Hamilton Lane Incorporated — Second Quarter Fiscal 2027 Earnings Summary

Financial Performance:

• Total revenues increased 31% year-over-year to $479.8 million for the six months ended September 30, 2026, and 7% to $204.4 million for the quarter.
• Management and advisory fees rose 18% year-over-year to $325.4 million for the six-month period and 15% to $164.0 million for the quarter.
• Incentive fees surged 70% year-over-year to $154.4 million for the six-month period and declined 9% to $40.4 million for the quarter.
• GAAP net income attributable to Hamilton Lane Incorporated increased 27% year-over-year to $157.9 million for the six months ended September 30, 2026, and 9% to $77.5 million for the quarter.
• Basic earnings per share (Class A common stock) increased 27% year-over-year to $3.82 for the six-month period and 10% to $1.88 for the quarter.
• Fee Related Earnings (non-GAAP) increased 34% year-over-year to $215.2 million for the six-month period and 18% to $90.8 million for the quarter.
• Adjusted net income (non-GAAP) increased 35% year-over-year to $210.7 million for the six-month period and 26% to $106.1 million for the quarter.
• Adjusted EBITDA (non-GAAP) increased 35% year-over-year to $265.9 million for the six-month period and 11% to $111.7 million for the quarter.
• Net cash provided by operating activities decreased to $105.2 million for the six months ended September 30, 2026, compared to $247.8 million in the prior period.
• Net cash used in investing activities increased to $370.6 million for the six months ended September 30, 2026, compared to $227.9 million in the prior period.
• Net cash provided by financing activities increased to $241.9 million for the six months ended September 30, 2026, compared to $29.7 million in the prior period.
• Total debt stood at $268.7 million as of September 30, 2026, down from $278.4 million as of March 31, 2026.
• Unrealized carried interest totaled $1.6 billion as of September 30, 2026, diversified across over 3,000 assets and 120 funds.

Guidance and Future Outlook:

• The press release does not provide specific forward-looking financial guidance, revenue targets, or earnings forecasts for future periods.
• Management highlighted a robust opportunity set for customized separate accounts and advisory services.
• Long-term growth trends indicate a 17% CAGR in Total AUM & AUA from 2005 to September 30, 2026.
• Fee-earning AUM has grown at a 14% CAGR, with annual fee rates remaining stable.

Business Segments and Product Lines:

• Assets under management (AUM) increased 4% year-over-year to $150.8 billion as of September 30, 2026.
• Assets under advisement (AUA) increased 8% year-over-year to $929.1 billion as of September 30, 2026.
• Fee-earning assets under management (FEAUM) increased 12% year-over-year to $85.9 billion as of September 30, 2026.
• Specialized funds contributed an $8.8 billion year-over-year increase in FEAUM, driven by the closing of the 6th direct equity fund, 9th credit-oriented fund, and 2nd infrastructure fund.
• Customized separate accounts saw a $0.7 billion year-over-year increase in FEAUM, with over 80% of gross contributions in the last 12 months coming from existing clients.
• Advisory services saw a $69.2 billion year-over-year increase in AUA.
• Incentive fee revenue from evergreen funds increased 102% year-over-year for the six-month period.
• Incentive fee revenue from secondary funds increased 1,751% year-over-year for the six-month period.
• Management and advisory fees from specialized funds increased 27% year-over-year for the six-month period.

Market and Competitive Landscape:

• The firm operates as one of the largest private markets investment firms globally with approximately 820 professionals.
• The market opportunity for customized separate accounts and advisory services is described as robust.
• The firm closed fundraising for its 7th secondary fund, 3rd impact fund, 2nd venture capital fund, and evergreen funds.
• The firm manages a diverse mix of clients seeking to establish or further relationships, including technology-driven reporting and analytics services.

Risks and Challenges:

• Risks include the unpredictability of carried interest distribution timing and the subjectivity of valuation methodologies for illiquid assets.
• Competition is intense for access to investments and for customized separate account and advisory clients.
• Revenue from customized separate accounts and advisory accounts is not a long-term contracted source.
• The firm is dependent on distributions from Hamilton Lane Advisors, L.L.C. to pay dividends, taxes, and expenses.
• Risks related to government regulation, compliance failures, data security breaches, and volatile market conditions are noted.
• Poorly performing investments could impact investment management revenue and the ability to raise capital.

Management Commentary and Tone:

• Management described the growth in Fee Related Earnings as "stable long-term growth" with double-digit CAGR.
• The tone emphasizes a "growing asset footprint & influence" and a "diverse mix of existing and prospective clients."
• The firm highlighted that recurring management and advisory fees represented an average of approximately 75% of total revenues over the past five fiscal years.
• Management noted that fee-earning AUM growth continues while annual fee rates remain stable.

Other Key Points:

• The Board declared a quarterly dividend of $0.60 per share of Class A common stock, payable on January 7, 2027, to record holders on December 21, 2026.
• The target full-year dividend of $2.40 represents an 11% increase from the prior fiscal year dividend.
• The company repurchased and retired shares of Class A common stock for $50.0 million during the six months ended September 30, 2026.
• Total assets under management and supervision reached approximately $1.1 trillion as of September 30, 2026.
• The firm employs approximately 820 professionals operating in North America, Europe, Asia Pacific, and the Middle East.
• Investments in the company's own products totaled $626 million in funds and $831 million in Consolidated Funds and Partnerships as of September 30, 2026.