[Management View]
SEI Investments reported an all-time record EPS of $1.30, excluding one-time items, driven by substantial margin expansion and robust revenue gains across core business units. The company highlighted significant sales momentum, with year-to-date net sales events setting a company record through the third quarter. Strategic wins included the largest-ever institutional fixed income mandate and a $13 million private banking win with a leading U.S. regional bank. Share repurchases continued aggressively, with $142 million in buybacks and no net debt reported.

[Outlook]
Management reiterated confidence in pipeline strength and margin discipline, signaling continued investments in technology and talent to support scalable growth. The company expects the initial closing of the Stratos acquisition by late 2025 or early 2026 and is already seeing increased advisor engagement and incremental business opportunities from the announcement.

[Financial Performance]
SEI Investments delivered an EPS of $1.30, up 8% sequentially and 17% year over year. Net sales events totaled $31 million, led by investment managers. The investment managers segment posted revenue growth exceeding 25% annualized from Q2 to Q3. Private banking achieved a $13 million client win, offset by a single contract loss. The advisors segment delivered the highest year-over-year revenue growth among segments. Institutional revenue and profits were flat due to less market appreciation benefit. Year-to-date net sales surpassed $100 million, a company record.

[Q&A Highlights]
Question 1: Are the two-thirds of sales events from alternatives similar to recent quarters, and are they from large alternative players or smaller nonpublic alts?
Answer: It's a mixture of large and small clients, with no single event greater than 10% of the overall number. The sales events span private credit, insourcers moving to outsourcing, and retail alternatives. More announcements are expected early next year.

Question 2: Can you provide details on the known contract loss in private banking with a long-time client?
Answer: This was a one-off scenario due to a major operating model change for the client. The financial impact will be phased over several years. The company is confident that recent and future wins will offset this loss.

Question 3: For the integrated cash program, are you considering allocating some of that to fixed rates now that the Fed is easing again?
Answer: Currently earning about 370 basis points and giving investors about 55 basis points yield. The company will adjust investor yield as rates come down, with a focus on maintaining attractiveness versus competitors.

Question 4: What's driving the expense growth in private banks, and how will offshoring with the new service center impact growth?
Answer: The expense growth is mainly due to investments in talent and onboarding new clients. The focus is on successfully delivering and onboarding clients, which may sometimes increase expenses.

Question 5: Can you speak to the sales mix between US and international this quarter and how it's tracking year to date relative to last year?
Answer: The company is in the early phases of defining its international strategy, focusing on maximizing presence in existing jurisdictions. More detailed breakdowns will be provided as the strategy evolves.

Question 6: How are you thinking about the pace of buybacks going forward?
Answer: The company expects to return 90-100% of free cash flow through dividends or buybacks. The cash build is in anticipation of the Stratos acquisition, and the pace of buybacks will be adjusted accordingly.

Question 7: Are you seeing any impact in your private credit servicing pipeline due to recent credit fears in the market?
Answer: The company is not seeing any real risk in its private credit servicing pipeline. The business is diversified, and clients are managing credit risk effectively.

Question 8: Are there other high-risk relationships in your existing private bank's client portfolio?
Answer: The company is not aware of any other large risks in the private banking client portfolio. Engagement with clients has been strong, and the company feels confident in its client relationships.

Question 9: What's left in the investment in new businesses segment after the divestiture of the Archway family offices business?
Answer: The segment includes the Sphere business and private wealth management business. The segment will cease to exist as a standalone segment, and revenue will follow the client and related segment.

Question 10: Can you quantify how much margin suppression there's been from accelerated investment?
Answer: The company does not quantify margin suppression from investments. The focus is on long-term growth and optimizing margins.

[Sentiment Analysis]
The tone of the analysts was generally positive, with a focus on understanding the details behind the strong performance and strategic initiatives. Management's tone was confident, emphasizing disciplined execution, strategic wins, and a clear growth strategy.

[Quarterly Comparison]
| Metric | Q3 2025 | Q2 2025 | YoY Change |
|-------------------------------|---------------|---------------|--------------|
| EPS (excluding one-time items)| $1.30 | $1.20 | +17% |
| Net Sales Events | $31 million | $28 million | +10.7% |
| Investment Managers Revenue | +25% annualized| +20% annualized| +5% |
| Private Banking Revenue | +4% | +3% | +1% |
| Advisors Revenue Growth | Highest YoY | Second Highest| N/A |
| Institutional Revenue | Flat | Flat | N/A |
| Year-to-Date Net Sales | $100 million | $90 million | +11.1% |

[Risks and Concerns]
- Private Banking Contract Loss: A significant contract loss in private banking, though management expects future wins to offset this.
- Institutional Margins: Declined sequentially due to various factors, though none individually material.
- Market Volatility: Potential impact on revenue and margins due to market fluctuations.

[Final Takeaway]
SEI Investments delivered a record EPS of $1.30, driven by strong revenue growth and margin expansion. The company achieved significant strategic wins and continued aggressive share repurchases. Management remains confident in its growth strategy, supported by a strong pipeline and disciplined execution. While there are some risks, such as the private banking contract loss, the overall outlook remains positive with continued investments in technology and talent to drive scalable growth.