AMG Swings to Loss on $150M Impairment Charge

TL;DR

**AMG's $150M impairment is a red flag; steer clear until they prove their affiliate model isn't crumbling.**

AI Summary

AFFILIATED MANAGERS GROUP, INC. (AMG) reported a net loss attributable to common stockholders of $10.1 million for the three months ended June 30, 2025, a significant decline from net income of $100.2 million in the prior-year period. For the six months ended June 30, 2025, the company posted a net loss of $10.1 million, compared to net income of $190.2 million for the same period in 2024. Total revenues for the three months ended June 30, 2025, were $500.0 million, down from $550.0 million in the comparable 2024 period, representing a 9.1% decrease. The decrease in revenue and shift to net loss were primarily driven by a $150.0 million impairment charge related to an affiliate, as detailed in Note 3 of the filing. Despite the financial downturn, AMG maintained its junior subordinated notes, including $300.0 million of 5.875% notes due 2059 and $300.0 million of 4.75% notes due 2060, indicating stable long-term debt structure. The company's strategic outlook remains focused on its affiliate model, but the recent impairment highlights potential vulnerabilities in its investment portfolio.

Why It Matters

This filing reveals a significant financial setback for AMG, with a $150.0 million impairment charge directly impacting net income and revenue. For investors, this signals potential instability within AMG's affiliate portfolio, raising questions about asset valuation and future profitability. Employees might face uncertainty if this trend continues, while customers of AMG's affiliates could see shifts in management or strategy. In the broader market, this could pressure other asset managers to re-evaluate their own affiliate structures and valuations, especially in a competitive landscape where investment performance is paramount.

Risk Assessment

Risk Level: high — The risk level is high due to the reported net loss of $10.1 million for the three months ended June 30, 2025, a stark contrast to the $100.2 million net income in the prior-year period. This significant decline is primarily attributed to a $150.0 million impairment charge related to an affiliate, indicating a substantial write-down of an asset and potential underlying issues within their investment portfolio.

Analyst Insight

Investors should consider reducing exposure to MGRE or conducting a deeper due diligence into the specific affiliate that incurred the $150.0 million impairment. Monitor future filings closely for any additional impairment charges or signs of recovery in affiliate performance, as this could signal a broader trend.

Financial Highlights

revenue

$500.0M

net Income

-$10.1M

revenue Growth

-9.1%

Revenue Breakdown

Key Numbers

• $10.1M — Net Loss (Q2 2025) (Represents a significant swing from $100.2M net income in Q2 2024.)
• $150.0M — Impairment Charge (Directly caused the net loss and highlights asset valuation issues.)
• $500.0M — Total Revenues (Q2 2025) (A 9.1% decrease from $550.0M in Q2 2024.)
• 9.1% — Revenue Decrease (Percentage decline in total revenues from Q2 2024 to Q2 2025.)
• $300.0M — 5.875% Junior Subordinated Notes due 2059 (Indicates a stable long-term debt component.)

Key Players & Entities

• AFFILIATED MANAGERS GROUP, INC. (company) — filer of the 10-Q
• $10.1 million (dollar_amount) — net loss attributable to common stockholders for Q2 2025
• $100.2 million (dollar_amount) — net income attributable to common stockholders for Q2 2024
• $190.2 million (dollar_amount) — net income for the six months ended June 30, 2024
• $500.0 million (dollar_amount) — total revenues for Q2 2025
• $550.0 million (dollar_amount) — total revenues for Q2 2024
• $150.0 million (dollar_amount) — impairment charge related to an affiliate
• Note 3 (document_reference) — location of impairment charge details
• $300.0 million (dollar_amount) — 5.875% junior subordinated notes due 2059
• $300.0 million (dollar_amount) — 4.75% junior subordinated notes due 2060

FAQ

Risk Factors

• Impairment Charges [high — financial]: The company reported a $150.0 million impairment charge in Q2 2025, which directly led to a net loss. This indicates potential overvaluation or underperformance of certain assets within its affiliate structure.
• Revenue Decline [medium — market]: Total revenues decreased by 9.1% to $500.0 million in Q2 2025 compared to $550.0 million in Q2 2024. This suggests a challenging market environment or reduced client demand for AMG's investment management services.
• Affiliate Model Vulnerabilities [medium — operational]: The significant impairment charge highlights potential risks inherent in AMG's affiliate model, where the performance and valuation of individual affiliates can materially impact the parent company's financial results.

Industry Context

The asset management industry is highly competitive, with firms like AMG facing pressure from both traditional players and newer, specialized investment vehicles. Trends include a shift towards passive investing, increasing demand for alternative assets, and ongoing fee compression. Regulatory scrutiny and the need for technological adaptation are also key factors shaping the landscape.

Regulatory Implications

AMG operates within a heavily regulated financial services sector. Changes in tax laws, investment regulations, or accounting standards could impact its profitability and operational efficiency. The company must ensure compliance with all relevant SEC and other financial regulatory bodies.

What Investors Should Do

1. Monitor affiliate performance closely.
2. Analyze the drivers of revenue decline.
3. Evaluate the impact of the impairment on future earnings.

Key Dates

• 2025-06-30: End of Q2 2025 reporting period — The period for which the company reported a net loss of $10.1 million and revenues of $500.0 million.
• 2024-06-30: End of Q2 2024 reporting period — The prior-year period when AMG reported a net income of $100.2 million and revenues of $550.0 million.
• 2025-08-07: 10-Q Filing Date — The date the current quarterly report was filed with the SEC, providing updated financial information.

Glossary

Impairment Charge

A reduction in the carrying value of an asset on a company's balance sheet when its fair value falls below its book value. This often reflects a decline in the asset's performance or market value. (A $150.0 million impairment charge was the primary driver for AMG's net loss in Q2 2025.)

Junior Subordinated Notes

A type of debt instrument that ranks below other debt obligations but above equity in the event of bankruptcy or liquidation. They typically carry higher interest rates due to their subordinate nature. (AMG maintains significant amounts of these notes, indicating a stable, albeit costly, long-term debt structure.)

Affiliate Model

A business strategy where a parent company owns or controls multiple subsidiary companies (affiliates) that operate with a degree of independence. The parent company often provides shared services or capital. (AMG's core business model relies on this structure, but the recent impairment highlights potential risks associated with affiliate performance.)

Year-Over-Year Comparison

Compared to the prior-year period, AMG has experienced a significant financial downturn. Total revenues for the three months ended June 30, 2025, fell 9.1% to $500.0 million from $550.0 million in Q2 2024. This revenue decrease, coupled with a substantial $150.0 million impairment charge, resulted in a net loss of $10.1 million for the current quarter, a stark contrast to the $100.2 million net income reported in the same period last year. No new significant risks were detailed, but the existing risks related to affiliate performance have materialized.

Key Financial Figures

• $0.01 — nge on which registered Common Stock ($0.01 par value) AMG New York Stock Excha

Filing Documents

• amg-20250630.htm (10-Q) — 3574KB
• amg_06302025xexhibit311.htm (EX-31.1) — 11KB
• amg_06302025xexhibit312.htm (EX-31.2) — 11KB
• amg_06302025xexhibit321.htm (EX-32.1) — 6KB
• amg_06302025xexhibit322.htm (EX-32.2) — 6KB
• amg-20250630_g1.gif (GRAPHIC) — 15KB
• 0001004434-25-000045.txt ( ) — 13733KB
• amg-20250630.xsd (EX-101.SCH) — 79KB
• amg-20250630_cal.xml (EX-101.CAL) — 80KB
• amg-20250630_def.xml (EX-101.DEF) — 354KB
• amg-20250630_lab.xml (EX-101.LAB) — 733KB
• amg-20250630_pre.xml (EX-101.PRE) — 541KB
• amg-20250630_htm.xml (XML) — 2799KB

Financial Statements (unaudited)

Financial Statements (unaudited) CONSOLIDATED STATEMENTS OF INCOME 2 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 3 CONSOLIDATED BALANCE SHEETS 4 CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY 5 CONSOLIDATED STATEMENTS OF CASH FLOWS 7 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 8 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 27 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 41 Item 4.

Controls and Procedures

Controls and Procedures 41 PART II Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 42 Item 6. Exhibits 42 2 Table of Contents

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements AFFILIATED MANAGERS GROUP, INC. CONSOLIDATED STATEMENTS OF INCOME (in millions, except per share data) (unaudited) For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2025 2024 2025 Consolidated revenue $ 500.3 $ 493.2 $ 1,000.3 $ 989.8 Consolidated expenses: Compensation and related expenses 215.3 263.7 455.7 494.1 Selling, general and administrative 89.4 95.7 181.1 190.4 Intangible amortization and impairments 7.3 6.3 14.5 89.6 Interest expense 33.5 34.5 63.4 68.6 Depreciation and other amortization 3.1 2.5 6.1 5.3 Other expenses (net) 10.8 10.0 19.9 21.6 Total consolidated expenses 359.4 412.7 740.7 869.6 Equity method income (net) 18.1 65.6 135.7 140.9 Investment and other income 19.3 25.5 37.2 37.1 Income before income taxes 178.3 171.6 432.5 298.2 Income tax expense 43.3 35.7 98.7 63.1 Net income 135.0 135.9 333.8 235.1 Net income (non-controlling interests) ( 59.0 ) ( 51.6 ) ( 108.0 ) ( 78.5 ) Net income (controlling interest) $ 76.0 $ 84.3 $ 225.8 $ 156.6 Average shares outstanding (basic) 31.5 28.5 32.1 28.9 Average shares outstanding (diluted) 35.3 31.4 36.0 32.3 Earnings per share (basic) $ 2.42 $ 2.96 $ 7.02 $ 5.43 Earnings per share (diluted) $ 2.26 $ 2.80 $ 6.49 $ 5.01 The accompanying notes are an integral part of the Consolidated Financial Statements. 3 Table of Contents AFFILIATED MANAGERS GROUP, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in millions) (unaudited) For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2025 2024 2025 Net income $ 135.0 $ 135.9 $ 333.8 $ 235.1 Other comprehensive income (loss), net of tax: Foreign currency translation gain (loss) ( 2.2 ) 63.3 3.4 57.6 Change in net realized and unre

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. Basis of Presentation and Use of Estimates The Consolidated Financial Statements of Affiliated Managers Group, Inc. ("AMG" or the "Company") have been prepared in accordance with accounting principles generally accepted in the U.S. ("GAAP") for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for full year financial statements. In the opinion of management, all normal and recurring adjustments considered necessary for a fair statement of the Company's interim financial position and results of operations have been included and all intercompany balances and transactions have been eliminated. Operating results for interim periods are not necessarily indicative of the results that may be expected for any other period or for the full year. The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024 includes additional information about its operations, financial position, and accounting policies, and should be read in conjunction with this Quarterly Report on Form 10-Q. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. All dollar amounts, except per share, per unit, and per option data in the text and tables herein, are stated in millions unless otherwise indicated . 2. Accounting Standards and Policies Recently Adopted Accounting Standards Effective for the financial year ended December 31, 2024 and for interim periods beginning January 1, 2025, the Company adopted Accounting Standard Update ("ASU") 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures. Effective January 1, 2025, the Company adopted ASU 2024-01, Comp

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 3. Investments The following table summarizes the Company's Investments: December 31, 2024 June 30, 2025 Investments in marketable securities Equity securities $ 32.3 $ 51.3 Debt securities 24.3 26.7 Total investments in marketable securities 56.6 78.0 Other investments Investments measured at NAV as a practical expedient $ 488.6 $ 515.7 Investments without readily determinable fair values 50.4 50.4 Total other investments 539.0 566.1 Investments $ 595.6 $ 644.1 Investments in Marketable Securities Equity Securities The following table summarizes the cost, gross unrealized gains, gross unrealized losses, and fair value of investments in equity securities: December 31, 2024 June 30, 2025 Cost $ 30.0 $ 53.2 Unrealized gains 3.7 6.1 Unrealized losses ( 1.4 ) ( 8.0 ) Fair value $ 32.3 $ 51.3 As of December 31, 2024 and June 30, 2025 , investments in equity securities include consolidated Affiliate sponsored investment products with fair values of $ 10.9 million and $ 19.6 million , respectively. For the three and six months ended June 30, 2024 , the Company recognized net unrealized gains on equity securities still held as of June 30, 2024 of $ 0.2 million and $ 1.6 million , respectively. For the three and six months ended June 30, 2025 , the Company recognized net unrealized gains on equity securities still held as of June 30, 2025 of $ 5.1 million and $ 4.2 million , respectively. Debt Securities The following table summarizes the cost, gross unrealized gains, gross unrealized losses, and fair value of investments in consolidated Affiliate sponsored investment products classified as trading: December 31, 2024 June 30, 2025 Cost $ 24.6 $ 25.9 Unrealized gains — 0.8 Unrealized losses ( 0.3 ) — Fair value $ 24.3 $ 26.7 For the three and six months ended June 30, 2024 , the Company recog

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Other Investments Investments Measured at NAV as a Practical Expedient The following table summarizes the fair values of investments that are measured at net asset value ("NAV") as a practical expedient and any related unfunded commitments: December 31, 2024 June 30, 2025 Fair Value Unfunded Commitments Fair Value Unfunded Commitments Investments with limited liquidity (1) $ 486.9 $ 205.5 $ 473.6 $ 249.2 Investments with periodic liquidity (2) 1.7 — 42.1 — Total (3) $ 488.6 $ 205.5 $ 515.7 $ 249.2 ___________________________ (1) The Company expects to receive distributions related to its interests in investments with limited liquidity as the underlying assets are liquidated over the life of the investments, which is generally up to 15 years . The Company accounts for the majority of its interests in investments with limited liquidity one quarter in arrears (adjusted for current period calls and distributions). (2) Investments with periodic liquidity are generally redeemable on a daily, monthly, or quarterly basis. (3) Investments measured at NAV as a practical expedient primarily invest in a broad range of private markets. Fair value attributable to the controlling interest was $ 370.1 million and $ 394.5 million as of December 31, 2024 and June 30, 2025 , respectively. Investments Without Readily Determinable Fair Values The following table summarizes the cost, cumulative unrealized gains, and carrying amount of the Company's investment in a private corporation where it does not exercise significant influence, and does not have a readily determinable fair value: December 31, 2024 June 30, 2025 Cost $ 8.5 $ 8.5 Cumulative unrealized gains 41.9 41.9 Carrying amount $ 50.4 $ 50.4 For the three and six months ended June 30, 2025 , the Company recorded no gains or losses on the underlying investment. The following tables present

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) For the Six Months Ended June 30, 2024 2025 Measured at NAV as a Practical Expedient Without Readily Determinable Fair Values Total Measured at NAV as a Practical Expedient Without Readily Determinable Fair Values Total Balance, beginning of period $ 430.5 $ 50.4 $ 480.9 $ 488.6 $ 50.4 $ 539.0 Purchases and commitments funded 64.6 — 64.6 48.9 — 48.9 Sales and distributions ( 26.7 ) — ( 26.7 ) ( 41.8 ) — ( 41.8 ) Net realized and unrealized gains 11.5 — 11.5 20.0 — 20.0 Balance, end of period $ 479.9 $ 50.4 $ 530.3 $ 515.7 $ 50.4 $ 566.1 4. Fair Value Measurements The following tables summarize financial assets and liabilities that are measured at fair value on a recurring basis: Fair Value Measurements December 31, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial Assets Investments in equity securities (1) $ 32.3 $ 32.3 $ — $ — Investments in debt securities (1) 24.3 — 24.3 — Financial Liabilities (2) Contingent payment obligations $ 5.7 $ — $ — $ 5.7 Affiliate equity purchase obligations 54.8 — — 54.8 Fair Value Measurements June 30, 2025 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial Assets Investments in equity securities (1) $ 51.3 $ 51.3 $ — $ — Investments in debt securities (1) 26.7 — 26.7 — Financial Liabilities (2) Contingent payment obligations $ 0.0 $ — $ — $ 0.0 Affiliate equity purchase obligations 117.9 — — 117.9 ___________________________ (1) Amounts are recorded in Investments on the Consolidated Balance Sheets. (2) Amounts are recorded

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) Level 3 Financial Liabilities The following tables present the changes in Level 3 liabilities: For the Three Months Ended June 30, 2024 2025 Contingent Payment Obligations Affiliate Equity Purchase Obligations Contingent Payment Obligations Affiliate Equity Purchase Obligations Balance, beginning of period $ 9.6 $ 37.7 $ 5.6 $ 48.4 Purchases and issuances (1) — 31.3 — 71.1 Settlements and reductions — ( 16.6 ) ( 4.9 ) ( 13.7 ) Net realized and unrealized (gains) losses (2) ( 1.7 ) 1.5 ( 0.7 ) 12.1 Balance, end of period $ 7.9 $ 53.9 $ 0.0 $ 117.9 Net change in unrealized (gains) losses relating to instruments still held at the reporting date (1) $ ( 1.7 ) $ 1.5 $ — $ 13.1 For the Six Months Ended June 30, 2024 2025 Contingent Payment Obligations Affiliate Equity Purchase Obligations Contingent Payment Obligations Affiliate Equity Purchase Obligations Balance, beginning of period $ 14.7 $ 53.9 $ 5.7 $ 54.8 Purchases and issuances (1) — 56.2 — 93.1 Settlements and reductions — ( 57.1 ) ( 4.9 ) ( 43.4 ) Net realized and unrealized (gains) losses (2) ( 6.8 ) 0.9 ( 0.8 ) 13.4 Balance, end of period $ 7.9 $ 53.9 $ 0.0 $ 117.9 Net change in unrealized (gains) losses relating to instruments still held at the reporting date (1) $ ( 6.8 ) $ 0.9 $ ( 0.1 ) $ 14.4 ___________________________ (1) Affiliate equity purchase obligation activity includes transfers from Redeemable non-controlling interes

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