Franklin Resources Inc Q2 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Benjamin Budish - Barclays Capital, Inc. - Analyst : Hi, good morning, and thank you for taking the question. Just curious, last quarter, we got some guidance on how fiscal-year expenses should shake out comp and benefits, some of the other line items. Just curious how you're thinking about that now, just given some of the market movements and the natural pressure on AUM. Where is there some flex in the model? How should we be thinking about the range of outcomes for the year? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 3:00PM, BEN.N - Q2 2025 Franklin Resources Inc Earnings Call

Question: Benjamin Budish - Barclays Capital, Inc. - Analyst : All right. That was very detailed. Thank you very much.

Question: Craig Siegenthaler - BofA Securities Inc. - Analyst : Thanks. Good morning, everyone. My question is on the positive long-term net flow trend ex-Western. And I'm wondering, do you have an estimate for the base fee organic growth rate, including Western? And I'm curious, just given how the lower fee rate on that Western business is, and you can see that your blended fee rate is rising. And if you don't have the numbers handy, high-level commentary would be helpful, too. Thank you.

Question: Craig Siegenthaler - BofA Securities Inc. - Analyst : Thank you.

Question: Alex Blostein - Goldman Sachs & Co. LLC - Analyst : Hey, Jenny. Good morning, everybody. I was hoping we could dig in a little more into your comments around private markets and the traction you're seeing there. I guess, first, would love to get your insight on how the retail products have done through April amid obviously all the volatility. It seems like the industry's held up quite well. Curious if you're seeing something similar. And I guess when you zoom out a little further, I believe Lexington will be in the market with their large flagship secondaries fund. It's an area where there's quite a bit of bright spots and good momentum in that business for the industry as well. So curious how you're thinking about sizing that as well and what that ultimately means for your aspirations for growth in private markets management fees over the next 12 months.

Question: Alex Blostein - Goldman Sachs & Co. LLC - Analyst : Very helpful. Thank you.

Question: Dan Fannon - Jefferies LLC - Analyst : Thanks. My question is on fixed income. You mentioned flows ex-Western being positive. Could you expand upon some of the strategies that are seeing that success? And then also just an update on Western and where you think you are in the redemption trends and the conversations they're having with clients, and just an overall update on the health of that subsidiary would be helpful. Thank you.

Question: Michael Cyprys - Morgan Stanley & Co. LLC - Analyst : Hey, good morning. Thanks for taking the question. I was hoping you could spend a moment on your international business. You guys have a pretty broad, large overseas footprint. I was hoping you could elaborate a bit more on how it's contributing to revenues and flows today, where you're seeing the most traction overseas. And if you could talk to some of your initiatives to help accelerate the growth from overseas, and particularly how you see demand evolving for non-US strategies in this backdrop. Thank you.

Question: Bill Katz - Cowen & Co. LLC - Analyst : Great. Thank you very much. Can you guys just clarify just the flows that WAMCO -- was the $10 billion, was that the net of the $5 billion or is that the net outflows? And then the broader question, Jenny, it seemed like you put together a pretty strong platform that can invest across credit bolts or private markets, both public and private. But there have been a number of alliances coming up around you and [KQR Capital Group], I think, a couple weeks ago now, Blackstone, Wellington, and Vanguard. What you're thinking strategically about setting up an alliance that might accelerate the opportunity set as the public-private world becomes more intersected? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 3:00PM, BEN.N - Q2 2025 Franklin Resources Inc Earnings Call

Question: Bill Katz - Cowen & Co. LLC - Analyst : Thank you.

Question: Glenn Schorr - Evercore Group LLC - Analyst : Hello there. A follow up on private markets, if we could. So I watch a lot of basketball, so I've seen a lot of the Franklin Templeton -- alternatives by Franklin Templeton advertising. It's been, I think, good general brand building. I'm curious, when it gets towards -- if it gets to specific products or

Question: Brian Bedell - Deutsche Bank Securities, Inc. - Analyst : Great, thanks. Good morning. Thanks for taking my question. Maybe just go back to the $470 billion, first, can you clarify? I think that's by the region where the product is domiciled as opposed to the strategy. And this is on slide 6, I think, by region. And if you can clarify that. And then the question really is if there is a rotation away from US strategies into non-US strategies. How are you positioned from that dynamic within these regions? So would they be potentially selling Franklin US strategies? But then are you positioned well to capture that flow into non-US strategies? And then I guess even more broadly, how do you feel you're positioned if there's just a general client shift in terms of competition versus other peers?

Question: Brian Bedell - Deutsche Bank Securities, Inc. - Analyst : Great color. Thank you.

Question: Patrick Davitt - Autonomous Research US LP - Analyst : Hey, good morning, everyone. You mentioned the insurance channel earlier. In that vein, could you update us on where the Great Western relationship stands? How much of their initial commitment is still left to fund? And any new potential commitments in the works? Thank you.

Question: Patrick Davitt - Autonomous Research US LP - Analyst : Thank you.