- Earnings call transcript Q3 2022

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Operator

Thank you for standing by, and welcome to the WisdomTree Third Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakes' presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's program is being recorded. I would now like to introduce your host for today's program, Jessica Zaloom, Head of Corporate Communications and Public Relations. ahead. go Please

Jessica Zaloom

Good morning.

Private of like WisdomTree's risks XX, presentation. in the duty section forward-looking to, June of This any the no quarterly the and forward-looking assumes of forth but statements. Risk would reference legal for statements including, factors XX-Q XX-K ended I Act presentation statements, in the meaning XXXX, our Reform Form results XXXX. the results to presentation for update and December the forward-looking report, in materially and could available cause annual does the begin, A limited to set today's disclaimer we this within of amended, actual report Before XXXX. ended not Litigation Form on differ WisdomTree number from to XX, quarter on Securities not Factors may year as undertake in contain discussed

CFO, it's my to call turn the Now to pleasure Bryan Edmiston. WisdomTree's over

Bryan Edmiston

over with our Treasury USFR, flows considering the Jessica, in product, increases quarter Floating inflation the year-to-date you, said, have and flows market billion a recession. an backdrop for market we decline billion with during not interest October. $X.X results Jarrett markets dropped conditions, of combat billion and to Lilien contributing equity Broad-based Rate the AUM territory to been turn at of year-to-date. income remarkable negative incredibly and $X.X our a has to begin over and against the market we'll pace almost $X.X rate call operating additional the movement. our quarter, seen reviewing $X.X during quarter Thank updates concerns over been challenging during primary imminent decades surging occurring of an our bear the quarter, contributor I'll into success and Fixed business. third on generating for results then billion the generated our the from of market welcome, everyone. have We've been in That by as

is U.S. annualized overlooked quarter be we billion consecutive annualized delivering suite, our AUM suite, to year-to-date. our quarters. positive during the with by our not which growth organic of billion evidenced in growth organic are experiencing $X.X commodity product challenges XX% eight Notwithstanding and However, best-in-class of XX% flowing we are brought in momentum the $X.X sustained Equity as across

having market AUM $X.X generated as currently September, $XX.X having Our movement. an at continues our flows the increase stands billion X% end almost of positive billion, benefited momentum from October and of from in of

X% AUM. Next million, were quarter decrease slide. to movement $XX.X a impact of Revenues on market negative our due from the the of prior

advisory Our point Adjusted due mix. also or fee average $X.XX income million X a AUM changes share. $X.X in was net basis to declined our

future gain after-tax commitment used compute from a results value noncash payments, for million non-GAAP obligations. the exclude discount our rate increase an resulting Our of gold to $XX annual of payment the to present the

also exclude in $X net non-GAAP results losses. non-operating Our other million

slide. Next

well as due expenses accruals quarter. decrease lower X% as incentive This were the Our adjusted and lower operating was down largely to expenses. marketing sales-related for compensation

Next slide.

expense guidance. updates few a Now our regarding

a had hiring we compensation our as million we end plans. As reminder, range by guidance tempered last tightened the quarter, high $X of our

to million remains Our $XX compensation guidance at $XX million.

at XX% levels, million. quarter. to gross and $XX We the XX% range for communicated from update previously to XX% balance our and communicated Our flow million expense growth. we $XX had investments of We AUM year of current a management for million guidance against ranges $XX to discretionary spending being reduced the margins million currently last anticipate is as from an now $XX continue to

our when market $XX impact adjustments This our unchanged our million, third-party platforms. AUM identified the while distribution adjusted [Indiscernible] impact And the remains guidance million of on our payments rate quarter. gold of given the was for approximately for finalizing $X.X XX% on year, income contractual at included returns. XXXX Our about the tax the volatility tax

Going XX%, I end high forward, of our XX%. have. normalized guidance to Jarrett. That's prior now all tax the we the over XX% income of rate I a turn of anticipate will to call

Jarrett Lilien

leverage, become streak streak, quarterly This Bryan. gathered counting. potential and Thanks, performance total, they comments eight finance. billion more Starting of progress growth, the $X.X and on in quarters to what QX an my us our be position focus organic will I a organic strong and flows might themes, breadth ETFs and models, assets for of noteworthy blockchain-enabled digital continued growth extended but and net in our have inflow In our strong have consistent in our depth growth. product with operating even year-to-date, noteworthy is rate. over we our XX% growth as inflows industry-leading and strong

we of eight income have six of Looking in quarter had fixed inflows In more of year-to-date at story. of flows, are product our categories. $X inflows this past than billion only year-to-date, the and major part

addition annualized this representing over in to net suite our products gathered XX% growth in inflows, income, In alone. U.S. equity year-to-date billion fixed have $X.X

be our than is In over in X our Managed and benchmarks growth and while funds, best-in-class our U.S. outstanding, Contributing is business. beating of addition, our organic X-star star over and product of X% X- our AUM to AUM X Models less funds. performance with XX% XX% continues to in

levels. succeeding two is strategy Our on

broker-dealer our of and our second, our partners, multi-asset Growth top a engagement winning remains With high are Lynch, flowing with Merrill we our both just we where WisdomTree such Merrill and our manager and offering. activity and independent and at Stanley, Lynch with Portfolio in mandate, performing with X-year And Stanley. income partners where platform Solutions mandate. platform Morgan partners First, RAA at through as Morgan the hit that anniversary

it final to XX before fact, go that income When flows. success XX due been material additional at diligence. within an we've In models to leverage the opportunity I'm additional launch mandate announce our to we expected subject to typically won our pleased we've able said takes in platform months Merrill to to mandates their are win see to three we on soon that new live that start multi-asset past, to

we are high accelerated. expect greatly have Given Advisors, that with be engagement on time the I Merrill platform line and will already

We equal success RIA independent with are and our partners. broker-dealer seeing

implement XX it and adoption. Our that portfolios the RIA pipeline rebalance easy model we for model and solution major every that trade helps IBD is Currently, clears button adding hurdle are this for segment and day. to deep,

important is operational as As growth efficiency.

a global and robust built that business scalable and is margins. models have We incremental extremely delivers ETP

margins now markets XX%. with only past several and inflow the an will made one incremental Over well have And of WisdomTree improvement the story. managers than many a operational margin be improvements means, and as both asset more years, normalize, we've story this

are will ETFs what and management a is core and it We digital sometimes evolution trade our digital assets various easy DNA to are consistent and to structured access hard this contributor also ETPs, access to assets to best access do exposures business. asset structures extension make is trade. an future natural the digital with on Attacking growth. but classes. next opportunity of in executing of is WisdomTree's today provide best and Today's to to We easy wrapper. be and our seek asset driver and important delivering we the blockchain-enabled DNA. hard to It's

bring and discussed the into equities mainstream funds and exposures and have is fixed our to assets. commodities through we like As bring approach before, tokenized blockchain-enabled income, digital world crypto to mainstream

we and already basket our crypto, the U.S. Regarding Europe offering with have broken crypto of crypto early direct ETPs launch index ground and in the our in

out tomorrow's to structured full thematic, working we Regarding recent U.S. to and filings tokens. as provide entire digital again, structure. build strategies access a structure. best digital minted large fund best treasury today's dollar we are best SEC several are assets basically already hit to are everything are focused gold mainstream digital our customer We digital suite income tomorrow's for includes a with recently funds We've milestone a from classes. for an equity ETFs captive assets, as building approval asset key portfolio. fund, in fixed needs Blockchain-enabled well that

foundation vision to bricks Taken is in services, that together, lead becoming the first laying our evolution the the us allow in are will financial to These deepest our reality. claim coming in a the an fast or opportunity, All blockchain-enabled digital steady saving investing merge. march lead the spending, us in the and larger finance continues. exposures our or positioning all, in wrapper to in and in expansion even

platform evolution over me now continue organic a growth a We leverage is fast with on services. operating that, to lead will strong that the With produce reality, a allow us it which to let in financial turn vision and best-in-class becoming Jon. to next

Jonathan Steinberg

you, Jarrett. Thank

improving our mentioned, our repeating, is is X and outsourced difficult a transparent it's our As thrilled net our with earned Merrill, consistency are ETF very showcasing in macro we've offering. It expanded at the accelerating. lineup the success where inflows success ETFs growing face the fact we've that WisdomTree a of model with quality but job exciting success Jarrett is models is RIA from solutions of pipeline how Equally the the our that momentum having quickly. in of did franchises today, products providers great inflows. and before, is early best a is year-to-date. of CIO the I'm expanded Jarrett few I'm said structured, pleased environment. with and exist our worth high-quality our

solutions still prove from WisdomTree I though think sales, results has a being successfully provider. now true evolved that ticker our individual to important,

We've for also We've products innovation exciting needed culture, token, never fixed building fund, our that WisdomTree in nine knew as road and knowledge our broad approval our blockchain-enabled about Our towards digital I strategies. our dollar higher transparent of We've there. in leadership a are made additional blockchain-enabled treasury ago, four several structured this minted aligned first financial tomorrow. strengths early our additional cost-effective product the future end fund. the brand, short-term that as deep with filed success. of well progress suite fund what succeed a token recently recently DNA, our success. a driven special model includes of funds, would map years to realized trusted product confidence regulation, been in We not how out our was be does gold and strength services. best in compliance received it has funds SEC equity I blockchain has regarding income uniquely focused the

attempting been to digital market and WisdomTree around Our on our years has they million implementing asset our journey effectiveness Since on bring branded a Facebook tokenization spent with $XX WisdomTree efficiency digital start several been than and reported It's spent Prime, digital to $XXX digital wallet. the asset exposures and less regulated, failed. noteworthy. wallet of million strategy ago, our has

on QX of next towards end and Prime year. track a for in the prior discussed currently rollout we've on is calls, beta remains testing WisdomTree As national

a significant to XXXX assets Additionally, in will repeat I where generating want is about cost in last without versus uptick excited said Digital very WisdomTree quarter. what XXXX I'm begin revenue levels. headed. I

a early have ahead well financial We blockchain-enabled opportunity as an and digital assets models business both mover in tremendous in Solutions and and ETFs, services. holistic Advisor as

So ago, from investments the limiting importance brand our our as is and of announced natural a are week WisdomTree WT. evolution this mission recognizing nature we to our to changing enhancement company. its WisdomTree dropping name from expanding we ticker This and ticker, in a symbol ETFs is and and changing less By name dropping a Inc. that our moment.

questions remains can Head some the in the quarters. momentum of that, our forward from success Jeremy look our to our strong, Our Investor operator, call to over With Relations, ongoing and to shareholders. sharing I turn Campbell take you coming

Operator

program the hand to Investor go Jeremy Please Head Relations. like I'd sir. to of over ahead, Campbell, Certainly,

Jeremy Campbell

morning, Jonathan, take we a shareholders quarters, the and everybody. to direct our UCITS Similar to from of are couple platform. going good prior questions of Thanks,

about realistic at process question the ETF first approved spot thinking next is bitcoin What And path the launched? how to a the this approval spot here is and the step? getting So is is, what point? bitcoin WisdomTree

Jonathan Steinberg

this Digital question? take of -- call this Assets, Will Peck, Head will you

William Peck

Yeah, Jon. happy to,

has there on the been recent So recently bitcoin some headlines ETF. spot

for today important I is this note product live in format that think ETP U.S. We this is the to Europe. in already have

in SEC Fund. SEC quarter news, approval that. some On of look, the actually an Treasury right we other certainly productively things have try still the this another regulators. and a part get of them to there. objective I or been earlier don't That's the that WisdomTree U.S., or to in at on providers be a been remarks. always first get process concerns. for working important might expect are us, lot Digital past kind like and what our time Short-term be the the suing productively of be We the SEC But note, address Clearly, very exact all. want among other be our the that. that know to not to I in them of line it's There's we now. ultimately work to productively for with has mentioned did plan So important first working with the to has from was with

actually For us, innovation-friendly been and us. the at And of of been in they've the focused recently the have as things SEC for the actually on one that year yes, most that that's of doing. important senior developments kind one people flagged

in I other right line with So we're number think and a on focused no of them. wanted a ETF of there think now, things. but add Bitcoin is points. initiatives, assets of them including you we're to that on Jarrett, on And is on focused digital someday, with couple immediate included we'll engaging productively time that. And A in lots get there we

Jarrett Lilien

Yeah.

me Let well. in jump as

important between blockchain-enabled two. to Bitcoin and of it's And people I the finance. think distinguish confuse lot very a

We For finance a be the are the for blockchain-enabled is here, conducted. it's of opportunity, think financial talk towards A way really us, will the services lot is about the case future. leading, really change crypto, but the crypto blockchain-enabled may what on are more only we about people Again, it use march where and done And that is finance, this impact much but is a exciting interesting, crypto blockchain. unwavering. can place winter.

the a completely deepest the to and evolution to in track. opportunity one in exposures We opportunity, claim have lay is management. the This on that asset is huge next

Jeremy Campbell

the higher investors a yield. equity have couple blended you interest in of of along the get this but markets first one fared ones the And other is two -- fixed income search lines have as have of it's number products kind environment? question And that in being, Great. for is together, as dividend rate seen how products waned,

Jarrett Lilien

year-to-date. to second start with because income the in first, I'm been really segment the billion for fixed income, We've Great, flows $XX going WisdomTree. fixed it's had

the breakout a this identified in demonstrate that launch now excellence. what's instrument But innovation ago, first-to-market core and team, So segment. this the now high-yield class income has with value future has the Treasury that In X% years credit been Treasuries eight Floating ETF. our to for has launched particular, a and ETF you fixed get beta, Rate really a just and our for quality development the quality versus in to space, WisdomTree's it speaks investment-grade year that just fashion in high-yield first And talking years set been ETF opportunity growing about performed team getting high-yield this year, and since high-yield yields really our product fixed decade, beta while the focus In We could been serious an Floating for in five launched, have the of cycle opportunities in rates systematic on traditional Rate in is without captured star time moved still can WisdomTree of performing very in has asset even screen, as X% and the screening treasury back category, the with proprietary a WSHY income buyers income. up. our quality it X-week high-yield a we've ago, team that income. for about well there's add It's vehicle. income and attracting over fixed exciting the

that So for yields good category, now. this setup looks X% there flows like future high-yield future a of performance, really again

and higher We aggregate also the traditional $X in AGGY at aggregate a of fund bond duration than core good billion investment-grade income. have very is index ETF. scale fixed over assets, yield-enhanced

duration year, now back we're to positioned, relationships in been better fixed client point, So income our at as our other to deeper that this some with history money much cross-sell firm. really entire flow generally ETFs success if bond these higher does in we've a

for on XX% [Indiscernible] value is stocks equity high focusing stars. X our for to moment exciting well. To performed the strategy talked talk the about the the AUM income billion and inception, Morningstar dominated earlier, our is growth -- to is we value specifically, A our the that the had very more has question on dividend you top $X.X we've just U.S.-listed firm in and headwind U.S. top this in ways a a focus inflows lot come groups been, And gets it's equity this our deciles dividends, of performance. was and We the X back few had had year-to-date other back but So XX-year which fixed for XX% And incredibly XX again, of a different of team stalwart. equities, within on about reversed. stretch quartile. ETFs and about the largely rate. U.S. completely of peer to where stocks going annualized a and all

So set you well across could up equity. incredibly is approach see the whole

ETF $XXX SBR year, this year. XX%, on seeing are And best but You're highlighting to It's year the the catalyzing had dividends, year-to-date in million has overemphasize best large of suite, is form since those positive the a since the ETF. inflows. UCITS having XX-year X $XXX DHS their performance, strong ETFs have those in the is performance, original globally, this that we've strategy, our it actually relative a taken of strong DLN, we've which this again strong in a the year launched. has flow few dividend down we flow cap high-dividend XXX performance launched. history for ETFs picture, when we taken form just is and million

is going you income the improved can what record, quarters. from we equities, to coming at focus the over think, for support environment so And sales track to macro a compelling we very the board really see fixed WisdomTree, across on

Jeremy Campbell

question continue do forward organic assets opportunity see you our where the from growth? going last is, And and UCITS the to platform gather Great.

Jonathan Steinberg

there? you Jarrett, start why don't

Jarrett Lilien

I for three right. digital really organic All managed main and and those growth, would ETF our be Great. lineup see continued assets, areas models.

a taking But as management, large it. covered in asset evolution next assets, opportunity. X time, deepest really, just exposures the what very and again, we Just own a the a see at digital we so those opportunity to huge

of already gives billion. that flows. that, continuing. third In terms the of got we of we've got had and of outstanding covered our and example fund that. ETF net has We've just also billion. see lineup, inflows got breadth growth. I'd us in of reiterate, inflows October our best-in-class that depth organic And quarter, Jono we just performance, momentum But net an $X.XX We've $X.X

So and there momentum models. Managed is it's continuing.

We and also spent the first, exciting. on prepared me that as again, two with earlier, solutions on through most management. time platform as that is to more Stanley, broker-dealer is all little independent strategy important go we into levels: RIAs wealth a partners, little threefold. portfolio more said but Merrill really this And that about second, Lynch implement trade the one It's help portfolios talking and remarks, get partners. is our also such with then and a of have We here, all partners for Morgan rebalance and in growth I and let but macro want trends succeeding because our and of And of to growth offering. very model

We focus. But the robust new just later pipeline, our our we growing year. prepared those We platforms. to being all remarks of every platforms models with Merrill, areas mind it's wealth of mentioned launched three we those it's are on So on at want on more then more And management this we've share are day. with the want our got our in of want partners. there models touching grow partners. that advisors And the and those

an with a partner adding preferred an well. that's and management we where a our on due and advisors for a investment we're assets. our to a of existing We're billion had preferred Advisor sorry, release So process traction, our additional they we distribution capabilities, we're doing in after partnership XXX press partner diligence We've Yesterday, new Group. got their be technology Private -- example got and relationship $XX support. And models. evaluated where a existing now rigorous

those great offering, XX there, of to get evidence firms size and we've approach our So got have of then pipeline different million of a Growth of the Solutions again, we piece there, assets. a Portfolio portion a meaningful And success. million large where firms between and of sort generally another $XXX and $XXX

And are So We've runway all working. point in a model this is really nature. inflows a in got important all, growth. is recurring long for

also comes As around. these to existing money you models. sticky. tends stackable establish it's it in, new builds It's relationships, the on in flows, It and stick

organic areas: about those again, our and models. excited lineup X ETF And managed very digital So growth. through assets,

Jeremy Campbell

Jonathan, analysts. sell-side open for up some questions Jarrett. Thanks, it from to free feel our

Operator

Certainly. [Operator line the Our Jefferies. Instructions] first from Fannon comes Dan question from of

Your question please.

Daniel Fannon

within kind be larger from on all channel? guess Thanks. of just discussion. precluded on the And really some, managed follow there's can't this then going given talk to other some existing big Or know on you you've some is platforms? model Good up relationships? is are firms. you with the getting discussions are -- about on it you your platforms I mentioned morning. you're how them I what other -- Can because AUM of today

Jonathan Steinberg

that Jarrett, want to you first? do take

Jarrett Lilien

Sure.

So around are past, being ratios asset talked XX%. of in the and new levels asset levels flows ratios about Those holding. and we've

we of have the opportunities, other In partner opportunities. partner terms yes,

second that board restrictions in pretty we there a robust, is so the ago another. was one X are saying no platform, being far on no the restrictions pipeline across there I So are as are and

our $X We're at big didn't it growth. in this to early if we levels, now And area zero our expecting see had to AUM in a over XXXX. So billion continue where contribute it, we on were are today. mention to initiative I we

Jonathan Steinberg

Thank you.

question? Next

Operator

Certainly the Brennan from UBS. question And our from next line of Hawken comes

Your question please?

Brennan Hawken

taking Will's question finished. efforts for are the comments not you spot suggested ETF my that Good bitcoin morning. Thank

help structural your and not ETF why spot you you received impediment bitcoin on to a of a share And that? in -- the SEC? steps And is U.S.? from can is exchange, traded So Have a next feedback security could understand the that considered that us you any are? an are the what concerns here

Jonathan Steinberg

Will, don't that? take you why

William Peck

restating I think -- of just U.S. ETF what spot bitcoin you the the I with so mean, Yeah. the maybe said the in concerns in I terms think approval

concern has So they referenced no for rejection so or the that, have There in don't over -- they the been U.S. that regulator market which market happens for bitcoin far market letters, potential that spot has the biggest around on price oversight potential manipulation. discovery for manipulation. SEC's their venues over, has oversight consistently the

I past. examples weeds think can point this, you the the you really into in get on can to

can keep next like not open responsible that about in productively spend on we I did like You the -- the we and are of from some I talking digital an great stopping broadly need and to happens journey, this development how going with anything continuing definitely with on of engaging discovery talk to steps to But I kind said, to SEC other that remarks, the price we on other We the skilled the big about past futures to of lawsuit single that. markets. found here. just that. like in to kind regulators SEC topic. DC manager things think That like not be in joining I But WTSY be be could or asset space, as it media more also, formats. of just ecosystem innovation mean, this, could evolution WisdomTree alone, time doing asset a But there's lot members the SEC. be in be us with it's can't interviews, want And said we're planning with my picture, said I've on a earlier working and

Jeremy Schwartz

ETP Yeah. let And me related one nothing The to add let launching. Prime just -- me has Bitcoin WisdomTree thing.

deterrent a to our going not that's that So product. from be launching

there out unrelated. that get they're to wanted Just that

Jonathan Steinberg

to I for is WisdomTree in Prime blockchain-enabled is, interesting. trees. That's where is finance. about. But forest what the the Crypto not And jump wanted let's opportunity real the again, miss Yeah. is

on it's and to the confuse great with is a opportunity that really holdups working to ETF that Prime. blockchain-enabled approved. We've momentum the more broader anything got here, don't WisdomTree for got the that a fund We've mistake It's finance. filed. got big nine use finance, We've opportunity we're mistake So approval a crypto, do on blockchain. the in blockchain-enabled for we're case one which and crypto confuse pursuing the that's to

Brennan Hawken

one's other Yeah. Anyway, They're the is thing. of asset separate, though, ask another. and love rail on that sort a to class clearly functional I'd point, an

SEC that's first approval. your have You blockchain-enabled received fund

are now might of the in more to you position to be comfortable using a benefits rails. try you where So those explain

I and think more the it's yet most than platforms. treasuries that if not X of and administered interesting and traditional at like least are it's most X on classes ironic, the being that, of new asset significant innovative

And so think through how garner we this benefits can operational should unusual about you potential improvements that or and and efficiency new administration?

Jonathan Steinberg

start? one? Jarrett, the I Will if in want you to on start course, this may or to want come over top, of but guys you

William Peck

me start. start. let I'll Yeah, Yeah,

ETFs, and we total standardization, a with mutual greater largest a a this. -- than the The the ETFs liked account ETFs. institution think holdings liquidity mutual than fund. right? better access world Liquidity, underlying of standardization, we to things are Anyone similar can transparency, single trader day the ETFs and experience transparency really experience are the right? the about with of some do, have of So very brokerage in funds

but enhance And a kind add You're I'll assets. seeing little the these tokenization on same qualities for just maybe thing and of point, one more bit the liquidity -- only on. with potential digital

when think this cetera. et first Bitcoin a oh, like lot as, of look at came gold asset, out, I it saw people

XX/X, look on market are a at peer-to-peer basis. and people at be of remarked structure how a lot asset on this that XXX a experienced think in I can settled there's an who basis with finality near

Like where much innovation down to intermediated, More inclusion further. that times plus we today, is For and people value. participate can from right? that markets which system more markets, is implications and broadly, of the the securities come financial cost. has profound, in can lots markets exchange one a which how That settlement terms for financial highly settlement broadly, two asset moving less of huge has is times T in more

tokenization with digital embarked on seeing that's why assets what and this. we've we're So that's

another right? a first one of example unlock able in ever One a from So as that And think an is that terms securities and just these that be peer-to-peer kind potential unlocking demonstrating of right? specific one WTSY the do process Transferring fund on you'll short-term very would cumbersome simple constructive. innovation is to transferability, journey is do, account this something for we treasury use lot to that is a this. be of very cases to able of peer-to-peer this step today, to allowing as WTSY no the with

Another count connecting elements stacks. more Payments tech and it two financial are one different totally be services, right? to other would on closely brokerage your today in

If one you another, right? just future future, and you're value isn't something from line, time like it do. would move this We're today with In stack, a is to what about tech wanted one all the seven-day the doing we to faster constructive try you diving closer talking which with users. and think investments, will moves and cost, for exchange a All to we much user we of is lower we're which payments efficiency simply quicker tech one savings stack, benefit, much [ph]. enhance value, think in

as that, nationally to seeing. if we're few more take blogged a just of QX. go this we'll about a it I at of soon and you be and live what the look demonstrating too are those want in So examples increasingly later we

Jonathan Steinberg

good? you did add more have or was to Jarrett, that

Jarrett Lilien

end is I you digital for zero first it's that it customer. our expense mean at important couple compelling it's of things. look Will I covered But think fund, treasury at all. ratio. the a Just this

and new. the immediate in financial the value just but the that difference a services it's So of middlemen. profound cut our the consumer spend, expense. fact We course, you also to benefits. save same basically experience invest lot We can revenue lot is utility, the consumer, in side. where our cut And asset then And streams. of a out benefit the there's, directly there's a on of We out diversify unnecessary

and fee thrive enables So to in it world us where a pressure. there's today succeed

consumer, the for compelling for compelling So WisdomTree.

Jeremy Campbell

to us want Thanks, Jarrett. the Jeremy, do question? you give next

Operator

next Northcoast from the Housum from of Certainly. And question our comes Research. Keith line

please. question Your

Keith Housum

understand, users far number so is a version of on confidence color beta -- quarter? in us first national in provide Good morning. you a Prime number you I But the Beta any of was heading of create hoping beta terms some a statistics terms role bit transactions. the Prime in guess, guys that little towards help probably the have, I more of of

Jonathan Steinberg

to want start? you Will, Okay.

William Peck

Yes, sure.

disclosing So in kind a was we're cleared. the we time metrics for hurdle point approval is WTSY regulatory Everything great of on track not this at beta. any that QX launch. on The

So we're that. excited quite about

far, on color specific track rollout beyond we're our the no and been broader for successful it's testing QX. So in so on beta

Keith Housum

Understood. Okay. Appreciate it.

segments? versus the European think are of, European to flows two the Europe I of terms have do fixed great trying there because that We're probably Is portfolios, to ETF guess, opportunity think different obviously, funds the in more income Are obviously U.S. and different more a trends is the of out but exposure. -- treasury commodity so there how funding In the I not economy USFR. of here. But because between -- do two success, the seeing type about you part there. we the U.S. well, to doing

Jonathan Steinberg

who Jeremy wants to or Will start?

Jeremy Campbell

start. Jeremy. This is I'll

still over -- Securities were the environment inflation for acquired inflation Gold rising rates, a elevated in a real the or when we one ETF particular do they were excited been dollar headwinds because of actually, were hiking the interest we the years, we an and platform, had challenges has year. in they lot Fed That's the strong that. some leader coming So commodities cycle. with like of this

of the backdrop for more from exposure You the aggressively to rates. could large hiking supportive very pivots Fed as a their gold a get sort

have like very flows that you opportunity we Europe in The diversifying same focus, has they've the They been So at Europe. that execution, -- are that dividend thematic And of they've year. very Europe. say, time, our the dividend there's more to also sectors a could year and from a focused next sort we the on leading exposure. least next half they long-term things mentioned have quality but of they been seeing But growing very lineup U.S. potentially we've some earlier, resonating. something as are second we the in focused globally, is commodity or look been do be good on to out have thematics Europe. in thematics adoption U.S. to shifted robust growth franchise high largest in think specific And ETF ETF, It's I and the in DGRW over been will of,

helps we're very got globally environments. firm. firm, And They've continuing crypto lineup. global so focus And fixed to we're It's the And you've exposures. a diversified diversify robust above the income, in as a equity, it terms on many different the for of very all of got commodities. --

Keith Housum

you. Thank Great.

Jonathan Steinberg

just I you Jarrett, add? guess to not. want

Next question?

Operator

the [Operator Instructions] Michael of Stanley. comes our And from Morgan question Certainly. Cyprys from line next

Michael Cyprys

Good morning. taking my Thanks question. for

distribution to treasury envision you different set you plan Are On this fund, have you the are here? in those hoping is about products customers the to blockchain-enabled invest getting digital strategy. How to digital little and the customers customers a retail could customer advisors? the in sold What as past? the was wrapper? I bit How -- about do from that these talk these go you

Jonathan Steinberg

Good question.

why field don't think Jarrett, and you I Will guys this?

William Peck

happy I'm Yeah. start to again.

I initially, will funds this the as over through happen infrastructure be wallet requirement with time, for we've will referring and customers with the application been be to DXC available quickly. could the think WisdomTree -- that's So fairly Prime only and that digital

lot grow line the no migrating see is outside placed we We well WisdomTree be there over expect time distribution opportunities very serve structure, them. into Prime, happening. immediate like that of But to to a we're of going to assets time, current but and on

institutions we well distribution. think like, our advisors, and something and financial suited given for it's that's with existing particularly that's the we're all that road whether on So the map,

Jarrett Lilien

to about launched distribution. a but story. actually XX some different look it's party. claiming new we pioneers, We're the XX we We you if we've Today, wrapper a just much catch got are new talk the needs with early to a We others first add, just world to years wrapper, considered But about we little to this party. in in and exposures party, deepest back the being innovators. But got were being ETF late the but years claim our nonetheless little of size a opportunity -- us. And up trying ETFs. the to bit exposures were bit therefore, -- I'd deepest the were the little early the ago. to

to others now, to right our to as be securities, need be sell able so product. And regulated

And so as Will said in the beginning, it wallet. will be through our

role it Will think environment Now big of a X. world, or close it about actually in a is but we zero in on in people you or you I physically think merged you earning compelling value really if a a in have have finance cash that the of And lot but marketing comments you earlier, in around, you want the money sit And checking I these think, today's will also, one another one touched bank account and about will blockchain-enabled sell. to how move sell, environment. sit And to when a account move exciting at worlds from unified. earning those are to things to brokerage

be can look source can spending. so your of of be that our investing. Digital like X.X%, X%, your something you And at Treasury That yielding source

you different have there environment, different zero. -- longer account, earning sit to in next a no You don't a in to

to, being how sorry. to proposition as and compelling. as you, development up, institutional broaden I'm the investors world platforms a because going of sell it's hope, catches -- early out up, distribute. we so Michael? is as value catches Michael, this itself, Did is us nice opportunity gives the to I interrupt business certainly we'll also I But rest as to the do regulation So well.

Michael Cyprys

acquisition? I ask with of of sort you it's growing have $XX million a of Yes, discretionary around to you the into you're next the current would we into just spend of about quantify about how about talk to Can that, that's plan advertising investments. to year, much just sort whether that How And as customer against you that? put on been think marketing, the grow follow-up that side, on could do Is in look so you I customers? you rate such? how or question spend planning resources a great. that already and would How little up embedded think maybe sort run bit it's

Jarrett Lilien

but quarter, said overall guidance give last -- we've earlier as the more So in significant you in rolling the We'll I'll WisdomTree's next as what X we're we're out Prime, increase comments and WisdomTree expenses. expecting take not roughly is that, last this. in well a quarter quarters

not more next many it to comforting changing, you -- but the So out the significantly be nationally, is we'll quarter. to should should analysts. I think base be but of that Rolling give cost have

Michael Cyprys

you. Thank Okay.

Operator

from And Brown the final our One you. question Michael for Thank moment Comes of KBW. for question. final today. line from our

please. Your question

Michael Brown

Thanks for morning. good question. Hi, my taking

have and to I up budgets anticipate investment large building to with So hear determined up already to to could you've to catch can't a likely but how here. you roll And some early-mover you landscape I of the an help they just clearly think about what evolve. blockchain at digital and out advantage guess continue to out. and the here try money players the that to seem been bigger catch digital wanted initiative on some front throw I competitive

do you seeing evolve? And expect are how you what landscape at time? that to this competitors So competitive from

Jonathan Steinberg

broadly over services to blockchain. it so more This this. financial be take the expecting time is I'll to compelling. I'm I So competitors. is that on expect certainly there will really because move

more seen They're in we've more from far, broad exploratory mode. So competitors. an

to I technology. come cases business new think exploit models their that they're with up how use and they'll own investigating. have They and the

a easy so And because so quite it's of definitions. not there's blurring

those motion. it bit we the early, conclusions does amongst into to not if maybe earliest. that be are seem now been this with very discussing but coming are be putting started to to who our X we've we our seem to of conclusions, and And many, and cases And years to take we ideas be ago, came also that not that creativity, our pleased so we're use very quickly a creating with but we're expecting alone, excited little --

their of firms amount to There's models. Let's existing these other significant legacy can navigate disruption a see coming business if issues.

of conviction And tackle add? did takes to so Jarrett, lot really with have to it going you're a you this anything energy.

Jarrett Lilien

Yeah.

does and isn't Just is over take an there as said. really app, was quickly But of as simple app, you've that time. three WisdomTree and our with Prime But you this mostly regulators. as years heard, efforts reiterating developing what

we've building Galileo. like Bank recently, seen of you've an been with partners As with people operational releases ecosystem press Stride and

product. on work there's So

There's more You've filed. got client seen us There's launch We've experience. functionality. a X product.

is well leveraging really three-plus So this and years, effort isn't on very it but be something existing a undertaken. that infrastructure been real We've people, our this quickly. repeated that we've for working can

Jonathan Steinberg

And click point on just that of last to double Jarrett's.

relevance as of and as assets have what to efforts. great the them, as in you we people business. doing roughly able digital nearly well are wouldn't do is the people We XXX cost digital the ETF assets. as effectively people quickly where without asset XXX to be XX in in But accomplish digital And

this So holistic, We're try really really, saying well that exploit the opportunity. is to but we keep this questions? company to it. positioned Any we to mean be more

Michael Brown

any further This I'll remarks. to Thank you. I'd there. question-and-answer leave Thank conclude hand CEO session program. of back Jonathan does like it today's program you. the for the Steinberg, to

Jonathan Steinberg

for attention, everybody. you we'll you your No to next to quarter. We remarks. talk and further just a and want great day, thank Have support

Operator

conclude Thank This program. you, your ladies participation does the today's gentlemen, in conference. and for

now Good day. disconnect. may You

WisdomTree (WT) 28 Oct 222022 Q3 Earnings call transcript