Envestnet, Inc

Greetings and welcome to the InvestNet first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Josh Warren, Chief Financial Officer. Thank you, sir. You may begin.

Good afternoon, everyone. I'm Josh Warren, Chief Financial Officer of InvestNet. Thank you for joining us on today's first quarter 2024 earnings call. Before we begin, I'd like to point out that our earnings press release, supplemental presentation, and associated Form 10-Q can be found under the investor relations section of our website at investnet.com. This call is being webcast live, and a replay will be available for one month under the investor relations section of our website as well. During the call, we will be discussing certain forward-looking information. This information is based on our current expectations and is not a guarantee of future performance. I encourage you to review the cautionary statement on slides two and three of the supplemental presentation for the potential risks, uncertainties, and other factors that could cause actual results to differ from those expressed by the forward-looking statements. Further information can be found in our regular SEC filings. During this call, we will be referring to certain as-adjusted financial measures. Please refer to the appendix in our supplemental presentation for reconciliation of these as-adjusted financial measures to the most directly comparable GAAP measures. Joining me on today's call are Jim Fox, our Board Chair and Interim CEO, and Tom Sipp, Executive Vice President for Business Lines. On our call this afternoon, we will provide a company update as well as an overview of the company's results during the first quarter. After our prepared remarks, we will open the call to questions. During the Q&A, please limit yourself to one question plus one follow-up. You may get back into the queue if you have additional questions. I'll now turn it over to Jim Fox.

Thank you, Josh. Good afternoon, and thank you for joining our Q1 2024 earnings call. We appreciate your time and look forward to highlighting for you the strengths and opportunities InvestNet provides for our clients and shareholders. Let me start with our Q1 results, which represent our focus on disciplined execution. Q1 revenue was $325 million, representing a 9% growth over Q1 2023, and near the high end of the guidance range. Adjusted EBITDA was 70 million, slightly above our guidance range, and representing a 22% adjusted EBITDA margin and approximately 350 basis points of margin expansion when compared with Q1 2023. Adjusted EPS for Q1 was 60 cents, also above our guidance range, up 30% from the 46 cents we reported in Q1, 2023. AUM net flows were 12.5 billion and annualized organic asset growth rate of 12%. Free cash flow in Q1 as always is impacted by seasonality, but improved more than 40 million year over year. Josh will discuss our results in more detail later in this call. As we look forward, InvestNet is in a tremendous strategic position for growth. We are uniquely able to deliver for clients through our connected ecosystem and extensive capabilities. InvestNet continues to be in this leading position because we are executing on what our clients need. We have unmatched scale that the leading wealth management firms, RIAs, and broker-dealers rely on to power their businesses. We are the industry leader by assets, advisors, and accounts. We've invested in our technology and data capabilities connected to the broadest set of solutions. One, we are providing meaningful data insights, over 20 million each day, that enables advisors and home offices to make better decisions and put more assets on our platform. Our technology is industry-leading and connects all parts of the advisor workflow. You see this in client engagement and in industry recognition like the annual T3 survey, where investment finished in the top three in 13 separate categories. Third, our investment platform is the largest in the industry with the broadest set of solutions. Investments, alternatives, insurance, credits, and supported by the leading product producers in the industry. We have a talented, experienced, and aligned leadership team that is driving the next phase of InvestMet and delivering results. All of this is why we are deeply and broadly embedded in our clients and partners, driving the growth and productivity of advisors by providing the leading wealth management platform to the industry. We have connected the pieces of InvestMet to create scale and competitive advantage, which leads to revenue growth, operating leverage, and improving free cash flow conversion. We're focused on execution, delivering greater value for our clients, and that in turn creates value for our shareholders. I'd now like to turn it over to Tom Sipp, who leads our InvestNet business lines for an overview of the drivers of the business. Tom? Thank you, Jim.