APAM 10-K & 10-Q changes, risk factors and insider trading

In addition to our key investment professionals, we also depend on the contributions of our senior management team led by Jason A. Gottlieb and Eric R. Colson and Jason A. Gottlieb,Colson, and certain marketing and client service personnel who have direct contact with our institutional clients, consultants, intermediaries and other key individuals within each of our distribution channels. Despite our efforts to implement succession plans with respect to these key professionals,plans, the loss of any of these key professionals could limit our ability to successfully execute our business strategy or adversely affect our ability to retain existing and attract new client assets and related revenues.

Competition for highly-skilled and motivated portfolio managers and other key professionals in the investment management industryprofessionals is intense, and the market for qualified professionals in our industry is characterized by the frequent movement of professionals among different firms. Further, portfolio managers and other keysuch professionals have an increasing number of employment options other thanbeyond traditional asset management firms, including multi-manager platforms, alternative investment firms, family offices and insurance companies. Any of our key professionals may resign at any time, retire, join our competitors or form a competing company. Although many of our portfolio managers and each of our named executive officers are subject to one-year post-employment non-compete obligations, these non-competition provisions are not enforceable in certain jurisdictions or may not be enforceable to their full extent. In addition, we have in the past and may again in the future agree to waive non-competition provisions or other restrictive covenants applicable to former key professionals in light of the circumstances surrounding their relationship with us. We do not carry “key person” insurance that would provide us with proceeds in the event of the death or disability of any of our key professionals.

Changes to our investment environment or compensation structuresstructures, or decisions related to resource allocation, could cause instability within our investment teams and/or have an adverse effect on the performance of our investment strategies, our financial results and our ability to grow.

Attracting, developing and retaining talented investment professionals is an essential component of our business strategy. To do so, it is critical that we continue to foster an environment and provide opportunities, compensation and benefits that are attractive for existing and prospective investment professionals.professionals within an increasingly complex platform. If we are unsuccessful in maintaining such an environment or compensation levels or structures, for example if the activities we undertake in pursuit of growing new areas of our alternatives-focused business impactsimpact our ability to simultaneously maintain our traditional equity-focused investment teams and strategies, our existing investment professionals may leave our firm or fail to produce their best work on a consistent, long-term basis and/or we may be unsuccessful in attracting talented new investment professionals, any of which could negatively impact the performance of our investment strategies, our financial results and our ability to grow.

With respect to asset-based revenues, each of our investment teams shares a bonus pool consisting of 25%a percentage of the asset-based revenues earned by the strategies managed by the respective team.team, which is generally set at 25% depending on strategy type. Each team is also entitled to a share of the performance-based revenues earned by the strategies it manages. The revenue share directly links the majority of the investment teams’ cash compensation to long-term growth in revenues, which, over the long-term, we believe is primarily linked to investment performance. Each team is also entitled to a share of the performance-based revenues earned by the strategies it manages. We also provide supplemental incentive payments to investment professionals in support of new or subscale teams or strategies or franchise development efforts.

We also grant franchise capital awards to investment professionals to enhance the alignment between our investment professionals and clients, and to provide investment professionals with greater control over their long-term economic outcome. Franchise capital awards are cash awards that are subject to the same long-term vesting and forfeiture provisions as the restricted share-based awards described above. Prior to vesting, though, the franchise capital awards will generally be invested in one or more of the investment strategies managed by the award recipient’s investment team.

The implementation of new or modified compensation arrangements or long-term incentive programs has in the past led to friction within our investment teams. Future modifications to compensation arrangements or long-term incentive programs, or other decisions relating to resource allocation, could cause instability within our investment teams if those modifications or decisions were perceived to negatively impact portfolio managers’ economic outcomes or treated teams differently from one another. In addition, any new arrangements or structures could materially impact our financial performance and results (or expectations about our future financial performance and results), reduce the amount of cash available for dividends and distributions to our stockholders and partners,partners or result in dilution to other stockholders.

Our financial results are impacted by changes in the total level of our AUM. The performance of our investment strategies is critical in retaining existing client assets and in attracting new client assets. Poor performanceperformance, as compared to third-party benchmarks or competitive products, causes financial intermediaries, advisors and consultants to remove our investment products from recommended lists and can result in lower Morningstar and Lipper ratings and rankings. During periods of long-term poor performance, our clients have in the past withdrawn funds from our investment strategies and, in some cases, have decided to end their relationship with us entirely. In addition, our ability to attract new client assets is adversely affected by prolonged periods of poor performance. A decrease in the value of our AUM as a result of poor performance has in the past, and would in the future, have an adverse impact on our revenues, as nearly all of the investment management fees we earn are based on a specified percentage of clients’ average AUM. Poor performance also adversely affects the portion of ourreduces revenues attributed to performance-based fees.

Our investment strategies can perform poorly for a number of reasons, including general market conditions; investor sentiment about market and economic conditions;conditions, as well as investment styles and philosophies; investment decisions; the performance of the companies in which our investment strategies invest and the currencies in which those investments are made; the liquidity of securities or instruments in which our investment strategies invest; our inability to identify sufficient appropriate investment opportunities for existing and new client assets on a timely basis; and our inability to retain key investment professionals and other personnel.

Moreover, even when our strategies experience strong results relative to the market, clients’client allocations to our strategies typically increase relative to their other investmentsinvestments, andoften weresulting sometimesin experiencesubsequent withdrawals as our clients rebalance their investments to fitmeet their asset allocation preferences despite our strong results.

While clients do not have legal recourse against us solely on the basis of poor investment results, if our investment strategies perform poorly, we are more likely to become subject to litigation brought by dissatisfied clients. In addition, to the extent clients are successful in claiming that their losses resulted from fraud, negligence, willful misconduct, breach of contractcontract, breach of fiduciary duty or similar misconduct, these clients may have remedies against us, the mutual funds and other funds we advise and/or our investment professionals under various U.S. and non-U.S. laws.

Financial markets have experienced, and may continue to experience, volatility and disruption amid continued concerns about elevated inflation, uncertainty around the timing and extent of changes in interest rates, economic and trade policy, effects of geopolitical tensions, conflicts and wars, and other global economic conditions. This continued volatility and uncertainty in global financial markets has impacted, and may continue to impact, the value of our AUM. Because the revenue we earn is based on the value of our AUM, fluctuations in our AUM result in corresponding fluctuations in our revenues and earnings. Difficult market conditions have in the past and may in the future cause investors in the mutual funds we advise to redeem their investments in those funds which they can do at any time and without prior notice. Our separate account clients have in the past and may in the future reduce the aggregate amount of AUM with us with minimal or no notice for any reason, including due to decliningdeteriorating financial market conditions. In addition, the prices of the securities held in the portfolios we manage have in the past and may in the future decline for any number of reasons beyond our control, including, among others, a declining market, general economic downturn or recession, political uncertainty, inflation rates, interest rates, natural disasters, war, acts of terrorism, social, civil or political unrest, public health crises, changes in trade policies, including the imposition of new or increased tariffs and the economic impact, volatility and uncertainty resulting therefrom, the imposition of economic sanctions or other unpredictable events.

Several of our investment strategies invest principally in the securities of non-U.S. companies, which involve foreign currency exchange,exchange risks and may face heightened tax, political, socialsocial, economic and economic uncertainties andlegal risks.

Investments in non-U.S. issuers face heightened tax, political, social, economic and legal risks. Non-U.S. issuers are affected by tax positions taken in countries or regions in which we are invested as well as political, social and economic uncertainty.invested. Declining tax revenues have in the past and could in the future cause governments to assert their ability to tax the local gains and/or income of foreign investors, which has in the past and could in the future adversely affect clients’ interests in investing outside their home markets. Many financial markets are not as developed or as efficient as the U.S. financial markets and in some cases lack established regulations. As a result, those markets typically have limited liquidity and higher price volatility.

LiquidityThe price and liquidity of securities traded in non-U.S. markets may also be adversely affected by political or economic events, government policies,policies and social or civil unrest within a particular country. For example, in response to Russia’s invasion of Ukraine, the U.S. and other countries imposed broad-ranging economic sanctions on Russia and certain Russian individuals, banking entities and corporations, which has impacted the value and liquidity of Russian holdings. Our ability to dispose of an investment may be adversely affected if we increase the size of our holdings in smaller non-U.S. issuers. Non-U.S. legal and regulatory environments, including financial accounting standards and practices, may also be different, and there may be less publicly available information about such companies. These risks could adversely affect the performance of our strategies that are invested in securities of non-U.S. issuers and may be particularly acute in the emerging or less developed markets in which we invest.invest where markets are often smaller, less liquid, less regulated and significantly more volatile than those in the U.S. In addition to our Sustainable Emerging Markets and Developing World strategies, and the strategies managed by the EMsights Capital Group, which invest primarily in emerging markets, several of our other investment strategies are permitted to invest, and do invest, in emerging or less developed markets to a more limited extent.

We may not be able to maintain our current fee rates for any number of reasons, including as a result of poor investment performance, competitive pressures, changes in global markets and asset classes,classes or as a result of changes in our business mix. Although our investment management fees vary by client, investment strategy and investment vehicle, we historically have been successful in maintaining an attractive overall rate of fee and profit margin due to the strength of our investment performance and our focus on high value-added investment strategies. However, the general trend toward lower fees in the investment management industry as a result of competition and regulatory and legal pressures continues. In order to maintain our fee structure in a competitive environment, we must retain the ability to decline additional assets to manage from potential clients who demand lower fees even though our revenues may be adversely affected in the short term. In addition, we must be able to continue to provide clients with investment returns and service that our clients believe justify our fees.

Our ability to attract additional assets to manage is highly dependent on our access to third-party intermediaries. We gain access to investors primarily through consultants,consultants and other third parties that advise institutional clients, as well as through 401(k) platforms,and mutual fund platforms, broker-dealersbrokerage andfirms, private banks, trust companies, financial advisors and other financial intermediaries through which shares of theour funds are sold.sold or that offer our investment products to their clients. We have relationships with some third-party intermediaries through which we access clients in multiple distribution channels. Our two largest intermediary relationships across multiple distribution channels each represented approximately 9% and 8% of our total AUM as of December 31, 2024.2025.

Competition within the investment management industry is based on a variety of factors, including investment performance, management fee rates, continuity of investment professionals and client relationships, the quality of client service, corporate positioning and business reputation, continuity of distribution arrangements with intermediaries and product mix and offerings. In addition, the investment management industry is facing transformative pressures and trends from a variety of different sources including increasedcontinued fee pressure; a continued shift away from actively managed equity and fixed income strategies towards alternative, passive and smart beta strategies; increased demands from clients and distributors for client engagement and services; a trend towards institutionsintermediaries developing fewer relationships and partners and reducing the number of investment managers they work with; increased regulatory activity and scrutiny of many aspects of the investment management industry; and advances in technology and digital wealth and distribution tools. A number of factors, including the following, serve to increase our competitive risks:

•Unlike some of our competitors, we do not currently engage in impact investing, offer passive investment strategies, exchange-traded fundsstrategies or “solutions” products like target-date funds.

We seek to recruit new investment teams that manage high value-added investment strategies and would allow us to grow strategically. We also look to develop new, differentiated strategies or vehicles managed by our existing teams. We expect the costs associated with establishing a new investment team, strategy or vehicle to initially exceed the revenues generated, which will negatively impactimpacts our results of operations. New strategies or vehicles, whether managed by a new team or by an existing team, can and do make investments or present operational, legal, regulatory,regulatory or distribution-related issues and risks that we have not yet encountered or with which we have less experience. The incorporation of new teams, strategies, vehicles and types of investments could strain our resources and increase the likelihood of an error or failure, a risk which is exacerbated by the increasingly complex and specialized nature of newer investment teams and strategies. The establishment of new teams or strategiesstrategies, (in particular, alternativealternative-focused investment teams or strategies)strategies, may also cause us to departmake fromchanges to our traditional compensation and economic model, which could reduce our profitability and harm our firm’s culture.

From time to time, we also consider other strategic opportunities, including potential acquisitions or similar transactions, which may impact our business. In January 2026, we completed our first acquisition with the purchase of Grandview Property Partners and began a phased integration designed to minimize disruption to operations and stakeholders. We cannot be certain that we will be able to identify, consummateidentify and successfully complete such transactions,transactions in the future, and no assurance can be given with respect to the timing, likelihood or business effect of any possible transaction. These initiativesinitiatives, including the acquisition of Grandview, typically involve a number of risks and present financial, managerial and operational challenges to ongoing business operations. Such risks include the required investment of capital and other resources; unanticipated problems regarding integration and oversight of a new business, additional or new regulatory requirements, operating facilities and technologies and new employees; distracting management and other key personnel from our existing businesses; and the existence of liabilities or contingencies not disclosed to or otherwise known by us prior to closing a transaction. There is no guarantee we will realize the anticipated benefits from any such transactions in a timely manner, if at all.

We derive substantially all of our revenues from investment management agreements, all of which are terminable by clients upon short or no notice. Our investment management agreements with U.S. registered mutual funds, as required by law, are generally terminable by the funds’ boards or a vote of a majority of the funds’ outstanding voting securities on not more than 60 days’ written notice. After an initial term, each fund’s investment management agreement must be renewed annually by that fund’s board, including by its independent members. In addition, all of our separate accounts and some of the mutual funds that we sub-advise have the ability to re-allocate all or any portion of the assets that we manage away from us at any time with little or no notice. The decrease in revenues that could result from the termination of a material client relationship or the re-allocation of assets away from us could have a material adverse effect on our business.

Investors in the mutual funds, UCITS funds, and some other pooled investment vehicles that we advise may redeem their investments in those funds at any time without prior notice. Investors in certain other pooled vehicles may redeem their investments with fairly limited prior notice. Investors may redeem for any number of reasons, including general financial market conditions, the absolute or relative investment performance we have achieved,achieved or their own financial condition and requirements. In a declining stock market, the pace of redemptions could accelerate. Redemptions reduce our AUM and adversely affect our revenues.

19 of our 25Our investment strategies,strategies whichthat we classify as being within the equity asset class accounted for overapproximately 90%88% of our AUM as of December 31, 2024, invest primarily in publicly-traded equity securities.2025. Under market conditions in which there is a general decline in the value of equity securities, the AUM in each of these strategies is likely to decline. Although certain strategies have the ability to take short positions in equity securities, such investments have not typically been made in practice. In addition, there is no guarantee that such short positions would meaningfully offset the poor performance of our long-only equity strategies under such market conditions. Even if our investment performance remains strong during such market conditions relative to other long-only, equity strategies, investors may choose to withdraw assets from our management or allocate a larger portion of their assets to non-long-only or non-equity strategies. In addition, the prices of equity securities may fluctuate more widely than the prices of other types of securities, making the level of our AUM and related revenues more volatile.

Our newestcredit and alternative investment strategies and strategies we may establish in the future present certain investment, operational, distribution and other risks that are different in kind and/or degree from those presented by our earlier investment strategies and dealing with those risks presents us with new challenges.

Our newestcredit and alternative investment strategies have the ability to make investments that present different risks and/or degrees of risk than our otherearlier strategies, many of which invest primarily in publicly traded equity securities. For example, several of our newest strategies invest in securities that are not publicly traded. We may be prohibited from selling these investments for a period of time and generally will be unable to sell these securities publicly unless their sale is registered under applicable securities law or unless an exemption from such registration is available. Illiquid securities are more difficult to value and dispose of when desired and, under certain circumstances, may make it more difficult to manage investors’ redemption requests. Several of our existing strategies, and strategies we may offer in the future, can and do invest in certain instruments (such as derivative securities) and engage in activities (such as shorting and use of leverage) the complexity of which may place additional demands on our existing operational infrastructure and our existing employees, and increase the risk of operational errors. Any such errors could damage our reputation or result in regulatory scrutiny or legal liability. In addition, any real or perceived problems could cause a disproportionate negative impact on our business and reputation.

Several of our newer investment strategies are primarily offered through private funds, which present operational, regulatory and distribution-related risks that are different from those associated with the mutual funds and traditional separate accounts through which we offer our earlier investment strategies. In the future, we expect to offer new investment strategies in new asset classes through different types of investment vehicles and fund structures which could present different types of operational, regulatory and distribution-related risks with which we have little to no experience. For example, our reputation as a long-only manager of traditional investment products has been an impediment to penetrating new channels and selling our newer alternative investment strategies. Although we continue to build out a team of distribution professionals with deep alternatives experience and strong fundraising networks, we cannot be sure that these changes will have a meaningful impact on selling our alternatives strategies. In general, the complexity of these newer strategies and vehicles could strain our resources and increase the likelihood of real or perceived problems, which could damage our reputation or result in regulatory scrutiny or legal liability.

We may, from time to time, strategically manage our exposure to market, interest or exchange rate risks on our own behalf or on behalf of our clients. However, because our clients invest in our investment strategies in order to gain exposure to the portfolio securities of the respective strategies, we have not adopted corporate-level risk management policies to manage market, interest rate,rate or exchange rate risks that would affect the value of our overall AUM.

As we expand the scope and complexity of our business and our client base, we must continue to monitor and address any conflicts between the interests of our stockholders and those of our clients. Our clients may withdraw funds if they perceive conflicts of interest between the investment decisions we make for strategies or vehicles in which they have invested and our obligations to our stockholders. For example, we may limit the growth of assets in or close strategies when we believe it is in the best interests of our clients even though our AUM and investment advisory fees may be negatively impacted in the short term. Similarly, we may establish new investment teamsteams, strategies or strategiesvehicles or expand operations into new geographic areas if we believe such actions are in the best interests of our clients, even though our profitability may be adversely affected in the short term. Although we believe such actions enable us to retain client assets and maintain our profitability, which benefits both our clients and stockholders, if clients perceive a change in our investment or operations decisions in favor of a strategy to maximize short-term results, they may withdraw funds, which could reduce our revenue and impact our financial condition.

The expansion of our business inside and outside of the United States raises tax and regulatory risks, may adversely affect our profit margins and places additional demands on our resources and employees.

While a majority of our operations take place in the U.S., we do maintain offices in a number of other countries including the U.K., Ireland, Singapore, Australia and Hong Kong. Operating our business in non-U.S. markets is generally more expensive than in the U.S. Amongfor othera expenses,number theof effectivereasons, including differences in tax ratesand applicableregulatory to our income allocated to some non-U.S. markets may be higher than the effective rates applicable to our income allocated to the U.S.regimes. To the extent that our revenues do not increase to the same degree our expenses increase in connection with our continuing expansion outside the U.S., our profitability could be adversely affected. Expanding our business into new markets may also place significant demands on our existing operational infrastructure and on our existing employees.

We are subject to income taxes, as well as non-income based taxes, in both the U.S. and certain foreign jurisdictions at various levels of government. We cannot predict future changes in the tax laws, regulations, administrative guidance or judicial decisions to which we are subject or that could apply to our business. Any such changes could have a material impact on our tax liability, materially impact our effective tax rate, result in additional tax reporting obligations,obligations or result in increased costs associated with our tax compliance efforts.

We are subject to extensive, complex and sometimes overlapping laws, rules and regulations.regulations that are subject to continual change.

The industry in which we operate is subject to extensiveextensive, complex and complexoverlapping or conflicting laws, rules and regulations. There is uncertainty associated with the regulatory and compliance environments in which we operate and such environments are subject to frequently changing and often increasingly strict rules, regulations, policies, legal interpretations and enforcement approaches around the world. We are subject to extensive regulation in the United States, primarily at the federal level, including regulation by the SEC, the U.S. Department of Labor, the Financial Industry Regulatory Authority, the Commodity Futures Trading Commission and the National Futures Association. Our business is also subject to the laws and regulations of the various countries in which we conduct distribution or investment management activities. It is impossible to determine the extent of the impact of any new laws, regulations or initiatives that may be proposed, or whether any such proposals will become law. Compliance with any new laws or regulations, or changes in the interpretation or enforcement of existing laws or regulations, could be difficult and expensive and affect the manner in which we conduct business. For a more extensive discussion of certain laws and regulations to which we are subject, see “Item 1—Business—Regulatory Environment and Compliance” in Part I of this report.

As a result of the extensive and complex regulatory environment in which we operate, we face risk of regulatory actions and litigation, which could consume substantial expenditures of time and capital. Our regulatory and compliance obligations impose significant operational and cost burdens on us and cover a broad range of topics including, investment advisory matters, securities and other financial instruments, financial reporting and other disclosure matters, sustainability, accounting, tax, cybersecurity and data protection, and privacy. As our business expands into new geographic regions and introduces newnew, more complex investment products with expanded degrees of freedom, the regulatory requirements to which we are subject will increase in number. While we have focused significant attention and resources on the development and maintenance of compliance policies, procedures and practices, any inadvertent non-compliance with applicable laws, rules or regulations, either in the U.S. or abroad, could result in various legal proceedings, including civil litigation and regulatory investigations and enforcement actions that could result in fines, suspensions of individual employees,employees or limitations on particular business activities, any of which could have an adverse impact on our reputation and business.

OperationalOperational, Technology and Cybersecurity Risks

We depend on informationa technology,variety of systems to operate and any failures of,of or damage to orthose unauthorized access to our information technology systems or infrastructure,systems, or those of third parties with which we do business, may disrupt our business,operations, result in losses, damage our reputation or limit our growth.

We are heavily dependent on the capacity and reliability of the communications and information technology systems supporting our operations, whether developed, owned and operated by us or by third parties. We also rely on manual workflows and a variety of manual user controls. As our clients, physical locations and investment teams and strategies increase in number and grow in complexity, and as our employees become increasingly mobile, developing and maintaining the systems supporting our operations becomes increasingly challenging. Moreover, the introduction of new technologies, such as artificial intelligence, presents new challenges and introduces operational and legal risks. Any changes or upgrades to our systems to support increased volumes or complexity of transactions or to otherwise support growth of the business may require significant expenditures and may increase the probability that we will experience operational errors. Operational issues or errors or interruption or failure of our financial, trading, compliance and other data processing systems, whether caused by human error, power or telecommunications failure, cyber-attack,disruptive ransomwarecyber or viruses,threats, severe weather events, natural disaster, fire, act of terrorism or war, pandemics or other unpredictable events, could result in a disruption of our business, liability to clients, regulatory intervention or reputational damage, and thus adversely affect our business. In addition, sinceas implementinga broadglobal remote-workfirm measureswith duringremote thework pandemic,capabilities, we have an increased dependency on remote equipment and connectivity infrastructure to access critical business systems that may be subject to failure, disruption,disruption or unavailability that could negatively impact our business operations. The potential for some types of operational risks, including trading errors, may increase in periods of increased volatility, which can magnify the cost of an error. We have back-up systems and a business continuity plan in place, however, these arrangements may not be adequate in the event of a significant interruption or failure of the systems or operations that are critical to our business, however caused. Although we have not suffered material operational errors, including material trading errors, in the past, we may experience such errors in the future, the losses related to which we would absorb. Insurance and other safeguards might not be available or might only partially reimburse us for our losses.

We rely on a number of key vendors for trading, middle- and back-office functions, various fund administration, accounting, custody and transfer agent roles and other operational needs. These key vendors may themselves rely on third party service providers to support their own operations. The failure of any key vendor, or of any service provider to a key vendor, to fulfill its obligations could cause operational issues that could lead to legal liability, regulatory issues, reputational harm and financial losses, the likelihood of which increases as we increase reliance on third-party service providers. Some of the key service providers and vendors upon which we rely operate in a remote or hybrid environment, which subjects both us and third-party service providers and key vendors to risk of operational issues and interruptions as well as to a heightened risk of cyberattacksdisruptive cyber threats or other privacy or data security incidents. We and our service providers are also subject to the risk that employees or contractors, or other third parties, may deliberately seek to circumvent established controls to commit fraud or act in ways that are inconsistent with our or their controls, policies, and procedures, and which may be harder to monitor in remote working environments. The financial and reputational impact of control failures can be significant. Moreover, as we grow our operations in new geographic regions, the potential for particular types of political, economic or infrastructure instabilities, information, technology or securitycyber limitations or breaches,threats or other country- or region-specific business continuity risks increases.

Any significant limitation,failure failureof, damage to or breachattack ofon theour information security infrastructure, software applications,applications or other systems that are critical to our operations could disrupt our business, damage our reputation,reputation and result in regulatory penalties or other additional costs to us.

To date, we have not experienced any known material breaches of or interference with our systems, networks or applications, nor to our knowledge have we been materially impacted by a breach of our vendors’ systems, networks or applications. However, we routinely encounter and address such threats, and the number and frequency of potential threats or security incidents experienced by us directly, or indirectly via our vendors, has increased in recent years due to, among other factors, an increase in thevulnerability number of security vulnerabilities,exploitation, more sophisticated andcyber automated attacks,threats, proliferation of cloud-based solutions, our increased operations in Chinacertain andnon-U.S. Hong Kongjurisdictions and the increase in remote work. Our experiences with cybersecurity and other technology threats have included phishing scams, introductions of malware,malicious software, attempts at electronic break-ins, brand infringements or impersonations, ransomware and unauthorized payment requests.

Despite the measures we have taken and may in the future take to address and mitigate cybersecurity and other technology risks, which are discussed further in “Item 1C—Cybersecurity” in Part I of this report, we cannot guarantee that our systems, networks and applications, and those of third parties on whom we rely, will not be subject to disruptions, system failures or outages, unauthorized access, ransomware,cybersecurity breachesincidents or other interference. In addition, our third-party service providers and other intermediaries with which we conduct business and transmit data have in the past been, and may in the future be, subject to successful cyberattackscybersecurity incidents or other data security events, and, despite our service provider oversight processes and practices, we cannot ensure that such third parties, or the service providers to such third parties, have appropriate controls in place to protect the confidentiality of data in the custody of such party or to allow them to continue their business operations, including the provision of their services to us. In addition, our reliance on third-party vendors and service providers that use artificial intelligence (AI), and the use of AI by other market participants, may increase our exposure to operational, cybersecurity, privacy and reputational risks.

Cybersecurity and information security events may result in operational disruptions as well as unauthorized access to or the disclosure, corruption or loss of our proprietary information or our clients’ or employees’ information. Any such events may result in legal claims, regulatory scrutiny and liability, reputational damage, the incurrence of costs to eliminate or mitigate further exposure, the loss of clients or other damage to our business. Ultimately, such an event may have a material adverse impact on our business, financial condition or results of operations. In addition, required public notification of such incidents could exacerbate the harm to our business, financial condition or results of operations. Even if our and our service providers’ technology infrastructure and the confidentiality of sensitive data are successfully protected, we may incur significant expense in connection with our response to any such attackscybersecurity incident and the adoption and maintenance of additional security measures. We cannot be certain that future advances in criminal capabilities, the discovery of new vulnerabilities or other developments will not compromise or breachcircumvent the security measures protecting the networks, systems and applications we use.

We have indebtedness outstanding in the amount of $200$190 million in unsecured notes, which exposes us to risks associated with the use of leverage. In addition, we maintain a $100 million revolving credit agreement, though no amounts are outstanding as of the date of this filing. Our indebtedness may make it more difficult for us to withstand or respond to adverse or changing business, regulatory and economic conditions or to take advantage of new business opportunities or make necessary capital expenditures. To the extent we service our debt from our cash flow, such cash will not be available for our operations or other purposes. Because our debt service obligations are fixed, the portion of our cash flow used to service those obligations could become substantial if our revenues decline significantly, whether because of market declines or otherour reasons.expenses increase significantly.

Our Series D,E, Series EF and Series FG notes bear interest at a rate equal to 4.29%,4.53%, 4.53%,3.10%, and 3.10%5.43% per annum, respectively. The fixed interest rate on each of the notes is subject to a 100 basis point increase in the event Holdings receives a below-investment grade rating. Each series requires a balloon payment at maturity. Any substantial decrease in net operating cash flows or substantial increase in expenses could make it difficult for us to meet our debt service requirements or force us to modify our operations. Our ability to repay the principal amount of our notes or any outstanding loans under our revolving credit agreement, to refinance our debt or to obtain additional financing through debt or the sale of additional equity securities will depend on our performance, as well as financial, business and other general economic factors affecting the credit and equity markets generally or our business in particular, many of which are beyond our control. Any such alternatives may not be available to us on satisfactory terms or at all.

Certain shares of common stock held by current employees are subject to a stockholders agreement, pursuant to which a stockholders committee has been granted an irrevocable voting proxy with respect to such shares. Shares held by an employee cease to be subject to the stockholders agreement upon termination of employment or if the stockholders agreement is terminated. The stockholders committee currently consists of Jason A. Gottlieb (Chief Executive Officer and President), Eric R. Colson (Chief Executive OfficerChair), and Charles J. Daley, Jr. (Chief Financial Officer) and Gregory K. Ramirez (Executive Vice President). All shares subject to the stockholders agreement are voted in accordance with the majority decision of those three members providing the committee with approximately 10%9% of the aggregate voting power as of February 21,14, 2025.2026.

In addition, because the majority of our pre-IPO owners, including certain members of APAM’s board of directors (the “Board”), hold or held a portion of their ownership interests in our business through Holdings, rather than through Artisan Partners Asset Management,APAM, these pre-IPO owners may have conflicting interests with holders of our Class A common stock. For example, our pre-IPO owners may have different tax positions from us which could influence their decisions regarding whether and when we should dispose of assets, whether and when we should incur new or refinance existing indebtedness, especially in light of the existence of the tax receivable agreements, and whether and when Artisan Partners Asset Management should terminate the tax receivable agreements and accelerate its obligations thereunder. In addition, the structuring of future transactions may take into consideration these pre-IPO owners’ tax or other considerations even where no similar benefit would accrue to us.

As a holding company, our assets principally consist of our ownership of partnership units of Holdings, deferred tax assets and cash and we have no independent means of generating revenue. Holdings is a partnership for U.S. federal income tax purposes and, as such, is not subject to U.S. federal income tax. Instead, Holdings’ taxable income is allocated to holders of its partnership units, including us. Accordingly, we incur income taxes on our proportionate share of Holdings’ taxable income and also may incur expenses related to our operations. Under the terms of its amended and restated limited partnership agreement, Holdings is obligated to make tax distributions to holders of its partnership units, including us. In addition to tax expenses, we are also required to make payments under the TRAs, which will be significant, and we incur other expenses related to the TRAs and our operations. We intend to fund the payment of amounts due under the TRAs out of the reduced tax payments that APAM realizes in respect of the tax attributes to which the TRAs relate. We also intend to cause Holdings to make distributions in an amount sufficient to allow us to pay our taxes and pay any additional operating expenses. However, its ability to make such distributions will be subject to various limitations and restrictions as set forth in the preceding risk factor. If, as a consequence of these various limitations and restrictions, we do not have sufficient funds to pay tax or other liabilities or to fund our operations, we may have to borrow funds and thus our liquidity and financial condition could be materially adversely affected. To the extent that we are unable to make payments when due under the TRAs, such payments will be deferred and will accrue interest from the due date (without extension) until such payments are made.

We are ana global multi-asset investment management firmplatform focused on providing higha value-added,broad activerange of high-value added investment strategies forin growing asset classes to sophisticated clients around the world. As of December 31, 2024,2025, our 11 autonomous investment teams managed a total of 2526 investment strategies across multiple asset classes and investment styles.

APAM’s equity ownership interest in Holdings increased from 86% at December 31, 2023 towas 87% at December 31, 2024, as a result of these transactions2024 and otherDecember equity31, transactions during the period.2025.

EconomicGlobal uncertaintymarket andconditions volatilitycan inmaterially globalimpact our financial markets impact the value of our AUM.performance. Because the revenue we earn is based on the value of our AUM, fluctuations in our AUM due to changes in the economic environment and financial markets will result in corresponding fluctuations in our revenues and earnings.

Changes to our operating results from one period to another are primarily caused by changes in the amount of our AUM. A key driver of changes in our AUM over time is the long-term investment performance of our investment strategies. Changes in the relative composition of our AUM among our investment strategies and vehicles and the effective fee rates on our investment products also impact our operating results.

•investment performance, including fluctuations in both the financial markets and foreign currency exchange rates and the quality of our investment decisionsdecisions, as assessed relative to applicable third-party benchmarks and peer groups, as appropriate;

While net flows are inherently difficult to predict, if recent performance and market trends persist, we could continue to experience net outflows in our equity strategies and net inflows in our credit and alternative strategies in 2026. Over the long-term,long term, we expect to generate the majority of our AUM growth through investment returns, which has been our historical experience.

The goal of our marketing, distribution and client service efforts is to establish and maintain a client base that is diversified by investment strategy, client type and distribution channel. As distribution channels have evolved to have more institutional-like decision making processes and longer-term investment horizons, we have expanded our distribution efforts into those areas. The table below sets forth our AUM by distribution channel:

Our institutional channel includes AUM sourced from defined contribution plan clients, which made up approximately 8%7% of our total AUM as of December 31, 2024. Across our institutional, intermediary and retail channels, we generally consider approximately 59% of our AUM as of December 31, 2024 to be attributed to intermediated wealth clients.2025.

AUM within theThe “separate accounts and other” category consists of assets we manage in or through vehicles other than Artisan Funds or Artisan Global Funds, including traditional separate accounts, Artisan-branded collective investment trusts and Artisan Private Funds, as well as certain Custom Credit Solutions, which represent assets managed by the Credit team within custom, investor-driven mandates. In addition, assets under advisement related to clients for whom we provide investment models but do not have discretionary investment authority.authority Assetsare also included within the “separate accounts and other” category comprised $83.6 billion, or 52%, of our AUM as of December 31, 2024. For the year ended December 31, 2024, fees from these clients represented $423.0 million, or 38%, of our revenues.category.

Traditional separate account clients are generally subject to standard fee schedules that vary by investment strategy and, through the application of standard breakpoints, reflect the size of the account and client relationship. The weighted average management fee rate paid by our traditional separate account clients was 0.472%, 0.489%, and 0.484% for the years ended December 31, 2024, 2023 and 2022, respectively. There are a number of exceptions to our standard fee schedules, including exceptions based on the nature of a client relationship and the aggregate value of a client’s assets under our management. In general, our effective rate of fee for a particular client relationship declines as the assets we manage for that client increase, which we believe is typical for the asset management industry.

A numberSome of our investment strategies are also accessible to certain types of employee benefit plans through Artisan-branded collective investment trusts. We act as investment adviser to the collective investment trusts and earn a management fee for providing this service. The weighted average management fee rate paid by our Artisan-branded collective investment trust clients was 0.701%, 0.665%, and 0.714% for the years ended December 31, 2024, 2023 and 2022, respectively.

Artisan serves as the investment manager and acts as the general partner for certain Artisan Private Funds. Under the terms of these agreements, Artisan earns a management fee, and for certain funds is entitled to receive either an allocation of profits or a performance-based fee. The weighted average management fee rate paid by our Artisan Private Funds clients was 0.447%, 0.654%, and 0.809% for the years ended December 31, 2024, 2023 and 2022, respectively.

Because, asAs is typical in the asset management industry, our rates of fee decline as the assets under our management in a relationship increase, and because of differences in our fees by investment strategy or investment vehicle, a change in the composition of our AUM, in particular a shift of assets to strategies or vehicles with lower effective rates of fees, could have a material impact on our overall weighted average rate of fee. See “—Qualitative and Quantitative Disclosures Regarding Market Risk—Market Risk” for a sensitivity analysis that demonstrates the impact that certain changes in the composition of our AUM could have on our revenues.

The different fee structures associated with Artisan Funds, Artisan Global Funds and separate accounts and other pooled vehicles, and the different fee schedules applicable to each of our investment strategies, make the composition of our AUM an important determinant of the investment managementadvisory fees we earn. Historically, we have received higher effective rates of investment management fees from Artisan Funds and Artisan Global Funds than from traditional separate accounts, reflecting, among other things, the different and broader array of services we provide to Artisan Funds and Artisan Global Funds. Our investment management fees also differ by investment strategy, with higher-capacity strategies having lower standard fee rates than strategies with more limited capacity.

Certain separate account clients pay us fees based on the performance of their accounts relative to agreed-upon benchmarks, which typically results in a lower base fee, but allows us to earn higher fees if the performance we achieve for that client is superior to the performance of the agreed-upon benchmark. We may also receive performance fees or incentive allocations from Artisan Private Funds. Approximately 3% of our $161.2$179.9 billion of AUM as of December 31, 20242025, have performance fee billing arrangements. Performance fees of $14.8 million, $4.3 million, and $0.6 million were recognized in the years ended December 31, 2024, 2023 and 2022, respectively.

For each of the years ended December 31, 2024,2025, 20232024 and 2022,2023, approximately 80%, 82%,80% and 82%, respectively, of our investment advisory fees were earned from clients located in the United States.

Our operating expenses consist primarily of compensation and benefits, distribution, servicing and marketing, occupancy, communication and technology,technology and general and administrative expenses.

•variations in the amount of total compensation expense due to, among other things, changes in the amount of incentive compensation earned and equitylong-term incentive awards made, variations in our employee count (including the addition of new investment teams), changes in our product mix and other competitive factors; and

Fixed compensation costs are comprised primarily of salaries, benefits and long-term incentive compensation expense. Fixed compensation costs, exclusive of long-term incentive compensation, are expected to increase mid-single digits in 2026 reflecting merit increases and anticipated growth in our number of full-time employees, including the Grandview acquisition. Certain compensation and benefits expenses are generally higher in the beginning of the year, including employer funded retirement and health care contributions and payroll taxes. We expect these expenses will add approximately $6 million to our expenses in the first quarter of 2025,2026, compared to the fourth quarter of 2024.2025.

Equity awards granted to our employees consist of standard restricted awards that generally vest on a pro rata basis over 5 years and career awards that vest when both of the following conditions are met (1) pro-rata time vesting over 5 years and (2) a qualifying retirement (as defined in the award agreements). Beginning with the 2024 grant, equity awards are also subject to a traditional retirement provision that eliminates the pro rata 5-year vesting requirement is waived when a career award recipient has a qualified retirement after having met an ageage-plus-service plus years of service threshold of 70.condition. Career vesting awards granted to investment team members are generally further subject to the Franchise Protection Clause, which applies to current or future portfolio managers and founding investment team members. The Franchise Protection Clause provides that the total number of career awards ultimately vesting will be reduced to the extent that cumulative net client cash outflows from the award recipient’s investment team during a specified measurement period exceeds a set threshold. Performance share units (“PSUs”) were granted to certain executive officers of the Company in 2020, 2021 and 2022. The number of PSUs that vest is dependent upon the Company’s adjusted operating margin and total stockholder return relative to a peer group over a three year measurement period. Once determined the extent to which the performance conditions have been met, 50% of the PSUs eligible to vest will vest and the underlying shares will be delivered. The remaining 50% of the PSUs eligible to vest will vest upon a qualified retirement. No performance share units have been granted subsequent to 2022 and the final performance period was completed on December 31, 2024.

The estimated grant date fair value of equity awards is recognized as compensation expense on a straight-line basis over the requisite service period of the award. The initial requisite service period is generally five years for restricted stock awards and restricted stock units, and was three years for PSUs. If an employee is eligible to fully vest in an award upon a qualified retirement, the initial requisite service period is equal to the employee’s required retirement notice period, which is generally either 12 or 18 months.

We grant cash-based long-term incentive awards, referred to as franchise capital awards, to certain investment team members in lieu of additional equity awards. Franchise capital awards are subject to the same vesting and forfeiture provisions as the equity awards. Prior to vesting, franchise capital awards are generally allocated to one or more of Artisan’s investment strategies. The underlying investment holdings and franchise capital award liability are marked to market value each quarter. The change in value of the award liability is included in compensation expense. The change in value of the underlying investment holdings is included in non-operating income/(expense).

Including the long-term incentive award approved in the first quarter of 2025,2026, total unrecognized long-term incentive compensation expense (including both equity grants and franchise capital awards) is $211.1$235.4 million. Long-term incentive compensation expense in 20252026 is expected to be $75.0approximately $85.0 million, excluding the impact of forfeitures and investment returns on the franchise capital awards’ underlying investments. The retirement acceleration feature added to certain awards granted beginning in 2024 results in higher amortization expense relative to prior awards which did not accelerate upon retirement. The incremental impact of the retirement acceleration feature will decrease over time, and we currently expect the impact on 2027 compensation expense to be approximately $5 million lower than the impact on 2026 compensation expense.

Distribution, servicing and marketing expenses primarily represent payments we make to broker-dealers, financial advisors, defined contribution plan providers, mutual fund supermarkets and other intermediaries for selling, servicing and administering accounts invested in shares of Artisan Funds. Artisan Funds authorizes intermediaries to accept purchase, exchange and redemption orders for shares of Artisan Funds on behalfits of Artisan Funds.behalf. Many intermediaries charge a fee for those services. Artisan Funds pays a portion of some of those fees, which portion is intended to compensate the intermediary for its provision of services of the type that would be provided by Artisan Funds’ transfer agent or other service providers if the shares were registered directly on the books of Artisan Funds’ transfer agent. Like the investment management fees we earn as adviser to Artisan Funds, distribution, servicing and marketing fees typically vary with the value of the assets invested in shares of Artisan Funds. The allocation of such fees between us and Artisan Funds is determined by the board of Artisan Funds, based on information and a recommendation fromprovided by us, with the goal of allocating to us, at a minimum, all costs attributable to the marketing and distribution of shares of Artisan Funds. A significant portion of Artisan Funds’ shares are held by investors through intermediaries to which we pay distribution, servicing and marketing expenses.

Occupancy expenses include operating leases for facilities, furniture and office equipment, miscellaneous facility related costs and depreciation expense associated with furniture purchases and leasehold improvements. We expect 2025 occupancy expense to be relatively consistent with 2024.

Communication and technology expenses include information and data subscriptions, telephonetelecommunication device and data costs, information systems consulting fees, equipment and software maintenance expenses, operating leases for information technology equipment and depreciation and amortization expenses associated with computer hardware and software. Information and data subscriptions represent the costs we pay to obtain investment research and other data we need to operate our business. A portion of these expenses generally increase or decrease in relative proportion to the number of our employees and the overall size and scale of our business operations. We expect to continue our measured investments in technology to support our investment teams, distribution efforts,efforts and scalable operations. We expect 2025 communication and technology expense to be relatively consistent with 2024.

On behalf of our clients, we make decisions to buy and sell securities, select broker-dealers to execute trades and negotiate brokerage commission rates. In connection with these transactions, we receive research products and services from broker-dealers in exchange for the business we conduct with such firms. Some of those research products and services could be acquired for cash and our receipt of those products and services through the use of client commissions, or soft dollars, reduces cash expenses we would otherwise incur. In response to the Markets in Financial Instruments Directive II and industry changes prompted by it, we have in the past experienced requests from clients to bear research expenses that are currently paid for using soft dollars. In response to such requests or as a result of changes in our operations, we may eventually bear a significant portionmore of the costs of research that are currently paid for using soft dollars, which wouldcould increase our operating expenses materially.

General and administrative expenses include professional fees, travel and entertainment, certain state and local taxes, directors’ and officers’ liability insurance, director fees,fees and other miscellaneous expenses we incur in operating our business. We expect 2025 general and administrative costs to be relatively consistent with 2024.

The increase in revenues of $136.7$84.9 million, or 14%,8%, for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023,2024, was driven primarily by a $20.9$12.8 billion, or 15%,8%, increase in our average AUM and a $10.5$14.3 million increase in performance fee revenue. The weightedincrease averagein performance fee revenue resulted from higher relative investment managementoutperformance fee,in whichproducts excludeswith performance fees, was 68.6 basis points for the year ended December 31, 2024, compared to 69.8 basis points for the year ended December 31, 2023. The weighted average investment management fee decreasedbilling primarily due to a change in the mix of AUM among our strategies with more weighting towards fixed income strategies with lower average fee rates.arrangements.

The weighted average fee rate, inclusive of performance fees, was 69.3 basis points for the year ended December 31, 2025, compared to 69.5 basis points for the year ended December 31, 2024. The following table sets forth investment advisory fees and the weighted average management fee by investment vehicle. The weighted average management fee for Artisan Funds and Artisan Global Funds reflects the additional services we provide to these pooled vehicles.

The increase in total compensation and benefits was driven by a $43.7$26.4 million increase in incentive compensation primarily drivenrelated byto increased revenue,revenues increasesand a $23.9 million increase in long-term incentive compensationcompensation, comprisedwhich of $5.9 million for the retirement acceleration provision on 2024 grants and $3.0 million asincluded a result of market valuation changes, and a $5.5$15.3 million increase indue salariesto and benefits as a result of the 2% increasechanges in the numbermarket value of full-timeoutstanding associateslong-term andincentive salary increases.awards.

Other operating expenses increaseddecreased $9.0$3.6 million for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023,2024, primarily due to increasesa decrease in third-partygeneral distributionand expenseadministrative ascosts, amost resultnotably of an increasedecreases in AUMtravel subjectand toentertainment those fees, an increase incosts, occupancy-related charges resulting from abandonment charges inand 2024,professional as well as an increase in travel expense.fees.

Net investment gain (loss) of consolidated investment products, net investment gain (loss) on nonconsolidated seed investments,investments and net investment gain (loss) on franchise capital investments decreasedincreased $8.4$14.6 million in the aggregate for the year ended December 31, 2024,2025, compared to the year ended December 31, 2023,2024, predominantly due to market conditions. Interest income on cash and cash equivalents and other increased $3.3 million due primarily to more cash invested in money market funds.

APAM’s effective income tax rate for the years ended December 31, 20242025 and 20232024 was 20.6%22.7% and 18.7%,20.6%, respectively. The increase in effective tax rate was primarily due to athe decreaseenactment in non-controlling interests, limitations on executive compensation deductions andof the impactOBBBA, ofwhich unrecognizedincreased the effective tax benefits.rate by 2.2%.

Several factors contribute to the effective tax rate, including a rate benefit attributable to the fact that approximately 14% and 16% of Holdings’ full year projected taxable earnings were not subject to corporate-level taxes for the years ended December 31, 20242025 and 2023, respectively.2024. Thus, income before income taxes includes amounts that are attributable to noncontrolling interests and not taxable to APAM and its subsidiaries, which reduces the effective tax rate. As APAM’s equity ownership in Holdings increases, the effective tax rate will likewise increase as more income will be subject to corporate-level taxes. The effective tax rate was favorably impacted in both periods due to tax deductible dividends paid on unvested restricted share-based awards.

Our management uses non-GAAP measures (referred to as “adjusted” measures) of net income to evaluate the profitability and efficiency of the underlying operations of our business and as a factor when considering net income available for distributions and dividends. These adjusted measures remove the impact of (1) net gain (loss) on the tax receivable agreements (if any), (2) compensation expense (reversal) related to market valuation changes in compensation plans, (3) net investment gain (loss) of investment products andproducts, (4) non-recurring expenses.expenses and (5) the adjustment to deferred taxes as a result of the OBBBA enactment. These adjustmentsadjusted measures also remove the non-operational complexities of our structure by adding back noncontrolling interests and assuming all income of Artisan Partners Holdings is allocated to APAM. Management believes these non-GAAP measures provide more meaningful information to analyze our profitability and efficiency between periods and over time. We have included these non-GAAP measures to provide investors with the same financial metrics used by management to manage the Company.

•Adjusted net income represents net income excluding the impact of (1) net gain (loss) on the tax receivable agreements (if any), (2) compensation expense (reversal) related to market valuation changes in compensation plans, (3) net investment gain (loss) of investment products, and (4) non-recurring expenses.expenses and (5) the adjustment to deferred taxes as a result of the OBBBA enactment. Adjusted net income also reflects income taxes assuming the vesting of all unvested Class A share-based awards and as if all outstanding limited partnership units of Artisan Partners Holdings had been exchanged for Class A common stock of APAM on a one-for-one basis. Assuming full vesting and exchange, all income of Artisan Partners Holdings is treated as if it were allocated to APAM, and the adjusted provision for income taxes represents an estimate of income tax expense at an effective rate reflecting APAM’s current federal, state and local income statutory tax rates. The adjusted tax rate was 24.7% for all periods presented.

Compensation expense (reversal) related to market valuation changes in compensation plans represents the expense (income) associated with the change in the long-term incentive award liability resulting from investment returns of the underlying investment products. Because the compensation expense impact of the investment market exposure is economically hedged, management believes it is useful to reflect the expected net income offset in the calculation of adjusted operating income, adjusted net income,income and adjusted EBITDA. The related investment gain (loss) on the underlying investments is included in the adjustment for net investment gain (loss) of investment products.

We are a global multi-asset investment platform focused on providing a broad range of high-value added investment strategies in growing asset classes to sophisticated clients around the world. As of MarchJune 31,30, 2026, our 12 autonomous investment teams managed a total of 27 investment strategies across multiple asset classes and investment styles.

We offer our investment management capabilities primarily to sophisticated investors that operate with institutional decision-making processes and longer-term investment horizons. We employ knowledgeable and investment focused relationship managers who are directly aligned with our investment teams, and we pair them with regional and distribution channel experts. We provide access to many of our investment strategies through multiple investment vehicles, including separate accounts and different types of pooled vehicles. As of MarchJune 31,30, 2026, approximately 74%73% of our assets under management (AUM) were managed for clients and investors domiciled in the U.S. and 26%27% of our AUM were managed for clients and investors domiciled outside of the U.S.

•During the three months ended MarchJune 31,30, 2026, our AUM declinedincreased to $183.4 billion, an increase of $10.4 billion, or 6%, compared to $173.0 billion, a decrease of $6.9 billion, or 4%, compared to $179.9 billion at DecemberMarch 31, 2025,2026, primarily due to $4.6$21.2 billion of market depreciation,appreciation, $3.1partially offset by $10.5 billion of net client cash outflows and $0.1 billion of Artisan Funds’ distributions not reinvested, partially offset by the acquisition of $0.9 billion from Grandview Property Partners.outflows.

•WeAverage earnedAUM $303.0for millionthe inthree revenuemonths ended June 30, 2026 was $181.9 billion, a decrease of 0.3% from the average of $182.4 billion for the three months ended March 31, 2026, and an increase of 9% from revenuesthe average of $277.1$166.8 millionbillion for the three months ended MarchJune 31,30, 2025.

•Our GAAP operating margin was 31.1%27.5% for the three months ended MarchJune 31,30, 2026, compared to 31.2%28.2% for the three months ended MarchJune 31,30, 2025. Adjusted operating margin was 31.1%32.9% for the three months ended MarchJune 31,30, 2026, compared to 32.1%31.7% for the three months ended MarchJune 31,30, 2025.

•We declared and distributed dividends of $1.58$0.77 per share of Class A common stock during the three months ended MarchJune 31,30, 2026.

•We declared, effective AprilJuly 28, 2026, a quarterly dividend with respect to the three months ended MarchJune 31,30, 2026, of $0.77$0.80 per share of Class A common stock.

Limited partners of Holdings, some of whom are employees, held approximately 12% of the equity interests in Holdings as of MarchJune 31,30, 20262026, which is reflected as noncontrolling interest.

During the threesix months ended MarchJune 31,30, 2026, certain limited partners of Holdings exchanged 160,114167,614 common units (along with a corresponding number of shares of Class B or Class C common stock of APAM, as applicable) for 160,114167,614 shares of Class A common stock. In connection with the exchanges, APAM received 160,114167,614 GP units of Holdings increasing its ownership interest in Holdings.

APAM’s equity ownership interest in Holdings was 88% and 87% at MarchJune 31,30, 2026 and December 31, 2025, respectively.

Global market conditions can materially impact our financial performance. Because the revenue we earn is based on the value of our AUM, fluctuations in our AUM due to changes in the economic environment and financial markets will result in corresponding fluctuations in our revenue and earnings.

The following table presents the total returns of relevant market indices for the three and six months ended MarchJune 31,30, 2026 and 2025:

Our equity strategies experienced net outflows of $4.2 billion in the first quarter of 2026, while our credit and alternative asset classes generated combined net inflows of $1.1 billion. While net flows are inherently difficult to predict, if recent performance and market trends persist, we could continue to experience net outflows in our equity strategies and net inflows in our credit and alternative strategies throughoutand net outflows in our equity strategies during the remainder of 2026. Over the long term, we expect investment returns to generatebe the majorityprimary driver of our AUM growthgrowth, throughconsistent investment returns, which has beenwith our historical experience.

The unaudited table on the following page sets forth the average annual total returns (gross of fees) for each composite and its respective benchmark (and style benchmark, if applicable) over a multi-horizon time period as of MarchJune 31,30, 2026. Returns for periods less than one year are not annualized.

Our institutional channel includes AUM sourced from defined contribution plan clients, which made up approximately 7% of our total AUM as of MarchJune 31,30, 2026.

The following tabletables setsset forth our AUM by asset class:

Three months ended MarchJune 31,30, 2026, compared to three months ended MarchJune 31,30, 2025

Certain separate account clients pay us fees based on the performance of their accounts relative to agreed-upon benchmarks, which typically results in a lower base fee but allows us to earn higher fees if the performance we achieve for that client is superior to the performance of the agreed-upon benchmark. We may also receive performance fees or incentive allocations from Artisan Private Funds. Approximately 4% of our $173.0$183.4 billion of AUM as of MarchJune 31,30, 2026 are subject to performance fee billing arrangements, of which substantially all performance fees are recognized in the fourth quarter.

The increase in revenues of $25.9$25.1 million, or 9%, for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, was driven primarily by a $15.7$15.1 billion, or 9% increase in our average AUM.

The weighted average fee rate, inclusive of performance fees, was 67.467.9 basis points for the three months ended MarchJune 31,30, 2026, compared to 67.568.1 basis points for the three months ended MarchJune 31,30, 2025.

The increase in total compensation and benefits was primarily drivendue byto a $8.7$7.4 million increase in short-termlong-term incentive compensation largely driven by market valuation changes, a $4.5 million increase in incentive compensation primarily attributable to higher revenues inand thea three$3.0 months ended March 31, 2026. A 2%million increase in full-timeemployee associates,separation related costs including those associated with the Grandviewwind acquisition,down alsoof ledthe toU.S. increasesValue in compensation and benefit related expenses.Team.

Total compensation and benefits was 56%59% of our revenues for the three months ended MarchJune 31,30, 2026 and 2025.

Other operating expenses increased $4.7$4.1 million for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, primarily due to an increase in general and administrative costs, most notably increases in professional fees.

Net investment gain (loss) of consolidated investment products,Total net investment gain (loss)increased on nonconsolidated seed investments and net investment gain (loss) on franchise capital investments decreased $18.5$0.9 million in aggregate for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, predominately due to market conditions.conditions partially offset by a lower average invested balance during the 2026 period.

Artisan's share of the $7.6$42.2 million total investment lossesgains for the three months ended MarchJune 31,30, 2026 was comprised of $6.3$30.3 million of lossesgains on investments to hedge compensation plans and $0.2$7.0 million of gains on seed investments. $1.5$4.9 million of the total investment lossesgains for the three months ended MarchJune 31,30, 2026 were attributable to noncontrolling interests.

The provision for income taxes primarily represents APAM’s U.S. federal, state and local income taxes on its allocable portion of Holdings’ income, as well as foreign income taxes payable by Holdings’ subsidiaries. APAM’s effective income tax rate for the three months ended MarchJune 31,30, 2026 and 2025 was 21.7%20.4% and 20.6%, respectively. SeveralAPAM’s factorseffective contributeincome totax rate was less than the effectiveU.S. taxfederal rate,statutory includingrate aof 21% as (i) the rate benefit attributable to the fact thatthat, for the three months ended June 30, 2026, approximately 14% of Artisan Partners Holdings’ full year projected taxable earnings were attributable to other partners and not subject to corporate-level taxes forand (ii) the threerate monthsbenefit endedfrom Marchtax 31,deductible 2026dividends paid on unvested restricted share-based awards, which was partially offset by the incremental impact to the rate from state and 2025. Thus, income before incomelocal taxes includes amounts that are attributable to noncontrolling interests and notlimits taxableon toexecutive APAM and its subsidiaries, which reduces the effective tax rate.compensation. As APAM’s equity ownership in Holdings increases, the effective tax rate will likewise increase as more income will be subject to corporate-level taxes.

Weighted average basic and diluted shares of Class A common stock outstanding were higher for the three months ended MarchJune 31,30, 2026, compared to the three months ended MarchJune 31,30, 2025, as a result of equity award grants. See Note 13, “Earnings Per Share” in the Notes to the unaudited consolidated financial statements for discussion of earnings per share.

Our management uses non-GAAP measures (referred to as “adjusted” measures) of net income to evaluate the profitability and efficiency of the underlying operations of our business and as a factor when considering net income available for distributions and dividends. These adjusted measures remove the impact of (1) net gain (loss) on the tax receivable agreements (if any), (2) compensation expense (reversal) related to market valuation changes in compensation plans, (3) net investment gain (loss) of investment products, (4) change in fair value of contingent consideration, (5) non-recurring expenses (if any) and (56) adjustments to deferred taxes as a result of the enactment of tax laws (if any). These adjusted measures also remove the non-operational complexities of our structure by adding back noncontrolling interests and assuming all income of Artisan Partners Holdings is allocated to APAM. Management believes these non-GAAP measures provide more meaningful information to analyze our profitability and efficiency between periods and over time. We have included these non-GAAP measures to provide investors with the same financial metrics used by management to manage the Company.

•Adjusted net income represents net income excluding the impact of (1) net gain (loss) on the tax receivable agreements (if any), (2) compensation expense (reversal) related to market valuation changes in compensation plans, (3) net investment gain (loss) of investment products, (4) change in fair value of contingent consideration, (5) non-recurring expenses (if any) and (56) adjustments to deferred taxes as a result of the enactment of tax laws (if any). Adjusted net income also reflects income taxes assuming the vesting of all unvested Class A share-based awards and as if all outstanding limited partnership units of Artisan Partners Holdings had been exchanged for Class A common stock of APAM on a one-for-one basis. Assuming full vesting and exchange, all income of Artisan Partners Holdings is treated as if it were allocated to APAM, and the adjusted provision for income taxes represents an estimate of income tax expense at an effective rate reflecting APAM’s current federal, state and local income statutory tax rates. The adjusted tax rate was 24.7% for all periods presented.

Our working capital needs, including accrued incentive compensation payments, have been and are expected to be met primarily through cash generated by our operations. The assets and liabilities of consolidated investment products attributable to third-party investors do not impact our liquidity and capital resources. We have no right to the benefits from, nor do we bear the risks associated with, the assets and liabilities of consolidated investment products, beyond our direct equity investment and any investment advisory fees earned. Accordingly, assets and liabilities of consolidated investment products attributable to third-party investors are excluded from the amounts and discussions below. The following table shows our liquidity position as of MarchJune 31,30, 2026 and December 31, 2025:

We manage our cash balances in order to fund our day-to-day operations. We mitigate concentration risk through the diversification of financial institutions holding daily operating cash balances and by investing excess operating cash in various money market funds. $243.1$312.2 million of our cash and cash equivalents balance was invested in money market funds as of MarchJune 31,30, 2026.

Accounts receivable primarily represent investment advisory fees that have been earned, but not yet received from our clients. We perform a review of our receivables on a monthly basis to assess collectability. As of MarchJune 31,30, 2026, none of our receivables were considered uncollectible.

We utilize cash to make seed investments in Artisan-sponsored investment products to support the development of new investment strategies and vehicles. As of MarchJune 31,30, 2026, the balance of all seed investments, including investments in consolidated investment products, was $109.9$96.2 million. The seed investments are generally redeemable at our discretion, though subject to certain monthly or quarterly timing restrictions for certain Artisan Private Funds. We monitor for opportunities to redeem our seed investments as sufficient scale in each investment strategy, vehicle and class, as applicable, is achieved.