T. Rowe Price Group, Inc. (TROW): Business Model Canvas [Dec-2025 Updated]

After two decades watching asset managers evolve, I can tell you that T. Rowe Price Group, Inc. is at a fascinating inflection point, moving beyond just stock-picking to become a true retirement solutions powerhouse. The canvas below distills how they manage their massive $1.77 trillion in assets as of late 2025, balancing their core active equity strength with a necessary pivot into alternatives and digital advice. If you want to see exactly where the revenue is coming from and what key partnerships are fueling their next growth chapter, dive into the nine building blocks right here.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Key Partnerships

You're looking at the critical external relationships T. Rowe Price Group, Inc. (TROW) relies on to execute its strategy, especially in expanding alternatives and modernizing operations. These aren't just vendors; they are deep strategic alignments.

Strategic collaboration with Goldman Sachs for public-private market solutions.

T. Rowe Price Group, Inc. announced a strategic collaboration with Goldman Sachs on September 4, 2025, specifically targeting retirement and wealth channels. This deal includes Goldman Sachs intending to invest up to $1 billion in T. Rowe Price common stock, aiming for a stake of up to 3.5%. Goldman Sachs will act as a third-party provider of private market strategies for T. Rowe Price's target-date series offerings. The firms expect to launch these jointly created, co-branded model portfolios in mid-2026.

OHA (Oak Hill Advisors) for expanding alternative credit investment offerings.

Oak Hill Advisors (OHA), T. Rowe Price Group, Inc.'s private markets platform since its acquisition, is central to the alternatives push. The acquisition price for OHA was up to approximately $4.2 billion, with up to an additional $900 million contingent on milestones beginning in 2025. OHA managed approximately $61 billion in capital across credit strategies as of June 30, 2023, and T. Rowe Price Group, Inc. reported Alternatives AUM of $56 billion as of September 30, 2025. This partnership is also key in managing assets for Aspida.

Charles River Development for cloud-based investment management platform (Charles River IMS).

T. Rowe Price Group, Inc. expanded its long-running relationship, which started in 2002, by migrating to the SaaS-deployed Charles River Investment Management Solution (Charles River IMS). This move transitioned the firm from proprietary infrastructure to a cloud-based platform to streamline management of global equity, fixed income, and multi-asset portfolios. Investment and wealth managers, asset owners, and insurers in approximately 30 countries rely on Charles River IMS to manage USD $59 Trillion in assets. T. Rowe Price Group, Inc. was entrusted with managing $1.79 trillion in client assets as of October 31, 2025.

Aspida for enhancing insurance asset management capabilities.

T. Rowe Price Group, Inc. and OHA formed a strategic partnership to manage certain public and private assets for Aspida Holdings Ltd., an insurer focused on retirement and reinsurance solutions. Aspida reported total assets of $21.6 billion as of December 31, 2024. T. Rowe Price Group, Inc. is an existing equity investor, having previously taken a minority stake to support Aspida's growth. This deal supports T. Rowe Price Group, Inc.'s insurance business expansion, which already managed over $1 trillion in retirement-related assets out of its total $1.6 trillion AUM in early 2025.

Global network of financial intermediaries and consultants for distribution.

Distribution relies heavily on a broad network catering to various share classes. T. Rowe Price Group, Inc. provides offerings across Investor, Advisor, R, I, Institutional, and F classes. The firm managed preliminary total assets under management of $1.77 trillion as of September 30, 2025. About two-thirds of these client assets are retirement-related.

Here's a quick look at the scale of these key relationships:

Partner Entity	Nature of Relationship	Key Financial/Statistical Data Point
Goldman Sachs	Public-Private Investment Solutions & Target-Date Series Support	Up to $1 billion intended investment in T. Rowe Price stock
Oak Hill Advisors (OHA)	Private Markets Platform & Alternative Credit Expertise	$56 billion in Alternatives AUM for T. Rowe Price (Sept 2025)
Aspida	Insurance Asset Management Mandate (Public & Private Assets)	Aspida total assets of $21.6 billion (Dec 2024)
Charles River Development	Cloud-based Investment Management Solution (IMS) Migration	Charles River IMS utilized by clients to manage $59 Trillion in assets
Financial Intermediaries	Primary Distribution Channel for Retail/Advisor Products	T. Rowe Price Group, Inc. AUM of $1.77 trillion (Sept 2025)

The firm supports distribution through specific share classes, which you can track via their dedicated intermediary resources:

• Investor Class funds
• Advisor Class funds
• R Class funds
• I Class funds
• Institutional Class funds
• Portfolio and Portfolio-II Classes

Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Key Activities

You're looking at the core engine of T. Rowe Price Group, Inc. as of late 2025. These are the things the firm absolutely must execute well to keep the assets flowing and the business profitable. It's all about managing money, building products, and modernizing the plumbing underneath it all.

Active investment management across equity, fixed income, and multi-asset classes

The primary activity is managing client capital across the main asset buckets. This requires continuous portfolio construction and risk management. The scale of this activity is substantial, as shown by the latest asset figures.

Here's a quick look at the asset allocation as of the end of the third quarter of 2025:

Asset Class	Assets Under Management (AUM) as of September 30, 2025
Total AUM	$1.77 trillion
Equity	$839 billion
Multi-asset	$583 billion
Fixed income, including money market	$200 billion
Alternatives	$53 billion

The firm's investment advisory revenue, which is the core income from these activities, was reported at $1.7 billion in the second quarter of 2025, representing over 90% of net revenues for that period. Net revenues for Q3 2025 were $1.89 billion.

Proprietary, independent investment research and market analysis

T. Rowe Price Group, Inc. relies on its internal research capabilities to drive its active management edge. This activity involves generating forward-looking insights that inform investment decisions across the firm's strategies. You see the output of this in their published outlooks.

Key areas of focus for their proprietary analysis in 2025 included:

• Assessing the impact of deglobalization and trade policy changes on markets.
• Analyzing the broadening opportunity set beyond U.S. mega-cap tech stocks.
• Evaluating the risk/reward profile of value stocks versus growth stocks.
• Forecasting the impact of AI monetization on enterprise software valuations.
• Identifying income opportunities in high yield bonds and emerging markets bonds.

This research underpins the firm's positioning, which is critical when market conditions, like the expected slowdown in AI infrastructure growth, shift.

Developing and launching new products like active ETFs and Managed Lifetime Income (MLI)

A key activity is product innovation to meet evolving investor demand, especially the structural shift toward exchange-traded funds (ETFs). The firm is actively expanding its active ETF roster.

Metrics related to this product development include:

• Active ETF Assets Under Management (AUM) reached $16.2 billion as of June 30, 2025.
• The firm had 22 active ETF offerings trading on NASDAQ as of mid-June 2025.
• The T. Rowe Price Capital Appreciation Equity Fund (TCAF), one of their key ETFs, charged a fee of 34 basis points (bps).

While specific AUM for Managed Lifetime Income (MLI) products isn't explicitly detailed in the latest reports, the focus on retirement income solutions is clear, with the Retirement Income 2025 Fund (TRAVX) actively managed to provide monthly income.

Technology modernization and migration to cloud-based front-office systems

To manage costs and improve efficiency, T. Rowe Price Group, Inc. is heavily engaged in technology modernization. This is a necessary activity to maintain competitive operating leverage.

The firm's commitment to efficiency is reflected in its cost structure management:

• Two-thirds of the firm's cost base is allocated to efficiency initiatives.
• Adjusted operating expenses in Q2 2025 rose by 3.7% year-over-year, indicating progress in cost discipline relative to revenue pressures.
• Q3 2025 operating expenses were reported at $1.25 billion.

The goal is to align expenses with revenue growth, especially given the pressure on fee rates across the industry.

Retirement plan recordkeeping and administrative services for institutional clients

Serving institutional clients through recordkeeping is a major activity, deeply integrated with the firm's investment management. Two-thirds of the firm's total AUM is retirement-related.

Key figures for this segment as of late 2025:

• Retirement assets represent approximately 66% of total AUM.
• Target date retirement portfolios held $520 billion in AUM as of Q2 2025.
• Institutionally-managed assets accounted for $993 billion of the total AUM in Q2 2025.

The firm provides full-service recordkeeping for defined contribution, 403(b), 457, defined benefit, nonqualified, and equity share plans. Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Key Resources

You manage assets totaling $1.77 trillion as of September 30, 2025. Honestly, about two-thirds of that is tied up in retirement-related assets.

Asset Class	AUM as of 09/30/2025 (in billions)
Equity	$ 885
Fixed income, including money market	$ 208
Multi-asset	$ 618
Alternatives	$ 56
Target date retirement portfolios	$ 553

Your investment teams are substantial, backed by rigorous global research and independent thinking. You rely on a deep bench of talent to inform decisions.

• 900+ investment professionals as of 03/31/2025.
• 350+ research analysts as of 03/31/2025.
• Serving clients in over 50 countries.

The balance sheet shows a solid liquidity position, with cash and equivalents reported at nearly $2.84 billion at the end of Q1 2025.

You have a scalable technology infrastructure, marked by the recent transition from proprietary systems to the SaaS-deployed Charles River Investment Management Solution (Charles River IMS) to manage global equity, fixed income, and multi-asset portfolios.

The brand reputation is built on over 85 years of investment excellence, retirement leadership, and independent proprietary research. Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Value Propositions

You're looking at the core promises T. Rowe Price Group, Inc. makes to its clients as of late 2025. These aren't just marketing slogans; they are backed by trillions in assets and specific performance metrics.

Active management aiming for consistent long-term outperformance.

The firm's value proposition centers on investment excellence derived from independent proprietary research. For instance, looking at the second quarter of 2025 results, over half of T. Rowe Price Group, Inc.'s funds beat their peer groups across the three, five, and ten-year time horizons. When you look at it on an asset-weighted basis for that same period, the numbers were even stronger: 65% of assets beat peer group medians over three years, 58% over five years, and 78% over ten years. This focus on long-term results is what clients rely on, even when facing short-term market shifts, such as the net client outflows of $7.9 billion experienced in the third quarter of 2025.

Retirement leadership: two-thirds of AUM is retirement-related.

T. Rowe Price Group, Inc. is deeply entrenched in retirement planning, a fact reflected in its massive scale. As of September 30, 2025, the firm was entrusted with managing $1.77 trillion in client assets, and about two-thirds of that AUM is tied to retirement solutions. This specialization is concrete: the Target Date Retirement Portfolios alone held $553 billion in assets as of that same date. This isn't a side business; it's the main event. The mission statement itself centers on helping clients succeed by providing investment excellence and retirement expertise.

The asset composition as of the end of the third quarter of 2025 illustrates the breadth of their offerings:

Asset Class	AUM (in billions)
Equity	$885
Fixed income, including money market	$208
Multi-asset	$618
Alternatives	$56
Total assets under management	$1,767
Target date retirement portfolios	$553

Diversified product suite including mutual funds, ETFs, and alternatives.

You see the diversification in the table above, covering traditional asset classes alongside specialized areas. The firm continues to grow its ETF business; in the first half of 2025, they saw over $6 billion in inflows to their ETFs. Furthermore, the effective fee rate, excluding performance-based fees, was 39.6 basis points as of the second quarter of 2025, showing a mix that includes lower-fee products alongside their actively managed strategies.

Access to private market and alternative strategies via new partnerships.

T. Rowe Price Group, Inc. actively expands its capabilities through strategic moves. For example, the firm announced a strategic collaboration with Goldman Sachs during the third quarter of 2025, creating an opportunity to bring innovative new solutions to market for clients. This type of partnership is key to enhancing their service offerings, especially in areas like alternatives, which stood at $56 billion in AUM as of September 30, 2025.

Personalized financial advice and planning tools for retail investors.

While specific retail user adoption numbers aren't public, the focus on retirement leadership inherently serves the retail investor base. The firm provides participant accounting and plan administration for retirement plans that primarily invest in their products. As of September 30, 2025, the assets under administration for these plans were $315 billion, of which $178 billion was assets T. Rowe Price Group, Inc. actually manages. This infrastructure supports the delivery of advice and planning tools to millions of investors globally.

Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Customer Relationships

You're looking at how T. Rowe Price Group, Inc. manages its connections across its diverse client base as of late 2025. Honestly, the relationship strategy is built on scale, given they are entrusted with managing $1.79 trillion in client assets as of October 31, 2025, across millions of clients globally.

The firm's approach segments its relationship efforts based on the client type, moving from highly personalized service to broad digital self-service.

Dedicated Private Asset Management for High-Net-Worth (HNW) clients.

While specific HNW client counts aren't public, the structure suggests a dedicated, high-touch service model. The firm serves Wealth Managers, which points to a segment requiring bespoke solutions beyond the retail or standard institutional offerings. This relationship is characterized by deep consultation, similar to how they engage with large institutional mandates, ensuring tailored investment strategies are deployed for these sophisticated, high-net-worth relationships.

Self-service digital tools and educational content for direct investors.

For the individual investor segment, the relationship is primarily digital and content-driven. T. Rowe Price empowers millions of investors worldwide, relying on digital platforms for day-to-day interaction. The firm offers educational content, such as insights from its 2025 U.S. Retirement Market Outlook, to help self-directed clients make informed choices. The firm's long-standing focus on investment excellence and independent proprietary research forms the backbone of the content provided to this segment.

Retirement Advisory Service providing personalized financial plans.

This service represents a significant, personalized touchpoint within the direct investor channel. T. Rowe Price was recognized as one of the best financial advisory firms of 2025, a ranking that considered client recommendations. The firm's core business is heavily weighted toward retirement, with about two-thirds of its total AUM being retirement-related. This service helps participants navigate their long-term goals, which is critical given the scale of their retirement business.

Relationship managers and sales teams for institutional and intermediary channels.

This channel relies on dedicated professionals to manage relationships with large entities. The firm actively deepens engagements with institutional investors, as evidenced by recent leadership appointments focused on Institutional Distribution in key regions like Australia and New Zealand. The scale of their institutional presence is vast; for instance, T. Rowe Price Investment Management, Inc. reported holding 10.5% of a major utility company's stock as of November 30, 2025, illustrating the magnitude of assets managed for these clients. The firm has been serving Australian institutional investors for over 20 years.

High-touch, consultative approach for plan sponsors and consultants.

The relationship with plan sponsors is consultative, focusing on evolving plan design, such as Qualified Default Investment Alternatives (QDIAs) and retirement income solutions, as highlighted in their 2025 Outlook. The firm's 2025 Reference Point report analyzes data from more than 2 million active workplace retirement plan participants where T. Rowe Price acts as the recordkeeper, showing the breadth of this consultative relationship. Consultants and advisors are deemed essential in helping plan sponsors select tailored retirement income capabilities.

Here's a quick look at the asset scale underpinning these relationships as of late 2025:

Metric	Value as of 10/31/2025	Value as of 09/30/2025	Value as of 08/31/2025
Total Assets Under Management (AUM)	$1.79 trillion	$1.767 trillion	$1.73 trillion
Target Date Retirement Portfolios AUM	N/A	$553 billion	$538 billion
Retirement-Related AUM (Approximate)	About two-thirds of total	About two-thirds of total	About two-thirds of total

The firm's relationship strategy is clearly bifurcated: deep, consultative partnerships for institutional and HNW segments, and scalable, digital/advisory support for the millions of individual investors, especially those saving for retirement.

Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Channels

You're looking at how T. Rowe Price Group, Inc. gets its investment products and services into the hands of clients. The firm uses a multi-pronged distribution strategy, which is typical for a global asset manager of its size, blending direct digital access with deep relationships across the professional financial advice ecosystem.

The scale of T. Rowe Price Group, Inc.'s operations as of late 2025 is substantial. As of October 31, 2025, the firm was entrusted with managing $1.79 trillion in client assets globally. To give you a sense of the overall structure, about two-thirds of this total Assets Under Management (AUM) is retirement-related.

Here's a look at the key channels T. Rowe Price Group, Inc. employs to reach its diverse client base.

Direct-to-Consumer Platform (Website, Mobile App, Call Centers)

This channel serves individual investors directly. While specific metrics on the number of direct retail accounts aren't public in the latest reports, this channel is a core component alongside their advice solutions like the Retirement Advisory Service^TM and the ActivePlus Portfolios® Program. The firm supports this with dedicated digital access points, including their website and mobile application, for self-directed investors.

Financial Intermediaries (Broker-Dealers, RIAs, Wirehouses)

This represents a significant portion of the business, particularly for mutual fund and ETF distribution. T. Rowe Price Group, Inc. maintains relationships with financial intermediaries across the Americas, EMEA, and APAC regions. These intermediaries, including Registered Investment Advisors (RIAs) and broker-dealers, distribute T. Rowe Price Group, Inc.'s mutual funds and ETFs to their underlying clients. The firm's focus on actively managed ETFs, which recently crossed $20 billion in AUM, is often facilitated through these intermediary networks.

Institutional Sales (Direct Sales to Pension Funds and Endowments)

The institutional segment is a major focus, evidenced by ongoing organizational efforts to deepen engagement with these sophisticated clients. As of August 31, 2025, the firm managed $1.73 trillion in AUM, with about two-thirds being retirement-related, suggesting a massive institutional footprint in pension and sovereign wealth funds. The firm actively services institutional consultants across Asia Pacific and is focused on delivering tailored solutions across equities, fixed income, and alternatives to these large asset owners.

Exchange-Traded Funds (ETFs) Trading on the NASDAQ Exchange

T. Rowe Price Group, Inc.'s actively managed ETF suite is a growing distribution mechanism, trading on the NASDAQ exchange. As of November 2025, the firm's total ETF AUM surpassed $20 billion. By June 2025, the firm had expanded its roster to 22 active, transparent ETF offerings. The T. Rowe Price Capital Appreciation Equity ETF (TCAF) alone had seen its AUM rise above $6 billion. In the quarter leading up to November 2025, their ETFs pulled in almost $2 billion in net inflows.

Retirement Plan Services Recordkeeping Platform

This is a distinct channel where T. Rowe Price Group, Inc. acts as the recordkeeper for defined contribution plans. The 2025 Reference Point report broke down data from more than 2 million active workplace retirement plan participants using their recordkeeping services. The firm highlights over 40+ years of retirement services experience. The Target Date Retirement Portfolios, a key offering within this channel, stood at $553 billion in AUM as of September 30, 2025.

Here's a snapshot of the scale, using the latest available AUM data for context:

Metric	Value	Date
Total Assets Under Management	$1.79 trillion	October 31, 2025
Retirement-Related AUM (Approximate)	Approx. $1.193 trillion (Two-thirds of total)	October 31, 2025
Target Date Retirement Portfolios AUM	$553 billion	September 30, 2025
Total ETF AUM	$20.72 billion	Late 2025
Number of Active ETFs	22	June 12, 2025
Active Workplace Retirement Participants (Recordkeeping)	More than 2 million	2025

The firm's commitment to this channel is underscored by its 97% client retention rate in 2023, based on a three-year average. They offer specific recordkeeping solutions like Essential Choice® for plans with $0 to $5 million in assets.

The overall distribution strategy relies on a strong brand reputation, which helps drive flows across all these avenues. For instance, T. Rowe Price Group, Inc. saw preliminary net outflows of $2.0 billion in September 2025, but the total AUM remained high at $1.77 trillion. This shows the stickiness of the assets managed, even with market movements. Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Customer Segments

You're looking at the core client base for T. Rowe Price Group, Inc. as of late 2025. The firm manages substantial assets, with preliminary month-end Assets Under Management (AUM) hitting $1.79 trillion as of October 31, 2025. About two-thirds of this total AUM is retirement-related.

The customer segments are clearly delineated, though some figures are based on the most recent detailed breakdown from Q2 2025, which showed total AUM at $1.68 trillion.

Segment Breakdown and Scale

T. Rowe Price Group, Inc. serves distinct client types, which can be broadly categorized by their relationship structure and asset type. Here's how the segments stacked up based on Q2 2025 data, which is the most granular segment-level data available:

• Institutional Clients: These clients, including pension funds, sovereign wealth funds, and endowments, accounted for $993 billion in AUM in Q2 2025.
• Individual Investors (Retail): Direct investment clients represented $684 billion in AUM as of Q2 2025.
• Retirement Assets Proxy: Assets specifically in Target Date Retirement Portfolios were valued at $553 billion as of September 30, 2025. Overall, retirement assets represented 66% of total AUM in Q2 2025.

The focus on retirement is clear; it's the bedrock of their business. Still, the firm is actively managing other pools of capital.

The composition of the AUM across asset classes, which reflects the underlying products these segments invest in, was:

Asset Class	AUM (Billions USD) as of Q2 2025	AUM (Billions USD) as of 10/31/2025
Equity	$839	Data not segmented by asset class for October 2025
Multi-Asset	$583	Data not segmented by asset class for October 2025
Fixed Income (incl. Money Market)	$200	Data not segmented by asset class for October 2025
Alternatives	$53	Data not segmented by asset class for October 2025

Retirement Plan Sponsors Focus

For Retirement Plan Sponsors offering plans like 401(k)s, T. Rowe Price Group, Inc. maintains a strong service reputation. While the exact participant count of ~2 million you mentioned isn't explicitly in the latest reports, their commitment to this segment is evidenced by service quality metrics. For instance, T. Rowe Price Retirement Plan Services has achieved #1 Overall Satisfaction for 8 years in a row in the Chatham Partners annual client satisfaction survey, which covers major industry recordkeepers. Furthermore, they secured the #1 Net Promoter Score for 10 years in a row in the same survey.

Advisor Class and R Class shares for mutual funds may generally only be purchased through a financial intermediary or a retirement plan, showing a structural tie to these sponsors.

Financial Intermediaries and Wealth Advisors

This segment is critical for distribution, especially for certain share classes. The firm captures assets through managed account-model delivery, which had $17.1 billion in Assets Under Advisement (AUA) in Q2 2025. Advisor Class shares generally require purchase through a financial intermediary. The firm also conducts an annual study capturing views from the U.S. Defined Contribution consultant and advisor community.

High-Net-Worth Individuals

Specific AUM figures for High-Net-Worth individuals with $5 million+ in assets aren't separately published in the preliminary reports. However, these clients are likely served through the Retail segment or through specialized managed accounts. The I Class shares, which have the lowest management fee at 0.37%, generally require a minimum initial investment of $500,000 per fund per account registration, though this is often waived or reduced for financial intermediaries and certain accounts where T. Rowe Price or its affiliates have discretionary investment authority.

Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Cost Structure

You're looking at the expense side of T. Rowe Price Group, Inc.'s operations as of late 2025, which is heavily weighted toward personnel and technology to support its global asset management platform.

Employee compensation and benefits definitely represent a large operating expense. As of September 30, 2025, T. Rowe Price Group, Inc. employed 7,830 associates, which was a decrease of 3.4% from 8,104 associates at September 30, 2024. For the third quarter of 2025, adjusted compensation and related costs totaled $632.5 million. This figure reflected lower salaries and benefits due to the decrease in average headcount, partially offset by a higher bonus accrual.

Investment in technology, data, and cloud infrastructure modernization is a key area of spend. For the third quarter of 2025, costs categorized as Technology, Occupancy, and Facility were $183.2 million, an increase of $19.2 million from the third quarter of 2024. This category includes depreciation and hosted solutions, plus increased depreciation tied to the new corporate headquarters that was occupied in March 2025.

Distribution and marketing costs are managed across various channels to support sales. Distribution and servicing costs for the third quarter of 2025 were reported at $95.8 million, an increase of $4.2 million from the third quarter of 2024. Advertising and promotion, a component of total expenses, was $26.1 million in the first quarter of 2025.

General and administrative expenses, which include the global real estate footprint, are under active review. Management cited an ongoing evaluation of the global real estate footprint, including transitioning from owning to leasing certain properties over time, as a cost control measure. In the first quarter of 2025, the line item for General, administrative, and other was $103.3 million.

The overall expectation for the full year is clear. T. Rowe Price Group, Inc. expects 2025 adjusted operating expenses, excluding carried interest expense, to be up 2% to 4% over 2024, totaling approximately $4.46 billion.

Here's a look at the quarterly breakdown of adjusted operating expenses for the third quarter of 2025 compared to prior periods:

Expense Component (Non-GAAP Basis)	Q3 2025 Amount (in millions)	Change from Q3 2024	Change from Q2 2025
Total Adjusted Operating Expenses	$1,134.4	3.2% increase	1.1% decrease
Compensation & Related Costs	$632.5	Data not directly comparable in snippet	Data not directly comparable in snippet
Distribution and Servicing Costs	$95.8	$4.2 million increase	$3.3 million increase
Product and Recordkeeping Related Costs	Data not directly comparable in snippet	$3.7 million increase	$3.9 million increase
Technology, Occupancy, and Facility Costs	$183.2	$19.2 million increase	$3.8 million increase
G&A & Other	Data not directly comparable in snippet	($2.8 million) change	Data not directly comparable in snippet

The primary drivers of the cost structure include:

• Employee Compensation: Directly tied to headcount, which was reduced by 3.4% year-over-year as of September 30, 2025.
• Technology Investment: Evidenced by the $183.2 million in Q3 2025 technology and facility costs.
• Real Estate Management: Under active evaluation with plans to transition from owning to leasing certain properties.
• Compensation Structure: Includes market-related changes in deferred compensation liabilities, such as the ($7.2 million) impact in Q1 2025.
• Nine-Month Year-to-Date Expenses: Total adjusted operating expenses for the nine months ended September 30, 2025, were $3,416.7 million, a 4.3% increase over the prior year period.

Finance: draft 13-week cash view by Friday.

T. Rowe Price Group, Inc. (TROW) - Canvas Business Model: Revenue Streams

You're looking at the core ways T. Rowe Price Group, Inc. brings in money, which is heavily tied to the market's ups and downs and client asset levels as of mid-2025. Honestly, it's a business where scale matters immensely, but the margin on that scale is constantly being squeezed.

Investment Advisory Fees are the bedrock. These are the fees charged based on a percentage of Assets Under Management (AUM). For the three months ended June 30, 2025, this primary stream hit $1,567.6 million, a slight dip of 0.1% from the $1,568.8 million seen in the second quarter of 2024. This revenue is directly linked to the quarter-end AUM, which stood at $1.68 trillion as of June 30, 2025.

The revenue picture for Q2 2025 shows total net revenues at $1,723.3 million, which was a 0.6% decrease from Q2 2024. This slight overall revenue contraction, despite AUM growth, points directly to the fee pressure you mentioned.

Here's a quick look at the key revenue components for the three months ended June 30, 2025, compared to the prior year period:

Revenue Component (in millions USD)	Q2 2025	Q2 2024	Change (%)
Investment advisory fees	$1,567.6	$1,568.8	(0.1)
Capital allocation-based income	$(0.4)	$0.1	n/m
Net revenues	$1,723.3	$1,733.3	(0.6)

Performance-Based Advisory Fees are less predictable and are mainly generated from alternative strategies. While the main GAAP table in the Q2 2025 release doesn't show a separate line item for performance fees, the commentary confirms these fees earned in Q2 2025 were primarily from alternatives strategies.

Capital Allocation-Based Income, which represents the change in accrued carried interest, was a small negative amount for the quarter. For Q2 2025, this was $(0.4) million, compared to $0.1 million in Q2 2024. The firm did report $37 million in accrued carried interest for Q2 2025, up from $27 million in Q2 2024, signaling some growth in the alternatives business component that feeds this income stream.

For Administrative, Distribution, and Service Fees, T. Rowe Price Group records revenue from services like recordkeeping here. As of June 30, 2025, the firm's total assets under administration (AUA) were $302 billion, though only $170 billion of that AUA was comprised of assets the firm actually manages. The firm also offers non-discretionary advisory services through model delivery, with assets under advisement in those portfolios at $33.5 billion at the end of June 2025.

The pressure on the effective fee rate is quite clear. The investment advisory annualized effective fee rate, when you exclude those performance-based fees, was 39.6 basis points in Q2 2025. This is down from 41.1 basis points in Q2 2024 and 40.0 basis points in Q1 2025.

The factors driving this compression include:

• Client flows shifting toward lower-fee asset classes.
• Gross sales favoring lower-fee vehicles like ETFs.
• Redemptions in higher-fee equity mutual funds.

The firm's strategic focus areas, while growing AUM, also reflect this trend:

• Retirement solutions AUM stood at $520 billion.
• ETF AUM reached $16.2 billion.

Finance: draft a sensitivity analysis showing revenue impact if the effective fee rate drops by 5 basis points across the entire AUM base by year-end 2025.