T. Rowe Price Outflows Widen as AUM Falls

The Tip Desk · October 30, 2026 · 3 min read

Net client outflows reached $28.3 billion in the third quarter as assets under management slipped to $1.86 trillion.

T. Rowe Price Group (TROW), the global asset manager, reported net client outflows of $28.3 billion in the third quarter of 2026, a sharp widening from $6.5 billion in the second quarter, and ending assets under management of $1.86 trillion.

The outflows reversed the $183.7 billion market-led AUM gain of the prior quarter. Equity net cash flows were negative $25.6 billion. Fixed income, including money market, added $3.4 billion, multi-asset lost $7.6 billion, and alternatives recorded $1.5 billion of net cash flows after $1.2 billion of manager-driven distributions. Net market depreciation and income subtracted $2.4 billion.

Average AUM was $1.89 trillion, up 9.5% from a year earlier, slower than the 15.7% year-over-year rise in the second quarter. The investment advisory annualized effective fee rate excluding performance-based fees was 37.8 basis points, down from 38.1 basis points in the second quarter. The company said client flows and transfers drove a mix shift toward lower-fee products and asset classes, partially offset by equity market appreciation.

Net revenues were $2.00 billion, up 5.9% from a year earlier, a slower year-over-year pace than the 10.7% increase in the second quarter. Investment advisory fees were $1.80 billion, up 5.8% from a year earlier. Multi-asset advisory fees were $537.6 million, equity advisory fees $1.05 billion, fixed income including money market $118.7 million, and alternatives $92.7 million. Capital allocation-based income was $59.9 million, including a $63.1 million change in accrued carried interest, versus $11.9 million in the second quarter. The company said the year-over-year carried-interest increase was primarily driven by a recently launched late-stage venture fund. Administrative, distribution, servicing, and other fees were $141.3 million.

GAAP operating expenses were $1.24 billion, down 1.2% from a year earlier. Adjusted operating expenses were $1.20 billion, up 5.8% from a year earlier. Compensation, benefits, and related costs were $664.7 million. Total compensation and related costs were $703.5 million. Distribution and servicing costs were $111.0 million, which the company attributed to higher average AUM distributed through third-party intermediaries. Technology, occupancy, and facility costs were $205.1 million, including a reversal of about $10 million in accrued technology-related expenses. A $4.0 million restructuring charge related to the previously announced expense-management program. The firm employed 7,640 associates at September 30, 2026.

GAAP net operating income was $769.8 million, up 19.7% from a year earlier. Adjusted net operating income was $809.2 million. GAAP non-operating income was $17.6 million, versus $238.4 million a year earlier. Adjusted non-operating income was $18.0 million, down 64.1% from a year earlier, which the company said was primarily driven by losses on fixed-income holdings from rising interest rates that more than offset higher dividends.

GAAP diluted earnings were $2.79 a share, down 2.8% from a year earlier. Adjusted diluted earnings were $2.86 a share, up 1.8% from a year earlier. Net income attributable to T. Rowe Price Group, Inc. was $612.3 million on a GAAP basis.

Investors domiciled outside the United States accounted for 9.3% of AUM at September 30, 2026. Unfunded capital commitments that do not earn fees were $19.0 billion. Assets under administration were $346 billion, of which $186 billion were managed. The firm estimated its full-year 2026 effective income tax rate, on a U.S. GAAP and adjusted basis, would be in the range of 23.5% to 25.5%.