Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 30, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-38980 | |
Entity Registrant Name | ASSETMARK FINANCIAL HOLDINGS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 30-0774039 | |
Entity Address, Address Line One | 1655 Grant Street | |
Entity Address, Address Line Two | 10th Floor | |
Entity Address, City or Town | Concord | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94520 | |
City Area Code | 925 | |
Local Phone Number | 521-2200 | |
Title of 12(b) Security | Common stock, par value $0.001 per share | |
Trading Symbol | AMK | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 74,400,366 | |
Entity Central Index Key | 0001591587 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 247,626 | $ 217,680 |
Restricted cash | 15,000 | 15,000 |
Investments, at fair value | 20,573 | 18,003 |
Fees and other receivables, net | 23,164 | 21,345 |
Income tax receivable, net | 0 | 1,890 |
Prepaid expenses and other current assets | 15,730 | 17,193 |
Total current assets | 322,093 | 291,111 |
Property, plant and equipment, net | 9,201 | 8,765 |
Capitalized software, net | 113,123 | 108,955 |
Other intangible assets, net | 681,519 | 684,142 |
Operating lease right-of-use assets | 19,244 | 20,408 |
Goodwill | 487,909 | 487,909 |
Other assets | 23,737 | 19,273 |
Total assets | 1,656,826 | 1,620,563 |
Current liabilities: | ||
Accounts payable | 278 | 288 |
Accrued liabilities and other current liabilities | 60,430 | 75,554 |
Income tax payable, net | 8,539 | 0 |
Total current liabilities | 69,247 | 75,842 |
Long-term debt, net | 93,567 | 93,543 |
Other long-term liabilities | 20,541 | 18,429 |
Long-term portion of operating lease liabilities | 24,885 | 26,295 |
Deferred income tax liabilities, net | 139,072 | 139,072 |
Total long-term liabilities | 278,065 | 277,339 |
Total liabilities | 347,312 | 353,181 |
Stockholders’ equity: | ||
Common stock, $0.001 par value (675,000,000 shares authorized and 74,399,237 and 74,372,889 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively) | 74 | 74 |
Additional paid-in capital | 964,868 | 960,700 |
Retained earnings | 344,586 | 306,622 |
Accumulated other comprehensive loss | (14) | (14) |
Total stockholders’ equity | 1,309,514 | 1,267,382 |
Total liabilities and stockholders’ equity | $ 1,656,826 | $ 1,620,563 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 675,000,000 | 675,000,000 |
Common stock, shares issued (in shares) | 74,399,237 | 74,372,889 |
Common stock, shares outstanding (in shares) | 74,399,237 | 74,372,889 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue: | ||
Total revenue | $ 190,266 | $ 170,298 |
Operating expenses: | ||
Asset-based expenses | 44,853 | 37,434 |
Spread-based expenses | 389 | 293 |
Employee compensation | 50,007 | 46,911 |
General and operating expenses | 27,324 | 25,689 |
Professional fees | 6,081 | 5,393 |
Depreciation and amortization | 9,922 | 8,428 |
Total operating expenses | 138,576 | 124,148 |
Interest expense | 2,294 | 2,347 |
Other (income) expense, net | (332) | 19,865 |
Income before income taxes | 49,728 | 23,938 |
Provision for income taxes | 11,764 | 6,716 |
Net income | 37,964 | 17,222 |
Net comprehensive income | $ 37,964 | $ 17,222 |
Net income per share attributable to common stockholders: | ||
Basic (in dollars per share) | $ 0.51 | $ 0.23 |
Diluted (in dollars per share) | $ 0.50 | $ 0.23 |
Weighted average number of common shares outstanding, basic (shares) | 74,383,265 | 73,890,162 |
Weighted average number of common shares outstanding, diluted (shares) | 75,269,626 | 74,370,353 |
Asset-based revenue | ||
Revenue: | ||
Total revenue | $ 149,984 | $ 131,039 |
Spread-based revenue | ||
Revenue: | ||
Total revenue | 30,093 | 31,999 |
Subscription-based revenue | ||
Revenue: | ||
Total revenue | 4,252 | 3,544 |
Other revenue | ||
Revenue: | ||
Total revenue | $ 5,937 | $ 3,716 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss |
Beginning balance (in shares) at Dec. 31, 2022 | 73,847,596 | ||||
Beginning balance at Dec. 31, 2022 | $ 1,126,366 | $ 74 | $ 942,946 | $ 183,503 | $ (157) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 17,222 | 17,222 | |||
Share-based compensation | 3,822 | 3,822 | |||
Issuance of common stock - vesting of restricted stock units (in shares) | 23,352 | ||||
Exercise of stock options (in shares) | 52,765 | ||||
Exercise of stock appreciation rights (in shares) | 499 | ||||
Ending balance at Mar. 31, 2023 | 1,147,410 | $ 74 | 946,768 | 200,725 | (157) |
Ending balance (in shares) at Mar. 31, 2023 | 73,924,212 | ||||
Beginning balance (in shares) at Dec. 31, 2023 | 74,372,889 | ||||
Beginning balance at Dec. 31, 2023 | 1,267,382 | $ 74 | 960,700 | 306,622 | (14) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 37,964 | 37,964 | |||
Share-based compensation | 4,168 | 4,168 | |||
Exercise of stock options (in shares) | 23,351 | ||||
Exercise of stock appreciation rights (in shares) | 2,997 | ||||
Ending balance at Mar. 31, 2024 | $ 1,309,514 | $ 74 | $ 964,868 | $ 344,586 | $ (14) |
Ending balance (in shares) at Mar. 31, 2024 | 74,399,237 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 37,964 | $ 17,222 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 9,922 | 8,428 |
Interest expense, net | (159) | (9) |
Share-based compensation | 4,168 | 3,822 |
Debt acquisition cost write-down | 0 | 92 |
Changes in certain assets and liabilities: | ||
Fees and other receivables, net | (1,578) | (1,484) |
Receivables from related party | (241) | (400) |
Prepaid expenses and other current assets | 2,493 | 1,738 |
Accounts payable, accrued liabilities and other current liabilities | (15,583) | 3,871 |
Income tax receivable and payable, net | 10,429 | 5,846 |
Net cash provided by operating activities | 47,415 | 39,126 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of Adhesion Wealth | 0 | (3,000) |
Purchase of investments | (1,562) | (824) |
Sale of investments | 179 | 66 |
Purchase of property and equipment | (1,071) | (220) |
Purchase of computer software | (10,833) | (9,954) |
Purchase of convertible notes | (4,182) | 0 |
Net cash used in investing activities | (17,469) | (13,932) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Payments on term loan | 0 | (25,000) |
Net cash used in financing activities | 0 | (25,000) |
Net change in cash, cash equivalents, and restricted cash | 29,946 | 194 |
Cash, cash equivalents, and restricted cash at beginning of period | 232,680 | 136,274 |
Cash, cash equivalents, and restricted cash at end of period | 262,626 | 136,468 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Income taxes paid, net | 1,324 | 868 |
Interest paid | 2,104 | 3,787 |
Non-cash operating and investing activities: | ||
Non-cash changes to right-of-use assets | 0 | 1,742 |
Non-cash changes to lease liabilities | $ 0 | $ 1,742 |
Overview
Overview | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview | Overview Organization and Nature of Business These consolidated financial statements include AssetMark Financial Holdings, Inc. (“AFHI”) and its subsidiaries, which include AssetMark, Inc., AssetMark Trust Company, AssetMark Brokerage, LLC, AssetMark Services, Inc. d/b/a AssetMark Retirement Services, Inc., Global Financial Private Capital, Inc., Voyant, Inc., Voyant UK Limited, Voyant Financial Technologies Inc., Voyant Australia Pty Ltd and Atria Investments, Inc. d/b/a Adhesion Wealth. The entities listed above are collectively referred to as the “Company”. AssetMark, Inc. (“AMI”) is a registered investment adviser that was incorporated under the laws of the State of California on May 13, 1999. AMI offers a broad array of wealth management solutions to individual investors through financial advisers by providing an open-architecture product platform along with tailored client advice, asset allocation options, practice management , support services and technology solutions to the financial adviser channel. AssetMark Trust Company (“ATC”) is a licensed trust company incorporated under the laws of the State of Arizona on August 24, 1994 and regulated by the Arizona Department of Insurance and Financial Institutions. ATC provides custodial recordkeeping services primarily to investor clients of registered investment advisers (including AMI) located throughout the United States. AssetMark Brokerage, LLC (“AMB”) is a limited-purpose broker-dealer located in Concord, California and was incorporated under the laws of the State of Delaware on September 25, 2013. AMB’s primary function is to distribute the proprietary mutual funds of AMI and to sponsor the Financial Industry Regulatory Authority (“FINRA”) licensing of those employees who provide distribution support through promotion of the AMI programs and strategies that employ the mutual funds. Voyant, Inc. (“Voyant”), is a SaaS-based financial planning, wellness and client digital engagement solutions company that was originally formed in Texas on December 29, 2005 and was converted to a Delaware corporation on November 21, 2008. Atria Investments, Inc. (“Adhesion Wealth”), doing business as Adhesion Wealth, is a registered investment adviser that was formed as a limited liability company under the laws of the State of North Carolina on March 29, 2007, and was converted to a corporation under the laws |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of only normal recurring adjustments, considered necessary for fair presentation have been included. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the year ended December 31, 2024 or any future period. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Risks and Uncertainties Estimates and assumptions about future events and their effects on the Company cannot be determined with certainty and therefore require the exercise of judgment. The Company is not aware of any specific events or circumstances that would require the Company to update its estimates, assumptions or judgments or revise the carrying value of its assets or liabilities. The Company will update the estimates and assumptions underlying the consolidated financial statements in future periods as events and circumstances develop. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). For the three months ended March 31, 2023 , the Company reclassified $6,264 in the accompanying unaudited condensed consolidated statements of comprehensive income from spread-based expenses to offset spread-based revenue to account for interest credited to customer accounts on a net basis in order to correct an immaterial error. The adjustment had no effect on the current year or the previous periods’ reported net income, earnings per-share, balance sheet, stockholders’ equity and cash flows. Management has deemed the error to be immaterial to the financial statements taken as a whole. Geographic Sources of Revenue Revenue attributable to customers outside of the United States totaled $4,237 and $3,726 in the three months ended March 31, 2024 and 2023, respectively. Accounting Pronouncements – Issued Not Yet Adopted In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures . The amendments in this update expand the annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The guidance becomes effective for the Company's annual fiscal period in 2024 and interim fiscal periods in 2025. Early adoption of the standard is permitted. The Company is currently evaluating the effect that ASU 2023-07 will have on its consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures . The amendments in this update improve the effectiveness of income tax disclosures about income tax information through improvements primarily related to the rate reconciliation and income taxes paid information. The guidance becomes effective for the Company beginning January 1, 2025. Early adoption of the standard is permitted. The Company is currently evaluating the effect that ASU 2023-09 will have on its consolidated financial statements. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 3 Months Ended |
Mar. 31, 2024 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: March 31, 2024 December 31, 2023 Prepaid expenses $ 9,674 $ 10,906 Operating lease right-of-use assets 4,813 4,795 Other 1,243 1,492 Total $ 15,730 $ 17,193 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill The Company’s goodwill balance was $487,909 as of March 31, 2024 and December 31, 2023. The Company performed an annual test for goodwill impairment based on the financial information available as of October 31, 2023 for the year ended December 31, 2023 and determined that goodwill was not impaired. The Company performed a qualitative analysis of factors and determined that goodwill was not impaired as of March 31, 2024. Other Intangible Assets Information regarding the Company’s intangible assets is as follows: March 31, 2024 Gross carrying Accumulated Net carrying Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Enterprise distribution channel customer relationships 17,500 — 17,500 Definite-lived intangible assets: Trade names 50,530 (17,989) 32,541 Technology 19,600 (6,439) 13,161 Customer relationships 36,450 (10,572) 25,878 Regulatory licenses 34,850 (12,924) 21,926 Non-compete agreements 400 (367) 33 Total $ 729,810 $ (48,291) $ 681,519 December 31, 2023 Gross carrying Accumulated Net carrying Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Enterprise distribution channel customer relationships 17,500 — 17,500 Definite-lived intangible assets: Trade names 50,530 (17,305) 33,225 Technology 19,600 (5,694) 13,906 Customer relationships 36,450 (9,846) 26,604 Regulatory licenses 34,850 (12,488) 22,362 Non-compete agreements 400 (335) 65 Total $ 729,810 $ (45,668) $ 684,142 A mortization expense for definite-lived intangible assets was $2,623 and $2,616 for the three months ended March 31, 2024 and 2023, respectively. The Company performed an annual test for intangible assets impairment in October for the year ended December 31, 2023 and determined that intangible assets were not impaired. The Company performed a qualitative analysis of factors and determined that intangible assets were not impaired as of March 31, 2024. Estimated amortization expense for definite‑lived intangible assets for future years is as follows: Remainder of 2024 $ 7,802 2025 10,308 2026 9,158 2027 9,158 2028 9,158 2029 and thereafter 47,955 Total $ 93,539 |
Accrued Liabilities and Other C
Accrued Liabilities and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities and Other Current Liabilities | Accrued Liabilities and Other Current Liabilities The following table shows the breakdown of accrued liabilities and other current liabilities: March 31, 2024 December 31, 2023 Accrued bonus $ 9,709 $ 22,643 Compensation and benefits payable 7,883 12,941 Asset-based payables 7,406 6,255 Reserve for uncertain tax positions 4,640 4,640 Current portion of operating lease liabilities 4,608 4,522 Other accrued expenses 26,184 24,553 Total $ 60,430 $ 75,554 |
Other Long-Term Liabilities
Other Long-Term Liabilities | 3 Months Ended |
Mar. 31, 2024 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Other Long-Term Liabilities Other long-term liabilities consisted of the following: March 31, 2024 December 31, 2023 Deferred compensation plan liability $ 20,029 $ 17,486 Other 512 943 Total $ 20,541 $ 18,429 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value in the condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, based on the three-tier fair value hierarchy: March 31, 2024 Fair Value Level I Level II Level III Assets: Equity securities investments $ 544 $ 544 $ — $ — Assets to fund deferred compensation liability 20,029 20,029 — — Convertible notes receivable 21,607 — — 21,607 Total assets $ 42,180 $ 20,573 $ — $ 21,607 Liabilities: Deferred compensation liability $ 20,029 $ 20,029 $ — $ — Total liabilities $ 20,029 $ 20,029 $ — $ — December 31, 2023 Fair Value Level I Level II Level III Assets: Equity securities investments $ 517 $ 517 $ — $ — Assets to fund deferred compensation liability 17,486 17,486 — — Convertible notes receivable 17,078 — — 17,078 Total assets $ 35,081 $ 18,003 $ — $ 17,078 Liabilities: Deferred compensation liability $ 17,486 $ 17,486 $ — $ — Total liabilities $ 17,486 $ 17,486 $ — $ — Fair Value of Equity Securities Investments The fair values of the Company’s equity securities investments consist of funds that invest in listed equity and debt securities which are actively traded and valued based on quoted market prices. Fair Value of Deferred Compensation Assets and Liability The fair value of the Company's deferred compensation assets is comprised of investments in funds which are actively traded and based on quoted market prices. The deferred compensation liability is included in other long-term liabilities in the consolidated balance sheets and its fair market value is based on quoted market prices of the various investment funds in the Company’s rabbi trust that the participants have selected. Fair Value of Convertible Notes Receivable The fair value of the convertible notes receivable issued by the Company was estimated using a market yield method with significant inputs that are not observable in the market and thus represents a Level III fair value measurement. The significant |
Asset-Based Expenses
Asset-Based Expenses | 3 Months Ended |
Mar. 31, 2024 | |
Operating Costs and Expenses [Abstract] | |
Asset-Based Expenses | Asset-Based Expenses Asset-based expenses incurred by the Company relating to the generation of asset-based revenue are as follows: Three Months Ended March 31, 2024 2023 Strategist and manager fees $ 38,243 $ 33,205 Premier broker-dealer fees 3,734 1,311 Custody fees 1,627 1,503 Fund advisory fees 1,110 1,353 Other 139 62 Total $ 44,853 $ 37,434 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Debt On December 30, 2020, the Company entered into a credit agreement (the “2020 Credit Agreement”) with Bank of Montreal for a senior secured credit facility in an aggregate principal amount of $250,000, consisting of a revolving credit facility with commitments in an aggregate principal amount of $250,000 (the “2020 Revolving Credit Facility”), with an accordion option of up to $25,000. The total outstanding principal under the 2020 Credit Agreement was paid in full on January 12, 2022. On January 12, 2022, the Company amended the 2020 Credit Agreement to, among other things, add a term loan facility (as amended and restated, the “2022 Credit Agreement”). Joint lead arrangers and joint bookrunners for the 2022 Credit Agreement are BMO Capital Markets Corp., JPMorgan Chase Bank, N.A., Truist Securities, Inc., U.S. Bank National Association and Wells Fargo Securities, LLC. The 2022 Credit Agreement provides for a senior secured credit facility in an aggregate principal amount of $500,000, consisting of a revolving credit facility with commitments in an aggregate principal amount of $375,000 (the “2022 Revolving Credit Facility”) and a term loan facility with commitments in an aggregate amount of $125,000 (the “2022 Term Loans”), with an accordion option to increase the revolving commitments by $100,000. On October 25, 2022, the Company entered into an amendment (the “ESG Amendment”) to the 2022 Credit Agreement, solely for the purpose of incorporating key performance indicators (“KPIs”) and environmental, social and governance pricing provisions into the 2022 Credit Agreement. The 2022 Term Loans bear interest at a rate per annum equal to, at the Company’s option, either (i) SOFR plus a margin based on the Company’s Total Leverage Ratio (as defined in the 2022 Credit Agreement) or (ii) the Base Rate (as defined in the 2022 Credit Agreement) plus a margin based on the Company’s Total Leverage Ratio. The margin ranges between 0.875% and 2.5% for base rate loans and between 1.875% and 3.5% for SOFR loans. The Company will pay a commitment fee based on the average daily unused portion of the commitments under the 2022 Revolving Credit Facility, a letter of credit fee equal to the margin then in effect with respect to the SOFR loans under the 2022 Revolving Credit Facility, a fronting fee and any customary documentary and processing charges for any letter of credit issued under the 2022 Credit Agreement. The 2022 Term Loans are subject to quarterly amortization payments and will mature on January 12, 2027. The ESG Amendment provides for up to (i) 0.05% positive or negative adjustments to the applicable margin and (ii) 0.01% positive or negative adjustments to the commitment fee, in each case, based on the Company’s performance against the KPIs, and includes customary affirmative covenants and representations and warranties with respect to the KPIs. In March 2023, the Company paid down a total of $25,000, with the excess repayment above the scheduled amortizing payment to be applied to future quarterly principal payments through September 30, 2025. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation On July 3, 2019, the Company’s Board of Directors adopted, and the Company’s sole stockholder approved, the 2019 Equity Incentive Plan (the “2019 Equity Incentive Plan”), which became effective on July 17, 2019, the date of effectiveness of the Company’s initial public offering (the “IPO”) registration statement on Form S-1. As of March 31, 2024, 841,250 shares were available for issuance under the 2019 Equity Incentive Plan. Restricted Stock Units Periodically, the Company issues restricted stock units (“RSUs”) to all officers, certain employees and independent directors of the board under the 2019 Equity Incentive Plan. Most of these RSUs are scheduled to vest in substantially equal installments on each of the first four anniversaries of their grant date. Share-based compensation expense related to the RSUs was $3,041 and $2,332 for the three months ended March 31, 2024 and 2023, respectively. Stock Appreciation Rights Equity-settled Stock Appreciation Rights P eriodically, the Company issues equity-settled stock appreciation rights (“Equity-settled SARs”) to certain officers with respect to shares of the Company’s common stock under the 2019 Equity Incentive Plan. Each Equity-settled SAR has a strike price equal to the fair market value of the Company’s common stock on the date of grant and is scheduled to vest and become exercisable in substantially equal installments on each of the first four anniversaries of their grant date, subject to the recipient’s continued employment through the vesting date, and have a ten-year contractual term. Upon exercise, each of these Equity-settled SARs will be settled in shares of the Company’s common stock with a value equal to the excess, if any, of the fair market value of the Company’s common stock measured on the exercise date over the strike price. Share-based compensation expense related to Equity-settled SARs was $1,127 and $1,490 for the three months ended March 31, 2024 and 2023, respectively. Cash-settled Stock Appreciation Rights The Company issued cash-settled stock appreciation rights (“Cash-settled SARs”) to certain officers with respect to shares of the Company’s common stock under the 2019 Equity Incentive Plan. Each Cash-settled SAR has a strike price equal to the fair market value of the Company’s common stock on the date of grant and is scheduled to vest and become exercisable in substantially equal installments on each of the first four anniversaries of their grant date, subject to the recipient’s continued employment through the vesting date, and have a ten-year contractual term. Upon exercise, each of these Cash-settled SARs will be settled in cash with a value equal to the excess, if any, of the fair market value of the Company’s common stock measured on the exercise date over the strike price. Compensation expense related to Cash-settled SARs was $313 and $0 for the three months ended March 31, 2024 and 2023, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation The Company faces the risk of litigation and regulatory investigations and actions in the ordinary course of operating the Company’s businesses, including the risk of class action lawsuits. The Company’s pending legal and regulatory actions include proceedings specific to the Company and others generally applicable to business practices in the industries in which the Company operates. The Company is also subject to litigation arising out of the Company’s general business activities such as the Company’s contractual and employment relationships. In addition, the Company is subject to various regulatory inquiries, such as information requests, subpoenas, books and record examinations and market conduct and financial examinations from state, federal and other authorities. Plaintiffs in class action and other lawsuits against the Company may seek very large or indeterminate amounts which may remain unknown for substantial periods of time. A substantial legal liability or a significant regulatory action against the Company could have an adverse effect on the Company’s business, financial condition and results of operations. Moreover, even if the Company ultimately prevails in the litigation, regulatory action or investigation, the Company could suffer significant reputational harm, which could have an adverse effect on the Company’s business, financial condition or results of operations. Because the Company operates in a highly regulated industry, the Company and its subsidiaries are regularly subject to examinations by the SEC and other relevant regulators. As disclosed since the fall of 2020, in July 2020, AMI received an examination report from the SEC’s Division of Examinations requesting that AMI and certain subsidiaries of AFHI take corrective actions. The Company’s subsidiaries also received related subpoenas from the SEC Division of Enforcement for production of documents and testimony. Based on discussions with the SEC enforcement staff, the Company recorded an accrual of $20,000 within other (income) expense, net within the unaudited condensed consolidated statements of comprehensive income for the three months ended March 31, 2023 for the expected resolution of this matter. In September 2023, the Company reached a settlement with the SEC regarding the matter at issue without admitting or denying the SEC’s findings. On September 29, 2023, the Company paid a civil penalty of $9,500 as well as disgorgement and prejudgment interest of $8,827, which will be distributed to impacted customers once the SEC approves the distribution plan. The Company also consented to, and intends to, comply with certain undertakings under the settlement. Other Contingencies In connection with the acquisition of Adhesion Wealth, the Company may incur contingent compensation obligations with respect to certain Adhesion Wealth employees based upon the achievement of certain milestones and their continued employment with the Company. The potential payouts are based on performance attributable to 2025 and 2026. The payouts were indeterminable at the balance sheet date and no amounts have been accrued or disclosed in the accompanying consolidated financial statements with respect to these contingencies. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company’s effective income tax rate differs from the federal corporate tax rate of 21.0%, primarily as a result of state taxes, the effect of research and development tax credits, and permanent non-deductible items. The Company’s effective tax rate was 23.7% and 28.1% for the three months ended March 31, 2024 and 2023, respectively. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions As of March 31, 2024 and December 31, 2023, the Company had amounts due from Huatai Securities Co., Ltd. (“HTSC”) of $491 and $250, respectively. |
Net Income Per Share Attributab
Net Income Per Share Attributable to Common Stockholders | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Net Income Per Share Attributable to Common Stockholders | Net Income Per Share Attributable to Common Stockholders Basic net income per share is computed by dividing net income by the weighted average number of shares of common stock outstanding for the period. For the calculation of diluted net income per share, the basic weighted average number of shares of common stock outstanding is increased by the dilutive effect (if any) of stock options, restricted stock units and Equity-settled SARs. The following table provides a reconciliation of the numerators and denominators used in computing basic and diluted net income per share attributable to common stockholders: Three Months Ended March 31, 2024 2023 Net income attributable to common stockholders $ 37,964 $ 17,222 Weighted average number of shares of common stock used in computing net income per share attributable to common stockholders, basic 74,383,265 73,890,162 Net income per share attributable to common stockholders, basic $ 0.51 $ 0.23 Weighted average shares used in computing net income per share attributable to common stockholders, basic 74,383,265 73,890,162 Effect of dilutive shares: Stock options 133,743 103,459 Unvested RSUs 470,723 371,655 Equity-settled SARs 281,895 5,077 Diluted number of weighted-average shares outstanding 75,269,626 74,370,353 Net income per share attributable to common stockholders, diluted $ 0.50 $ 0.23 The following securities were not included in the computation of diluted shares because such securities did not have a dilutive effect. Three Months Ended March 31, 2024 2023 Equity-settled SARs 53,860 1,550,357 Total 53,860 1,550,357 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On April 25, 2024, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with GTCR Everest Borrower, LLC, a Delaware limited liability company (“Parent”), and GTCR Everest Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which Merger Sub will merge with and into the Company, with the Company surviving as a wholly owned subsidiary of Parent (the “Merger” or “Transaction”). The Transaction is valued at approximately $2,622,573. The consummation of the Merger is subject to certain customary closing conditions and required regulatory approvals, which have not been satisfied or obtained as of May 7, 2024. The Merger Agreement contains certain customary termination rights for the Company and Parent. The Company is required to pay Parent a one-time termination fee equal to approximately $80,761 in cash upon termination of the Merger Agreement under specified circumstances, including if (i) the Merger Agreement is terminated (1) by Parent or the Company if the Merger has not been consummated on or before May 1, 2025 or (2) by Parent in connection with the Company breaching its representations, warranties or covenants in a manner that would cause the related closing conditions to not be satisfied (subject to a cure period in certain circumstances), (ii) an alternative acquisition proposal was previously publicly announced (or, in certain circumstances, disclosed to the Board of Directors of the Company) and (iii) within 12 months after termination of the Merger Agreement, an acquisition transaction is consummated. Upon termination of the Merger Agreement under other specified circumstances, including, without limitation, if Parent breaches any representation, warranty or covenant that results in the failure of the related closing condition to be satisfied, subject to a cure period in certain circumstances, Parent will be obligated to pay to the Company a one-time fee equal to approximately $161,522 in cash. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net income | $ 37,964 | $ 17,222 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Risks and Uncertainties | Risks and Uncertainties Estimates and assumptions about future events and their effects on the Company cannot be determined with certainty and therefore require the exercise of judgment. The Company is not aware of any specific events or circumstances that would require the Company to update its estimates, assumptions or judgments or revise the carrying value of its assets or liabilities. The Company will update the estimates and assumptions underlying the consolidated financial statements in future periods as events and circumstances develop. |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). For the three months ended March 31, 2023 , the Company reclassified $6,264 in the accompanying unaudited condensed consolidated statements of comprehensive income from spread-based expenses to offset spread-based revenue to account for interest credited to customer accounts on a net basis in order to correct an immaterial error. The adjustment had no effect on the current year or the previous periods’ reported net income, earnings per-share, balance sheet, stockholders’ equity and cash flows. Management has deemed the error to be immaterial to the financial statements taken as a whole. |
Geographic Sources of Revenue | Geographic Sources of Revenue Revenue attributable to customers outside of the United States totaled $4,237 and $3,726 in the three months ended March 31, 2024 and 2023, respectively. |
Recent Accounting Pronouncements - Issued Not Yet Adopted | Accounting Pronouncements – Issued Not Yet Adopted In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures . The amendments in this update expand the annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The guidance becomes effective for the Company's annual fiscal period in 2024 and interim fiscal periods in 2025. Early adoption of the standard is permitted. The Company is currently evaluating the effect that ASU 2023-07 will have on its consolidated financial statements. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures . The amendments in this update improve the effectiveness of income tax disclosures about income tax information through improvements primarily related to the rate reconciliation and income taxes paid information. The guidance becomes effective for the Company beginning January 1, 2025. Early adoption of the standard is permitted. The Company is currently evaluating the effect that ASU 2023-09 will have on its consolidated financial statements. |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following: March 31, 2024 December 31, 2023 Prepaid expenses $ 9,674 $ 10,906 Operating lease right-of-use assets 4,813 4,795 Other 1,243 1,492 Total $ 15,730 $ 17,193 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | Information regarding the Company’s intangible assets is as follows: March 31, 2024 Gross carrying Accumulated Net carrying Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Enterprise distribution channel customer relationships 17,500 — 17,500 Definite-lived intangible assets: Trade names 50,530 (17,989) 32,541 Technology 19,600 (6,439) 13,161 Customer relationships 36,450 (10,572) 25,878 Regulatory licenses 34,850 (12,924) 21,926 Non-compete agreements 400 (367) 33 Total $ 729,810 $ (48,291) $ 681,519 December 31, 2023 Gross carrying Accumulated Net carrying Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Enterprise distribution channel customer relationships 17,500 — 17,500 Definite-lived intangible assets: Trade names 50,530 (17,305) 33,225 Technology 19,600 (5,694) 13,906 Customer relationships 36,450 (9,846) 26,604 Regulatory licenses 34,850 (12,488) 22,362 Non-compete agreements 400 (335) 65 Total $ 729,810 $ (45,668) $ 684,142 |
Summary of Estimated Amortization Expense for Definite-Lived Intangible Assets | Estimated amortization expense for definite‑lived intangible assets for future years is as follows: Remainder of 2024 $ 7,802 2025 10,308 2026 9,158 2027 9,158 2028 9,158 2029 and thereafter 47,955 Total $ 93,539 |
Accrued Liabilities and Other_2
Accrued Liabilities and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | The following table shows the breakdown of accrued liabilities and other current liabilities: March 31, 2024 December 31, 2023 Accrued bonus $ 9,709 $ 22,643 Compensation and benefits payable 7,883 12,941 Asset-based payables 7,406 6,255 Reserve for uncertain tax positions 4,640 4,640 Current portion of operating lease liabilities 4,608 4,522 Other accrued expenses 26,184 24,553 Total $ 60,430 $ 75,554 |
Other Long-Term Liabilities (Ta
Other Long-Term Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Long-Term Liabilities | Other long-term liabilities consisted of the following: March 31, 2024 December 31, 2023 Deferred compensation plan liability $ 20,029 $ 17,486 Other 512 943 Total $ 20,541 $ 18,429 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value | The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value in the condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023, based on the three-tier fair value hierarchy: March 31, 2024 Fair Value Level I Level II Level III Assets: Equity securities investments $ 544 $ 544 $ — $ — Assets to fund deferred compensation liability 20,029 20,029 — — Convertible notes receivable 21,607 — — 21,607 Total assets $ 42,180 $ 20,573 $ — $ 21,607 Liabilities: Deferred compensation liability $ 20,029 $ 20,029 $ — $ — Total liabilities $ 20,029 $ 20,029 $ — $ — December 31, 2023 Fair Value Level I Level II Level III Assets: Equity securities investments $ 517 $ 517 $ — $ — Assets to fund deferred compensation liability 17,486 17,486 — — Convertible notes receivable 17,078 — — 17,078 Total assets $ 35,081 $ 18,003 $ — $ 17,078 Liabilities: Deferred compensation liability $ 17,486 $ 17,486 $ — $ — Total liabilities $ 17,486 $ 17,486 $ — $ — |
Asset-Based Expenses (Tables)
Asset-Based Expenses (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Operating Costs and Expenses [Abstract] | |
Schedule of Asset-Based Expenses | Asset-based expenses incurred by the Company relating to the generation of asset-based revenue are as follows: Three Months Ended March 31, 2024 2023 Strategist and manager fees $ 38,243 $ 33,205 Premier broker-dealer fees 3,734 1,311 Custody fees 1,627 1,503 Fund advisory fees 1,110 1,353 Other 139 62 Total $ 44,853 $ 37,434 |
Net Income Per Share Attribut_2
Net Income Per Share Attributable to Common Stockholders (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerators and Denominators Used in Computing Basic and Diluted Net Income Per Share | The following table provides a reconciliation of the numerators and denominators used in computing basic and diluted net income per share attributable to common stockholders: Three Months Ended March 31, 2024 2023 Net income attributable to common stockholders $ 37,964 $ 17,222 Weighted average number of shares of common stock used in computing net income per share attributable to common stockholders, basic 74,383,265 73,890,162 Net income per share attributable to common stockholders, basic $ 0.51 $ 0.23 Weighted average shares used in computing net income per share attributable to common stockholders, basic 74,383,265 73,890,162 Effect of dilutive shares: Stock options 133,743 103,459 Unvested RSUs 470,723 371,655 Equity-settled SARs 281,895 5,077 Diluted number of weighted-average shares outstanding 75,269,626 74,370,353 Net income per share attributable to common stockholders, diluted $ 0.50 $ 0.23 |
Schedule of Anti-dilutive Securities Were Not Included in Computation of Diluted Shares Outstanding | The following securities were not included in the computation of diluted shares because such securities did not have a dilutive effect. Three Months Ended March 31, 2024 2023 Equity-settled SARs 53,860 1,550,357 Total 53,860 1,550,357 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Product Information [Line Items] | ||
Reclassification of spread based expenses to offset spread based revenue | $ 6,264 | |
Outside United States | ||
Product Information [Line Items] | ||
Revenue | $ 4,237 | $ 3,726 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expense and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid expenses | $ 9,674 | $ 10,906 |
Operating lease right-of-use assets | 4,813 | 4,795 |
Other | 1,243 | 1,492 |
Total | $ 15,730 | $ 17,193 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 487,909 | $ 487,909 | |
Amortization expense | $ 2,623 | $ 2,616 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Accumulated amortization | $ (48,291) | $ (45,668) |
Total | 93,539 | |
Intangible assets, Gross carrying amount | 729,810 | 729,810 |
Intangible assets, Net carrying amount | 681,519 | 684,142 |
Trade names | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | 50,530 | 50,530 |
Definite-lived intangible assets, Accumulated amortization | (17,989) | (17,305) |
Total | 32,541 | 33,225 |
Technology | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | 19,600 | 19,600 |
Definite-lived intangible assets, Accumulated amortization | (6,439) | (5,694) |
Total | 13,161 | 13,906 |
Customer relationships | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | 36,450 | 36,450 |
Definite-lived intangible assets, Accumulated amortization | (10,572) | (9,846) |
Total | 25,878 | 26,604 |
Regulatory licenses | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | 34,850 | 34,850 |
Definite-lived intangible assets, Accumulated amortization | (12,924) | (12,488) |
Total | 21,926 | 22,362 |
Non-compete agreements | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | 400 | 400 |
Definite-lived intangible assets, Accumulated amortization | (367) | (335) |
Total | 33 | 65 |
Broker-Dealer Relationships | ||
Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, Net carrying amount | 570,480 | 570,480 |
Enterprise Distribution Channel Customer Relationships | ||
Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, Net carrying amount | $ 17,500 | $ 17,500 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Summary of Estimated Amortization Expense for Definite-Lived Intangible Assets (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2024 | $ 7,802 |
2025 | 10,308 |
2026 | 9,158 |
2027 | 9,158 |
2028 | 9,158 |
2029 and thereafter | 47,955 |
Total | $ 93,539 |
Accrued Liabilities and Other_3
Accrued Liabilities and Other Current Liabilities - Schedule of Accrued Liabilities and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Payables and Accruals [Abstract] | ||
Accrued bonus | $ 9,709 | $ 22,643 |
Compensation and benefits payable | 7,883 | 12,941 |
Asset-based payables | 7,406 | 6,255 |
Reserve for uncertain tax positions | 4,640 | 4,640 |
Current portion of operating lease liabilities | 4,608 | 4,522 |
Other accrued expenses | 26,184 | 24,553 |
Total | $ 60,430 | $ 75,554 |
Other Long-Term Liabilities - S
Other Long-Term Liabilities - Schedule of Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Other Liabilities Disclosure [Abstract] | ||
Deferred compensation plan liability | $ 20,029 | $ 17,486 |
Other | 512 | 943 |
Total | $ 20,541 | $ 18,429 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Assets: | ||
Total assets | $ 42,180 | $ 35,081 |
Liabilities: | ||
Total liabilities | 20,029 | 17,486 |
Equity securities investments | ||
Assets: | ||
Total assets | 544 | 517 |
Assets to fund deferred compensation liability | ||
Assets: | ||
Total assets | 20,029 | 17,486 |
Convertible notes receivable | ||
Assets: | ||
Total assets | 21,607 | 17,078 |
Deferred compensation liability | ||
Liabilities: | ||
Total liabilities | 20,029 | 17,486 |
Level I | ||
Assets: | ||
Total assets | 20,573 | 18,003 |
Liabilities: | ||
Total liabilities | 20,029 | 17,486 |
Level I | Equity securities investments | ||
Assets: | ||
Total assets | 544 | 517 |
Level I | Assets to fund deferred compensation liability | ||
Assets: | ||
Total assets | 20,029 | 17,486 |
Level I | Convertible notes receivable | ||
Assets: | ||
Total assets | 0 | 0 |
Level I | Deferred compensation liability | ||
Liabilities: | ||
Total liabilities | 20,029 | 17,486 |
Level II | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Level II | Equity securities investments | ||
Assets: | ||
Total assets | 0 | 0 |
Level II | Assets to fund deferred compensation liability | ||
Assets: | ||
Total assets | 0 | 0 |
Level II | Convertible notes receivable | ||
Assets: | ||
Total assets | 0 | 0 |
Level II | Deferred compensation liability | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Level III | ||
Assets: | ||
Total assets | 21,607 | 17,078 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Level III | Equity securities investments | ||
Assets: | ||
Total assets | 0 | 0 |
Level III | Assets to fund deferred compensation liability | ||
Assets: | ||
Total assets | 0 | 0 |
Level III | Convertible notes receivable | ||
Assets: | ||
Total assets | 21,607 | 17,078 |
Level III | Deferred compensation liability | ||
Liabilities: | ||
Total liabilities | $ 0 | $ 0 |
Asset-Based Expenses - Schedule
Asset-Based Expenses - Schedule of Asset-Based Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating Costs and Expenses [Abstract] | ||
Strategist and manager fees | $ 38,243 | $ 33,205 |
Premier broker-dealer fees | 3,734 | 1,311 |
Custody fees | 1,627 | 1,503 |
Fund advisory fees | 1,110 | 1,353 |
Other | 139 | 62 |
Total | $ 44,853 | $ 37,434 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | ||
Jan. 12, 2022 | Mar. 31, 2023 | Dec. 30, 2020 | |
Debt Instrument [Line Items] | |||
Repayments of long term debt | $ 25,000 | ||
2022 Credit Agreement | 2022 Term Loans | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 125,000 | ||
Applicable margin percentage, adjustment based on performance (as a percent) | 0.05% | ||
Commitment fee percentage, adjustment based on performance (as a percent) | 0.01% | ||
2022 Credit Agreement | Senior Secured Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 500,000 | ||
2022 Credit Agreement | 2022 Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 375,000 | ||
Accordion option | $ 100,000 | ||
Minimum | 2022 Credit Agreement | 2022 Term Loans | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate | 0.875% | ||
Minimum | 2022 Credit Agreement | 2022 Term Loans | SOFR | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate | 1.875% | ||
Maximum | 2022 Credit Agreement | 2022 Term Loans | Base Rate | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate | 2.50% | ||
Maximum | 2022 Credit Agreement | 2022 Term Loans | SOFR | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate | 3.50% | ||
Bank of Montreal | 2020 Credit Agreement | Senior Secured Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 250,000 | ||
Bank of Montreal | 2020 Credit Agreement | 2020 Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 250,000 | ||
Bank of Montreal | Maximum | 2020 Credit Agreement | 2020 Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Accordion option | $ 25,000 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) $ in Thousands | 3 Months Ended | ||
Jul. 03, 2019 anniversary | Mar. 31, 2024 USD ($) anniversary shares | Mar. 31, 2023 USD ($) | |
Restricted Stock Units (RSUs) | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of award anniversaries | anniversary | 4 | ||
Share-based compensation expense | $ | $ 3,041 | $ 2,332 | |
Stock Appreciation Rights, Equity Settled | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of award anniversaries | anniversary | 4 | ||
Share-based compensation expense | $ | $ 1,127 | 1,490 | |
Contractual term | 10 years | ||
Stock Appreciation Rights, Cash Settled | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of award anniversaries | anniversary | 4 | ||
Share-based compensation expense | $ | $ 313 | $ 0 | |
Contractual term | 10 years | ||
2019 Equity Incentive Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share available for issuance under the plan (in shares) | shares | 841,250 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 1 Months Ended | |
Sep. 30, 2023 | Mar. 31, 2023 | |
Other Commitments [Line Items] | ||
Loss contingency accrual | $ 20 | |
Civil Penalty | ||
Other Commitments [Line Items] | ||
Civil penalty paid in litigation settlement | $ 9,500 | |
Disgorgement and Prejudgment Interest | ||
Other Commitments [Line Items] | ||
Civil penalty paid in litigation settlement | $ 8,827 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate (as a percent) | 23.70% | 28.10% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Related Party | ||
Related Party Transaction [Line Items] | ||
Other receivables | $ 491 | $ 250 |
Net Income Per Share Attribut_3
Net Income Per Share Attributable to Common Stockholders - Schedule of Reconciliation of Numerators and Denominators Used in Computing Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Net income | $ 37,964 | $ 17,222 |
Weighted average number of shares of common stock used in computing net income per share attributable to common stockholders, basic (shares) | 74,383,265 | 73,890,162 |
Net income per share attributable to common stockholders, basic (in dollars per share) | $ 0.51 | $ 0.23 |
Effect of dilutive shares: | ||
Diluted number of weighted-average shares outstanding (shares) | 75,269,626 | 74,370,353 |
Net income per share attributable to common stockholders, diluted (in dollars per share) | $ 0.50 | $ 0.23 |
Stock options | ||
Effect of dilutive shares: | ||
Effect of dilutive shares | 133,743 | 103,459 |
Unvested RSUs | ||
Effect of dilutive shares: | ||
Effect of dilutive shares | 470,723 | 371,655 |
Equity-settled SARs | ||
Effect of dilutive shares: | ||
Effect of dilutive shares | 281,895 | 5,077 |
Net Income Per Share Attribut_4
Net Income Per Share Attributable to Common Stockholders - Schedule of Anti-dilutive Securities Were Not Included in Computation of Diluted Shares Outstanding (Details) - shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive Securities were not included in computation of diluted shares outstanding | 53,860 | 1,550,357 |
Equity-settled SARs | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive Securities were not included in computation of diluted shares outstanding | 53,860 | 1,550,357 |
Subsequent Events (Details)
Subsequent Events (Details) - GTCR Everest - Subsequent Event $ in Thousands | Apr. 25, 2024 USD ($) |
Subsequent Event [Line Items] | |
Business Combination, Consideration Transferred | $ 2,622,573 |
Business combination, termination fee | 80,761 |
Business combination, covenant, breach of agreement fee | $ 161,522 |