Franklin Resources Inc (NYSE:BEN) Surpasses Q4 Earnings and Revenue Estimates

Franklin Resources Inc (NYSE:BEN) reported fourth-quarter earnings that surpassed analyst expectations, sending shares higher in pre-market trading as investors digested the asset manager's improved financial performance and strategic progress.

Earnings and Revenue Performance

The company's quarterly results demonstrated significant strength relative to Wall Street forecasts. For the quarter ended September 30, 2025, Franklin Resources posted adjusted earnings per share of $0.67, comfortably exceeding the analyst consensus estimate of $0.58. This represents a substantial 37% increase from the previous quarter's adjusted EPS of $0.49.

Revenue performance was equally impressive, with the company reporting operating revenues of $2.34 billion for the quarter. This figure significantly outpaced the estimated $1.74 billion and marked a 14% increase from the previous quarter's $2.06 billion.

Key financial highlights from the quarter include:

• Adjusted net income of $357.5 million, up 36% from the previous quarter
• Adjusted operating income of $472.4 million, representing a 25% sequential increase
• Adjusted operating margin expanding to 26.0% from 23.7% in the prior quarter

Market Reaction and Price Action

The market responded positively to the earnings beat, with BEN shares rising approximately 1.3% in pre-market trading. This upward movement suggests investors were encouraged by the company's ability to exceed expectations amid challenging market conditions for asset managers. The positive sentiment extends the stock's recent momentum, building on gains of approximately 2.5% over the past two weeks.

Business Performance and Strategic Highlights

CEO Jenny Johnson highlighted the company's "solid fourth quarter and fiscal year 2025 results," pointing to "continued growth and diversification across our global platform." The quarter saw several positive developments in the company's core business operations.

Assets under management ended the quarter at $1.66 trillion, up $49.4 billion from the previous quarter, driven primarily by positive market movements and cash management inflows. While the company reported long-term net outflows of $11.9 billion for the quarter, management emphasized that excluding Western Asset Management, the firm achieved $11.4 billion in net inflows – marking the eighth consecutive quarter of positive flows on that basis.

Notable business achievements during the quarter included:

• Long-term inflows increased across every asset class to $84.6 billion, up 12% from the prior quarter
• Institutional pipeline of won-but-unfunded mandates remained healthy at $20.4 billion
• Alternative AUM reached a record $270 billion following the Apera Asset Management acquisition
• Strong fundraising of $26.2 billion in alternatives, including $22.9 billion in private markets

Capital Management and Outlook

Franklin Resources maintained a strong balance sheet position with $6.7 billion in cash and investments. During the fiscal year, the company returned $930 million to shareholders through dividends and share repurchases, including $67.1 million spent on buying back 2.6 million shares in the fourth quarter alone.

Looking ahead, analysts project continued growth for the company, with estimates pointing to Q1 2026 revenue of $1.73 billion and full-year 2026 revenue of $6.96 billion. While the company did not provide specific quantitative guidance in its release, management expressed confidence that their business strategy "positions us well to capture the long-term trends reshaping our industry across public and private markets."

For detailed historical earnings data and future analyst estimates, view the complete earnings and estimates page for BEN.

Disclaimer: This article is for informational purposes only and does not constitute investment advice, financial analysis, or recommendation to buy or sell any securities. Readers should conduct their own research and consult with a qualified financial advisor before making investment decisions.