REVENUEBeat +0.4%
EPSBeat +26.3%
Actuals vs. estimates
| Metric | Actual | Consensus | Surprise |
|---|---|---|---|
| RevenueTotal revenue | $91.9M | $91.5M | ▲ Beat +0.4% |
| EPS(GAAP diluted) | $0.10 | $0.08 | ▲ Beat +26.3% |
Verdict
- Total revenue of $91.9 million beat the $91.5 million consensus by 0.4%, up 1% year over year.
- GAAP diluted EPS of $0.10 beat the $0.08 consensus, down from $0.24 a year ago on post-IPO stock compensation.
- No guidance was given; Wealthfront disclosed that platform assets passed $100 billion at the end of August.
- The one thing that matters: platform assets grew 12% and revenue grew 1%, because the mix is moving from the 0.55% cash book to the 0.22% advisory book.
Key metrics
| Metric | Reported | Prior year | Change |
|---|---|---|---|
| Total Platform Assets | $99.0bn | $88.2bn | +12% |
| Investment Advisory Assets | $54.1bn | $41.6bn | +30% |
| Cash Management Assets | $44.9bn | $46.6bn | -4% |
| Funded Clients | 1.51m | 1.32m | +14% |
| Annualized cash management fee rate | 0.55% | 0.60% | -5 bps |
| Adjusted EBITDA | $38.1m | $44.8m | -15% |
Guidance changes
No financial guidance change disclosed.
Quality of earnings
- The earnings decline is entirely stock compensation. SBC was $16.4 million against $1.6 million a year ago on dual-trigger awards that vested after the December 2025 IPO; excluding it, adjusted operating expenses of $58.7 million rose 17%, against 1% revenue growth.
- Operating cash flow overstates the trend. Cash from operations of $47.3 million was up 22%, but adjusted free cash flow fell 27% to $28.3 million after an $18.7 million swing in temporary client funding receivables.
- Fee compression, not attrition, drives the revenue line. Cash management revenue fell to $61.8 million from $68.9 million as the annualized fee rate went to 0.55% from 0.60%, while advisory revenue rose to $28.8 million at an unchanged 0.22%.
Gotchas & watch items
- Net deposits of $1.05 billion were down from $3.66 billion a year ago, and the definition changed this quarter to include promotional deposit matches from June 2026 — the comparison is not like-for-like.
- Cash management assets fell 4% to $44.9 billion with cash net deposits of $(26) million, so the higher-fee book is now in outflow.
- Diluted shares of 174.1 million against 150.1 million basic leave a 24 million share overhang; the quarter's 3.3 million share buyback for about $30 million offsets a fraction of it.
- Adjusted EBITDA margin fell to 41% from 49% while assets grew 12% — scale is not producing operating leverage.