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Federated Hermes Inc

Federated Hermes, Inc. reports record assets under management with first quarter 2026 earnings

  • Total assets under management reach a record $907.1 billion
  • Money market assets reach a record $684.7 billion
  • Equity assets reach a record $100.8 billion
  • Q1 2026 earnings per diluted share of $1.27
  • Quarterly dividend increased by 11.8% from previous quarter to $0.38 per share

PITTSBURGH , April 30, 2026 /PRNewswire/ -- Federated Hermes, Inc. (NYSE: FHI), a global leader in active investing, today reported earnings per diluted share (EPS) of $1.27 for Q1 2026, compared to $1.25 for the same quarter last year, on net income of $96.4 million for Q1 2026, compared to $101.1 million for Q1 2025. Federated Hermes' Q1 2025 results included a $12.9 million decrease in other operating expense, or $0.15 per diluted share, resulting from a value-added tax (VAT) refund received as part of amended VAT filings in the U.K.

Federated Hermes' total managed assets were a record $907.1 billion at March 31, 2026, up $67.3 billion or 8% from $839.8 billion at March 31, 2025 and up $4.5 billion from $902.6 billion at Dec. 31, 2025. Total average managed assets for Q1 2026 were $915.6 billion, up $72.4 billion or 9% from $843.2 billion for Q1 2025 and up $41.9 billion or 5% from $873.7 billion for Q4 2025.

"In the first quarter, we saw record gross sales and positive net flows in our equity offerings as we continued momentum from the previous year, with investor interest in a range of our offering types," said J. Christopher Donahue, president and chief executive officer. "Separate accounts reached new record assets on overall demand for our MDT suite of quantitative investment solutions, led by our MDT All Cap Core and MDT Mid Cap Growth offerings. Investors with interest in capital preservation and liquidity continued to rely on our money market offerings and—for those interested in moving further out the yield curve in the pursuit of higher yields than money market products—our ultrashort funds."

Federated Hermes' board of directors declared a dividend of $0.38 per share, which was an increase of $0.04 or 11.8% from the previous quarter. The dividend is payable on May 15, 2026 to shareholders of record as of May 8, 2026. During Q1 2026, Federated Hermes purchased 1,191,300 shares of Federated Hermes class B common stock for $66.0 million.

Equity assets were a record $100.8 billion at March 31, 2026, up $19.9 billion or 25% from $80.9 billion at March 31, 2025 and up $2.9 billion or 3% from $97.9 billion at Dec. 31, 2025. Top-selling equity funds during Q1 2026 on a net basis were Federated Hermes MDT Mid Cap Growth Fund, Federated Hermes MDT Large Cap Growth Fund, Federated Hermes MDT All Cap Core Fund, Federated Hermes MDT US Equity Fund and Federated Hermes MDT Small Cap Core Fund.

Fixed-income assets were $99.8 billion at March 31, 2026, up $0.3 billion from $99.5 billion at March 31, 2025 and down $0.3 billion from $100.1 billion at Dec. 31, 2025. Top-selling fixed-income funds during Q1 2026 on a net basis were Federated Hermes Ultrashort Bond Fund, Federated Hermes Total Return Bond ETF, Federated Hermes Municipal Ultrashort Fund, Federated Hermes Government Ultrashort Fund and Federated Hermes Short-Term Income Fund.

Alternative/private markets assets were $19.0 billion at March 31, 2026, down $0.4 billion or 2% from $19.4 billion at March 31, 2025 and down $0.1 billion or 1% from $19.1 billion at Dec. 31, 2025.

Money market assets were a record $684.7 billion at March 31, 2026, up $47.6 billion or 7% from $637.1 billion at March 31, 2025 and up $2.1 billion from $682.6 billion at Dec. 31, 2025. Money market fund assets were $502.8 billion at March 31, 2026, up $37.9 billion or 8% from $464.9 billion at March 31, 2025 and down $5.6 billion or 1% from $508.4 billion at Dec. 31, 2025.

Financial Summary

Q1 2026 vs. Q1 2025

Revenue increased $55.4 million or 13% primarily due to an increase in revenue due to higher average money market and equity assets. This increase was partially offset by a decrease in performance fees and carried interest of $5.6 million, which includes a decrease of $1.0 million in carried interest from consolidated carried interest vehicles, which is largely offset in compensation expense.

During Q1 2026, Federated Hermes derived 54% of its revenue from money market assets, 45% from long-term assets (30% from equity, 10% from fixed-income, and 5% from alternative/private markets and multi-asset) and 1% from sources other than managed assets.

Operating expenses increased $60.9 million or 21% primarily due to a $26.7 million increase in distribution expenses resulting primarily from higher average money market fund assets, an $18.2 million increase in other expense primarily due to a value added tax (VAT) refund received in Q1 2025 related to amended VAT filings in the U.K. and fluctuations in foreign currency exchange rates, and a $10.8 million increase in compensation and related expense primarily due to higher incentive compensation.

Nonoperating income (expenses), net for Q1 2026 decreased $0.8 million due primarily to lower net gains on securities.

Q1 2026 vs. Q4 2025

Revenue decreased $3.9 million or 1% primarily due to a $10.5 million decrease in revenue resulting from two fewer days in Q1 2026 and a decrease in development fees of $8.6 million. These decreases were partially offset by an increase in revenue due to higher average money market and equity assets.

Operating expenses increased $5.4 million or 2% primarily due to a $9.1 million increase in compensation and related expense  primarily from higher stock-based compensation expense, partially offset by a $3.4 million decrease in Other expense primarily due to lower charitable contributions.

Nonoperating income (expenses), net decreased $1.3 million due primarily to lower net gains on securities .

Earnings call information

Federated Hermes will host an earnings conference call at 9 a.m. Eastern on Friday, May 1, 2026. Investors are invited to listen to the earnings teleconference by calling 888-506-0062 (domestic) or 973-528-0011 (international) prior to the 9 a.m. start time. To listen online, go to the About section of FederatedHermes.com/us to register and join the call. A replay will be available at approximately 12:30 p.m. Eastern on May 1, 2026. To access the telephone replay, dial 877-481-4010 (domestic) or 919-882-2331 (international) and enter access code 53870. The online replay will be available via FederatedHermes.com/us for one year.

About Federated Hermes

Federated Hermes, Inc. is a global leader in active investment management, with $907.1 billion in assets under management1. We deliver investment solutions that help investors target a broad range of outcomes and provide equity, fixed-income, alternative/private markets, multi-asset and liquidity management strategies to more than 11,000 institutions and intermediaries worldwide. Our clients include corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Headquartered in Pittsburgh, Federated Hermes has more than 2,000 employees in London, New York, Boston and offices worldwide.

Federated Hermes ranks in the top 5% of equity fund managers, the top 8% of money market fund managers and the top 11% of fixed-income fund managers2 in the industry. Federated Hermes also ranks as the 10th-largest manager of model-delivered separately managed accounts3. For more information, including an analyst presentation, which is updated periodically, visit FederatedHermes.com/us.

###

1) As of March 31, 2026.
2) Morningstar, March 31, 2026. Based on U.S. fund flows rankings.
3) Money Management Institute/Cerulli,Q4 2025.
Federated Securities Corp. is distributor of the Federated Hermes funds.
Separately managed accounts are made available through Federated Global Investment Management Corp., Federated Investment Counseling, Federated MDTA LLC, Hermes Fund Managers Ireland Limited, Hermes Investment Management Limited, and Hermes GPE LLP, each a registered investment advisor in one or more of the U.S., U.K. or Ireland.

Cautionary statements

Certain statements in this press release, such as those related to performance, investment strategies, opportunities to meet client needs, investor preferences and demand, asset flows and asset mix constitute or may constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements can include statements that do not relate strictly to historical or current facts and are typically identified by words or phrases such as "trend," "forecast," "project," "predict," "potential," "approximate," "opportunity," "believe," "expect," "anticipate," "current," "intention," "estimate," "position," "projection," "plan," "assume," "continue," "remain," "maintain," "sustain," "seek," "achieve," and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "can," "may," and similar expressions. Any forward-looking statement, and Federated Hermes' level of business activity and financial results, are inherently subject to significant business, market, economic, competitive, regulatory and other risks and uncertainties, many of which are difficult to predict and beyond Federated Hermes' control. Other risks and uncertainties include the ability of the company to predict the level of fee waivers and expenses in future quarters, predict whether performance fees or carried interest will be earned and retained, the ability of the company to sustain product demand, the timing and level of product sales and redemptions, market appreciation or depreciation, revenues, and asset levels, flows and mix, which could vary significantly depending on various factors, such as market conditions, investment performance and investor behavior. Other risks and uncertainties include the risk factors discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission. As a result, no assurance can be given as to future results, levels of activity, performance or achievements, and neither the company nor any other person assumes responsibility for the accuracy and completeness, or updating, of such statements in the future.

Unaudited Condensed Consolidated Statements of Income

(in thousands, except per share data)








Quarter Ended

%
Change
Q1 2025
to Q1
2026


Quarter Ended

%
Change
Q4 2025
to Q1
2026


March 31, 2026

March 31, 2025


Dec. 31, 2025

Revenue







Investment advisory fees, net

$        319,408

$        287,460

11 %


$       313,975

2 %

Administrative service fees, net—affiliates

110,285

101,109

9


109,759

0

Other service fees, net

49,264

34,971

41


59,099

(17)

Total Revenue

478,957

423,540

13


482,833

(1)








Operating Expenses







Compensation and related

154,119

143,270

8


144,981

6

Distribution

125,745

99,085

27


122,339

3

Systems and communications

26,463

24,226

9


24,719

7

Professional service fees

21,336

18,548

15


23,399

(9)

Office and occupancy

10,062

9,952

1


9,704

4

Advertising and promotional

4,098

4,576

(10)


7,001

(41)

Travel and related

3,850

3,553

8


4,677

(18)

Intangible asset related

3,422

3,196

7


3,475

(2)

Other

3,531

(14,638)

(124)


6,964

(49)

Total Operating Expenses

352,626

291,768

21


347,259

2

Operating Income

126,331

131,772

(4)


135,574

(7)








Nonoperating Income (Expenses)







Investment income (loss), net

6,653

7,475

(11)


7,886

(16)

Debt expense

(3,185)

(3,179)

0


(3,201)

0

Other, net

(30)

(27)

(11)


73

(141)

Total Nonoperating Income (Expenses), net

3,438

4,269

(19)


4,758

(28)

Income before income taxes

129,769

136,041

(5)


140,332

(8)

Income tax provision

33,823

32,165

5


32,899

3

Net income including the noncontrolling interests in subsidiaries

95,946

103,876

(8)


107,433

(11)

Less: Net income (loss) attributable to the noncontrolling interests in subsidiaries

(432)

2,742

(116)


394

(210)

Net Income

$         96,378

$        101,134

(5) %


$        107,039

(10) %








Amounts Attributable to Federated Hermes, Inc.







Earnings Per Share 1







Basic and diluted

$            1.27

$            1.25

2 %


$            1.39

(9) %

Weighted-Average Shares Outstanding







Basic

72,648

77,541



73,795


Diluted

72,650

77,542



73,795


Dividends Declared Per Share

$            0.34

$            0.31



$            0.34




1)

Unvested share-based awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the "two-class method." As such, total net income of $4.4 million, $4.5 million and $4.8 million available to unvested restricted Federated Hermes shareholders for the quarterly periods ended March 31, 2026, March 31, 2025 and Dec. 31, 2025, respectively, was excluded from the computation of earnings per share.

 

 Unaudited Condensed Consolidated Balance Sheets



(in thousands)

March 31, 2026

Dec. 31, 2025

Assets



  Cash and other investments

$          645,417

$           724,297

  Other current assets

143,153

139,495

  Intangible assets, net, including goodwill

1,173,986

1,183,612

  Other long-term assets

181,251

181,933

  Total Assets

$        2,143,807

$         2,229,337




Liabilities, Redeemable Noncontrolling Interests and Equity



  Current liabilities

$          240,680

$           314,141

  Long-term debt

348,434

348,369

  Other long-term liabilities

291,853

303,350

  Redeemable noncontrolling interests

58,520

66,529

Equity excluding treasury stock

2,133,825

2,070,162

Treasury stock

(929,505)

(873,214)

  Total Liabilities, Redeemable Noncontrolling Interests and Equity

$        2,143,807

$         2,229,337

 

Unaudited Changes in Long-Term Assets - By Asset Class

(in millions)

Quarter Ended


March 31, 2026

Dec. 31, 2025

March 31, 2025

Equity




Beginning assets

$        97,898

$        94,656

$        79,423

Sales1

9,091

8,949

7,412

Redemptions1

(6,878)

(7,431)

(5,993)

Net sales (redemptions)1

2,213

1,518

1,419

Net exchanges

(139)

139

(114)

Impact of foreign exchange2

(287)

107

754

Market gains and (losses)3

1,147

1,478

(569)

Ending assets

$       100,832

$        97,898

$        80,913





Fixed Income




Beginning assets

$       100,127

$       101,813

$        98,059

Sales1

5,927

5,891

5,944

Redemptions1

(6,349)

(8,687)

(6,288)

Net sales (redemptions)1

(422)

(2,796)

(344)

Net exchanges

148

15

101

Impact of foreign exchange2

(40)

6

85

Market gains and (losses)3

(15)

1,089

1,585

Ending assets

$        99,798

$       100,127

$        99,486





Alternative/Private Markets




Beginning assets

$        19,101

$        19,024

$        18,864

Sales1

629

724

1,085

Redemptions1

(547)

(592)

(1,024)

Net sales (redemptions)1

82

132

61

Net exchanges

0

0

1

Impact of foreign exchange2

(275)

35

532

Market gains and (losses)3

83

(90)

(32)

Ending assets

$        18,991

$        19,101

$        19,426





Multi-asset




Beginning assets

$         2,854

$         2,940

$         2,883

Sales1

58

59

63

Redemptions1

(94)

(92)

(105)

Net sales (redemptions)1

(36)

(33)

(42)

Net exchanges

1

(121)

2

Market gains and (losses)3

(41)

68

(17)

Ending assets

$         2,778

$         2,854

$         2,826





Total Long-term Assets




Beginning assets

$       219,980

$       218,433

$       199,229

Sales1

15,705

15,623

14,504

Redemptions1

(13,868)

(16,802)

(13,410)

Net sales (redemptions)1

1,837

(1,179)

1,094

Net exchanges

10

33

(10)

Impact of foreign exchange2

(602)

148

1,371

Market gains and (losses)3

1,174

2,545

967

Ending assets

$       222,399

$       219,980

$       202,651



1)

For certain accounts, including separately managed accounts, institutional accounts, certain sub-advised funds and other managed offerings, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.

2)

Reflects the impact of translating non-U.S. dollar denominated assets under management (AUM) into U.S. dollars for reporting purposes.

3)

Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions and net investment income.

 

Unaudited Changes in Long-Term Assets - By Asset Class and Offering Type

(in millions)



Quarter Ended


March 31, 2026


Equity

Fixed Income

Alternative / Private
Markets

Multi-asset

Total


Funds

Separate
Accounts1

Funds

Separate
Accounts1

Funds

Separate
Accounts1

Funds

Separate
Accounts1

Funds.

Separate
Accounts1

Beginning assets

$   54,988

$   42,910

$   45,973

$   54,154

$  12,085

$   7,016

$    2,850

$       4

$ 115,896

$  104,084

Sales

5,855

3,236

3,985

1,942

609

20

58

0

10,507

5,198

Redemptions

(4,561)

(2,317)

(3,993)

(2,356)

(318)

(229)

(94)

0

(8,966)

(4,902)

Net sales (redemptions)

1,294

919

(8)

(414)

291

(209)

(36)

0

1,541

296

Net exchanges

(169)

30

148

0

0

0

1

0

(20)

30

Impact of foreign exchange2

(158)

(129)

(26)

(14)

(159)

(116)

0

0

(343)

(259)

Market gains and (losses)3

(767)

1,914

(166)

151

122

(39)

(41)

0

(852)

2,026

Ending assets

$   55,188

$   45,644

$   45,921

$   53,877

$  12,339

$   6,652

$    2,774

$       4

$ 116,222

$  106,177



1)

Includes separately managed accounts, institutional accounts, certain sub-advised funds and other managed offerings. For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.

2)

Reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.

3)

Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions and net investment income.

 

Unaudited Changes in Long-Term Assets - By Offering Type

(in millions)

Quarter Ended


March 31, 2026

Dec. 31, 2025

March 31, 2025

Total Fund Assets




Beginning assets

$       115,896

$       115,215

$       103,567

Sales

10,507

10,419

9,279

Redemptions

(8,966)

(10,835)

(8,763)

Net sales (redemptions)

1,541

(416)

516

Net exchanges

(20)

33

0

Impact of foreign exchange1

(343)

34

685

Market gains and (losses)2

(852)

1,030

(479)

Ending assets

$       116,222

$       115,896

$       104,289





Total Separate Account Assets 3




Beginning assets

$       104,084

$       103,218

$        95,662

Sales4

5,198

5,204

5,225

Redemptions4

(4,902)

(5,967)

(4,647)

Net sales (redemptions)4

296

(763)

578

Net exchanges

30

0

(10)

Impact of foreign exchange1

(259)

114

686

Market gains and (losses)2

2,026

1,515

1,446

Ending assets

$       106,177

$       104,084

$        98,362





Total Long-term Assets 3




Beginning assets

$       219,980

$       218,433

$       199,229

Sales4

15,705

15,623

14,504

Redemptions4

(13,868)

(16,802)

(13,410)

Net sales (redemptions)4

1,837

(1,179)

1,094

Net exchanges

10

33

(10)

Impact of foreign exchange1

(602)

148

1,371

Market gains and (losses)2

1,174

2,545

967

Ending assets

$       222,399

$       219,980

$       202,651



1)

Reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.

2)

Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions and net investment income.

3)

Includes separately managed accounts, institutional accounts, certain sub-advised funds and other managed offerings.

4)

For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.

 

Unaudited Managed Assets


(in millions)

March 31, 2026

Dec. 31, 2025

Sept. 30, 2025

June 30, 2025

March 31, 2025

By Asset Class






Equity

$       100,832

$         97,898

$         94,656

$         88,994

$         80,913

Fixed-Income

99,798

100,127

101,813

98,687

99,486

Alternative / Private Markets

18,991

19,101

19,024

20,738

19,426

Multi-Asset

2,778

2,854

2,940

2,856

2,826

Total Long-Term Assets

222,399

219,980

218,433

211,275

202,651

Money Market

684,748

682,604

652,767

634,400

637,122

Total Managed Assets

$       907,147

$       902,584

$       871,200

$       845,675

$       839,773







By Offering Type






Funds:






Equity

$         55,188

$         54,988

$         54,110

$         49,359

$         43,910

Fixed-Income

45,921

45,973

46,478

45,415

45,800

Alternative / Private Markets

12,339

12,085

11,814

12,905

11,879

Multi-Asset

2,774

2,850

2,813

2,730

2,700

Total Long-Term Assets

116,222

115,896

115,215

110,409

104,289

Money Market

502,775

508,403

492,701

468,044

464,912

Total Fund Assets

$       618,997

$       624,299

$       607,916

$       578,453

$       569,201

Separate Accounts:






Equity

$         45,644

$         42,910

$         40,546

$         39,635

$         37,003

Fixed-Income

53,877

54,154

55,335

53,272

53,686

Alternative / Private Markets

6,652

7,016

7,210

7,833

7,547

Multi-Asset

4

4

127

126

126

Total Long-Term Assets

106,177

104,084

103,218

100,866

98,362

Money Market

181,973

174,201

160,066

166,356

172,210

Total Separate Account Assets

$       288,150

$       278,285

$       263,284

$       267,222

$       270,572

Total Managed Assets

$       907,147

$       902,584

$       871,200

$       845,675

$       839,773

 

Unaudited Average Managed Assets

Quarter Ended

(in millions)

March 31, 2026

Dec. 31, 2025

Sept. 30, 2025

June 30, 2025

March 31, 2025

By Asset Class






Equity

$       102,037

$         96,404

$         92,436

$         83,564

$         82,105

Fixed-Income

100,996

100,855

99,206

98,365

99,360

Alternative / Private Markets

19,232

18,971

19,862

20,053

19,012

Multi-Asset

2,859

2,836

2,895

2,779

2,900

Total Long-Term Assets

225,124

219,066

214,399

204,761

203,377

Money Market

690,450

654,635

645,092

632,543

639,827

Total Avg. Managed Assets

$       915,574

$       873,701

$       859,491

$       837,304

$       843,204







By Offering Type






Funds:






Equity

$         56,987

$         55,101

$         51,828

$         45,965

$         45,260

Fixed-Income

46,096

46,116

45,743

44,972

45,715

Alternative / Private Markets

12,254

11,871

12,347

12,370

11,610

Multi-Asset

2,855

2,833

2,770

2,654

2,774

Total Long-Term Assets

118,192

115,921

112,688

105,961

105,359

Money Market

507,752

493,355

482,237

462,683

463,727

Total Avg. Fund Assets

$       625,944

$       609,276

$       594,925

$       568,644

$       569,086

Separate Accounts:






Equity1

$         45,050

$         41,303

$         40,608

$         37,599

$         36,845

Fixed-Income

54,900

54,739

53,463

53,393

53,645

Alternative / Private Markets

6,978

7,100

7,515

7,683

7,402

Multi-Asset1

4

3

125

125

126

Total Long-Term Assets

106,932

103,145

101,711

98,800

98,018

Money Market

182,698

161,280

162,855

169,860

176,100

Total Avg. Separate Account Assets

$       289,630

$       264,425

$       264,566

$       268,660

$       274,118

Total Avg. Managed Assets

$       915,574

$       873,701

$       859,491

$       837,304

$       843,204


1) A Separate Account was reclassified from Multi-Asset to Equity effective October 1, 2025.

 

Cision View original content:https://www.prnewswire.com/news-releases/federated-hermes-inc-reports-record-assets-under-management-with-first-quarter-2026-earnings-302759420.html

SOURCE Federated Hermes, Inc.