Franklin Resources, Inc. Announces Month-End Assets Under Management

Rhea-AI Summary

Franklin Resources (NYSE: BEN) reported preliminary assets under management (AUM) of $1.58 trillion at December 31, 2024, down from $1.65 trillion in November 2024. The decrease was attributed to negative markets and long-term net outflows of $18.9 billion, which included $38.0 billion of outflows from Western Asset Management, partially offset by reinvested distributions of $17.8 billion.

Excluding Western Asset Management, the company saw long-term net inflows of $19.1 billion. For the quarter ended December 31, 2024, total long-term net outflows were $50.0 billion, with Western Asset Management accounting for $67.9 billion in outflows. The AUM breakdown shows Equity at $620.0 billion, Fixed Income at $469.5 billion, Alternative at $248.8 billion, and Multi-Asset at $174.0 billion.

Positive

• Long-term net inflows of $19.1 billion excluding Western Asset Management
• Equity AUM increased to $620.0 billion from $467.5 billion year-over-year

Negative

• Total AUM decreased by $77.2 billion from November ($1.58T vs $1.65T)
• Western Asset Management experienced significant outflows of $38.0 billion in December
• Quarterly net outflows of $50.0 billion
• Fixed Income AUM declined by $47 billion from November ($469.5B vs $516.5B)

Insights

Investment Management Analyst

The latest AUM report reveals concerning trends for Franklin Resources. The $1.58 trillion AUM represents a significant month-over-month decline from $1.65 trillion, driven by substantial outflows at Western Asset Management ($38.0 billion) and negative market performance. The $18.9 billion in total long-term net outflows, even when offset by $17.8 billion in reinvested distributions, signals ongoing challenges in client retention.

The most alarming metric is Western Asset Management's performance, which saw its AUM drop from $317.0 billion to $272.2 billion in just one month. This 14.1% decline in a key fixed income division could materially impact Franklin's revenue stream, as fixed income typically generates stable management fees. The quarterly outflows of $67.9 billion from Western Asset suggest a deeper structural issue that may require strategic intervention.

On a positive note, excluding Western Asset, the core business showed resilience with $19.1 billion in monthly net inflows. The equity segment, while down month-over-month, shows strong year-over-year growth from $467.5 billion to $620.0 billion, indicating successful diversification efforts away from traditional fixed income products.

Market Research Analyst

The significant outflows from Western Asset Management represent a critical inflection point for Franklin Resources' business model. When contextualizing these flows against industry trends, the $38 billion monthly outflow suggests potential market share erosion in the fixed income space, where competitors like BlackRock and Vanguard have been gaining ground through lower-cost ETF offerings.

The fixed income AUM decline from $516.5 billion to $469.5 billion month-over-month is particularly concerning given the current high interest rate environment, where fixed income products typically attract investor interest. This divergence from industry patterns suggests company-specific challenges rather than broader market dynamics.

The alternative assets segment's stability at $248.8 billion, despite $1.6 billion in distributions, demonstrates resilience in higher-margin product lines. However, this represents only about 15.8% of total AUM, limiting its ability to offset the impact of fixed income outflows on overall profitability.

SAN MATEO, Calif.--(BUSINESS WIRE)-- Franklin Resources, Inc. (Franklin Templeton) (NYSE: BEN) today reported preliminary month-end assets under management (AUM) of $1.58 trillion at December 31, 2024, compared to $1.65 trillion at November 30, 2024. This month's decrease in AUM reflected the impact of negative markets and long-term net outflows of $18.9 billion, inclusive of $38.0 billion of long-term net outflows at Western Asset Management¹ and reinvested distributions of $17.8 billion. Excluding Western Asset Management, long-term net inflows were $19.1 billion.

For the quarter ended December 31, 2024, AUM reflected the impact of negative markets and long-term net outflows of $50.0 billion, inclusive of $67.9 billion of long-term net outflows at Western Asset Management¹ and reinvested distributions of $20.1 billion. Excluding Western Asset Management, long-term net inflows were $17.9 billion.

By Asset Class:
(In USD billions)	Preliminary
	31-Dec-24	30-Nov-24	30-Sep-24	30-Jun-24	31-Dec-23
Equity	$620.0	$646.1	$632.1	$595.0	$467.5
Fixed Income	469.5	516.5	556.4	564.5	511.7
Alternative2	248.8	248.8	249.9	254.5	256.2
Multi-Asset	174.0	177.9	176.2	168.1	154.6
Long Term:	1,512.3	1,589.3	1,614.6	1,582.1	1,390.0
Cash Management	63.4	63.6	64.0	64.5	65.5
Total Ending AUM	$1,575.7	$1,652.9	$1,678.6	$1,646.6	$1,455.5

1 As of December 31, 2024, Western Asset Management had AUM of $272.2 billion, compared to $317.0 billion at November 30, 2024. This month’s AUM reflected the impact of negative markets, the aforementioned long-term net outflows of $38.0 billion, and cash management net outflows of $0.3 billion. This quarter’s AUM reflected the impact of negative markets, the aforementioned long-term net outflows of $67.9 billion, and cash management net outflows of $0.4 billion.

2 December 31,2024 Alternative AUM includes $1.6 billion of aggregate realizations and distributions for the month and $3.8 billion for the quarter.

About Franklin Templeton

Franklin Resources, Inc. [NYSE:BEN] is a global investment management organization with subsidiaries operating as Franklin Templeton and serving clients in over 150 countries. Franklin Templeton’s mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. Through its specialist investment managers, the company offers specialization on a global scale, bringing extensive capabilities in equity, fixed income, alternatives and multi-asset solutions. With more than 1,500 investment professionals, and offices in major financial markets around the world, the California-based company has over 75 years of investment experience.

The company posts information that may be significant for investors in the Investor Relations and News Center sections of its website and encourages investors to consult those sections regularly. For more information, please visit investors.franklinresources.com.

Forward-Looking Statements

The financial results in this press release are preliminary. Some of the statements herein may include forward-looking statements that reflect our current views with respect to future events, financial performance and market conditions. Such statements are provided under the “safe harbor” protection of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts and generally can be identified by words or phrases written in the future tense and/or preceded by words such as “anticipate,” “believe,” “could,” “depends,” “estimate,” “expect,” “intend,” “likely,” “may,” “plan,” “potential,” “preliminary,” “seek,” “should,” “will,” “would,” or other - similar words or variations thereof, or the negative thereof, but these terms are not the exclusive means of identifying such statements.

Forward-looking statements involve a number of known and unknown risks, uncertainties and other important factors that may cause actual results and outcomes to differ materially from any future results or outcomes expressed or implied by such forward-looking statements, including market and volatility risks, investment performance and reputational risks, global operational risks, competition and distribution risks, third-party risks, technology and security risks, human capital risks, cash management risks, and legal and regulatory risks. While forward-looking statements are our best prediction at the time that they are made, you should not rely on them and are cautioned against doing so. Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other possible future conditions.

Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. They are neither statements of historical fact nor guarantees or assurances of future performance. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them.

These and other risks, uncertainties and other important factors are described in more detail in our recent filings with the U.S. Securities and Exchange Commission, including, without limitation, in Risk Factors and Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024 and our subsequent Quarterly Reports on Form 10-Q. If a circumstance occurs after the date of this press release that causes any of our forward- looking statements to be inaccurate, whether as a result of new information, future developments or otherwise, we undertake no obligation to announce publicly the change to our expectations, or to make any revision to our forward-looking statements, to reflect any change in assumptions, beliefs or expectations, or any change in events, conditions or circumstances upon which any forward-looking statement is based, unless required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250110498254/en/

Franklin Resources, Inc.

Investor Relations: Selene Oh (650) 312-4091, selene.oh@franklintempleton.com

Media Relations: Jeaneen Terrio (212) 632-4005, jeaneen.terrio@franklintempleton.com

investors.franklinresources.com

Source: Franklin Resources, Inc.

FAQ

What caused the decrease in Franklin Resources (BEN) AUM in December 2024?

The decrease was due to negative markets and long-term net outflows of $18.9 billion, including $38.0 billion of outflows from Western Asset Management, partially offset by reinvested distributions of $17.8 billion.

How much were Franklin Resources (BEN) net outflows in Q4 2024?

Total long-term net outflows for Q4 2024 were $50.0 billion, including $67.9 billion of outflows from Western Asset Management.

What was Franklin Resources (BEN) total AUM as of December 31, 2024?

Franklin Resources' total AUM was $1.575 trillion as of December 31, 2024.

How did Franklin Resources (BEN) perform excluding Western Asset Management in December 2024?

Excluding Western Asset Management, Franklin Resources saw positive long-term net inflows of $19.1 billion in December 2024.

What was the AUM breakdown by asset class for Franklin Resources (BEN) in December 2024?

The AUM breakdown was: Equity $620.0B, Fixed Income $469.5B, Alternative $248.8B, Multi-Asset $174.0B, and Cash Management $63.4B.