Good morning, ladies and gentlemen, and welcome to the Hamilton Lane First Quarter Fiscal 2026 Earnings Conference Call. This call is being recorded on Tuesday, August 5, 2025. I would now like to turn the conference over to John Oh, Head of Shareholder Relations. Please go ahead.

Thank you, Constantine. Good morning, and welcome to the Hamilton Lane Q1 Fiscal 2026 Earnings Call. Today, I will be joined by Erik Hirsch, Co-Chief Executive Officer; and Jeff Armbrister, Chief Financial Officer. Earlier this morning, we issued a press release and a slide presentation, which are available on our website. Before we discuss the quarter's results, we want to remind you that we will be making forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial position, results of operations, plans, objectives, future performance, and business. These forward-looking statements do not guarantee future events or performance and are subject to risks and uncertainties that may cause our actual results to differ materially from those projected. For a discussion of these risks, please review the cautionary statements and risk factors included in the Hamilton Lane fiscal 2025 10-K and subsequent reports we file with the SEC. These forward-looking statements are made only as of today, and except as required, we undertake no obligation to update or revise any of them. We will also be referring to non-GAAP measures that we view as important in assessing the performance of our business. Reconciliation of those non-GAAP measures to GAAP can be found in the earnings presentation materials made available on the shareholders section of the Hamilton Lane website. Our detailed financial results will be made available when our 10-Q is filed. Please note that nothing on this call represents an offer to sell or a solicitation of an offer to purchase interest in any of Hamilton Lane's products. Let's begin with the highlights, and I'll start with our total asset footprint. At quarter-end, our total asset footprint stood at $986 billion and represents a 5% increase to our footprint year-over-year. AUM stood at $141 billion and grew $11 billion or 9% compared to the prior year period. The growth came from both our specialized funds and customized separate accounts. AUA came in at $845 billion and grew $35 billion or 4% relative to the prior year period. This stemmed primarily from market value growth and the addition of a variety of technology solutions and back-office mandates. For this first quarter of fiscal year 2026, total management and advisory fees were down 4% year-over-year. However, this decrease was due primarily to the impact from retro fees, which were $21 million in fiscal Q1 of 2025 versus approximately $300,000 in this current reported quarter. Fee-related earnings for the quarter grew by 31% versus the prior year period. We generated quarterly GAAP EPS of $1.28 based on $54 million of GAAP net income and non-GAAP EPS of $1.31 based on $72 million of adjusted net income. We have also declared a dividend of $0.54 per share this quarter, which keeps us on track for the 10% increase over last fiscal year, equating to the targeted $2.16 per share for fiscal year 2026. With that, I'll now turn the call over to Erik.

Thank you, John, and good morning, everyone. Our growth story continues with another solid quarter, and that growth is coming across the totality of the business, clients, assets, revenues, deal flow and people. The Hamilton Lane team is executing well across all fronts, and our results this quarter are certainly reflective of that. Turning now to fee-earning AUM. Total fee-earning AUM stood at $74 billion and grew $6.7 billion or 10% relative to the prior year period. Net quarter-over-quarter growth was $2.4 billion or 3%. Fee-earning AUM growth continues to be largely driven by our specialized fund platform. Specifically, our semi-liquid Evergreen products continue to experience strong momentum. The combination of our fundraising, new product additions, and strong performance has driven the growth of total fund net asset value. Our blended fee rate also continues to benefit from the shift of fee-earning AUM towards higher fee rate specialized funds, most notably our Evergreen products. Today, our blended fee rate stands at 64 basis points. At quarter-end, customized separate account fee-earning AUM stood at $40 billion and grew $2.1 billion or 5% over the last 12 months. Net quarter-over-quarter growth was $937 million or 2%, with the gross contribution stemming from a mix of new client wins. These wins came from both U.S. and non-U.S. prospects and the mandates ranged across geographies and sub-asset classes. We also continue to see re-up activity from existing clients and contributions from investment activity. These gains were offset by fee-based decreases from exit activity and the migration from committed to invested capital in certain accounts. We maintain large amounts of committed and contractual dry powder to continue to deploy, along with a strong backlog of business that has been won and is now in the contracting phase. As we've mentioned in the past, the sale and contracting dynamic in our SMA business can lead to some unpredictability as to when these dollars come on, but we simply remain focused on winning new business. Moving now to specialized funds. Fee-earning AUM ended fiscal Q1 at $34 billion, having grown $4.6 billion over the last 12 months. This represents an increase of 16%. Quarter-over-quarter net growth was $1.4 billion or 4%, largely driven by our Evergreen platform. No material drawdown fund closes have occurred in the past 9 weeks since our last quarterly update. We are slated to have a series of closings on our drawdown funds following summer's end. Quickly running through the various drawdown funds in market. On our last call, we highlighted that we held a close for our sixth equity opportunities fund that would be reflected in this reported quarter. As a reminder, that close totaled $181 million of LP commitments and brought the total amount raised to nearly $1.3 billion. Of the $181 million, $51 million came in on a committed capital management fee basis, while $131 million came in on a net invested capital basis. The $51 million generated $290,000 in retro fees for the quarter. We expect to remain in market into calendar 2026. Our second infrastructure fund has raised nearly $775 million of commitments in and alongside the fund. As a quick refresher, the strategy for this product centers around direct equity and secondaries in the real assets and infrastructure space and generates management fees on a net invested basis. We will remain in market with this fund through the second half of calendar 2025. Our annual strategic opportunities fund, which is our closed-end direct credit strategy, continues to take additional capital. To date, we've raised over $363 million for this current series. As a reminder, this product charges management fees on a net invested basis and is effectively perpetually fundraising as when we close the sleeve, we immediately open another. Lastly, we remain in market with our third impact fund. This fund focuses on investing directly into private companies that have a measurable environmental and social impact and it generates management fees on a committed capital basis. Recall that our first 2 funds in this strategy totaled nearly $100 million and $373 million of commitments, respectively. To date, we've raised over $175 million of investor commitments, and we expect to remain in market into calendar 2026. Turning now to our Evergreen platform. It has been about 6 years since we've launched our first Evergreen product, and we are very pleased with the progress to date. We continue to grow across every axis: assets, relationships, products, clients and performance. As of June 30, we are approaching over $12.5 billion in total Evergreen AUM. This represents growth of nearly 65% over the last 12 months. Looking at the net flows for the quarter, we took in nearly $1.2 billion across the platform. This marked our first quarter surpassing $1 billion in net inflows, with June being our second highest month since we began. This growth has been partially fueled by our strong fund performance. From the start, we've laid out clear return expectations for our partners. And so far, we've met them. Our partners value the experience we deliver, which comes from being thoughtful about how we build portfolios and manage flows. It is consistent intentional work that leads to these results. Also fueling growth is the continued execution of our global distribution strategy. Our success has come from a combination of strategic partnerships, technology, a growing in-house distribution team, and brand expansion. We also continue to expand the number of relationships across wealth managers. It is this all-encompassing approach that has laid the foundation of what we believe to be driving the success we're seeing now with these 6 new product offerings we've launched over the last 12 months. As a quick refresher, we launched infrastructure products for U.S. and non-U.S. investors, a multi-strategy product for European investors, a secondaries product for U.S. investors, and a dedicated venture and growth product for U.S. investors. Most recently, we announced the launch of what we believe to be a first-of-its-kind fund focused solely on Asian private market investments. Our significant Asian presence continues to yield substantial and differentiated deal flow that we believe investors will find additive. And while our success has been strong, we will continue to reiterate that we are, a, still at the very beginning of this journey, and b, building and orienting the firm to be running a marathon and not a sprint. And with that, I'll now pass the call to Jeff to cover the financials.

Thank you, Erik, and good morning, everyone. For this first quarter of fiscal 2026, we continue to generate solid growth in our business. Management and advisory fees were down 4% from the prior year period. However, this includes the impact of $21 million of retro fees from specialized funds, namely the final close for our sixth secondary fund in the prior year period versus $290,000 of retro fees in this quarter stemming from our latest direct equity fund. As a reminder, investors that come into later closes during a fundraise pay retroactive fees dating back to the fund's first close. Specialized funds revenue decreased by $7 million or 8% compared to the prior year period due to the retro fee impact I just detailed. And while specialized fund revenue was down due to the retro fee comparison, specialized fund fee-earning AUM increased due primarily to a $4.5 billion increase in our Evergreen platform relative to the prior year period. Overall, specialized fund fee rates continue to remain strong and again, largely due to the continued growth in Evergreen fee-earning AUM. Moving on to customized separate accounts. Revenue increased $1 million or 3% compared to the prior year period due to the addition of new accounts, re-ups from existing clients, and continued investment activity. Revenue from our reporting, monitoring, data, and analytics offerings increased by over $1 million or 20% compared to the prior year period as we continue to produce strong growth in our technology solutions offering. Lastly, the final component of our revenue is incentive fees, which totaled $42 million for the quarter. This amount includes $29 million of fee-related performance revenues stemming primarily from the quarterly crystallization of performance fees from our U.S. private assets, Evergreen Fund, as we detailed on our last call. Let's turn now to our unrealized carry balance. Balance is up 6% from the prior year period even while having recognized $97 million of incentive fees, excluding fee-related performance revenues during the last 12 months. The unrealized carry balance now stands at approximately $1.3 billion. Moving to expenses. Total expenses decreased $8 million compared with the prior year period. Total compensation and benefits decreased by $9 million, driven primarily by lower incentive fee-related compensation. This was offset by higher compensation associated with increased headcount and equity-based compensation. G&A increased slightly by $742,000. We continue to see growth in revenue-related expenses, including the third-party commissions related to our U.S. Evergreen product being offered on wirehouses that we've discussed on prior calls. Relative to the fourth quarter of fiscal year 2025, we saw a decrease in G&A. This was due to some one-time and timing benefits we experienced this quarter. We will continue to emphasize that while overall G&A expenses have increased over time, the bulk of the increase stems from these revenue-related expenses, which is a good sign and can be an indicator of growth to come. We continue to successfully offset this with cost savings and expense discipline in other parts of the business where we have discretion. Let's move now to FRE. And just a quick reminder, FRE will now include the fee-related performance revenues that we detailed on the last call. Additionally, we will now be excluding the impact of equity-based compensation in the calculation of FRE. With that, FRE for the quarter came in at $84 million and was up 31% relative to the prior year period. FRE margin for the quarter came in at 51% compared to 45% for the prior year period and benefited from strong fee-related performance revenues in the quarter and more muted G&A growth. I'll wrap up now with some commentary on our balance sheet. Our largest asset continues to be our investments alongside our clients in our customized separate accounts and specialized funds. Over the long term, we view these investments as an important component of our continued growth, and we will continue to invest our balance sheet capital alongside our clients. In regard to our liabilities, we continue to be modestly leveraged, and we'll continue to evaluate utilizing our strong balance sheet in support of continued growth for the firm. With that, we will now open up the call for questions.

Your first question comes from the line of Ken Worthington from JPMorgan.

I wanted to first dig into the DBS Private Banking relationship. It seems possibly like this is a different spin on distribution for your wealth products. Maybe first, describe what you're doing here? And is there something different? And if there is something different, what is the opportunity to kind of do more of this over time? And are you delivering just asset management solutions? Or is there some component of technology, data or administration that goes along with the relationship?

Sure. Ken, it's Erik. Happy to take that. I think this is simply us doing more of what we've been doing, which is identifying a variety of strategic relationships, utilizing technology, different types of distribution where we can offer our products, services, technology, and data in a variety of fashions. I think when you look at the success that we're having in both the institutional traditional drawdown world as well as Evergreen, more retail-oriented world, I think it's a combination of factors that's driving that. And I've noted its expansion of relationships. It's expanding within those relationships. It's adding new partnerships that we think are different. One of the things that we're seeing, particularly when we're now talking about accessing the retail investor is that we need to meet the customer where they are, and these customers are not homogeneous. They are looking to transact in different ways. Some want to exist in a digital world, and so we're going to have to transact with them in more of a tokenized fashion. Some are going to continue to transact very traditionally through wealth advisers. Others are going to access through different technology platforms. And for Hamilton Lane, we're simply focused on making sure that we are having our goods and services available in all of those various channels.

Okay. I guess I respect that, but it does seem like this is different here. Like what you're doing through the wirehouses is delivering a product, and you're a solutions-based company. This seems to be a solution. So again, it seems to be different. And it's in Asia, it would seem like there might be potentially more to do similarly to this elsewhere. And it also seems to me like products maybe can come and go, but the relationship sort of persists. So am I just reading too much into what this is?

No, it's Erik again. I don't. I think this is differentiated. It's a differentiated platform, and the services that we're offering through that are more customized around what they and their clients at the end of the day are looking for. And I think this sort of goes to my earlier point of the clients and the customers are not all looking for the same thing in the same fashion. And so I think you should expect to see that you will see additional announcements as we are simply aligning with different kinds of distribution partners who are accessing their own type of customer that is comfortable operating on their particular platform. And yes, we agree that we can expand. We can do more. We can do more of these. All of that, we see as a fantastic opportunity in front of us.

Just administratively, how far along is Fund Secondary Fund VI invested, and have you started to more actively market Fund VII?

We have not started to actively market the next fund. We are more than halfway through. While we are engaged in significant activity on the secondary investment side, we are deploying capital across various vehicles, including the traditional commingled secondary fund, as well as some activities flowing into Evergreen and SMAs. We are investing at a good pace and continue to see tremendous deal flow and unique opportunities. We have been generating strong performance in this area. Fundraising for the next fund will happen in the near future.

Your next question comes from the line of Michael Cyprys from Morgan Stanley.

This is Steph on for Mike. Maybe just diving into the customized separate account growth. Nice to see that organic growth accelerating. I recall last quarter, you had called out elongated sales cycle. Just curious how would you rank order some of the drivers of the re-acceleration this quarter between new sales, re-ups or investment activity? And then how to think about that pipeline here as we look out?

Thanks for the question. It's Erik. So it's all of that. And I think what I said last quarter, and I will reiterate again, the sales cycle for SMAs is not short. So I think people should be confident in the fact that the flows that we're seeing coming in this quarter were certainly not started in the sales cycle in this quarter. So we're not identifying marketing to and closing and doing that in a couple of months' time period. The process takes longer than that. And so what I've been saying is, we have a huge pipeline of business that we are both working on. And in a number of cases, we've already won that we're just simply moving through the contracting phase. And so that just takes time with some of these customers, and then we start to activate. So this quarter, what you saw was brand-new wins getting contracted and activated. You're seeing existing customers re-up getting contracted and activated, and you're seeing an increase in investment activity, which was also causing that fee basis to go up.

Okay. Great. And then maybe just one more for me on cap markets. Some of the GPs are noting that the DPI drought has seen some signs of relief here, especially if this better macro persists. I think your incentive fees have been lighter over the last 2 quarters or so. Just curious what's that pipeline you're seeing and then how to think about the incentive fee trajectory into the back half of this year and next year?

Sure. It's Erik. I agree with what others have mentioned about the positive macro environment, as it is likely to create more exit opportunities. Currently, our average hold periods are around 5 years, meaning many transactions are still not at that stage. This situation is due to the aging of assets and the improving economic conditions. While the last two quarters have been somewhat below historical averages, we had previously removed a significant amount of carry from the system. Therefore, I find this trend not surprising. If the macro environment continues to improve or stay the same, I do expect to see an increase in exit activity in the latter half of the year.

Your next question comes from the line of Alex Blostein from Goldman Sachs.

Well, I was hoping you guys could double-click into the Evergreen fund. And specifically, I was curious about the institutional demand you guys have seen within that product, both in terms of the existing base, if you think about the sort of fee-paying AUM in the Evergreen products, how much of that is comprised from maybe some of the smaller institutional accounts? And as you think about the growth forward, is that all sort of new incremental demand you're seeing to the firm? Or do you think some of that is coming out of whether separate accounts or other specialized vehicles?

Sure, Alex. It's Erik. I'll take that. In our previous call, we mentioned that roughly 15% of our flows came from institutional investors into Evergreen, while the remaining 85% was from traditional retail wealth. This distribution may fluctuate from quarter to quarter, but overall, we aren't observing any significant changes in how customers are using the products compared to nine weeks ago. When we examine the institutional customers using the Evergreen product, we identify a variety of types. One group consists of smaller customers who previously accessed the asset class through fund-of-funds vehicles. They may be too small for a separate managed account, and since most of us have stopped offering fund-of-funds, their options have been limited to co-investment or secondary funds. While these provide some diversification, they are not as diversified as our Evergreen products. Some of these clients had been inactive but are now re-engaging, while others are switching from one product offering to another. We also see larger institutional clients considering the Evergreen product as a valuable portfolio management tool. For a CIO of a plan sponsor or a sovereign wealth fund, for instance, if they aim to overweight credit in their private markets portfolio, managing that with a drawdown fund can be time-consuming. By the time managers are selected and capital is called, years could pass, making tactical adjustments to the portfolio challenging. The Evergreen products, however, provide a fully invested option that allows for easy adjustments when wanting to increase or decrease exposure. I want to emphasize that this process is a marathon, not a sprint. We are in the early stages of educating customers on the tactical uses of these products, and we anticipate continued evolution in this area. I don’t view this as mere cannibalization; rather, it's about market expansion, which we believe is a positive development.

Yes. That's helpful. One just quick cleanup question for you guys on the expenses for the quarter. I think I heard you say on G&A, there was a little bit of a one-time helper, but I think last quarter was also particularly elevated. So maybe kind of help us frame what G&A outlook could look like for the firm as you look into the back half of fiscal or rather calendar 2025? And any framework to kind of think about G&A growth from there?

Yes, this is Jeff Armbrister. Thank you for the question. Internally, we're looking at this as approximately a $33 million expense each quarter. However, it's important to note that a portion of this is linked to revenue from PAF and the commissions from the wirehouses. We have been successful in generating savings through our initiatives and cost controls, which have helped to offset the increased commissions. When considering the one-time impact, it amounts to a couple of million dollars. Overall, I believe we have been performing better than the $33 million target we've set, but we do anticipate some continued increases as we generate revenue from the wirehouses and pay related commissions.

Thank you. There are no further questions at this time. I'd like to turn the call over to Erik Hirsch, Co-Chief Executive Officer, for closing comments. Sir, please go ahead.

Great. Thank you, everyone, for the time. We're very pleased with the quarter. We are very optimistic about what we see ahead of us, and the Hamilton Lane team continues to operate strongly. So we look forward to the next call. Thank you very much.

Ladies and gentlemen, this concludes today's conference call. Thank you very much for your participation. You may now disconnect.