SEIC's Net Income Jumps 28% on Revenue Growth, Strategic Divestiture

Ticker: SEIC · Form: 10-Q · Filed: Oct 27, 2025 · CIK: 350894

Sentiment: bullish

Topics: Financial Technology, Asset Management, Earnings Growth, Share Repurchase, Strategic Divestiture, Wealth Management, Fintech

Related Tickers: SEIC, BLK, MSCI, JPM, SCHW

TL;DR

**SEIC is crushing it, with a massive net income jump and smart divestiture, making it a solid buy for growth-focused investors.**

AI Summary

SEI Investments Company (SEIC) reported a strong financial performance for the nine months ended September 30, 2025, with total revenues increasing by 7.7% to $1.689 billion from $1.568 billion in the prior year. Net income attributable to SEI Investments Company surged by 27.6% to $542.8 million, up from $425.4 million. Basic earnings per common share rose significantly to $4.35 from $3.26, reflecting a 33.4% increase. A key driver of this growth was a $94.4 million gain on the sale of a business, which significantly boosted income before income taxes to $699.2 million from $555.6 million. Asset management, administration, and distribution fees grew by 7.6% to $1.332 billion, while information processing and software servicing fees increased by 8.3% to $357.8 million. The company also saw a substantial increase in cash provided by operating activities, reaching $481.3 million, up from $427.1 million. Shareholder returns were also a focus, with $515.2 million spent on common stock repurchases and $61.5 million in dividends declared. The company also consolidated Variable Interest Entities, adding $170.7 million in assets and $100.5 million in liabilities to the balance sheet.

Why It Matters

SEIC's robust earnings growth and strategic business divestiture signal strong operational efficiency and a focus on core competencies, which could attract new investors and strengthen its competitive position against financial technology rivals. The significant share repurchases, totaling $515.2 million, demonstrate management's confidence and commitment to returning capital to shareholders, potentially boosting stock price. For employees, continued profitability and growth could lead to stability and opportunities. Customers benefit from SEIC's investment in technology and asset management platforms, enhancing service offerings and potentially driving market share gains in the financial services industry.

Risk Assessment

Risk Level: medium — While SEIC shows strong financial performance, the consolidation of Variable Interest Entities (VIEs) introduces new balance sheet complexities, with $170.7 million in assets and $100.5 million in liabilities from consolidated VIEs. Additionally, the company's significant reliance on asset management and information processing fees means it is susceptible to market fluctuations and competitive pressures, as evidenced by the $112.2 million increase in receivables, which could indicate potential collection risks.

Analyst Insight

Investors should consider SEIC's strong earnings growth and strategic capital allocation, including significant share repurchases, as positive indicators. Monitor the integration and performance of consolidated VIEs and the impact of market conditions on asset management fees. This filing suggests a company executing well, making it a potential addition for growth-oriented portfolios.

Financial Highlights

debt To Equity
0.18
revenue
$1.689B
operating Margin
N/A
total Assets
$2.845B
total Debt
$425.7M
net Income
$542.8M
eps
$4.35
gross Margin
N/A
cash Position
$792.8M
revenue Growth
+7.7%

Revenue Breakdown

SegmentRevenueGrowth
Asset management, administration and distribution fees$1,331,650+7.6%
Information processing and software servicing fees$357,800+8.3%

Key Numbers

Key Players & Entities

FAQ

What were SEI Investments Company's total revenues for the nine months ended September 30, 2025?

SEI Investments Company reported total revenues of $1.689 billion for the nine months ended September 30, 2025, an increase from $1.568 billion in the same period of 2024.

How much did SEI Investments Company's net income attributable to the company increase?

Net income attributable to SEI Investments Company increased by 27.6% to $542.8 million for the nine months ended September 30, 2025, compared to $425.4 million in the prior year.

What was the basic earnings per common share for SEI Investments Company?

Basic earnings per common share for SEI Investments Company was $4.35 for the nine months ended September 30, 2025, a significant increase from $3.26 in the same period of 2024.

Did SEI Investments Company have any significant gains from business divestitures?

Yes, SEI Investments Company recognized a net gain of $94.4 million from the sale of a business during the nine months ended September 30, 2025, contributing to its strong income before taxes.

How much cash did SEI Investments Company generate from operating activities?

SEI Investments Company generated $481.3 million in net cash from operating activities for the nine months ended September 30, 2025, up from $427.1 million in the prior year.

What was SEI Investments Company's strategy regarding common stock repurchases?

SEI Investments Company purchased and retired common stock totaling $515.2 million for the nine months ended September 30, 2025, demonstrating a commitment to returning capital to shareholders.

What impact did Variable Interest Entities have on SEI Investments Company's balance sheet?

The consolidation of Variable Interest Entities added $170.7 million in assets and $100.5 million in liabilities to SEI Investments Company's balance sheet as of September 30, 2025.

What were the main revenue streams for SEI Investments Company?

SEI Investments Company's main revenue streams were asset management, administration and distribution fees, totaling $1.332 billion, and information processing and software servicing fees, totaling $357.8 million, for the nine months ended September 30, 2025.

How did SEI Investments Company's expenses change year-over-year?

Total expenses for SEI Investments Company increased to $1.224 billion for the nine months ended September 30, 2025, from $1.162 billion in the prior year, primarily driven by higher compensation and benefits costs.

What is SEI Investments Company's outlook based on this filing?

Based on the strong revenue growth, significant net income increase, and strategic capital allocation including a business divestiture and share repurchases, SEI Investments Company appears to be in a strong financial position with a positive outlook.

Risk Factors

Industry Context

SEI Investments Company operates in the highly competitive financial technology, operations, and asset management sectors. The industry is characterized by increasing demand for integrated solutions that streamline investment processes, enhance client experiences, and improve operational efficiency. Key trends include the adoption of digital platforms, outsourcing of back- and middle-office functions, and the growing importance of data analytics and personalized investment strategies.

Regulatory Implications

SEIC faces significant regulatory scrutiny due to its role in the financial services industry. Compliance with evolving regulations concerning data privacy (e.g., GDPR, CCPA), consumer protection, and financial market conduct is paramount. Failure to adhere to these regulations can result in substantial fines, legal actions, and reputational damage, requiring continuous investment in compliance infrastructure and expertise.

What Investors Should Do

  1. Monitor the impact of the VIE consolidation on future financial statements and operational leverage.
  2. Evaluate the sustainability of earnings growth, considering the one-time gain on the sale of a business.
  3. Assess the effectiveness of capital allocation strategies, particularly share repurchases.
  4. Analyze the growth drivers within the Asset Management and Information Processing segments.

Key Dates

Glossary

Variable Interest Entities (VIEs)
Entities for which the equity is insufficient to permit the entity to finance its activities without additional financial support from other parties, or where the equity investors do not have the characteristics of a controlling financial interest. SEIC consolidates these entities if it has a controlling financial interest. (The consolidation of VIEs on September 30, 2025, added $170.7 million in assets and $100.5 million in liabilities to SEIC's balance sheet, impacting its financial structure.)
Asset management, administration and distribution fees
Revenue generated from providing services related to managing investment portfolios, administering funds, and distributing investment products. (This is a primary revenue stream for SEIC, showing a 7.6% increase year-over-year, indicating growth in its core asset management and related services.)
Information processing and software servicing fees
Revenue derived from providing technology solutions, business process outsourcing, and software services, particularly for wealth managers and investment operations. (This segment grew by 8.3%, highlighting the increasing demand for SEIC's technology-enabled financial services and operational solutions.)
Basic earnings per common share (EPS)
The net income attributable to each outstanding share of common stock, calculated using the weighted average number of shares outstanding. (SEIC reported a significant 33.4% increase in basic EPS to $4.35, demonstrating enhanced profitability on a per-share basis for shareholders.)
Common stock repurchases
The company's action of buying back its own shares from the open market, which reduces the number of outstanding shares and can increase EPS. (SEIC spent $515.2 million on repurchases, indicating a commitment to returning capital to shareholders and potentially boosting future EPS.)
Operating Lease Right-of-Use Assets
An asset representing the lessee's right to use an underlying leased asset for the lease term. This is recognized under ASC 842 for leases classified as operating leases. (These assets, valued at $24.1 million as of September 30, 2025, represent SEIC's long-term usage rights for leased properties or equipment.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, SEIC has demonstrated robust financial performance. Total revenues increased by 7.7% to $1.689 billion, and net income saw a substantial rise of 27.6% to $542.8 million, significantly boosted by a one-time gain on the sale of a business. Basic EPS grew by an impressive 33.4% to $4.35. Cash provided by operating activities also improved, rising from $427.1 million to $481.3 million. The balance sheet reflects the consolidation of Variable Interest Entities, adding $170.7 million in assets and $100.5 million in liabilities.

Filing Stats: 4,460 words · 18 min read · ~15 pages · Grade level 20 · Accepted 2025-10-27 14:34:35

Key Financial Figures

Filing Documents

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION Page

Financial Statements. 2

Item 1. Financial Statements. 2 Consolidated Balance Sheets (Unaudited) -- September 30, 2025 and December 31, 2024 2 Consolidated Statements of Operations (Unaudited) -- For the Three and Nine Months Ended September 30, 2025 and 2024 4 Consolidated Statements of Comprehensive Income (Unaudited) -- For the Three and Nine Months Ended September 30, 2025 and 2024 5 Consolidated Statements of Changes in Equity (Unaudited) -- For the Three and Nine Months Ended September 30, 2025 and 2024 6 Consolidated Condensed Statements of Cash Flows (Unaudited) -- For the Nine Months Ended September 30, 2025 and 2024 8

Notes to Consolidated Financial Statements 10

Notes to Consolidated Financial Statements 10

Management's Discussion and Analysis of Financial Condition and Results of Operations. 32

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. 32

Quantitative and Qualitative Disclosures About Market Risk. 48

Item 3. Quantitative and Qualitative Disclosures About Market Risk. 48

Controls and Procedures. 48

Item 4. Controls and Procedures. 48

- OTHER INFORMATION

PART II - OTHER INFORMATION

Legal Proceedings. 49

Item 1. Legal Proceedings. 49

Risk Factors. 49

Item 1A. Risk Factors. 49

Unregistered Sales of Equity Securities and Use of Proceeds. 49

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. 49

Other Information 49

Item 5. Other Information 49

Exhibits. 50

Item 6. Exhibits. 50 Signatures 51 1

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. Consolidated Balance Sheets SEI Investments Company (unaudited) and Subsidiaries (Dollars in thousands, except per-share data) September 30, 2025 December 31, 2024 Assets Current Assets: Cash and cash equivalents $ 792,822 $ 840,193 Receivables from investment products 50,563 54,118 Receivables, net of allowance for doubtful accounts of $ 2,228 and $ 1,435 670,116 567,634 Securities owned 31,242 29,583 Other current assets 66,975 60,282 Total Current Assets 1,611,718 1,551,810 Property and Equipment, net of accumulated depreciation of $ 461,304 and $ 493,219 156,065 159,643 Operating Lease Right-of-Use Assets 24,065 28,905 Capitalized Software, net of accumulated amortization of $ 661,413 and $ 641,071 235,559 236,023 Investments 293,865 315,567 Assets of Consolidated Variable Interest Entities 170,657 — Goodwill 168,430 170,287 Intangible Assets, net of accumulated amortization of $ 44,506 and $ 55,835 61,387 77,370 Deferred Contract Costs 49,113 45,855 Deferred Income Taxes 17,490 51,984 Other Assets, net 56,761 47,162 Total Assets $ 2,845,110 $ 2,684,606 The accompanying notes are an integral part of these consolidated financial statements. 2 Consolidated Balance Sheets SEI Investments Company (unaudited) and Subsidiaries (Dollars in thousands, except per-share data) September 30, 2025 December 31, 2024 Liabilities, Redeemable Non-controlling Interests and Shareholders' Equity Current Liabilities: Accounts payable $ 7,871 $ 13,081 Accrued liabilities 254,162 347,513 Current portion of long-term operating lease liabilities 7,083 7,900 Deferred revenue 12,307 12,019 Total Current Liabilities 281,423 380,513 Liabilities of Consolidated Variable Interest Entities 100,492 — Long-term Income Taxes Payable — 803 Long-term Operating Lease Liabilities 19,234 24,235 Other Long-term Liabilities 24,552 26,943 Total Liabilities 425,701 432,494 Commitments and Contingencies Redeemable Non-con

Notes to Consolidated Financial Statements SEI Investments Company

Notes to Consolidated Financial Statements SEI Investments Company (all figures are in thousands except share and per-share data) and Subsidiaries Note 1 – Summary of Significant Accounting Policies Nature of Operations SEI Investments Company (the Company), a Pennsylvania corporation, is a leading global provider of financial technology, operations, and asset management services within the financial services industry. Investment processing platforms provide technologies and business process outsourcing services for wealth managers. These solutions include investment advisory, client relationship, and other technology-enabled capabilities for the front office; administrative and investment services for the middle office; and accounting and processing services for the back office. Revenues from investment processing services are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations. Investment operations platforms provide business process outsourcing services for investment managers and asset owners. These platforms support a broad range of traditional and alternative investments and provide technology-enabled information analytics and investor capabilities for the front office; administrative and investment services for the middle office; and fund administration and accounting services for the back office. Revenues from investment operations services are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations. Investment management platforms provide comprehensive solutions for managing personal and institutional wealth. These platforms include goals-based investment strategies; SEI-sponsored and third-party investment products, including mutual funds, ETFs, collective investment products, alternative investment portfolios and separately managed accounts (SMA); and other market-specific advice, technology and operational

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