Lpl financial : q1 2025 historical information

Published: 2025-05-08 20:08:44 ET LPLA

Published on 05/08/2025 at 20:08

‌LPL Financial Holdings Inc.‌

Q1 2025 Historical Information

Member FINRA/SIPC

*Notice to Investors: Non-GAAP Financial Measures

Adjusted EPS, adjusted net income, gross profit, core G&A, EBITDA, adjusted EBITDA and adjusted pre-tax income are non-GAAP financial measures. Management believes that presenting certain non-GAAP financial measures by excluding or

including certain items can be helpful to investors and analysts who may wish to use this information to analyze the Company's current performance, prospects and valuation. Management uses this non-GAAP information internally to evaluate

operating performance and in formulating the budget for future periods. Management believes that the non-GAAP financial measures and metrics discussed below are appropriate for evaluating the performance of the Company.

Gross profit is calculated as total revenue less advisory and commission expense; brokerage, clearing and exchange expense; and market fluctuations on employee deferred compensation. All other expense categories, including depreciation and amortization of property and equipment and amortization of other intangibles, are considered general and administrative in nature. Because the Company's gross profit amounts do not include any depreciation and amortization expense, the Company considers gross profit to be a non-GAAP financial measure that may not be comparable to similar measures used by others in its industry. Management believes that gross profit can provide investors with useful insight into the Company's core operating performance before indirect costs that are general and administrative in nature. For a calculation of gross profit, please see page 4 of this presentation.

Adjusted EPS is defined as adjusted net income, a non-GAAP measure defined as net income plus the after-tax impact of amortization of other intangibles, acquisition costs and certain regulatory charges, losses on extinguishment of debt, and amounts related to the departure of the Company's former Chief Executive Officer, divided by the weighted average number of diluted shares outstanding for the applicable period. The Company presents adjusted net income and adjusted EPS because management believes that these metrics can provide investors with useful insight into the Company's core operating performance by excluding non-cash items, acquisition costs and certain other charges that management does not believe impact the Company's ongoing operations. Adjusted net income and adjusted EPS are not measures of the Company's financial performance under GAAP and should not be considered as alternatives to net income, earnings per diluted share or any other performance measure derived in accordance with GAAP. For a reconciliation of net income and earnings per diluted share to adjusted net income and adjusted EPS, please see page 5 of this presentation.

Core G&A consists of total expense less the following expenses: advisory and commission; depreciation and amortization; interest expense on borrowings; brokerage, clearing and exchange; amortization of other intangibles; market fluctuations on employee deferred compensation; losses on extinguishment of debt; promotional (ongoing); employee share-based compensation; regulatory charges; and acquisition costs. Management presents core G&A because it believes core G&A reflects the corporate expense categories over which management can generally exercise a measure of control, compared with expense items over which management either cannot exercise control, such as advisory and commission, or which management views as promotional expense necessary to support advisor growth and retention, including conferences and transition assistance. Core G&A is not a measure of the Company's total expense as calculated in accordance with GAAP. For a reconciliation of the Company's total expense to core G&A, please see page 4 of this presentation. The Company does not provide an outlook for its total expense because it contains expense components, such as advisory and commission, that are market-driven and over which the Company cannot exercise control. Accordingly a reconciliation of the Company's outlook for total expense to an outlook for core G&A cannot be made available without unreasonable effort.

EBITDA is defined as net income plus interest expense on borrowings, provision for income taxes, depreciation and amortization, and amortization of other intangibles. Adjusted EBITDA is defined as EBITDA, a non-GAAP measure, plus acquisition costs, certain regulatory charges, amounts related to the departure of the Company's former Chief Executive Officer, and losses on extinguishment of debt. The Company presents EBITDA and adjusted EBITDA because management believes that they can be useful financial metrics in understanding the Company's earnings from operations. EBITDA and adjusted EBITDA are not measures of the Company's financial performance under GAAP and should not be considered as alternatives to net income or any other performance measure derived in accordance with GAAP. For a reconciliation of net income to EBITDA and adjusted EBITDA, please see page 5.

Adjusted pre-tax income is defined as income before provision for income taxes plus amortization of other intangibles, acquisition costs, certain regulatory charges, amounts related to the departure of the Company's former Chief Executive Officer, and losses on extinguishment of debt. The Company presents adjusted pre-tax income because management believes that it can provide investors with useful insight into the Company's core operating performance by excluding non-cash items, acquisition costs, and certain other charges that management does not believe impact the Company's ongoing operations. Adjusted pre-tax income is not a measure of the Company's financial performance under GAAP and should not be considered as an alternative to income before provision for income taxes or any other performance measure derived in accordance with GAAP. For a reconciliation of income before provision for income taxes to adjusted pre-tax income, please see page 5.

LPL Financial Holdings Inc. - Historical Management's Statements of Operations

For the quarter ending March 31, 2025

($ in thousands, unless noted)

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Gross Profit*

Advisory

$ 1,689,245

$ 1,595,834

$ 1,378,050

$ 1,288,163

$ 1,199,811

$ 1,085,497

$ 1,081,562

$ 1,014,565

$ 954,057

Trailing commissions

437,719

439,668

377,400

363,976

361,211

326,454

331,808

323,925

317,653

Sales-based commissions

610,038

525,795

429,132

423,070

385,235

355,958

311,792

298,961

286,072

Advisory fees and commissions

2,737,002

2,561,297

2,184,582

2,075,209

1,946,257

1,767,909

1,725,162

1,637,451

1,557,782

Production-based payout

(2,374,368)

(2,248,674)

(1,910,634)

(1,812,050)

(1,686,332)

(1,548,540)

(1,506,080)

(1,419,659)

(1,342,668)

Advisory fees and commissions, net of payout

362,634

312,623

273,948

263,159

259,925

219,369

219,082

217,792

215,114

Client cash

408,224

397,001

372,333

361,316

373,408

373,979

377,782

396,238

438,612

Other asset-based

303,210

290,962

272,336

259,533

248,339

228,473

224,614

211,300

203,473

Service and fee

145,199

139,119

145,729

135,000

132,172

130,680

135,648

123,122

118,987

Transaction

67,864

61,535

58,546

58,935

57,258

53,858

50,210

46,936

48,935

Interest income, net

27,637

28,481

31,428

27,618

22,482

21,975

23,485

20,136

17,015

Other revenue

2,023

32,705

3,392

6,621

3,382

4,636

4,113

3,431

3,945

Total net advisory fees and commissions

and attachment revenue

1,316,791

1,262,426

1,157,712

1,112,182

1,096,966

1,032,970

1,034,934

1,018,955

1,046,081

Brokerage, clearing, and exchange expense

(44,138)

(34,789)

(29,636)

(32,984)

(30,532)

(25,917)

(24,793)

(29,148)

(26,126)

Gross Profit*

1,272,653

1,227,637

1,128,076

1,079,198

1,066,434

1,007,053

1,010,141

989,807

1,019,955

G&A Expense

Core G&A*

413,069

421,894

359,134

370,912

363,513

364,469

341,728

337,025

326,177

Regulatory charges

6,887

7,335

24,879

7,594

7,469

8,905

48,083

6,600

7,732

Promotional (ongoing)

151,932

173,191

175,605

147,830

132,311

138,457

140,171

106,535

101,163

Acquisition costs excluding interest

43,407

37,261

22,243

36,876

9,524

34,931

5,989

4,091

3,092

Employee share-based compensation

18,366

26,067

20,289

19,968

22,633

15,535

15,748

16,777

17,964

Total G&A

633,661

665,748

602,150

583,180

535,450

562,297

551,719

471,028

456,128

Loss on extinguishment of debt

3,983

EBITDA*

638,992

557,906

525,926

496,018

530,984

444,756

458,422

518,779

563,827

Depreciation and amortization

92,356

92,032

78,338

70,999

67,158

67,936

64,627

58,377

56,054

Amortization of other intangibles

43,521

42,614

32,461

30,607

29,552

28,618

27,760

26,741

24,092

Interest expense on borrowings

80,725

81,979

67,779

64,341

60,082

54,415

48,363

44,842

39,184

Acquisition costs - interest

5,137

INCOME BEFORE PROVISION FOR INCOME TAXES

417,253

341,281

347,348

330,071

374,192

293,787

317,672

388,819

444,497

PROVISION FOR INCOME TAXES

98,680

70,532

92,045

86,271

85,428

76,232

93,381

103,299

105,613

NET INCOME

$ 318,573

$ 270,749

$ 255,303

$ 243,800

$ 288,764

$ 217,555

$ 224,291

$ 285,520

$ 338,884

Earnings per share, diluted

$ 4.24

$ 3.59

$ 3.39

$ 3.23

$ 3.83

$ 2.85

$ 2.91

$ 3.65

$ 4.24

Weighted-average shares outstanding, diluted

75,112

75,337

75,405

75,548

75,463

76,240

77,147

78,194

79,974

Adjusted EBITDA*

$ 682,399

$ 584,783

$ 566,169

$ 532,894

$ 540,508

$ 479,687

$ 504,411

$ 522,870

$ 566,919

Adjusted pre-tax income*

$ 509,318

$ 410,772

$ 420,052

$ 397,554

$ 413,268

$ 357,336

$ 391,421

$ 419,651

$ 471,681

Adjusted EPS*

$ 5.15

$ 4.25

$ 4.16

$ 3.88

$ 4.21

$ 3.51

$ 3.74

$ 3.94

$ 4.49

Note: Totals may not foot due to rounding.

($ in millions)

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Total revenue

$3,670

$3,512

$3,108

$2,932

$2,833

$2,644

$2,522

$2,469

$2,418

Advisory and commission expense

2,354

2,250

1,948

1,819

1,733

1,608

1,488

1,449

1,371

Brokerage, clearing and exchange expense

Employee deferred compensation

(1)

Gross Profit(1)

$1,273

$1,228

$1,128

$1,079

$1,066

$1,007

$1,010

$990

$1,020

Advisory and commission expense

$2,354

$2,250

$1,948

$1,819

$1,733

$1,608

$1,488

$1,449

$1,371

Plus (Less): Advisor deferred compensation

(2)

(37)

(7)

(47)

(59)

(29)

(28)

Production-based payout

$2,374

$2,249

$1,911

$1,812

$1,686

$1,549

$1,506

$1,420

$1,343

Client cash on Management's Statement of Operations

$408

$397

$372

$361

$373

$374

$378

$396

$439

Interest income on CCA balances segregated under

federal or other regulations

(16)

(18)

(20)

(21)

(17)

(18)

(20)

Client cash on Condensed Consolidated Statements

of Income

$392

$379

$354

$341

$352

$353

$361

$378

$418

Interest income, net on Management's Statement

of Operations

$28

$31

$28

$22

$23

$20

$17

Interest income on CCA balances segregated under

federal or other regulations

Interest income, net on Condensed Consolidated

Statements of Income

$44

$47

$50

$47

$44

$43

$41

$38

$37

Other revenue on Management's Statement of

Operations

$33

Deferred compensation

(21)

(19)

Other revenue on Condensed Consolidated

Statements of Income

($19)

$34

$43

$14

$53

$67

($15)

$34

$33

Interest expense on borrowings on Management's

Statement of Operations

$81

$82

$68

$64

$60

$54

$48

$45

$39

Cost of debt issuance related to Commonwealth

Financial Network acquisition

Interest expense on borrowings on Condensed

Consolidated Statements of Income

$86

$82

$68

$64

$60

$54

$48

$45

$39

Total expense

$3,253

$3,171

$2,761

$2,602

$2,458

$2,350

$2,205

$2,080

$1,973

Advisory and commission

2,354

2,250

1,948

1,819

1,733

1,608

1,488

1,449

1,371

Depreciation and amortization

Interest expense on borrowings

Amortization of other intangibles

Brokerage, clearing and exchange

Employee deferred compensation

(1)

Loss on extinguishment of debt

Total G&A

$634

$666

$602

$583

$535

$562

$552

$471

$456

Promotional (ongoing)

$152

$173

$176

$148

$132

$138

$140

$107

$101

Employee share-based compensation

Regulatory charges(2)

Acquisition costs excluding interest

Core G&A

$413

$422

$359

$371

$364

$342

$337

$326

Note: Totals may not foot due to rounding.

($ in millions)

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Net income

$319

$271

$255

$244

$289

$218

$224

$286

$339

Interest expense on borrowings

Provision for income taxes

103

106

Depreciation and amortization

Amortization of other intangibles

EBITDA

$639

$558

$526

$496

$531

$445

$458

$519

$564

Regulatory charges(2)

Acquisition costs excluding interest

Loss on extinguishment of debt

Departure of former Chief Executive Officer(3)

(14)

Adjusted EBITDA

$682

$585

$566

$533

$541

$480

$504

$523

$567

Income before provision for income taxes

$417

$341

$347

$330

$374

$294

$318

$389

$444

Amortization of other intangibles

Regulatory charges(2)

Acquisition costs

Departure of former Chief Executive Officer(3)

(14)

Loss on extinguishment of debt

Adjusted pre-tax income

$509

$411

$420

$398

$414

$358

$391

$420

$472

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Amount

Per Share

Net income / earnings per diluted share

$319

$4.24

$271

$3.59

$255

$3.39

$244

$3.23

$289

$3.83

$218

$2.85

$224

$2.91

$286

$3.65

$339

$4.24

Amortization of other intangibles

0.58

0.57

0.43

0.41

0.39

0.38

0.36

0.34

0.30

Acquisition costs

0.65

0.49

0.29

0.49

0.13

0.46

0.08

0.05

0.04

Regulatory charges(2)

0.24

0.52

Departure of former Chief Executive Officer(3)

(14)

(0.19)

Loss on extinguishment of debt

0.05

Tax benefit

(24)

(0.32)

(20)

(0.27)

(15)

(0.19)

(18)

(0.24)

(10)

(0.14)

(14)

(0.18)

(9)

(0.12)

(8)

(0.10)

(7)

(0.09)

Adjusted net income / adjusted EPS

$387

$5.15

$320

$4.25

$313

$4.16

$293

$3.88

$318

$4.21

$267

$3.51

$289

$3.74

$308

$3.94

$359

$4.49

Diluted share count

Note: Totals may not foot due to rounding.

LPL Financial Holdings Inc. - Key Operating Metrics

As of March 31, 2025

(End of period $ in billions, unless noted)

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Assets (4)

Advisory assets

977.4

957.0

892.0

829.1

793.0

735.8

662.7

661.6

620.9

Brokerage assets

817.5

783.7

700.1

668.7

647.9

618.2

575.7

578.6

554.3

Total Advisory and Brokerage Assets

1,794.9

1,740.7

1,592.1

1,497.8

1,440.9

1,354.1

1,238.4

1,240.2

1,175.2

Centrally managed assets(5)

164.4

160.0

138.1

126.9

121.7

112.1

100.5

99.8

94.6

Assets by Platform

Corporate advisory assets(6)

699.1

678.3

618.8

567.8

537.6

496.5

444.4

442.1

415.3

Independent RIA advisory assets(6)

278.3

278.7

273.2

261.3

255.4

239.3

218.3

219.5

205.6

Brokerage assets

817.5

783.7

700.1

668.7

647.9

618.2

575.7

578.6

554.3

Total Advisory and Brokerage Assets

1,794.9

1,740.7

1,592.1

1,497.8

1,440.9

1,354.1

1,238.4

1,240.2

1,175.2

Organic Net New Assets † (7)

Organic net new advisory assets(8)

35.7

49.3

23.2

26.6

16.2

20.5

22.7

18.1

13.7

Organic net new brokerage assets

35.2

18.8

3.8

2.5

0.5

4.2

10.5

3.6

7.1

Total Organic Net New Assets

70.9

68.0

27.0

29.0

16.7

24.7

33.2

21.7

20.8

Acquired Net New Assets

Acquired net new advisory assets

1.9

21.8

0.5

0.3

0.0

0.9

Acquired net new brokerage assets

6.0

67.5

0.1

4.8

0.0

2.8

Total Acquired Net New Assets

7.9

89.3

0.6

5.0

0.0

3.7

Total Net New Assets (9)(10)

Net new advisory assets

37.6

71.1

23.7

26.8

16.2

20.5

22.7

18.1

14.6

Net new brokerage assets

41.2

86.2

3.8

7.2

0.5

4.2

10.5

3.6

9.9

Total Net New Assets

78.8

157.3

27.5

34.0

16.7

24.7

33.2

21.7

24.5

Net brokerage to advisory conversions(11)

5.9

4.8

3.5

3.7

3.6

2.6

2.7

2.2

2.1

Corporate RIA net new advisory assets

31.7

64.5

24.0

23.4

13.9

15.9

17.0

11.8

10.4

Independent RIA net new advisory assets

5.9

6.6

(0.3)

3.4

2.3

4.6

5.7

6.4

4.2

Total Net New Advisory Assets

37.6

71.1

23.7

26.8

16.2

20.5

22.7

18.1

14.6

Centrally managed net new advisory assets

6.5

24.9

4.4

3.6

3.0

4.4

2.0

1.7

Client Cash Balances (12)

Insured cash account sweep

36.1

38.3

32.1

31.0

32.6

34.5

33.6

36.0

39.7

Deposit cash account sweep

10.7

9.6

9.2

9.3

9.1

9.5

10.2

Total Bank Sweep

46.8

49.0

41.7

40.2

41.8

43.8

42.7

45.5

49.9

Money market sweep

4.3

2.3

2.4

2.6

2.3

2.6

Total Client Cash Sweep Held by Third Parties

51.1

53.3

44.0

42.5

44.2

46.2

45.3

47.9

52.5

Client cash account(13)

1.9

1.8

1.5

2.1

2.0

1.5

1.7

1.6

Total Client Cash Balances

53.1

55.1

45.8

44.0

46.3

48.2

46.9

49.6

54.0

Net buy (sell) activity(14)

42.0

38.3

37.7

39.3

37.8

32.8

35.6

32.3

36.9

Market Drivers

S&P 500 Index (end of period)

5,612

5,882

5,762

5,460

5,254

4,770

4,288

4,450

4,109

Russell 2000 Index (end of period)

2,012

2,230

2,048

2,125

2,027

1,785

1,889

1,802

Fed Funds daily effective rate (average bps)

433

466

527

533

526

499

452

† Organic Net New Assets from Large Institutions

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Organic net new advisory assets

6.8

18.4

0.0

2.3

0.0

Organic net new brokerage assets

36.1

21.2

0.0

0.3

8.5

0.0

Total Organic Net New Assets from Large Institutions

43.0

39.6

0.0

0.3

10.8

0.0

Note: Totals may not foot due to rounding.

LPL Financial Holdings Inc. - Monthly Key Operating Metrics

As of March 31, 2025

(End of period $ in billions, unless noted)

Mar 2025

Feb 2025

Jan 2025

Dec 2024

Nov 2024

Oct 2024

Sep 2024

Aug 2024

Jul 2024

Jun 2024

May 2024

Apr 2024

Mar 2024

Assets (4)

Advisory assets

977.4

995.0

992.4

957.0

973.8

910.6

892.0

869.5

850.6

829.1

809.4

775.5

793.0

Brokerage assets

817.5

828.2

819.4

783.7

785.6

762.7

700.1

690.6

678.7

668.7

655.0

637.5

647.9

Total Advisory and Brokerage Assets

1,794.9

1,823.1

1,811.8

1,740.7

1,759.3

1,673.3

1,592.1

1,560.1

1,529.3

1,497.8

1,464.4

1,413.0

1,440.9

Organic Net New Assets † (7)

Organic net new advisory assets(8)

12.7

9.6

13.4

12.5

27.9

8.8

11.0

5.4

6.8

9.2

9.9

7.4

7.5

Organic net new brokerage assets

0.5

14.1

20.5

12.9

6.3

(0.5)

0.5

1.1

2.2

1.6

1.3

(0.4)

0.4

Total Organic Net New Assets

13.1

23.8

34.0

25.5

34.2

8.3

11.4

6.6

9.0

10.8

11.2

7.0

7.9

Acquired Net New Assets

Acquired net new advisory assets

1.8

0.0

0.1

0.0

0.5

21.3

0.2

0.0

0.3

0.0

Acquired net new brokerage assets

5.3

0.7

0.0

0.2

0.3

67.0

0.1

0.0

4.8

0.0

Total Acquired Net New Assets

7.1

0.7

0.1

0.3

0.8

88.3

0.3

0.0

5.0

0.0

Total Net New Assets (9)(10)

Net new advisory assets

14.5

9.6

13.5

12.6

28.4

30.1

11.2

5.7

6.8

9.2

9.9

7.6

7.5

Net new brokerage assets

5.8

14.8

20.6

13.2

6.6

66.5

0.5

1.2

2.2

1.6

1.3

4.3

0.4

Total Net New Assets

20.2

24.5

34.1

25.8

35.0

96.6

11.7

6.8

9.0

10.8

11.2

12.0

7.9

Net brokerage to advisory conversions(11)

1.9

2.1

2.0

1.7

1.1

1.2

1.3

1.0

1.2

1.3

Client Cash Balances (12)

Insured cash account sweep

36.1

35.6

36.2

38.3

34.8

34.7

32.1

30.4

31.1

31.0

31.8

32.5

32.6

Deposit cash account sweep

10.7

10.2

10.0

10.7

9.9

9.7

9.6

9.3

9.1

9.2

9.0

9.1

9.2

Total Bank Sweep

46.8

45.8

46.3

49.0

44.7

44.4

41.7

39.7

40.2

40.8

41.6

41.8

Money market sweep

4.3

4.0

4.1

4.3

2.6

2.3

2.2

2.3

2.4

Total Client Cash Sweep Held by Third Parties

51.1

49.8

50.4

53.3

49.0

47.0

44.0

41.9

42.5

43.1

43.8

44.2

Client cash account(13)

1.9

1.5

1.8

1.5

1.3

1.8

1.4

1.5

1.3

1.9

2.1

Total Client Cash Balances

53.1

51.3

52.2

55.1

50.5

48.3

45.8

43.3

44.0

44.5

45.7

46.3

Net buy (sell) activity(14)

13.2

14.3

14.5

13.5

12.4

12.5

12.2

12.6

12.9

12.1

15.0

12.3

12.9

Market Drivers

S&P 500 Index (end of period)

5,612

5,955

6,041

5,882

6,032

5,705

5,762

5,648

5,522

5,460

5,278

5,036

5,254

Russell 2000 Index (end of period)

2,012

2,163

2,288

2,230

2,435

2,197

2,230

2,218

2,254

2,048

2,070

1,974

2,125

Fed Funds Daily effective rate (average bps)

433

448

465

483

513

533

† Organic Net New Assets from Large Institutions

Mar 2025

Feb 2025

Jan 2025

Dec 2024

Nov 2024

Oct 2024

Sep 2024

Aug 2024

Jul 2024

Jun 2024

May 2024

Apr 2024

Mar 2024

Organic net new advisory assets

0.0

6.8

0.0

18.4

0.0

Organic net new brokerage assets

0.2

14.0

21.9

13.4

7.8

0.0

Total Organic Net New Assets from Large Institutions

0.2

14.0

28.8

13.4

26.3

0.0

Note: Totals may not foot due to rounding.

LPL Financial Holdings Inc. - Key Productivity and Business Metrics

For the quarter ending March 31, 2025

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Average Total Brokerage & Advisory Assets

$1,638

$1,537

$1,428

$1,354

$1,290

$1,231

$1,186

$1,142

$1,114

Gross Profit (average bps)

Net advisory fees and commissions

7.4

7.2

7.1

6.9

7.0

Other asset-based

6.9

7.0

7.1

7.0

7.2

Service and fee

3.4

3.6

3.8

3.9

4.0

4.1

4.2

4.3

Client cash

9.4

9.8

10.4

11.0

11.8

12.9

13.9

13.8

12.0

Transaction, net of BC&E

0.6

0.7

0.8

Interest income and other, net

0.8

0.9

0.8

0.7

0.6

Gross Profit ROA (average bps)

28.5 bps

29.1 bps

30.1 bps

30.7 bps

31.6 bps

32.8 bps

33.6 bps

33.4 bps

31.8 bps

Operating Expenses (average bps)

Core G&A

9.6

9.9

10.2

10.6

10.9

11.1

11.2

11.3

11.1

Promotional

4.0

4.1

4.2

4.1

4.0

3.6

3.4

3.3

Regulatory

0.2

0.3

Employee share-based compensation

0.4

0.5

D&A expense (ex. amortization of other intangibles)

2.0

1.9

Amortization of other intangibles

0.9

0.8

0.9

0.8

Operating Expense ROA (average bps)

17.1 bps

17.6 bps

17.9 bps

18.3 bps

18.5 bps

18.8 bps

18.5 bps

18.2 bps

17.9 bps

EBIT ROA (average bps)

11.4 bps

11.5 bps

12.2 bps

12.4 bps

13.1 bps

14.0 bps

15.1 bps

15.2 bps

13.9 bps

Business Metrics

Advisors

29,493

28,888

23,686

23,462

22,884

22,660

22,404

21,942

21,521

Net new advisors

605

5,202

224

578

224

256

462

421

246

Total client accounts (in millions)

10.4

10.0

8.7

8.6

8.4

8.3

8.2

8.1

8.0

Transition assistance loan amortization ($ in millions)

81.8

76.3

69.1

61.9

58.3

55.1

53.7

50.5

46.7

Recruited AUM ($ in billions)

38.6

78.7

25.7

24.3

20.2

16.9

31.2

18.6

12.9

AUM retention rate (quarterly annualized)(15)

98.2%

97.3%

97.0%

98.4%

97.4%

98.4%

98.8%

98.7%

Employees(16)

9,118

9,051

8,790

8,642

8,252

8,163

7,757

7,570

7,074

Capital Management ($ in millions)

Capital expenditures(17)

119.5

165.5

147.1

128.9

121.0

105.9

95.0

101.1

101.3

Acquisitions, net(18)

95.1

847.9

34.1

115.1

10.2

92.9

60.3

49.0

251.3

Share repurchases

100.0

70.0

225.0

250.0

350.0

275.0

Dividends

22.4

22.5

22.4

22.7

22.8

23.1

23.6

Total Capital Returned

122.4

122.5

22.4

92.4

247.7

272.8

373.1

298.6

Note: Totals may not foot due to rounding. Average assets and ROA periods are based on the trailing twelve months. EBIT ROA excludes Acquisition costs and other charges that are excluded from adjusted net income, as outlined on page 5.

Endnotes

Gross profit for the three months ended December 31, 2024 includes other income of $26.4 million related to the departure of the Company's former Chief Executive Officer and related clawback of share-based compensation awards.

Regulatory charges for the three months ended September 30, 2024 include charges related to a settlement with the SEC to resolve the Company's civil investigation of certain elements of the Company's Anti-Money Laundering ("AML") compliance program. The Company has recorded an $18.0 million charge for the quarter ended September 30, 2024 and reached a settlement with the staff of the SEC and paid the civil monetary penalty in January 2025. Regulatory charges for the three months ended September 30, 2023 include a $40.0 million charge to reflect the amount of the penalty related to the SEC's civil investigation of the Company's compliance with records preservation requirements for business-related electronic communications that was not covered by the Company's captive insurance subsidiary. The Company reached a settlement with the staff of the SEC and paid the civil monetary penalty of $50.0 million in August 2024.

The departure of the Company's former Chief Executive Officer resulted in other income of $26.4 million related to the clawback of share-based compensation awards which was offset by share-based compensation expense of $12.0 million related to the modification of certain stock options that were retained as per the settlement agreement that the Company reached with the former Chief Executive Officer.

Consists of total advisory and brokerage assets under custody at the Company's primary broker-dealer subsidiary, LPL Financial LLC ("LPL Financial"), as well as assets under custody of a third-party custodian related to Atria Wealth Solutions, Inc.'s seven introducing broker-dealer subsidiaries.

Consists of advisory assets in LPL Financial's Model Wealth Portfolios, Optimum Market Portfolios, Personal Wealth Portfolios and Guided Wealth Portfolios platforms.

Assets on the Company's corporate advisory platform are serviced by investment advisor representatives of LPL Financial. Assets on the Company's independent RIA advisory platform are serviced by investment advisor representatives of separate registered investment advisor firms rather than representatives of LPL Financial.

Organic net new assets include assets that off-boarded as part of the previously disclosed planned separation from misaligned large OSJs. In Q3 2024, there were $6.3B of assets that off-boarded, including $0.6B in July, $3.8B in August, and

$1.9B in September. In Q4 2024, there were $2.0B of assets that off-boarded, including $1.0B in October, $0.6B in November and $0.4B in December. In Q1 2025, there were $0.7B of assets that off-boarded, including $0.2B in January, $0.2B in February, and $0.2B in March.

Organic net new advisory assets include advisory assets that off-boarded as part of the previously disclosed planned separation from misaligned large OSJs. In Q3 2024, there were $5.2B of advisory assets that off-boarded, including $0.5B in

July, $3.6B in August, and $1.0B in September. In Q4 2024, there were $0.4B of advisory assets that off-boarded, including $0.2B in October, $0.1B in November and $0.1B in December. In Q1 2025, there were $0.3B of advisory assets that off-boarded, including $0.1B in January, $0.1B in February, and $0.1B in March.

Consists of total client deposits into advisory or brokerage accounts less total client withdrawals from advisory or brokerage accounts, plus dividends, plus interest, minus advisory fees. The Company considers conversions from and to brokerage or advisory accounts as deposits and withdrawals, respectively.

Total net new assets includes acquired net new assets.

Consists of existing custodied accounts that converted from brokerage to advisory, less existing custodied assets that converted from advisory to brokerage.

Client cash balances include client cash accounts and exclude purchased money market funds. Client cash account ("CCA") balances include cash that clients have deposited with LPL Financial that is included in Client payables in the consolidated balance sheets. The following table presents purchased money market fund balances for the periods presented:

(End of period $ in billions)

Q1 2025

Q4 2024

Q3 2024

Q2 2024

Q1 2024

Q4 2023

Q3 2023

Q2 2023

Q1 2023

Purchased Money Market Funds

44.7

41.0

38.5

35.7

32.6

29.5

25.2

20.0

15.0

During the first quarter of 2024, the Company updated its definition of the client cash account balances to exclude other client payables. Prior period disclosures have been updated to reflect this change as applicable.

Represents the amount of securities purchased less the amount of securities sold in client accounts custodied with LPL Financial.

Reflects retention of total advisory and brokerage assets, calculated by deducting quarterly annualized attrition from total advisory and brokerage assets, divided by the prior-quarter total advisory and brokerage assets.

During the first quarter of 2025, the Company updated its reporting of employees to include all full-time employees, including those reflected in Core G&A, promotional (ongoing) and advisory and commission expense. Prior period disclosures have been updated to reflect this change as applicable.

Capital expenditures represent cash payments for property and equipment during the period.

Acquisitions, net represents cash paid for acquisitions, net of cash acquired during the period. Acquisitions, net for the three months ended March 31, 2025 excludes $70.2 million related to The Investment Center, which was prefunded on October 1, 2024 in conjunction with the close of the Atria acquisition, as well as cash inflows associated with working capital and other post-closing adjustments.

Disclaimer

LPL Financial Holdings Inc. published this content on May 07, 2025, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 08, 2025 at 23:01 UTC.