WLTH earnings call summary

Prepared Highlights

• Total platform assets reached a record $92.8B, up 21% YoY, driven by Cash Management assets of $47B (+14% YoY) and Investment Advisory assets of $45.8B (+31% YoY) (CEO).
• Total net deposits were $1.6B in Q3 and $9.7B in the trailing 12 months (CEO).
• Funded Clients ~1.38M, up 20% YoY; Funded Accounts ~1.78M, also up 20% YoY (1.3 accounts per client) (CEO).
• Revenue quarterly record $93.2M, +16% YoY: Cash Management revenue $68.8M (+14% YoY); Investment Advisory revenue $24.2M (+26% YoY) (CFO).
• Cash Management average balance $46.8B (+18% YoY); annualized fee rate 58 bps (-2 bps YoY) (CFO).
• Investment Advisory average balance $43.7B (+28% YoY); annualized fee rate 22 bps (flat YoY) (CFO).
• Gross profit record $83M (+15% YoY); gross margin 89% (CFO).
• Adjusted EBITDA $43.8M (+24% YoY); margin 47% (+3 ppts YoY); incremental margin 66% (CFO).
• Rule of 40 63% for Q3; 13th consecutive quarter exceeding the metric (CFO).
• GAAP net income $30.9M (+3% YoY); GAAP EPS $0.21 (CFO).
• Free cash flow $41.3M; FCF conversion ratio 94% of EBITDA (CFO).
• Cash & equivalents $266M at quarter-end; post-IPO cash >$400M (CFO).
• Asset-weighted cross-product adoption (clients with both Cash & Investment Advisory) ended December at 60%, up ~1 ppt vs Q3-end (CFO).
• Home Lending: first mortgage originated in Q3; rollout began in Q4 starting in Colorado, later expanded to Texas and California; licenses cover majority of clients (CEO).
• Nasdaq-100 Direct launched in Q3: 12 bps annual advisory fee, went from idea to launch in <8 weeks (CEO).

Official Guidance

• No quarterly or full-year guidance provided; company will publish monthly metrics intra-quarter and final month with earnings (CFO).
• Q4 (ending Jan 31, 2026): one-time noncash stock-based compensation charge of $245M–$250M from IPO-related RSUs (CFO).
• Post-IPO fully diluted share count: ~189M shares (CFO).

Mgmt Quotes

• "We've built fully automated services that enable a better client experience, drive faster product and feature velocity and have generated high gross margins at or around 90% in recent years." (CEO)
• "This combination has driven adjusted EBITDA margins to over 40% for the last 10 quarters, which has allowed us to reinvest in the business to continue this flywheel." (CEO)
• "We are better positioned today than ever to take advantage of the current transition period with the combination of a broad suite of investment products, overarching platform incentives and targeted life cycle marketing campaigns in place." (CEO)
• "Incremental adjusted EBITDA margin was 66%, thanks to our highly efficient low marginal cost infrastructure." (CFO)
• "Assets moving from Cash Management to Investment Advisory will lower revenue in the short term due to the lower relative fee rate for Investment Advisory assets, but due to faster investment asset growth will benefit clients and Wealthfront in the long term." (CFO)

Prepared Metrics