Victory Capital Holdings, Inc.

Good morning and welcome to the Victory Capital second quarter 2025 earnings conference call. All callers are in a listen-only mode. Following the company's prepared remarks, there will be a question-and-answer session. I will now turn the call over to Mr. Matthew Dennis, Chief of Staff and Director of Investor Relations. Please go ahead, Mr. Dennis.

Thank you. Before I turn the call over to David Brown, I would like to remind you that during today's conference call, we may make a number of forward-looking statements. Victory Capital's actual results may differ materially from these statements. Please refer to our SEC filings for a list of some of the risk factors that may cause actual results to differ materially from those expressed on today's call. Victory Capital assumes no duty and does not undertake any obligation to update any forward-looking statements. Our press release, which was issued after the market closed yesterday, disclosed both GAAP and non-GAAP financial results. We believe the non-GAAP measures enhance the understanding of our business and our performance. Reconciliations between these non-GAAP measures and the most comparable GAAP measures are included in tables that can be found in our earnings press release and in the slides accompanying this call, both of which are available on the investor relations section of our website at ir.dcm.com. It is now my pleasure to turn the call over to David Brown, Chairman and CEO. David?

Thanks, Matt. Good morning and welcome to Victory Capital's second quarter 2025 earnings call. I'm joined today by Michael Pellecarpo, our President, Chief Financial and Administrative Officer, as well as Matt Dennis, our Chief of Staff and Director of Investor Relations. I will start today with a business overview of our second quarter, After that, I will turn the call over to Mike to review the financial results in greater detail. Following our prepared remarks, Mike, Matt, and I will be available to answer your questions. The quarterly business overview begins on slide five. Total client assets increased by 76% quarter over quarter, reaching more than $300 billion, which is a record high for a quarter end. Our sales momentum continued with quarterly gross long-term flows accelerating to $15.4 billion and net outflows coming in at just $660 million. This was the third consecutive quarter of improving long-term flows on both a gross and net basis. We are encouraged by our current trajectory and further by the sustained underlying momentum we have in several products and capabilities including our fixed income, global equity, and ETF strategies. Adjusted EBITDA was $179 million in the quarter, which equates to an adjusted EBITDA margin of 50.8%. This was slightly higher than anticipated due to a positive asset mix and realization of certain fees produced annually but realized this quarter. This caused a slight increase in our revenue and fee rate, Second quarter adjusted net income with tax benefit was $133 million, or $1.57 per diluted share. We successfully closed on our multifaceted strategic transaction with Amundi on April 1st, which included the acquisition of the Amundi U.S. business and the reintroduction of the Pioneer Investments brand as our newest investment franchise. This resulted in significantly increasing our size and scale while also substantially enhancing diversification of our business. We are now managing assets for investors in 60 countries and have exciting new investment capabilities in fixed income and numerous equity asset classes. The integration work is progressing very nicely. By the end of the second quarter, we had achieved $70 million of net expense synergies on a run rate basis. This represents nearly two thirds of the total $110 million of net expense synergies that we expect to achieve within the first two years of ownership. The remaining $40 million of net expense synergies will be front-end loaded with approximately $30 million being realized within the next three quarters and the remaining $10 million over the following 12 months. Beyond integration, we've expanded our product range by launching the first ETF managed by Pioneer on our Victory Shares ETF platform in June. The Victory Shares Pioneer Asset-Based Income ETF is an actively managed ETF that targets premium yields available within selected securitized credit markets, giving investors access to private credit-like characteristics in a listed liquid ETF wrapper. In addition to the Victory Shares Pioneer Asset-Based Income ETF, We also expanded our free cash flow series of ETFs with the launch of the Victory Shares International Free Cash Flow ETF, ticker IFLO, and the Victory Shares International Free Cash Flow Growth ETF, ticker GRIN. These products are designed to complement our existing free cash flow ETFs and deliver enhanced diversification. Our ETF platform continued to deliver strong results in the second quarter consistent with the past couple of years. The first half of this year, our ETF platform posted positive net flows of more than $4 billion, bringing our ETF assets under management to $15 billion at the end of June. This is up nearly 90% from the same time last year. Keep in mind, these are competitively priced products that meet our margin requirements. The process of creating numerous vintage victory strategies and vehicles for delivery to investors outside of the U.S. by Amundi's distribution team is ongoing. In coordination with Amundi, we've identified our first go-to-market products and expect to have registrations completed in the next few quarters. In the institutional channel, we are live and our products are available, and we are working very hard to educate the Amundi sales force, respond to RFPs, and client inquiries and assist in marketing our strategies throughout their vast distribution network. We are very optimistic about the opportunity to expand business around the globe. In conjunction with product development and growth efforts, we work hard to ensure investment capabilities are aligned with client demand, preferences, and market opportunities. During the quarter, we carefully evaluate existing products and liquidated several upscale mutual funds in ETS. We also made the decision to close our Newbridge, Sophos, and THB investment franchises, which collectively managed less than $1 billion of AUM, or 0.3% of our total assets at quarter end. This is slightly accretive and will allow us the opportunity to allocate more resources to other parts of our business that will help foster future growth. On slide seven, we show our firm-wide investment performance. 57 mutual funds and ETFs representing 64% of the AUM with star ratings were rated overall four or five stars by Morningstar. Majority of our AUM and strategies are also outperforming benchmarks across all timeframes shown here. Moreover, based on total return rankings, more than 50% of our mutual fund and ETF AUM is ranked in the top quartile in its respective Morningstar category For the important 3 and 5 year periods with the Monday transaction now complete and delivering the expected financial benefits through increased earnings and cash flow. I'm pleased to announce that our board has authorized an increase to our share repurchase plan from 200Million dollars to 500Million dollars. The largest in our history, the future prospects for our business are quite encouraging and I believe the intrinsic value of these opportunities. is not currently reflected in our share price. Lastly, we are extremely active from an acquisition perspective, evaluating potential opportunities. The current environment is very conducive for executing a transaction, and I continue to believe that industry consolidation will accelerate over the next few years. Our proven track record, business model, and what our platform has to offer potential acquisition candidates is compelling, unique, and value added. This, along with our strengthened financial position, has me very encouraged about our ability to continue to execute on our strategic value-creating acquisitions in the short, medium, and long-term timeframes. With that, I will turn the call over to Mike to go through the quarterly results in greater detail. Mike?