0001193125-26-104113
SEC filingHorizon Kinetics Holding Corporation reported total revenue of $72.8 million for FY 2025, a 30% increase from the prior year, driven by higher average assets under management (AUM) in mutual funds, ETFs, and separately managed accounts. Operating income was $11.1 million, a significant improvement from an operating loss of $15.1 million in FY 2024. However, net income attributable to the company was $5.1 million, a sharp decline from $92.5 million in the prior year, primarily due to a $27.0 million net other expense, including a $15.6 million unrealized loss on investments and a $4.9 million equity loss. AUM decreased 2% to $9.6 billion, impacted by market value declines in key holdings like Texas Pacific Land Corporation and Grayscale Bitcoin Trust. The company ended the year with $36.9 million in cash and declared a quarterly dividend of $0.121 per share.
Horizon Kinetics Holding Corporation reported FY 2025 total revenue of $72.8 million, a 30% increase from $55.8 million in FY 2024. This growth was driven by higher management and advisory fees, which increased $16.9 million (30%) due to higher average assets under management in mutual funds and ETFs. Operating income was $11.1 million, a significant improvement from an operating loss of $15.1 million in the prior year. However, net income attributable to HKHC was $5.1 million, a substantial decline from $92.5 million in FY 2024. This decrease was primarily due to $27.0 million in net other expenses, including a $15.6 million unrealized loss on investments (mainly from Texas Pacific Land Corporation stock), a $4.9 million equity loss, and a $796,000 unrealized loss on digital assets. Basic EPS was $0.27 compared to $5.07 in the prior year.
Management and advisory fees, the company's primary revenue source, totaled $72.4 million in FY 2025, up from $55.5 million in FY 2024. The increase was driven by mutual fund management fees ($36.7 million, up 42%), ETF management fees ($11.2 million, up 56%), and separately managed account fees ($22.1 million, up 12%). Other income and fees were $458,000. The company earned incentive fees of $0.7 million in FY 2025, significantly lower than the $51.7 million earned in FY 2024. Assets under management decreased 2% to $9.6 billion as of December 31, 2025, from $9.8 billion a year earlier, impacted by market value declines in key holdings.
Operating margin was 15.2% in FY 2025, a significant improvement from negative operating margin in the prior year. Total operating expenses were $61.8 million, down from $70.9 million in FY 2024. Compensation and related employee benefits decreased $5.5 million (15%) due to lower internal commissions and bonus pool values resulting from significantly lower incentive fees. Sales, distribution and marketing expenses decreased $3.4 million (18%) primarily due to the absence of commissions on prior year incentive fees. Depreciation and amortization decreased $0.7 million (39%) due to certain intangible assets becoming fully amortized. General and administrative expenses increased slightly by $84,000 (1%).
Net cash used in operating activities was $43.1 million in FY 2025, compared to $11.8 million provided in FY 2024. The decrease was primarily due to decreased earnings and working capital changes. Net cash provided by investing activities was $25.2 million, primarily from $32.8 million in proceeds from sale of investments. Net cash provided by financing activities was $41.5 million, including $76.6 million from contributions by redeemable noncontrolling interests and $6.3 million in dividend payments. The company ended the year with $36.9 million in cash and cash equivalents, $76.5 million in investments at fair value (including $49.7 million in TPL stock), total assets of $2.00 billion, total liabilities of $97.4 million, and shareholders' equity of $339.0 million. The company believes its cash will be sufficient to fund operations for at least one year.
The company's growth strategy focuses on producing superior returns to grow its asset base and attracting new assets through differentiated products. It may explore growth through acquisitions, partnerships, or strategic transactions. The Board declared a quarterly cash dividend of $0.121 per share payable March 31, 2026. Key risks include market volatility impacting AUM and revenues, regulatory changes, litigation risks, and competition from larger asset managers. The company converted to a C-Corporation on July 1, 2024, resulting in significant deferred tax expenses. Unearned incentive fees of approximately $24.9 million are subject to market prices and expected to be resolved, with $22.6 million not expected until Q1 2026.