Hamilton Lane's 2025 Q2 Earnings Call: Unpacking Contradictions in Evergreen Funds, G&A Outlook, and Incentive Fees

Expansion of Evergreen Funds and Institutional Interest, G&A Expense Outlook, Evergreen fund growth and market demand, incentive fees and exit activity, relationship with DBS Private Banking are the key contradictions discussed in Hamilton Lane's latest 2025Q2 earnings call.



Total Asset Footprint and AUM Growth:
- Hamilton Lane's total asset footprint stood at $986 billion at the end of the quarter, representing a 5% increase year-over-year.
- The growth in AUM, standing at $141 billion and growing 9% compared to the prior year period, was driven by both specialized funds and customized separate accounts.

Fee-Earning AUM and Evergreen Platform:
- Fee-earning AUM reached $74 billion, with a year-over-year increase of 10%, primarily driven by the specialized fund platform and the Evergreen platform.
- The Evergreen platform reported nearly 65% growth in total AUM over the last year, with $1.2 billion in net inflows for the quarter, fueled by strong performance and expanded global distribution.

Financial Performance and Cost Control:
- Management and advisory fees were down 4% year-over-year, mainly due to the impact of retro fees.
- Fee-related earnings grew by 31%, and the FRE margin increased to 51%, driven by strong fee-related performance revenues and cost control measures.

Incentive Fees and Exit Activity:
- Incentive fees totaled $42 million for the quarter, including $29 million of fee-related performance revenues.
- With average hold periods around 5 years, a positive macro backdrop could lead to increased exit opportunities, impacting future incentive fee trajectories.