WisdomTree Investments (NYSE:WT) reported record assets under management (AUM) and strong financial results for the first quarter of 2025, according to the company’s earnings presentation on May 2. The asset manager continues to see momentum in its core ETF business while making progress on its digital assets initiatives.
Quarterly Performance Highlights
WisdomTree achieved record AUM of $115.8 billion as of March 31, 2025, representing a 5.5% increase from the $109.8 billion reported at the end of 2024. The company generated $3.0 billion in net inflows during the quarter, translating to an 11% annualized organic growth rate.
"WisdomTree was one of the only asset managers to expand AUM quarter-over-quarter," the company noted in its presentation, highlighting that inflows were spread across five of its eight major product categories and all three of its divisions: U.S. ($1.8 billion), Europe ($1.1 billion), and Digital ($0.1 billion).
The company’s UCITS ETF suite was particularly strong, attracting over $1 billion in net inflows, representing a 65% annualized organic growth rate. As of April 30, 2025, AUM had further increased to $116.3 billion, up 0.4% from the end of the first quarter.
As shown in the following chart of AUM and net flows:
On the financial front, WisdomTree reported adjusted revenues of $108.1 million for Q1 2025, up 12.1% compared to $96.4 million in the same period last year. Adjusted net income rose to $23.0 million from $20.3 million in Q1 2024, while adjusted earnings per share increased to $0.16 from $0.12, representing a 33.3% year-over-year improvement.
The company’s adjusted operating margin expanded to 31.6% in Q1 2025, up from 29.7% in the first quarter of 2024, demonstrating improved operational efficiency.
The following chart illustrates the company’s revenue and earnings performance:
Digital Assets Strategy
WisdomTree continues to position itself as an early mover in the tokenization of real-world assets, a market the company claims has grown from near zero in 2017 to over $200 billion today. The company’s digital assets strategy is divided into two main platforms: WisdomTree Prime for retail investors and WisdomTree Connect for businesses and institutions.
The company’s digital assets platform is illustrated in the following diagram:
Digital asset metrics showed promising growth in Q1 2025, with 28,000 opened accounts (up 8% from year-end 2024) and 2,700 funded accounts (up 17% from year-end 2024). Total WisdomTree tokenized AUM reached $132 million, representing a significant increase of $101 million from the end of 2024.
The WisdomTree Government Money Market Digital Fund attracted $100 million in net inflows during the quarter, demonstrating growing interest in the company’s blockchain-enabled funds.
As shown in the following metrics for digital assets:
"A secular shift toward tokenization is underway and WisdomTree is a leader," the company stated, noting that the early growth curve of tokenized real-world assets exceeds the early ETF adoption in the 1990s. WisdomTree Connect has expanded to several different blockchains and gathered over $100 million in assets in 2025 so far.
The company’s digital assets product strategy focuses on two main pillars: Access & Services (through WisdomTree Prime and WisdomTree Connect) and Exposures (through asset tokens, digital funds, and crypto offerings).
The following chart outlines WisdomTree’s digital assets product pillars:
Portfolio Solutions Strategy
WisdomTree is pursuing an ambitious growth strategy for its model portfolio business in 2025, targeting a 35-40% expansion in Model Assets Under Advisement (AUA) to $5.2 billion and a 25-30% increase in model users to 3,250.
The company’s portfolio solutions distribution strategy employs what it calls a "barbell approach," focusing on both large distribution networks and customized models for registered investment advisors (RIAs) and independent broker-dealers (IBDs).
As illustrated in the following growth targets for model portfolios:
"WisdomTree’s ability to deliver strong model performance and asset growth allows the firm to navigate rigorous selection processes at some of the leading wealth management firms in the U.S.," the company noted in its presentation.
The company is focused on a three-pronged growth strategy: increasing the number of advisors using WisdomTree model products, growing the number of accounts per advisor, and growing the assets per account.
Forward Outlook
WisdomTree’s guidance for 2025 remains largely unchanged from previous forecasts. The company expects a compensation to revenue ratio of 28-30%, discretionary spending of $68-72 million, and a gross margin of 81-82% for the full year.
The company outlined its growth algorithm, which includes ongoing inflow momentum, "stickier" inflows from expanding managed model relationships, early mover advantage in tokenization, and scale benefits as AUM and revenue growth expand operating margins.
The following diagram illustrates WisdomTree’s growth algorithm:
WisdomTree expects its incremental margins to exceed 50%, which should lead to "material margin improvement" as the company continues to scale its AUM and revenues. The company’s key themes for 2025 include growing and diversifying revenue streams, disciplined execution, strategic innovation, and proactive capital deployment.
The company noted that it is "actively monitoring market volatility and may scale back spending if necessary," suggesting a cautious approach to managing expenses in the current market environment.
WisdomTree’s stock closed at $8.73 on May 1, 2025, up 0.34% for the day. The stock has traded between $7.47 and $12.45 over the past 52 weeks.
Full presentation:
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