Federated Hermes Reports 18.5% Revenue Growth to $502.8 Million in Q2 2026

Federated Hermes, Inc. reported a significant increase in financial performance for the second quarter of 2026, with total revenue reaching $502.8 million, up 18.5% from $424.8 million in the same period last year. For the first half of 2026, revenue totaled $981.7 million, a 15.6% increase compared to $848.4 million in the first half of 2025. The growth was primarily driven by higher investment advisory fees, which rose to $337.7 million from $287.4 million year-over-year, reflecting an increase in average equity assets and money market assets. Net income for the second quarter was $104.3 million, compared to $91.0 million in the prior year, resulting in earnings per share of $1.38, up from $1.16.

The company experienced notable changes in its asset management landscape, with total managed assets increasing to $911.6 billion as of June 30, 2026, an 8% rise from $845.7 billion a year earlier. This growth was attributed to a 23% increase in equity assets and a 7% increase in money market assets. The firm also completed the acquisition of an 80% interest in FCP Fund Manager, L.P. for $216 million, which is expected to enhance its capabilities in private markets and alternatives in the U.S. This acquisition contributed to a $90.3 million increase in intangible assets and a $229 million increase in goodwill.

Operationally, Federated Hermes reported a decrease in accrued compensation and benefits, which fell by $68.3 million, primarily due to the payment of 2025 annual incentive compensation. The company’s total operating expenses for the second quarter increased to $369.9 million, up from $307.8 million in the previous year, driven by higher distribution expenses and compensation related to the FCP acquisition. The firm’s cash flow from operating activities also improved significantly, totaling $109.7 million for the first half of 2026, compared to $33.1 million in the same period of 2025.

Looking ahead, Federated Hermes anticipates continued growth driven by its strategic acquisitions and the expansion of its investment offerings. The company plans to invest approximately $296 million over the next three years to support technology-driven initiatives and enhance its service capabilities. The firm remains focused on maintaining liquidity and capital resources, with liquid assets totaling $537.5 million as of June 30, 2026. The board of directors has declared a dividend of $0.38 per share, reflecting the company's commitment to returning value to shareholders while pursuing growth opportunities.