Revenue stability near $1.9 billion persists, though operating margins remain volatile, ranging from 23.6% to 34.6% over the last ten quarters.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 |
|---|
| Sales/Revenue | 7.41B | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Revenue Growth % | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Cost of Goods Sold | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| COGS % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Gross Profit | 5.12B | 4.58B | 3.68B | 3.21B | 3.57B | 4.68B | 3.59B | 3.23B | 3.13B | 2.78B | 2.42B | 2.61B | 2.51B | 2.21B | 1.88B | 1.71B | 1.46B | 1.76B | 2.01B | 2.14B | 1.63B | 1.34B | 1.12B | 855.58M | 924M | 995M | 1.15B | 1.04B | 886.14M | 755M | 586.1M |
| Gross Margin % | 69.05% | 62.67% | 51.94% | 49.63% | 54.96% | 60.98% | 57.85% | 57.55% | 58.18% | 57.29% | 56.43% | 62.03% | 63% | 63.43% | 62.16% | 62.13% | 61.83% | 94.52% | 95.19% | 95.87% | 89.54% | 88.48% | 88.01% | 85.66% | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
| Gross Profit Growth % | - | 24.43% | 14.91% | -10.09% | -23.78% | 30.31% | 11.05% | 3.43% | 12.38% | 15.04% | -7.21% | 3.85% | 13.52% | 17.63% | 9.65% | 17.07% | -17.08% | -12.39% | -5.7% | 31.45% | 21.46% | 19.05% | 31.36% | -7.41% | -7.14% | -13.78% | 11.35% | 16.95% | 17.37% | 28.82% | 33.42% |
| Operating Expenses | 2.88B | 2.4B | 1.35B | 1.22B | 1.19B | 968.7M | 844.6M | 846M | 764.3M | 672.6M | 684.3M | 706.6M | 618M | 572.7M | 514.5M | 475.8M | 427.1M | 1.06B | 1.17B | 1.14B | 1.03B | 857.2M | 751.77M | 631M | 603M | 684M | 745M | 621.43M | 573.33M | 755M | 586.1M |
| OpEx % of Revenue | - | 32.75% | 19.04% | 18.88% | 18.38% | 12.63% | 13.61% | 15.06% | 14.23% | 13.85% | 15.97% | 16.82% | 15.52% | 16.44% | 17.02% | 17.25% | 18.04% | 56.95% | 55.1% | 51.15% | 56.64% | 56.69% | 58.87% | 63.17% | 65.26% | 68.74% | 64.56% | 59.96% | 64.7% | 100% | 100% |
| Selling, General & Admin | 2.23B | 2.28B | 1.21B | 1.17B | 1.07B | 968.7M | 844.6M | 846M | 779.5M | 722.6M | 618.1M | 238.9M | 219.9M | 222.8M | 213.2M | 205.8M | 196M | 846.6M | 919.7M | 905.1M | 97.3M | 86.1M | 74.27M | 59.01M | 59.06M | 64.64M | 88.22M | 74.14M | 73.04M | 320.7M | 237.7M |
| SG&A % of Revenue | - | 31.17% | 17.02% | 18.08% | 16.49% | 12.63% | 13.61% | 15.06% | 14.51% | 14.88% | 14.43% | 5.69% | 5.52% | 6.39% | 7.05% | 7.46% | 8.28% | 45.34% | 43.46% | 40.62% | 5.36% | 5.69% | 5.82% | 5.91% | 6.39% | 6.5% | 7.64% | 7.15% | 8.24% | 42.48% | 40.56% |
| Research & Development | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Operating Income | 2.24B | 2.19B | 2.33B | 1.99B | 2.37B | 3.71B | 2.75B | 2.39B | 2.36B | 2.11B | 1.73B | 1.9B | 1.89B | 1.64B | 1.36B | 1.23B | 1.04B | 701.6M | 848.5M | 996.4M | 786.9M | 655M | 525.28M | 365M | 321M | 311M | 409M | 414.94M | 312.81M | 924.5M | 747M |
| Operating Margin % | 30.18% | 29.92% | 32.89% | 30.74% | 36.58% | 48.36% | 44.24% | 42.49% | 43.95% | 43.44% | 40.45% | 45.21% | 47.48% | 46.99% | 45.14% | 44.49% | 43.79% | 37.57% | 40.09% | 44.72% | 43.36% | 43.31% | 41.13% | 36.54% | 34.74% | 31.26% | 35.44% | 40.04% | 35.3% | 122.45% | 127.45% |
| Operating Income Growth % | - | -6.19% | 17.48% | -16.32% | -36.02% | 35.12% | 15.03% | 1.08% | 11.98% | 21.66% | -8.72% | 0.42% | 15.48% | 20.02% | 11.2% | 18.37% | 47.73% | -17.31% | -14.84% | 26.62% | 20.14% | 24.7% | 43.91% | 13.71% | 3.22% | -23.96% | -1.43% | 32.65% | -66.16% | 23.76% | 34.18% |
| EBITDA | 2.67B | 2.62B | 2.84B | 2.47B | 3.02B | 3.91B | 2.94B | 2.58B | 2.52B | 2.25B | 1.87B | 2.03B | 2B | 1.73B | 1.45B | 1.3B | 1.1B | 767.3M | 910.8M | 1.05B | 833.4M | 697.3M | 565.3M | 410.29M | 371.58M | 391.49M | 462.69M | 448.32M | 346.17M | 953.5M | 765.1M |
| EBITDA Margin % | 36.08% | 35.83% | 40% | 38.2% | 46.54% | 51.03% | 47.29% | 45.89% | 46.92% | 46.39% | 43.57% | 48.21% | 50.29% | 49.6% | 47.81% | 47.11% | 46.45% | 41.09% | 43.04% | 47.14% | 45.92% | 46.11% | 44.27% | 41.08% | 40.21% | 39.35% | 40.09% | 43.26% | 39.07% | 126.29% | 130.54% |
| EBITDA Growth % | -6.15% | -7.64% | 14.98% | -18.27% | -22.87% | 33.37% | 13.87% | 2.26% | 11.92% | 20.66% | -7.82% | 1.13% | 15.89% | 19.57% | 11.23% | 18.17% | 43.29% | -15.76% | -13.29% | 26.04% | 19.52% | 23.35% | 37.78% | 10.42% | -5.09% | -15.39% | 3.21% | 29.51% | -63.69% | 24.62% | 33.92% |
| D&A (Non-Cash Add-back) | 437.2M | 432M | 504.2M | 481.6M | 645.8M | 204.8M | 189.6M | 190.8M | 159.5M | 143.6M | 133.4M | 126.3M | 111.7M | 90.6M | 80.9M | 72.4M | 63M | 65.7M | 62.3M | 54M | 46.5M | 42.3M | 40.02M | 45.29M | 50.58M | 80.49M | 53.69M | 33.37M | 33.36M | 29M | 18.1M |
| EBIT | 2.45B | 2.45B | 2.48B | 2.04B | 2.5B | 3.71B | 2.75B | 2.39B | 2.35B | 2.06B | 1.8B | 1.9B | 1.89B | 1.64B | 1.36B | 1.23B | 1.04B | 701.6M | 848.5M | 996.4M | 786.9M | 655M | 525.28M | 365M | 924M | 311M | 409M | 414.94M | 312.81M | 924.5M | 747M |
| Net Interest Income | 626.6M | 497.4M | 59.4M | 45.9M | 15.4M | 133.9M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 626.6M | 497.4M | 59.4M | 45.9M | 15.4M | 133.9M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | 0 | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Pretax Income | 2.84B | 2.88B | 2.82B | 2.49B | 1.95B | 3.99B | 3.24B | 2.93B | 2.38B | 2.51B | 1.96B | 2B | 2B | 1.7B | 1.44B | 1.25B | 1.07B | 688.9M | 796.2M | 1.08B | 858.3M | 679.4M | 533.78M | 365.52M | 309.6M | 330.59M | 458.19M | 414.77M | 312.81M | 245.6M | 171.1M |
| Pretax Margin % | 38.35% | 39.31% | 39.75% | 38.55% | 30.03% | 52.07% | 52.24% | 52.11% | 44.38% | 51.6% | 45.75% | 47.67% | 50.3% | 48.8% | 47.48% | 45.35% | 45.2% | 36.89% | 37.62% | 48.32% | 47.29% | 44.93% | 41.8% | 36.59% | 33.51% | 33.23% | 39.7% | 40.02% | 35.3% | 32.53% | 29.19% |
| Income Tax | 653.4M | 667.2M | 683.8M | 654.6M | 498.6M | 896.1M | 718.9M | 678.4M | 615.9M | 923.9M | 706.5M | 779.4M | 773.5M | 652.7M | 551.5M | 477.4M | 397.8M | 255.3M | 305.4M | 406.2M | 328.7M | 248.4M | 196.52M | 138.03M | 115.35M | 135.08M | 174.82M | 155.17M | 118.68M | 101.2M | 72.6M |
| Effective Tax Rate % | 23% | 23.2% | 24.25% | 26.29% | 25.59% | 22.43% | 22.17% | 23.17% | 25.83% | 36.88% | 36.04% | 38.92% | 38.62% | 38.39% | 38.43% | 38.17% | 37.18% | 37.06% | 38.36% | 37.72% | 38.3% | 36.56% | 36.82% | 37.76% | 37.26% | 40.86% | 38.15% | 37.41% | 37.94% | 41.21% | 42.43% |
| Net Income | 2.09B | 2.09B | 2.1B | 1.79B | 1.56B | 3.08B | 2.37B | 2.13B | 1.84B | 1.5B | 1.22B | 1.22B | 1.23B | 1.05B | 883.6M | 773.2M | 672.2M | 433.6M | 490.8M | 670.6M | 529.6M | 431M | 337.26M | 227M | 194M | 196M | 269M | 239.4M | 174.14M | 144.4M | 98.5M |
| Net Margin % | 28.28% | 28.53% | 29.61% | 27.69% | 24.01% | 40.18% | 38.23% | 37.94% | 34.2% | 30.85% | 28.36% | 29.11% | 30.88% | 30.07% | 29.23% | 28.04% | 28.4% | 23.22% | 23.19% | 30.09% | 29.18% | 28.5% | 26.41% | 22.73% | 21% | 19.7% | 23.31% | 23.1% | 19.65% | 19.13% | 16.81% |
| Net Income Growth % | 3.87% | -0.62% | 17.41% | 14.81% | -49.47% | 29.93% | 11.33% | 15.99% | 22.68% | 23.28% | -0.65% | -0.54% | 17.36% | 18.57% | 14.28% | 15.03% | 55.03% | -11.65% | -26.81% | 26.62% | 22.88% | 27.79% | 48.57% | 17.01% | -1.02% | -27.14% | 12.36% | 37.48% | 20.6% | 46.6% | 30.46% |
| Net Income (Continuing) | 2.19B | 2.21B | 2.14B | 1.84B | 1.45B | 3.1B | 2.52B | 2.25B | 1.77B | 1.58B | 1.25B | 1.22B | 1.23B | 1.05B | 883.6M | 773.2M | 672.2M | 433.6M | 490.8M | 670.6M | 529.6M | 431M | 337.26M | 227M | 194M | 196M | 269M | 239.4M | 194.14M | 144.4M | 98.5M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 1.1B | 1.19B | 1.1B | 786.1M | 847.4M | 1.23B | 1.56B | 1.12B | 740.3M | 992.8M | 687.2M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 366K | 60.2M | 52.7M | 49.8M | 38.2M |
| EPS (Diluted) | 9.38 | 9.25 | 9.15 | 7.76 | 6.70 | 13.12 | 9.98 | 8.70 | 7.27 | 5.97 | 4.75 | 4.63 | 4.55 | 3.90 | 3.36 | 2.92 | 2.53 | 1.65 | 1.82 | 2.40 | 1.90 | 1.58 | 1.25 | 0.88 | 0.76 | 0.76 | 1.04 | 0.93 | 0.67 | 0.56 | 0.40 |
| EPS Growth % | 5.78% | 1.09% | 17.91% | 15.82% | -48.93% | 31.46% | 14.71% | 19.67% | 21.78% | 25.68% | 2.59% | 1.76% | 16.67% | 16.07% | 15.07% | 15.42% | 53.33% | -9.34% | -24.17% | 26.32% | 20.25% | 26.4% | 42.05% | 15.79% | 0% | -26.92% | 11.83% | 38.81% | 19.64% | 40% | 29.03% |
| EPS (Basic) | - | 9.26 | 9.18 | 7.78 | 6.73 | 13.25 | 10.08 | 8.82 | 7.41 | 6.07 | 4.85 | 4.74 | 4.68 | 4.02 | 3.47 | 3.01 | 2.60 | 1.69 | 1.89 | 2.53 | 2.01 | 1.65 | 1.33 | 0.92 | 0.79 | 0.80 | 1.11 | 1.00 | 0.73 | 0.62 | 0.43 |
| Diluted Shares Outstanding | 223.41M | 223.77M | 223.3M | 224.8M | 227.1M | 228.8M | 231.2M | 238.6M | 246.9M | 245.1M | 250.3M | 260.9M | 267.4M | 266.3M | 261M | 263.3M | 265.1M | 262.3M | 270.1M | 279.2M | 278.7M | 273.2M | 268.27M | 257.95M | 255.26M | 257.89M | 258.65M | 258.82M | 259.91M | 255.58M | 246.25M |
| Basic Shares Outstanding | 223.41M | 223.77M | 222.8M | 224.1M | 226M | 226.6M | 228.8M | 235.4M | 242.2M | 241.2M | 245.5M | 254.6M | 259.6M | 258.3M | 253.4M | 255.6M | 257.2M | 255.9M | 259.3M | 264.8M | 263.8M | 260.53M | 254.84M | 246.74M | 245.57M | 246.54M | 242.34M | 240.61M | 238.55M | 232.9M | 229.07M |
| Dividend Payout Ratio | - | 54.77% | 54.07% | 62.71% | 71.08% | 55.2% | 35.65% | 34.43% | 37.79% | 37.6% | 44.51% | 86.59% | 37.58% | 37.86% | 68.29% | 41.11% | 41.49% | 59.25% | 63.67% | 26.89% | 27.87% | 27.73% | 28.51% | 36.86% | 40.57% | 37.67% | 23.38% | 20.15% | 23.2% | 20.84% | 24.47% |
Secular active-to-passive migration
According to the provided quarterly income statements, T. Rowe Price has maintained a consistent revenue base near $1.8 billion to $1.9 billion, suggesting that the firm's top-line performance remains heavily tethered to market beta rather than significant organic growth or aggressive expansion into new asset classes.
The lack of meaningful revenue growth over the ten-quarter period highlights the firm's sensitivity to broader capital market valuations. While the firm is diversifying into private markets, the current data indicates that these efforts have yet to translate into a discernible acceleration in top-line momentum.
As reported in financial statements, T. Rowe Price exhibits significant quarterly fluctuations in gross margins, ranging from 46.5% to 94.6%, which suggests that the firm's profitability is highly susceptible to non-operating items and the timing of investment-related gains rather than purely stable advisory fee structures.
The wide variance in gross margins warrants further investigation into the firm's seed capital accounting, as these figures do not reflect a standard, predictable service-based margin. Investors should monitor whether core advisory margins are being masked by these volatile investment income components.
Based on TROW's reported figures, operating margins have fluctuated between 23.6% and 34.6%, indicating that the firm struggles to achieve consistent operating leverage despite its high-margin business model, likely due to the persistent need for investment in research and technology to defend its competitive position.
The inability to consistently scale operating income faster than revenue suggests that the firm's cost structure is increasingly rigid. This may indicate that the cost of retaining top-tier investment talent is rising, potentially creating a ceiling on margin expansion in the current competitive environment.
Analysis of the income statement reveals that stock-based compensation, which reached as high as $95.9 million in 2023Q4, periodically distorts net income, suggesting that reported EPS may overstate the firm's underlying cash-generating capability during periods of high equity-based incentive issuance.
The lumpy nature of stock-based compensation and its impact on quarterly net income suggests that investors should focus on adjusted earnings metrics to gauge true operational performance. The firm's reliance on share repurchases to support EPS growth appears to be a primary mechanism for offsetting stagnant net income.
Data from the last ten quarters suggests that T. Rowe Price faces a structural challenge, as the firm's reliance on active management fees may be increasingly unsustainable given the broader industry shift toward lower-cost passive alternatives that do not require the same level of research overhead.
Short-term margin stability may be misleading if the firm is forced to lower its effective fee rates to remain competitive in the 401(k) space. The current income statement does not yet show a definitive collapse in profitability, but the trend of stagnant revenue growth suggests that the firm's pricing power is under significant long-term pressure.
Quick answers to the most common questions about buying TROW stock.
T. Rowe Price Group, Inc. (TROW) is profitable, generating $2.09B in net income for the fiscal year ending 2025 with a net profit margin of 28.5%.
T. Rowe Price Group, Inc. (TROW) reported an operating income of $2.19B, resulting in an operating profit margin of 29.9%. This margin reflects the operational efficiency of the business before interest and taxes.
T. Rowe Price Group, Inc. (TROW) generated $4.58B in gross profit for the year, representing a gross profit margin of 62.7%. This demonstrates the company's core pricing power and production efficiency.