T. Rowe Price Technology ETF 2025 Q1 Earnings Mixed Results as Net Income Drops 14.9%

T. Rowe Price Technology ETF (TTEQ) reported its fiscal 2025 Q1 earnings on May 2nd, 2025. The total revenue of T. Rowe Price Technology ETF increased by 0.8% to $1.76 billion in 2025 Q1, up from $1.75 billion in 2024 Q1. T. Rowe Price anticipates maintaining its focus on strategic investments and enhancing its market positioning. The firm projects an effective tax rate for the full year 2025 between 23.5% to 27.5% on a GAAP basis, and 24.0% to 27.0% on an adjusted basis. The leadership expects continued revenue growth while navigating client flows and market conditions, aiming to stabilize AUM and improve overall profitability.

Revenue

Investment advisory fees contributed significantly with $1.60 billion in revenue. The equity segment generated $959.20 million, while fixed income, including money market, accounted for $103.60 million. Multi-asset revenues reached $454.70 million, and alternatives brought in $80.90 million. Performance-based advisory fees added $10.40 million, although capital allocation-based income was negative at -$1.20 million. Administrative, distribution, services, and other fees totaled $156.30 million, leading to net revenues of $1.76 billion.

Earnings/Net Income

T. Rowe Price Technology ETF's EPS fell 14.0% to $2.15 in 2025 Q1, compared to $2.50 in 2024 Q1. The company's net income also saw a decline, reaching $505.10 million in 2025 Q1, down 14.9% from $593.40 million in the previous year. The reduction in EPS signals a challenging quarter for profitability.

Post Earnings Price Action Review

Following the earnings report, T. Rowe Price Technology ETF (TROW) stock exhibited mixed results over various time frames. Approximately 55% of the time, the stock price increased within three days post-earnings, with an average 3-day return of 1.61% and a maximum return of 2.74% observed on day 24. The 10-day win rate was higher at 65%, with an average return of 2.23% and a peak return of 3.06% on day 28. Over 30 days, the win rate mirrored the 3-day rate at 55%, with an average return of 0.73%. While specific revenue impacts weren't detailed, positive win rates suggest that revenue, alongside earnings, can influence stock price positively. Net income and EPS, though not separately analyzed, are inferred to contribute to stock appreciation when reported with revenue. Overall, these metrics appear to positively impact the stock, particularly in the short term post-earnings.

CEO Commentary

Rob Sharps, Chair, CEO, and President, highlighted the firm's progress in extending its reach while leveraging its investment platform and leadership in retirement services. He noted that T. Rowe Price managed $1.57 trillion in assets under management (AUM) despite facing net outflows of $8.6 billion during the quarter. Sharps expressed confidence in the firm’s capability to navigate market uncertainties and emphasized the importance of supporting clients in similar situations. He conveyed an optimistic outlook, asserting that T. Rowe Price is well-positioned to capitalize on growth opportunities moving forward.

Guidance

T. Rowe Price anticipates maintaining its focus on strategic investments and enhancing its market positioning. The firm projects an effective tax rate for the full year 2025 between 23.5% to 27.5% on a GAAP basis, and 24.0% to 27.0% on an adjusted basis. The leadership expects continued revenue growth while navigating client flows and market conditions, aiming to stabilize AUM and improve overall profitability.

Additional News

In recent weeks, T. Rowe Price Technology ETF has been the focus of discussions regarding its strategic approach and market position. The actively managed ETF, which began trading in October 2024, has drawn attention for its emphasis on high-conviction technology investments and its thematic investment strategy. Additionally, T. Rowe Price's expansion into the active ETF space has been a topic of interest, highlighting the firm's commitment to providing innovative investment solutions. The ETF targets cutting-edge technology companies, aiming to capture growth opportunities in the rapidly evolving tech sector. This strategic focus positions TTEQ as a compelling option for investors seeking exposure to transformative technological advancements on a global scale. The ETF's ability to leverage active management expertise while offering the operational benefits of an ETF continues to be a key selling point in the competitive landscape.