Advisor and institutional businesses had flat sequential revenue growth as market appreciation in May and June offset April declines.
AUM and AUA grew sequentially and year-over-year, with AUM net flows roughly flat year-to-date, a significant improvement from prior year outflows.
Consolidated operating margins improved slightly year-over-year but declined sequentially due to onetime expenses and corporate overhead.
Excluding onetime items, adjusted EPS was $1.20, an increase from both the prior year and prior quarter.
Investment Managers revenue grew 8% year-over-year with double-digit growth in alternatives offsetting a 1% decline in traditional revenue due to mark-to-market weakness.
Margins declined sequentially due to investments in talent and technology, with Investment Managers margins impacted by hiring ahead of expected new business.
Private Banking revenue increased year-over-year and sequentially, supported by larger clients going live.
SEI reported EPS of $1.78 including significant onetime items totaling a $0.60 EPS impact, partially offset by $0.02 of expenses related to foreign currency losses and legal fees tied to the Stratos investment.
SEI returned significant capital to shareholders with buybacks exceeding $700 million on a trailing 12-month basis.
Adjusted EBITDA for Q2 was $1.5 million, slightly higher than $1.4 million in Q2 2024, despite near-term profitability pressures.
Net loss for Q2 was $11 million or $0.28 per share, compared to a net loss of $5.5 million or $0.14 per share in the prior year, impacted by a $7.3 million tax expense due to a change in tax methodology.
Operating expenses increased to $181 million in Q2 from $166 million last year, driven by higher cost of services and one-time reorganization expenses.
The company remains well-capitalized with no debt and $333 million in cash and equivalents, returning $190 million to shareholders over the past three years.
Total revenue for Q2 2025 was $172 million, up 8.8% year-over-year, driven by 4% growth in brokerage revenue and a 44% increase in financing revenue.
Year-to-date revenue was $317 million, up 10.4% from $287 million last year, with brokerage commissions accounting for 84% of revenue.
Impact of Securities Portfolio Repositioning on Earnings and Margins
Executed an additional securities repositioning at the end of Q2, resulting in a $8.5 million net loss but expected to be accretive to future earnings.
Repositioning is projected to add 13 basis points to net interest margin and $0.20 of annual EPS, primarily benefiting Q3.
Management emphasized the strategic importance of this move for margin expansion and earnings growth.
Dafinchi