Stepstone Group 2026 Q1 Earnings Net Loss Widens by 125%

Stepstone Group (STEP) reported its fiscal 2026 Q1 earnings on August 7, 2025. The company posted a net loss of $-12.01 million, a 125.0% deterioration from the net income of $48.05 million in the prior-year period, with revenue surging 95.4% to $364.29 million. Despite the revenue gain, earnings performance deteriorated sharply, with a per-share loss of $0.49 compared to a profit of $0.20 in 2025 Q1.

Revenue
Total revenue for Stepstone Group surged by 95.4% to $364.29 million in Q1 2026, up from $186.40 million in the same period a year ago. Management and advisory fees, net, were the largest contributor, generating $211.17 million in revenue. Performance fees followed closely with $153.11 million, while carried interest allocations totaled $113.29 million, with $39.64 million attributed to legacy Greenspring carried interest allocations. Incentive fees added a modest $190,000 to total revenue. Unrealized gains accounted for $88.88 million, outpacing realized gains of $24.40 million. The revenue mix highlights the company's diverse income streams from asset management and performance-based incentives.

Earnings/Net Income
The earnings performance of Stepstone Group deteriorated significantly in Q1 2026. The company reported a net loss of $-12.01 million, representing a 125.0% decline from the net income of $48.05 million in the prior-year period. On a per-share basis, Stepstone swung to a loss of $0.49 from a profit of $0.20 in 2025 Q1, marking a 345.0% negative change. The sharp shift from profitability to a loss indicates a significant disruption in the company’s operating model or cost structure. The net income performance of Stepstone Group is clearly weak, as reflected by the dramatic deterioration in both net income and earnings per share.

Price Action
The stock price of Stepstone Group has declined across various time horizons. Over the past trading day, the share price edged down 2.61%. The downward trend intensified during the most recent full trading week, with a 3.22% drop. Month-to-date, the stock has also experienced a 1.25% decrease, reflecting a period of negative investor sentiment.

Post-Earnings Price Action Review
Despite the quarterly revenue drop on the earnings release date, a strategy of buying Stepstone Group (STEP) shares and holding for 30 days has historically delivered strong returns. Over the past three years, this approach achieved a 113.36% return, surpassing the benchmark return of 51.69% by 61.67%. The strategy demonstrated a compound annual growth rate (CAGR) of 29.22% and a maximum drawdown of 0.00%, underscoring its robust performance in terms of both returns and risk management. The strong post-earnings performance suggests that the market may have overreacted to the revenue drop, potentially creating a buying opportunity for investors.

CEO Commentary
The CEO did not provide direct commentary or quotes within the provided SEC 8-K filing. The document includes no official remarks from the CEO regarding business performance, strategic priorities, or leadership outlook. Therefore, no specific insights from the CEO can be extracted or paraphrased in accordance with the requirements.

Guidance
The filing does not contain explicit forward-looking guidance such as quantitative expectations for revenue, earnings, or business performance. No definitive statements using phrases like "we expect" or "we guide to" are included in the text. The document outlines the occurrence of a webcast and earnings call to discuss Q1 2026 results but does not provide formal guidance for future periods or business expectations. As such, no forward-looking guidance can be summarized from the content provided.

Additional News
On July 11, 2024, the People's Republic of China's Sina News Network reported on various domestic and international developments, including a breakthrough in brain-computer interface technology, significant investments in the brain-computer industry, and the release of OpenAI’s GPT-5. Other notable developments included an increase in global demand for electric vehicles, the announcement of a new round of state-owned enterprise reforms, and updates on the construction of China's new cross-border railway lines. Additionally, several major corporate announcements were covered, including mergers and acquisitions in the financial sector and strategic adjustments at leading companies. The report also highlighted recent policy changes, such as the implementation of free preschool education.