T. Rowe Price Group, Inc.

Good morning. My name is Daniel and I will be your conference facilitator today. Welcome to T. Rowe Price's first quarter 2025 earnings conference call. All participants will be in 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'll now turn the call over to Lindsley Carruth, T. Rowe Price's Director of Investor Relations.

Hello, and thank you for joining us today for our first quarter earnings call. The press release and the supplemental materials document can be found on our IR website at investors.troweprice.com. Today's call will last approximately 45 minutes. Our Chair, CEO, and President, Rob Sharp, and CFO, Jen Dardis, will discuss the company's results for about 15 minutes. Then we'll open it up for your questions, at which time we'll be joined by Head of Global Investments, Eric Vial. 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 in 10Q. Discussion related to the funds is intended to demonstrate their contribution to the organization's results and are not recommendations. All investment performance references to peer groups on today's call are using Morningstar peer groups and for the quarter that ended March 31st, 2025. Now I'll turn it over to Rob.

Thank you, Lindley, and thank you all for joining our first quarter update. Despite policy-driven market volatility pressuring our assets under management and revenues, we are making important progress. Our world-class investment platform, powered by broad and deep active research, makes us uniquely well-positioned to navigate periods of uncertainty and to help our clients do the same. We are extending our reach by leveraging our leadership position in retirement and the strength of our brand. I'd like to start with investment performance, which versus peers improved meaningfully from the fourth quarter with gains across asset classes. Over 60% of our funds beat their peer groups for the one, three, five, and 10-year time periods. Results were even stronger on an asset-weighted basis, where 61% beat for the one-year time period, 73% for the three-year, 68% for the five-year, and 87% for the 10-year. In equity, value outperformed growth in the quarter amid a shift in sentiment driven by tariff concerns and a sell-off in the technology sector. Against this backdrop, most of our value products delivered. with strong performers across the franchise, including the equity income, large cap value, and value funds. Each moved from the bottom quartile in the prior quarter to the top quartile in the first quarter, boosting their one, three, five, and 10 year performance track records. International value and small cap value also delivered strong performance in the quarter, improving their long-term track records as well. In contrast, New Horizons, MidCap Value, U.S. Equity Research, and a few of our sector funds had more challenging quarters. Target date performance was strong. 99% of our target date assets beat their peer groups for the three, five, and 10-year time periods. Our retirement strategies benefited from an overweight two and strong outperformance within value, as well as a tactical overweight to international and real assets and strong security selection. However, The glide pass overall level of equity exposure detracted across vintages. Fixed income performance was solid, with 64% of funds beating their peer group median on a one-year basis and 65% on a five-year basis. We had more mixed results for the three-year time period, with 50% of funds beating their medians. The best performing fixed income segment in the quarter was U.S. taxable bonds. Alternative portfolios produced mixed results in the first quarter, Private lending strategies generated the strongest gains, followed by structured strategies which benefited from timely monetizations. Performance of opportunistic and liquid strategies was mixed, driven by negative developments in certain positions. Deployment of capital in private lending funds was muted due to the generally slow M&A environment. In addition to improved investment performance, we also strengthened our leadership position in retirement in the first quarter. including expanding our reach beyond the United States. We launched the Subadvise Retirement Date Fund series in partnership with a Japanese asset manager, marking the first time we've offered our customized glide path design expertise in this market. We were selected as one of four external asset managers to partner with a leading global banking institution to develop a series of custom retirement-related funds to be distributed in Asia, the UK, and the Middle East. We are growing our longstanding custom target date relationship in Korea with increased net flows in the quarter. Outside of Asia Pacific, we were notified of our first client commitment for the newly launched T. Rowe Price Retirement Date Series in Canada. In the U.S., we launched Social Security Analyzer, a tool designed to help financial advisors optimize their clients' benefits by building custom strategies, conducting in-depth analysis, and providing side-by-side comparisons among various Social Security claiming strategies. And we are examining how allocations to private market alternative investments could add to our target date franchise so we are ready if or when plan sponsor demand materializes. We remain the largest provider of active target date products and continue our work to adapt the target date franchise and to bring this capability to new clients and new markets. Beyond our strengths in global retirement, we built momentum with our ETF and SMA offerings. We launched two transparent equity ETFs, Hedged Equity and Capital Appreciation Premium Income, our latest addition to the Capital Appreciation Suite. Both ETFs integrate our strong equity research platforms with hedging strategies. These additions bring our roster to 19 ETFs with over $12.5 billion in assets under management as of March 31st. including allocations from our multi-asset products. Nine of our ETFs have surpassed $500 million, with three reaching over $1 billion. We also broadened our lineup of SMA offerings with the launch of integrated U.S. small cap growth and integrated U.S. small mid-core, which combine our fundamental and quantitative processes in this tailored vehicle structure. In the first quarter, we continue to be recognized for our people, our products and services, and our workplace. The T. Rowe Price OHA Select Private Credit Fund, referred to as Ocredit, was named 2024 BDC of the Year Americas by Private Debt Investor. For the 15th consecutive year, we were named one of Fortune Magazine's World's Most Admired Companies. And for the third year in a row, our firm placed in the top 10 in XTEL's 2024 ranking of America's top asset management firms. T. Rowe Price Associates maintained its number two position among the over 350 asset managers nominated, and this was the first year that T. Rowe Price Investment Management was recognized in the corporate survey at seventh place. We also officially opened our global headquarters at Harbor Point in Baltimore, designed to support our culture of collaboration and enhance the associate experience. Despite this important investment, We are being thoughtful about controllable expenses to preserve our ability to invest in our strategic initiatives and strengthen our right to win. Finally, our balance sheet remains strong with $3.3 billion of cash and discretionary investments. We continue to prioritize returning capital to our stockholders and recently announced a quarterly dividend of $1.27, which increased for the 39th consecutive year. We will be opportunistic in our approach to stock for purchases, strategically leveraging market downturns for selective buying opportunities. Before I turn to Jen, I want to thank our associates for their resilience and their steadfast commitment to clients. For nearly 90 years, our associates have been trusted to help people navigate the ups and downs of the markets, and they continue to build on that legacy today. Now, Jen will share a view of our first quarter financial results.