Principal Site Reliability Engineer - Infrastructure Observability

T. Rowe Price's ETF push confronts $28.3 billion in outflows. T. Rowe Price's earnings improved, but heavy client withdrawals keep pressure on its ETF expansion, planned F/m acquisition and investment performance. T. Rowe Price reported $28.3 billion in third-quarter net outflows despite adjusted net revenue rising 5.3% from a year earlier to $2 billion. T. Rowe Price Group (TROW) increased third-quarter earnings and revenue, but $28.3 billion in net client withdrawals underscored the challenge facing its expansion into exchange-traded funds and other investment products. The asset manager ended the quarter with $1.86 trillion under management. Higher average assets supported its financial results even as clients continued pulling money from equity strategies and mutual funds. Management expects withdrawals to moderate in the fourth quarter, though remain elevated, according to its earnings call carried by Nasdaq Markets. Shares were up 1.61% as of 16:25:18 GMT on October 29. The improved earnings and continued withdrawals present different tests: the company is generating more revenue from its asset base, but has yet to reverse its overall loss of client money. Higher assets lift earnings as fee rates soften. Adjusted diluted earnings were $2.86 a share, compared with $2.57 in the preceding quarter and $2.81 a year earlier. Higher average assets drove both increases, while a lower share count also helped the year-over-year comparison. Adjusted net revenue reached $2 billion, up 5.3% from a year earlier and 5.1% from the previous quarter. Investment advisory revenue totaled $1.8 billion, with higher average assets partly offset by a lower effective fee rate. 8 billion, with higher average assets partly offset by a lower effective fee rate. That annualized fee rate, excluding performance-based fees, declined to 37.8 basis points from 38.1 basis points in the second quarter. Management attributed about two-thirds of the decline to continued growth in its Target Date Blend and Hybrid offerings. The shift shows why asset growth alone does not determine advisory revenue: the mix of products also matters. Adjusted carried interest, a performance-linked source of income, rose to $63.1 million from $15.2 million in the prior quarter. Management also said full-year adjusted operating expense growth was tracking toward the middle of its 4% to 7% guidance range. ETF inflows offer a foothold against withdrawals. The strongest growth channels remain smaller than the overall withdrawal problem. ETFs attracted $3.8 billion in net inflows during the quarter, taking year-to-date inflows to $11 billion. Fixed-income strategies brought in $3.4 billion, while alternatives also recorded positive net flows. By contrast, multi-asset strategies lost $7.6 billion, primarily in Target Date products. That included a previously disclosed large September redemption by a defined-contribution retirement plan from the active Target Date series. The planned acquisition of F/m Investments would broaden the businesses attracting demand. Announced in August and expected to close early in 2027, the deal would add a fixed-income and ETF specialist with approximately $20 billion under management, including institutional and separately managed accounts. Management's discussion in the Motley Fool transcript emphasized expanding access through ETFs, separately managed accounts and model portfolios. These formats address demand for tax efficiency and customization, but their inflows have not yet overcome withdrawals elsewhere. Performance improves, but the recovery is uneven. Investment results offered some support for the turnaround effort. All three large-cap growth funds beat their peer groups during the quarter, reversing the prior quarter's underperformance. Across equity fund assets, 48% outperformed peers over one year and 58% over three years. The five-year figure remained weaker at 37%. Fixed-income performance was stronger, with 85% of assets ahead of peers over one year. Those results leave T. Rowe Price with improving performance in parts of its lineup and growing demand for newer formats, but continued pressure on established products. Management's fourth-quarter outlook points to easing withdrawals - not yet a return to net inflows. Key facts. * Quarter-end assets: $1.86 trillion under management * Net client flows: $28.3 billion in third-quarter net outflows * Adjusted earnings: $2.86 per diluted share in Q3 2026 * TROW shares: Up 1.61% as of October 29, 2026, at 16:25:18 GMT

T. Rowe Price reports $2 billion in Q3 revenue, $28.3 billion in outflows. October 29, 2026 Baltimore-based T. Rowe Price Group (NASDAQ: TROW) reported third-quarter 2026 net revenue of $2 billion, up 5.9% from a year earlier, while net client outflows reached $28.3 billion and assets under management declined to $1.86 trillion. The global asset management firm reported net income attributable to the company of $612.3 million, down 5.2% from $646.1 million in the third quarter of 2025. Diluted earnings per share fell to $2.79 from $2.87 a year earlier. Adjusted diluted earnings per share increased 1.8% to $2.86 from $2.81, while adjusted net income was $629.5 million, compared with $631.7 million in the prior-year period. Net operating income rose 19.7% to $769.8 million, supported by higher revenue and lower reported operating expenses. Adjusted operating income increased 4.5% to $809.2 million. Assets under management totaled $1.86 trillion at September 30, down $30.7 billion from $1.89 trillion at the end of June. The quarterly decline reflected $28.3 billion in net client outflows and $2.4 billion in net market depreciation and income effects. Equity strategies accounted for $25.6 billion in net outflows, while multi-asset products experienced $7.6 billion in withdrawals. Fixed-income strategies recorded $3.4 billion in net inflows, and alternatives generated $1.5 billion in net inflows after manager-driven distributions. Despite the quarterly decline, assets under management increased 5.4% from $1.77 trillion a year earlier. Average assets under management rose 9.5% year over year to $1.89 trillion. Investment advisory fees increased 5.8% to $1.80 billion, including $1.05 billion from equity strategies and $537.6 million from multi-asset products. Fixed-income advisory fees rose 7.8% to $118.7 million, while alternatives advisory fees increased 9.4% to $92.7 million. The firm's annualized effective advisory fee rate, excluding performance-based fees, declined to 37.8 basis points from 39.1 basis points a year earlier. T. Rowe Price attributed the decrease primarily to client flows and asset transfers that shifted its business toward lower-fee investment products and asset classes. Capital allocation-based income increased to $59.9 million from $42 million, reflecting higher accrued carried interest and lower acquisition-related amortization and impairments. Operating expenses declined 1.2% to $1.24 billion, compared with $1.25 billion in the prior-year quarter. Adjusted operating expenses, however, increased 5.8% to $1.20 billion. Compensation, benefits and related costs rose 5.1% to $664.7 million, primarily reflecting higher bonus accruals and long-term incentive compensation. Distribution and servicing costs increased 15.9% to $111 million, while technology, occupancy and facility costs rose 4% to $205.1 million. The company recorded a $4 million restructuring charge associated with its ongoing expense management program. T. Rowe Price employed 7,640 associates at quarter-end, down 2.4% from 7,830 a year earlier. Rob Sharps, chair and CEO, said the firm is expanding its exchange-traded fund, separately managed account and model portfolio businesses while pursuing new investment products and strategic partnerships. "We continue to expand our ETF, SMA, and model portfolio businesses, extending our active investment expertise to more clients through a broader range of portfolio solutions," Sharps said. For the first nine months of 2026, T. Rowe Price generated $5.77 billion in net revenue, compared with $5.38 billion in the corresponding 2025 period. Net income attributable to the company increased to $1.74 billion from $1.64 billion, while diluted earnings per share rose to $7.89 from $7.25. The firm ended September with $3.77 billion in cash and cash equivalents, compared with $3.38 billion at year-end 2025. Approximately two-thirds of its assets under management were retirement-related. T. Rowe Price expects its full-year 2026 effective income tax rate to range from 23.5% to 25.5% on both a GAAP and adjusted basis.