, distribution professionals, technologies, and new product offerings in order to provide our clients with strong investment management expertise and service.

MARKET TRENDS.

Major stock indexes declined in the first quarter of 2025. Early optimism about the incoming Trump administration’s likely business-friendly policies faded amid concerns that President Trump’s tariffs on imports from major trading partners would lead to higher prices of goods sold in the U.S. and contribute to inflation pressures. Investors were also concerned that some weaker-than-expected economic data and reports from various retailers warning about slowing sales or decreased consumer spending would translate into slower economic growth, if not a recession. As the quarter ended, investors were bracing for President Trump to impose “reciprocal” tariffs in early April on countries that already have tariffs or other trade barriers on imports from the U.S.

Developed non-U.S. equity markets strongly outperformed U.S. shares in U.S. dollar terms. In Europe, equity markets were mostly positive in dollar terms, helped by expectations for eurozone spending on defense and infrastructure to increase, particularly in Germany. Developed Asian markets were mixed in dollar terms, with Japanese stocks adding only about 0.5%.

Emerging equity markets rose but trailed stocks in developed non-U.S. markets in U.S. dollar terms. In emerging Asia, markets were mostly negative in dollar terms, but Chinese shares were lifted in part by hopes that fiscal and monetary stimulus would lead to increased consumption and stronger economic growth. In Latin America and in the emerging Europe, Middle East, and Africa (EMEA) region, markets were mostly positive in dollar terms.

Returns of several major equity market indexes were as follows:

(1) Returns exclude dividends

Page 19

Global bond returns were mostly positive in the first quarter of 2025. In the U.S., Treasury bill yields were little changed as the Federal Reserve held short-term interest rates steady due to inflation remaining above its 2% long-term goal. Intermediate- and long-term U.S. Treasury yields declined, however, amid concerns about slowing economic growth. The 10-year U.S. Treasury note yield decreased from 4.58% to 4.23% in the first quarter.

In the U.S. investment-grade universe, sector performance was broadly positive. Mortgage-backed and Treasury securities performed best, but corporate bonds and non-agency commercial mortgage-backed securities also did well. Asset-backed securities lagged with milder gains. Tax-free municipal bonds trailed the broad taxable bond market, as intermediate-term yields fell less than comparable Treasury yields, and as long-term muni yields increased during the quarter. High yield corporate bonds produced modest gains but underperformed investment-grade bonds.

Bonds in developed non-U.S. markets produced positive returns in U.S. dollar terms; returns to U.S. investors were enhanced by stronger non-U.S. currencies versus the dollar. In Europe, longer-term bond yields increased in various countries, particularly in March, in response to the German government’s plans to ramp up infrastructure and defense spending. The European Central Bank reduced interest rates twice during the quarter, while the Bank of England reduced its benchmark interest rate once. In Japan, long-term government bond yields rose steadily for most of the quarter, to levels unseen in about 16 years, in anticipation of tighter monetary policy later this year. However, yields retraced some of their increase in late March amid concerns that economic growth will slow in response to U.S. tariffs on Japanese automobiles and other exports. Emerging markets bonds produced positive returns in U.S. dollar terms. Bonds denominated in local currencies generally outperformed dollar-denominated bonds in U.S. dollar terms, as most developing markets currencies appreciated versus the dollar.

Returns of several major bond market indexes were as follows:

Page 20

ASSETS UNDER MANAGEMENT.

Assets under management ended the first quarter of 2025 at $1,566.3 billion, a decrease of $40.3 billion from December 31, 2024. The decrease in assets under management during the first quarter of 2025 was driven by market depreciation of $31.7 billion and net cash outflows of $8.6 billion.

The following table details changes in our assets under management, by asset class, during the first quarter of 2025:

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | ---

Showing the first 8K of 93K characters. Open the full section

There has been no material change in our market risks from those provided in Item 7A of the Form 10-K Annual Report for 2024.

Our management, including our principal executive and principal financial officers, has evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2025. Based on that evaluation, our principal executive and principal financial officers have concluded that our disclosure controls and procedures as of March 31, 2025, are effective at the reasonable assurance level to ensure that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, including this Form 10-Q quarterly report, is recorded, processed, summarized, and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms, and to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our management, including our principal executive and principal financial officers, has evaluated any change in our internal control over financial reporting that occurred during the first quarter of 2025, and has concluded that there was no change during the first quarter of 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

For information about our legal proceedings, please see our Commitments and Contingencies footnote to our unaudited consolidated financial statements in Part 1 of this Form 10-Q.

There have been no material changes in the information provided in Item 1A of our Form 10-K Annual Report for 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(c) Repurchase activity during the first quarter of 2025 is as follows:

Shares repurchased by us in a quarter may include repurchases conducted pursuant to publicly announced board authorization, outstanding shares surrendered to us to pay the exercise price in connection with swap exercises of employee stock options, and shares withheld to cover the minimum tax withholding obligation associated with the vesting of restricted stock awards. Of the total number of shares purchased during the first quarter of 2025, 75,690 were related to shares surrendered in connection with employee stock option exercises and no shares were withheld to cover tax withholdings associated with the vesting of restricted stock awards.

Page 36

The following table details the changes in and status of the Board of Directors’ outstanding publicly announced board authorizations.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Not applicable.

The following exhibits required by Item 601 of Regulation S-K are filed herewith, except for Exhibit 32 that is furnished herewith.

Page 37

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on May 2, 2025.

T. Rowe Price Group, Inc.

By: /s/ Jennifer B. Dardis

Vice President, Chief Financial Officer and Treasurer

Page 38