Westwood Holdings 2025 Q2 Earnings Strong Performance as Net Income Surges 146.6%

Westwood Holdings (WHG) reported its fiscal 2025 Q2 earnings on August 8, 2025, showcasing a solid rebound from the previous year. The company has sustained profitability for 19 consecutive years in the quarter, demonstrating its resilience and operational strength. Leadership expressed cautious optimism for the remainder of the year, citing momentum in energy and ETF strategies and a focus on long-term margin expansion.

Revenue
The company's total revenue increased by 2.9% year-over-year to $23.02 million in Q2 2025 from $22.37 million in Q2 2024, reflecting steady performance across its core operations.

Earnings/Net Income
Westwood Holdings returned to profitability with an EPS of $0.12 in Q2 2025, reversing from a loss of $0.27 per share in the same period a year ago. The company achieved a net income of $1.03 million in the second quarter, a 146.6% positive swing from a net loss of $2.21 million in Q2 2024. This marks a significant turnaround and reinforces the firm’s long-term stability.

Price Action
Despite the positive earnings report, the stock price of Westwood Holdings declined slightly in the latest trading day, dropping 5.04%, and declined further by 3.25% during the most recent full trading week. However, it edged up by 0.12% month-to-date.

Post-Earnings Price Action Review
A strategy of buying Westwood Holdings shares after a revenue increase quarter-over-quarter and holding for 30 days has yielded moderate returns. The approach has achieved a 47.89% return over the past three years, slightly underperforming the benchmark by 2.29%. The strategy demonstrated a low-risk profile with a Sharpe ratio of 0.34, but it was marked by high volatility (41.16%) and no maximum drawdown. The compound annual growth rate (CAGR) of 14.17% underscores consistent long-term growth.

CEO Commentary
Brian O'Connor Casey, CEO & Director, highlighted key achievements such as the addition of Westwood to the Russell 2000 Index, MDST surpassing $100 million in assets, and the launch of 11 sector ETFs under the WEBs platform. He emphasized the company’s strong investment strategies, which have outperformed benchmarks over 3- and 5-year horizons. Strategic priorities include evolving the Wealth Management division into a multifamily office model for Texas-based ultra-high net worth clients, enhancing client experience through technology investments, and expanding the ETF platform.

Guidance
Terry Forbes, CFO, provided financial results for Q2 2025, reporting revenue of $23.1 million, net income of $1.0 million ($0.12 per share), and non-GAAP economic earnings of $2.8 million ($0.32 per share). The firm maintains a robust cash balance of $33.1 million and a debt-free balance sheet. While no explicit quantitative forward guidance was provided, leadership remains optimistic about continued growth in energy and ETF strategies, strong institutional pipeline momentum, and ongoing operational efficiencies.

Additional News
Over the past three weeks, Westwood Holdings has been engaged in key strategic initiatives and operational developments. Recently, the company expanded its ETF platform with the launch of 11 sector ETFs under the WEBs platform, enhancing its offerings to institutional and retail investors. Additionally, the firm successfully added its shares to the Russell 2000 Index, marking a milestone in its market visibility and accessibility for broader investor bases. Management also announced the enhancement of its Wealth Management division, shifting toward a multifamily office model tailored for Texas-based ultra-high net worth clients, with a focus on personalized service and asset diversification. These moves are expected to drive long-term client retention and revenue growth.