StepStone Group Reports 67% Revenue Growth but Faces $366.1 Million Net Loss in Q2 FY 2026

StepStone Group Inc. reported significant financial results for the second quarter of fiscal year 2026, ending September 30, 2025, with total revenues reaching $454.2 million, a 67% increase from $271.7 million in the same period last year. This growth was primarily driven by a substantial rise in carried interest allocations, management and advisory fees, and incentive fees. Management and advisory fees alone increased by 17% to $215.5 million, attributed to new client activity and a 27% growth in average fee-earning assets under management (FEAUM). Performance fees also saw a notable rise, with total performance fees amounting to $238.7 million, up from $86.9 million in the prior year.

In contrast, the company experienced a net loss of $366.1 million for the quarter, compared to a profit of $17.6 million in the previous year. This loss was largely due to a significant increase in total expenses, which surged to $1.2 billion, a 433% increase year-over-year. The rise in expenses was primarily driven by a substantial increase in equity-based compensation, which rose to $884.5 million, reflecting the impact of liability classified awards related to profits interests issued in the private wealth subsidiary. Cash-based compensation also increased by 21% to $100.3 million, driven by a higher average headcount and merit increases.

Operationally, StepStone Group reported a total of $771 billion in assets under management (AUM) and assets under advisement (AUA) as of September 30, 2025. The company’s AUM was $209 billion, reflecting a growth from $189 billion in March 2025. The firm continues to expand its geographic footprint, operating in 31 cities across 19 countries, and employs over 1,240 individuals, including 420 investment professionals. The company’s flexible business model allows it to cater to a diverse client base, including large pension funds, sovereign wealth funds, and high-net-worth individuals.

Looking ahead, StepStone Group remains cautious about the potential impacts of ongoing economic volatility, including the effects of U.S. trade policies and inflation. The company is closely monitoring these developments, as well as the implications of the ongoing U.S. government shutdown, which could affect operations and access to capital. Despite these challenges, StepStone Group is optimistic about its ability to leverage its multi-asset class expertise and proprietary data to continue attracting new capital and generating strong returns for its clients. The firm has also announced a quarterly cash dividend of $0.28 per share, payable on December 15, 2025, reflecting its commitment to returning value to shareholders.