T. Rowe Price Group, Inc. (TROW) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

July 28, 2023 8:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning. My name is Gigi, and I'll be your conference facilitator today. Welcome to T. Rowe Price's Second Quarter 2023 Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer period. I will give you instructions on how to ask questions at that time. As a reminder, this call is being recorded, and will be available for replay on T. Rowe Price's website shortly after the call concludes.

I will now turn the call over to Linsley Carruth, T Rowe Price's Director of Investor Relations.

Linsley Carruth

Hello, and thank you for joining us today for our second quarter earnings call.

The press release and a supplemental materials document can be found on our IR website at investors.troweprice.com. Today's call will last approximately 45 minutes. Our CEO and President, Rob Sharps, and CFO, Jen Dardis, will discuss the company's results for about 15 minutes, and then we'll open it up to your questions. We ask that you limit it to one question per participant.

I'd like to remind you that during the course of this call, we may make a number of forward-looking statements and reference certain non-GAAP financial measures. Please refer to the forward-looking statement language and the reconciliations to GAAP in the supplemental materials as well as in our press release and 10-Q.

Now, I'll turn it over to Rob.

Rob Sharps

Thank you, Linsley, and thank you all for joining us today.

While equity outflows continued in the second quarter, we saw improved performance in a number of important investment strategies. Stronger equity markets helped lift revenue from first quarter levels, and we identified substantial cost savings that will allow us to meaningfully slow expense growth while continuing to pursue our strategic initiatives.

On today's call, I'll give an overview of our investment performance followed by a brief update on the key milestones we've reached in advancing our strategic initiatives. Jen will then provide a detailed view of our financial results before we take your questions.

Overall, second quarter investment performance was encouraging with reasonably solid results across asset classes and the percentage of funds outperforming their peers increasing from the prior quarter. The U.S. large-cap growth franchise outperformed this quarter, with blue chip growth stock and large-cap growth posting top-quartile results versus peers and beating their benchmarks. Our U.S. equity research and mid-cap value strategies continued to deliver strong performance. In contrast, the large-cap value franchise, a bright spot in 2022, gave back some of its relative outperformance in the first half of 2023. However, the long-term results remain favorable.