seic-20240930

美国

证券交易委员会

华盛顿特区20549

________________________________________

表格 10-Q

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☒			根据1934年证券交易法第13或15(d)条款的季度报告。

截至2024年6月30日季度结束 2024年9月30日

或


☐			根据1934年证券交易法第13条第15(d)条，过渡报告。

过渡期从_________至 ________

委员会档案编号： 0-10200

________________________________________

sei investments company

（根据其章程所指定的正式名称）

________________________________________


宾夕法尼亚						23-1707341
（成立或组织的）州或其他辖区或组织成立的州或其他司法管辖区)						（联邦税号）

公开市场, 橡树, 宾夕法尼亚 19456-1100

(总执行办公室地址) (邮政编号)

(610) 676-1000

（注册人的电话号码，包括区号）

无可奉告

（如上次报告后更改，请注明旧名称、旧地址及旧财政年度）

根据法案第12(b)条登记的证券：

每种类别的名称

交易符号

每个注册交易所的名称

每股普通股，面值为0.01美元

SEIC

纳斯达克股票市场有限公司

请在方框内选上，表示申报人（1）在过去12个月（或规定申报人须申报报告的较短时间内），已如期申报证券交易法案第13条或15(d)条文件；及（2）已在过去90天内遵守该申报要求。是 x 所有板块 ☐

请用勾号表示，注册人是否已按照S-t规则405条（本章节第232.405条）要求，在过去12个月内（或注册人需要提交此类文件的较短期间）递交了每个互动数据文件。是 x 否 ☐

请用勾选来表示，申报人是否为大型加速递交者、加速递交者、非加速递交者、较小的报告公司或新兴成长公司。请参见《交易所法》第 120亿2条中对“大型加速递交者”、“加速递交者”、“较小的报告公司”和“新兴成长公司”之定义。

大型加速归档人

加速档案提交者

☐

非加速归档人

☐

较小报告公司

☐

新兴成长型企业

☐

如果是新兴成长型企业，在符合任何依据证券交易法第13(a)条所提供的任何新的或修改的财务会计准则的遵循的延伸过渡期方面，是否选择不使用核准记号进行指示。☐

标示是否公司是一个空壳公司（如法案第1202条定义）。是☐不x

截至2024年10月22日业务结束时，公司普通股的流通股数是：


普通股，每股面值0.01美元						128,908,648

sei investments company

第一部分 - 财务信息

页面

项目1。

基本报表。

合并资产负债表（未经审核）-- 2024年9月30日和2023年12月31日

合并营业报表（未经审核）-- 截至2024年9月30日的三个月和九个月以及2023年

合并综合收益表（未经审核）-- 截至2024年9月30日的三个月和九个月以及2023年

合并股权变动表（未经审核）-- 截至2024年9月30日的三个月和九个月以及2023年

综合简明现金流量表（未经查核）-- 截至2024年和2023年9月30日止九个月

基本报表注

项目2。

管理层对财务状况和营运结果的讨论与分析。

项目3。

市场风险的定量和定性披露。

项目4。

控制项和程序。

第二部分 - 其他信息

项目1。

法律诉讼。

项目1A。

风险因素。

项目2。

未注册出售权益证券和资金用途。

项目5。

其他信息

第6项。

展览品。

签名

第一部分。财务信息

项目1。综合基本报表。

通过Dynex Capital公司401（k）计划，从员工贡献，公司配对贡献和股息再投资中购买发行人证券。

综合资产负债表

(未经审核)

（以千元美元表示，除每股面值外）


	2024年9月30日		2023年12月31日
资产
流动资产：
现金及现金等价物	$	901,134	$	834,697
限制性现金	302		301
来自投资产品的应收款项	54,585		55,886
应收款项，扣除怀疑账户抵押1,833 15.1663	609,794		501,434
拥有的证券	30,289		31,334
其他流动资产	61,433		54,464
所有流动资产总额	1,657,537		1,478,116
资产与设备，扣除累计折旧$后的净值489,143 15.1474,034	164,927		171,364
Operating Lease Right-of-Use 资产	29,567		22,477
资本化的软体，扣除累计摊提$后的净值633,932 15.1612,971	237,236		239,783
可供出售金融资产及股权证券	175,722		155,413
对关联基金的投资，以公平价值计量	8,410		7,316
投资于未纳入合并财务报表的联属公司	49,675		110,781
商誉	138,085		137,333
无形资产，扣除已摊销累积金额$52,964 15.142,520	74,041		82,443
待办契约成本	42,527		40,221
递延所得税	58,373		37,709
其他资产净额	48,329		37,047
总资产	$	2,684,429	$	2,520,003

附注是这些综合基本报表的重要部分。

通过Dynex Capital公司401（k）计划，从员工贡献，公司配对贡献和股息再投资中购买发行人证券。

合并资产负债表

(未经审核)

（以千元美元表示，除每股面值外）


	2024年9月30日		2023年12月31日
负债及股东权益
当前负债：
应付账款	$	8,250	$	10,618
应付负债	258,167		318,945
长期营业租赁负债的流动部分	7,926		8,118
逐步认列的收入	11,330		15,366
全部流动负债	285,673		353,047

长期应付所得税	803		803

长期营业租赁负债	24,647		17,235
其他长期负债	18,896		17,090
总负债	330,019		388,175
承诺和条件
股东权益：
0.010.01 每股面额为 750,000,000 授权股份为 128,755,430 和 131,177,513 股份发行及流通	1,288		1,312
超过票面价值的股本	1,477,880		1,404,962
保留收益	901,908		762,586
累计其他综合损益，净额	(26,666)		(37,032)
股东权益总额	2,354,410		2,131,828
负债合计和股东权益	$	2,684,429	$	2,520,003

附注是这些综合基本报表的重要部分。

通过Dynex Capital公司401（k）计划，从员工贡献，公司配对贡献和股息再投资中购买发行人证券。

综合损益表

（未经审计）

(以千为单位，除每股数据外)


	截至9月30日的三个月				截至9月30日的九个月
	2024		2023		2024		2023
收入：
资产管理、管理和分配费用	$	423,859	$	380,594	$	1,237,623	$	1,131,244
信息处理和软体服务费	113,537		96,165		330,338		303,691
总收益	537,396		476,759		1,567,961		1,434,935
费用：
投资顾问、分销和其他资产管理成本	47,969		47,531		141,279		142,157
软体版税和其他信息处理成本	8,936		8,095		25,503		23,784
补偿、福利和其他人员	191,740		180,470		570,534		529,591
股份报酬	13,696		7,979		37,224		23,458
咨询、外包和专业费用	53,291		54,203		159,258		176,619
资料处理和与计算机相关	37,556		34,016		112,790		102,301
设施、用品和其他成本	21,622		16,999		58,795		58,825
摊销	10,413		9,797		31,284		28,851
折旧	8,341		9,197		25,097		26,509
总支出	393,564		368,287		1,161,764		1,112,095
营业收入	143,832		108,472		406,197		322,840
投资的净收益（亏损）	427		(206)		3,349		1,053
利息和股息收入	13,579		11,125		35,950		29,453
利息费用	(141)		(116)		(419)		(396)
其他收益	8,151		—		8,151		—
对未合并联属公司的权益	36,513		29,927		102,375		91,517
税前收入	202,361		149,202		555,603		444,467
所得税	47,461		33,541		130,183		102,940
净利润	$	154,900	$	115,661	$	425,420	$	341,527
基本每股收益	$	1.20	$	0.87	$	3.26	$	2.57
用于计算基本每股收益的股份	129,418		132,231		130,550		133,035
普通股每股稀释后盈利	$	1.19	$	0.87	$	3.23	$	2.54
用于计算稀释每股收益的股份	130,671		133,504		131,830		134,250
每股普通股宣布的分红派息	$	—	$	—	$	0.46	$	0.43

The accompanying notes are an integral part of these consolidated financial statements.

SEI Investments Company

Consolidated Statements of Comprehensive Income

(unaudited)

(In thousands)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net income	$	154,900	$	115,661	$	425,420	$	341,527
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	12,413		(8,502)		9,071		249
Unrealized gain (loss) on investments:
Unrealized gains (losses) during the period, net of income taxes of $(1,007), $624, $(463) and $581	3,373		(2,089)		1,546		(1,945)
Reclassification adjustment for (gains) losses realized in net income, net of income taxes of $21, $(10), $76 and $(39)	(70)		35		(251)		128
Total other comprehensive income (loss), net of tax	15,716		(10,556)		10,366		(1,568)
Comprehensive income	$	170,616	$	105,105	$	435,786	$	339,959

The accompanying notes are an integral part of these consolidated financial statements.

SEI Investments Company

Consolidated Statements of Changes in Equity

(unaudited)

(In thousands)


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Three Months Ended September 30, 2024
Balance, July 1, 2024	129,855	$	1,299	$	1,465,037	$	823,549	$	(42,382)	$	2,247,503
Net income	—	—		—		154,900		—		154,900
Other comprehensive income	—	—		—		—		15,716		15,716
Purchase and retirement of common stock	(1,274)	(13)		(9,261)		(76,541)		—		(85,815)
Issuance of common stock under employee stock purchase plan	17	1		965		—		—		966
Issuance of common stock under share-based award plans	157	1		7,443		—		—		7,444
Stock-based compensation	—	—		13,696		—		—		13,696


Balance, September 30, 2024	128,755	$	1,288	$	1,477,880	$	901,908	$	(26,666)	$	2,354,410


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Three Months Ended September 30, 2023
Balance, July 1, 2023	132,230	$	1,322	$	1,337,538	$	724,672	$	(39,979)	$	2,023,553
Net income	—	—		—		115,661		—		115,661
Other comprehensive loss	—	—		—		—		(10,556)		(10,556)
Purchase and retirement of common stock	(1,399)	(14)		(9,262)		(76,703)		—		(85,979)
Issuance of common stock under employee stock purchase plan	20	1		1,072		—		—		1,073
Issuance of common stock under share-based award plans	720	7		32,138		—		—		32,145
Stock-based compensation	—	—		7,979		—		—		7,979

Other	—	—		—		5		—		5
Balance, September 30, 2023	131,571	$	1,316	$	1,369,465	$	763,635	$	(50,535)	$	2,083,881

The accompanying notes are an integral part of these consolidated financial statements.

SEI Investments Company

Consolidated Statements of Changes in Equity

(unaudited)

(In thousands)


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Nine Months Ended September 30, 2024
Balance, January 1, 2024	131,178	$	1,312	$	1,404,962	$	762,586	$	(37,032)	$	2,131,828
Net income	—	—		—		425,420		—		425,420
Other comprehensive income	—	—		—		—		10,366		10,366
Purchase and retirement of common stock	(3,730)	(37)		(27,128)		(225,813)		—		(252,978)
Issuance of common stock under employee stock purchase plan	59	1		3,348		—		—		3,349
Issuance of common stock under share-based award plans	1,248	12		59,474		—		—		59,486
Stock-based compensation	—	—		37,224		—		—		37,224
Dividends declared ($0.46 per share)	—	—		—		(60,285)		—		(60,285)

Balance, September 30, 2024	128,755	$	1,288	$	1,477,880	$	901,908	$	(26,666)	$	2,354,410


	Shares of Common Stock	Common Stock		Capital In Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Loss		Total Equity
	For the Nine Months Ended September 30, 2023
Balance, January 1, 2023	134,162	$	1,342	$	1,307,162	$	694,287	$	(48,967)	$	1,953,824
Net income	—	—		—		341,527		—		341,527
Other comprehensive loss	—	—		—		—		(1,568)		(1,568)
Purchase and retirement of common stock	(4,050)	(41)		(26,800)		(215,007)		—		(241,848)
Issuance of common stock under employee stock purchase plan	65	1		3,316		—		—		3,317
Issuance of common stock under share-based award plans	1,394	14		62,329		—		—		62,343
Stock-based compensation	—	—		23,458		—		—		23,458
Dividends declared ($0.43 per share)	—	—		—		(57,177)		—		(57,177)
Other	—	—		—		5		—		5
Balance, September 30, 2023	131,571	$	1,316	$	1,369,465	$	763,635	$	(50,535)	$	2,083,881

SEI Investments Company

Consolidated Condensed Statements of Cash Flows

(unaudited)

(In thousands)


	Nine Months Ended September 30,
	2024		2023
Cash flows from operating activities:
Net income	$	425,420	$	341,527
Adjustments to reconcile net income to net cash provided by operating activities (See Note 1)	1,654		4,455
Net cash provided by operating activities	427,074		345,982
Cash flows from investing activities:
Additions to property and equipment	(27,203)		(23,114)
Additions to capitalized software	(18,414)		(26,584)
Purchases of marketable securities	(134,665)		(83,968)
Prepayments and maturities of marketable securities	113,801		89,352
Sales of marketable securities	7,546		893
Proceeds from fixed asset dispositions	9,946		—
Other investing activities	(8,196)		(4,816)
Net cash used in investing activities	(57,185)		(48,237)
Cash flows from financing activities:

Payment of contingent consideration	—		(8,799)
Purchase and retirement of common stock	(252,889)		(236,914)
Proceeds from issuance of common stock	62,835		65,660
Payment of dividends	(120,338)		(114,833)
Net cash used in financing activities	(310,392)		(294,886)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	6,941		(1,474)
Net increase in cash, cash equivalents and restricted cash	66,438		1,385
Cash, cash equivalents and restricted cash, beginning of period	834,998		853,359
Cash, cash equivalents and restricted cash, end of period	$	901,436	$	854,744

The accompanying notes are an integral part of these consolidated financial statements.

Notes to Consolidated Financial Statements

(all figures are in thousands except share and per share data)

Note 1. Summary of Significant Accounting Policies

Nature of Operations

SEI Investments Company (the Company), a Pennsylvania corporation, provides comprehensive platforms, services and infrastructure–encompassing technology, operational, and investment management services–to help wealth managers, financial advisors, investment managers, family offices, institutional and private investors create and manage wealth.

Investment processing platforms provide technologies and business process outsourcing services for wealth managers. These solutions include investment advisory, client relationship, and other technology-enabled capabilities for the front office; administrative and investment services for the middle office; and accounting and processing services for the back office. Revenues from investment processing platforms are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.

Investment operations platforms provide business process outsourcing services for investment managers and asset owners. These platforms support a broad range of traditional and alternative investments and provide technology-enabled information analytics and investor capabilities for the front office; administrative and investment services for the middle office; and fund administration and accounting services for the back office. Revenues from investment operations platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment management platforms provide comprehensive solutions for managing personal and institutional wealth. These platforms include goals-based investment strategies; SEI-sponsored investment products, including mutual funds, collective investment products, alternative investment portfolios and separately managed accounts (SMA); and other market-specific advice, technology and operational components. These platforms are offered to wealth managers as part of a complete goals-based investment program for their end-investors. For institutional investors, the Company provides Outsourced Chief Investment Officer (OCIO) solutions and Enhanced Chief Investment Officer (ECIO) solutions that include investment management programs, as well as advisory and administrative services. Revenues from investment management platforms are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Basis of Presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Certain financial information and accompanying note disclosure normally included in the Company’s Annual Report on Form 10-K have been condensed or omitted. The interim financial information is unaudited but reflects all adjustments (consisting of only normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of financial position of the Company as of September 30, 2024, the results of operations for the three and nine months ended September 30, 2024 and 2023, and cash flows for the nine months ended September 30, 2024 and 2023. These interim Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

There have been no significant changes in significant accounting policies during the nine months ended September 30, 2024 as compared to the significant accounting policies described in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.

Variable Interest Entities

The Company or its affiliates have created numerous investment products for its clients in various types of legal entity structures. The Company serves as the Manager, Administrator and Distributor for these investment products and may also serve as the Trustee for some of the investment products. The Company receives asset management, distribution, administration and custodial fees for these services. Clients are the equity investors and participate in proportion to their ownership percentage in the net income or loss and net capital gains or losses of the products, and, on liquidation, will participate in proportion to their ownership percentage in the remaining net assets of the products after satisfaction of outstanding liabilities. The Company has concluded that it is not the primary beneficiary of the entities and, therefore, is not required to consolidate any of the pooled investment vehicles for which it receives asset management, distribution, administration and custodial fees under the VIE model.

The Company is a party to expense limitation agreements with certain SEI-sponsored money market funds subject to Rule 2a-7 of the Investment Company Act of 1940 which establish a maximum level of ordinary operating expenses incurred by

the fund in any fiscal year including, but not limited to, fees of the administrator or its affiliates. Under the terms of these agreements, the Company waived $1,202 and $5,519 in fees during the three months ended September 30, 2024 and 2023, respectively. During the nine months ended September 30, 2024 and 2023, the Company waived $6,764 and $16,400, respectively, in fees.

Revenue Recognition

Revenue is recognized when the transfer of control of promised goods or services under the terms of a contract with customers are satisfied in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those promised goods or services. Certain portions of the Company’s revenues involve a third party in providing goods or services to its customers. In such circumstances, the Company must determine whether the nature of its promise to the customer is to provide the underlying goods or services (the Company is the principal in the transaction and reports the transaction gross) or to arrange for a third party to provide the underlying goods or services (the entity is the agent in the transaction and reports the transaction net). See Note 13 for related disclosures regarding revenue recognition.

Cash and Cash Equivalents

Cash and cash equivalents includes $423,471 and $397,838 at September 30, 2024 and December 31, 2023, respectively, invested in SEI-sponsored open-ended money market mutual funds. See Note 5 for information related to the Company's total investments in SEI-sponsored and non-SEI-sponsored money market mutual funds and commercial paper classified as cash equivalents.

Restricted Cash

Restricted cash includes $250 at September 30, 2024 and December 31, 2023 segregated for regulatory purposes related to trade-execution services conducted by SEI Investments (Europe) Limited. Restricted cash also includes $52 and $51 at September 30, 2024 and December 31, 2023, respectively, segregated in special reserve accounts for the benefit of customers of the Company’s broker-dealer subsidiary, SEI Investments Distribution Co. (SIDCO), in accordance with certain rules established by the Securities and Exchange Commission (SEC) for broker-dealers.

Capitalized Software

The Company capitalized $18,414 and $26,584 of software development costs during the nine months ended September 30, 2024 and 2023, respectively, to further develop the SEI Wealth PlatformSM (SWP) and for the development of a new platform for the Investment Managers segment. The Company capitalized $10,542 and $13,706 of software development costs for significant enhancements to SWP during the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024, the net book value of SWP was $208,457. The net book value includes $1,145 of capitalized software development costs in-progress associated with future releases of SWP. SWP has a weighted average remaining life of 8.4 years. Amortization expense for SWP was $20,517 and $19,027 during the nine months ended September 30, 2024 and 2023, respectively.

The Company also capitalized $7,872 and $12,878 of software development costs during the nine months ended September 30, 2024 and 2023, respectively, related to the development of a new platform for the Investment Managers segment. Capitalized software development costs in-progress associated with this platform were $28,040 as of September 30, 2024. The platform is not yet ready for use.

Earnings per Share

The calculations of basic and diluted earnings per share for the three and nine months ended September 30, 2024 and 2023 are:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net income	$	154,900	$	115,661	$	425,420	$	341,527
Shares used to compute basic earnings per common share	129,418,000		132,231,000		130,550,000		133,035,000
Dilutive effect of stock awards	1,253,000		1,273,000		1,280,000		1,215,000
Shares used to compute diluted earnings per common share	130,671,000		133,504,000		131,830,000		134,250,000
Basic earnings per common share	$	1.20	$	0.87	$	3.26	$	2.57
Diluted earnings per common share	$	1.19	$	0.87	$	3.23	$	2.54

During the three months ended Sept 30, 2024 and 2023, employee stock options to purchase 10,606,000 and 10,869,000 shares of common stock with an average exercise price of $61.06 and $61.31, respectively, were outstanding but not

included in the computation of diluted earnings per common share. During the nine months ended September 30, 2024 and 2023, employee stock options to purchase 10,747,000 and 11,049,000 shares of common stock with an average exercise price of $61.05 and $61.29, respectively, were outstanding but not included in the computation of diluted earnings per common share. These options for the three and nine month periods were not included in the computation of diluted earnings per common share because either the performance conditions have not been satisfied or would not have been satisfied if the reporting date was the end of the contingency period or the options' exercise price was greater than the average market price of the Company’s common stock and the effect on diluted earnings per common share would have been anti-dilutive.

New Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07) which updates reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The amendments in ASU 2023-07 apply retrospectively to all prior periods presented in the financial statements. The Company continues to assess the impact of ASU 2023-07. The Company has identified the chief operating decision maker (CODM) and is in the process of finalizing the significant segment expenses and other information regularly provided to the CODM and included with the reported measure of segment profit/loss. The Company is on schedule to complete its assessment of ASU 2023-07 and the impact on its consolidated financial statements and related disclosures as of January 1, 2025.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures (ASU 2023-09) to enhance the transparency and decision usefulness of income tax disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2023-09 on its consolidated financial statements and related disclosures.

Reclassifications

Certain prior year amounts have been reclassified to conform to current year presentation.

Statements of Cash Flows

For purposes of the Consolidated Statements of Cash Flows, the Company considers investment instruments purchased with an original maturity of three months or less to be cash equivalents.

The following table provides the details of the adjustments to reconcile net income to net cash provided by operating activities for the nine months ended September 30, 2024 and 2023:


	2024		2023
Net income	$	425,420	$	341,527
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	25,097		26,509
Amortization	31,284		28,851
Equity in earnings of unconsolidated affiliate	(102,375)		(91,517)
Distributions received from unconsolidated affiliate	112,476		100,252
Stock-based compensation	37,224		23,458
Provision for losses on receivables	1,170		283
Deferred income tax expense	(21,051)		(20,971)
Net gain from investments	(3,349)		(1,053)
Net gain from sale of property	(8,151)		—
Change in other long-term liabilities	3,205		3,105
Change in other assets	(4,005)		1,099
Contract costs capitalized, net of amortization	(2,306)		(590)
Other	(2,900)		2,122
Change in current assets and liabilities:

Receivables from investment products	1,301		6,327
Receivables	(109,522)		(62,053)
Other current assets	606		(8,654)
Advances due from unconsolidated affiliate	51,005		51,293

Accounts payable	(2,364)		(3,085)
Accrued liabilities	(1,655)		(48,128)
Deferred revenue	(4,036)		(2,793)
Total adjustments	1,654		4,455
Net cash provided by operating activities	$	427,074	$	345,982

Note 2. Investment in Unconsolidated Affiliate

LSV Asset Management

The Company has an investment in LSV Asset Management (LSV), a registered investment advisor that provides investment advisory services primarily to institutions, including pension plans and investment companies. LSV is currently an investment sub-advisor for a limited number of SEI-sponsored investment products. The Company's partnership interest in LSV as of September 30, 2024 was 38.6%. The Company accounts for its interest in LSV using the equity method because of its less than 50% ownership. The Company’s interest in the net assets of LSV is reflected in Investment in unconsolidated affiliate on the accompanying Consolidated Balance Sheets and its interest in the earnings of LSV is reflected in Equity in earnings of unconsolidated affiliate on the accompanying Consolidated Statements of Operations.

At September 30, 2024, the Company’s total investment in LSV was $49,675. The Company's investment includes advances provided to LSV related to their working capital accounts. The Company receives partnership distributions from LSV on a quarterly basis. The Company received partnership distributions from LSV of $112,476 and $100,252 in the nine months ended September 30, 2024 and 2023, respectively. As such, the Company considers these distribution payments as returns on investment rather than returns of the Company's original investment in LSV and has therefore classified the associated cash inflows as an operating activity on the Consolidated Statements of Cash Flows.

The Company’s proportionate share in the earnings of LSV was $36,513 and $29,927 during the three months ended September 30, 2024 and 2023, respectively. During the nine months ended September 30, 2024 and 2023, the Company’s proportionate share in the earnings of LSV was $102,375 and $91,517, respectively.

These tables contain condensed financial information of LSV:


Condensed Statement of Operations	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Revenues	$	122,412	$	102,183	$	343,581	$	309,211
Net income	94,634		77,566		265,335		237,119


Condensed Balance Sheets	September 30, 2024		December 31, 2023
Current assets	$	137,776	$	169,867
Non-current assets	5,735		6,568
Total assets	$	143,511	$	176,435

Current liabilities	$	66,795	$	74,853
Non-current liabilities	5,544		2,182
Partners’ capital	71,172		99,400
Total liabilities and partners’ capital	$	143,511	$	176,435

Note 3. Composition of Certain Financial Statement Captions

Receivables

Receivables on the accompanying Consolidated Balance Sheets consist of:


	September 30, 2024		December 31, 2023
Trade receivables	$	174,091	$	115,356
Fees earned, not billed	418,561		372,291
Other receivables	18,975		14,450
	611,627		502,097
Less: Allowance for doubtful accounts	(1,833)		(663)
	$	609,794	$	501,434

Fees earned, not billed represents receivables from contracts with customers earned but unbilled and results from timing differences between services provided and contractual billing schedules. These billing schedules generally provide for fees to be billed on a quarterly basis. In addition, certain fees earned from investment operations services are calculated based on assets under administration that have an extended valuation process. Billings to these clients occur once the asset valuation processes are completed.

Receivables from investment products on the accompanying Consolidated Balance Sheets primarily represent fees receivable for distribution, investment advisory, and administration services to various regulated investment companies and other investment products sponsored by SEI.

Property and Equipment

Property and Equipment on the accompanying Consolidated Balance Sheets consists of:


	September 30, 2024		December 31, 2023
Buildings	$	216,418	$	216,968
Equipment	194,591		193,096
Land	27,317		26,450
Purchased software	165,676		165,348
Furniture and fixtures	23,028		23,025
Leasehold improvements	26,533		19,827
Construction in progress	507		684
	654,070		645,398
Less: Accumulated depreciation	(489,143)		(474,034)
Property and Equipment, net	$	164,927	$	171,364

The Company recognized $25,097 and $26,509 in depreciation expense related to property and equipment for the nine months ended September 30, 2024 and 2023, respectively.

Deferred Contract Costs

Deferred contract costs, which primarily consist of deferred sales commissions, were $42,527 and $40,221 as of September 30, 2024 and December 31, 2023, respectively. The Company deferred expenses related to contract costs of $5,326 and $2,243 during the three months ended September 30, 2024 and 2023, respectively. During the nine months ended September 30, 2024 and 2023, the Company deferred expenses related to contract costs of $10,237 and $7,212, respectively. Amortization expense related to deferred contract costs were $7,931 and $6,622 during the nine months ended September 30, 2024 and 2023, respectively. Amortization expense related to deferred contract costs is included in Compensation, benefits and other personnel on the accompanying Consolidated Statements of Operations. There were no material impairment losses in relation to deferred contract costs during the nine months ended September 30, 2024.

Accrued Liabilities

Accrued liabilities on the accompanying Consolidated Balance Sheets consist of:


	September 30, 2024		December 31, 2023
Accrued employee compensation	$	103,977	$	107,495
Accrued employee benefits and other personnel	10,368		9,797
Accrued voluntary separation program	5,515		21,058
Accrued consulting, outsourcing and professional fees	37,753		32,285
Accrued sub-advisory, distribution and other asset management fees	51,812		49,405

Accrued dividend payable	1,042		61,104
Accrued income taxes	13,130		4,965
Other accrued liabilities	34,570		32,836
Total accrued liabilities	$	258,167	$	318,945

Note 4. Fair Value Measurements

The fair value of the Company’s financial assets and liabilities, except for the Company's investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy. The fair value of the Company’s Level 1 financial assets consist mainly of investments in open-ended mutual funds that are quoted daily. Level 2 financial assets consist of GNMA mortgage-backed securities held by the Company's wholly-owned limited purpose federal thrift subsidiary, SEI Private Trust Company (SPTC), and Federal Home Loan Bank (FHLB) and other U.S. government agency short-term notes held by SIDCO. The financial assets held by SIDCO were purchased as part of a cash management program requiring only short term, top-tier investment grade government and corporate securities. The financial assets held by SPTC are debt securities issued by GNMA and are backed by the full faith and credit of the U.S. government. These securities were purchased for the sole purpose of satisfying applicable regulatory requirements and have maturity dates which range from 2027 to 2041.

The fair value of the Company's investment funds sponsored by LSV is measured using the net asset value per share (NAV) as a practical expedient. The NAVs of the funds are calculated by the funds' independent custodian and are derived from the fair values of the underlying investments as of the reporting date. The funds allow for investor redemptions at the end of each calendar month. This investment has not been classified in the fair value hierarchy but is presented in the tables below to permit reconciliation to the amounts presented on the accompanying Consolidated Balance Sheets.

The valuation of the Company's Level 2 financial assets held by SIDCO and SPTC are based upon securities pricing policies and procedures utilized by third-party pricing vendors.

The pricing policies and procedures applied for our Level 1 and Level 2 financial assets during the nine months ended September 30, 2024 were consistent with those as described in the Company's Annual Report on Form 10-K at December 31, 2023. The Company had no Level 3 financial assets at September 30, 2024 or December 31, 2023 that were required to be measured at fair value on a recurring basis. The Company's Level 3 financial liabilities at September 30, 2024 and December 31, 2023 consist entirely of the estimated fair value of the contingent consideration resulting from an acquisition (See Note 12). There were no transfers of financial assets between levels within the fair value hierarchy during the nine months ended September 30, 2024.

The fair value of certain financial assets of the Company was determined using the following inputs:


			Fair Value Measurements at the End of the Reporting Period Using
Assets	September 30, 2024		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Equity securities	$	40,251	$	40,251	$	—
Available-for-sale debt securities	135,471		—		135,471
Fixed-income securities owned	30,289		—		30,289
Investment funds sponsored by LSV (1)	8,410
	$	214,421	$	40,251	$	165,760


			Fair Value Measurements at the End of the Reporting Period Using
Assets	December 31, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Equity securities	$	36,661	$	36,661	$	—
Available-for-sale debt securities	118,752		—		118,752
Fixed-income securities owned	31,334		—		31,334
Investment funds sponsored by LSV (1)	7,316
	$	194,063	$	36,661	$	150,086

(1) The fair value amounts presented in the tables above are intended to permit reconciliation of the fair value hierarchy to the amounts presented on the accompanying Consolidated Balance Sheets (See Note 5).

Note 5. Marketable Securities

Marketable securities include investments in money market funds and commercial paper classified as cash equivalents, available-for-sale debt securities, investments in SEI-sponsored and non-SEI-sponsored mutual funds, equities, investments in funds sponsored by LSV and securities owned by SIDCO.

Cash Equivalents

Investments in SEI-sponsored and non-SEI-sponsored money market funds and commercial paper classified as cash equivalents had a fair value of $633,780 and $565,588 at September 30, 2024 and December 31, 2023, respectively. There were no material unrealized or realized gains or losses from these investments during the nine months ended September 30, 2024 and 2023. Investments in money market funds and commercial paper are Level 1 assets.

Available for Sale and Equity Securities

Available For Sale and Equity Securities on the accompanying Consolidated Balance Sheets consist of:


	At September 30, 2024
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value
Available-for-sale debt securities	$	142,718	$	—	$	(7,247)	$	135,471
SEI-sponsored mutual funds	32,203		2,144		—		34,347
Equities and other mutual funds	5,418		486		—		5,904
	$	180,339	$	2,630	$	(7,247)	$	175,722


	At December 31, 2023
	Cost Amount		Gross Unrealized Gains		Gross Unrealized (Losses)		Fair Value
Available-for-sale debt securities	$	127,681	$	—	$	(8,929)	$	118,752
SEI-sponsored mutual funds	30,427		818		(19)		31,226
Equities and other mutual funds	5,301		134		—		5,435
	$	163,409	$	952	$	(8,948)	$	155,413

Net unrealized losses at September 30, 2024 of available-for-sale debt securities were $5,580 (net of income tax benefit of $1,667). Net unrealized losses at December 31, 2023 of available-for-sale debt securities were $6,875 (net of income tax benefit of $2,054). These unrealized losses are associated with the Company’s investments in mortgage-backed securities issued by GNMA and were caused by interest rate increases (See Note 4). The contractual cash flows of these securities are guaranteed by an agency of the U.S. government. Accordingly, it is expected that the securities would not be settled at a price less than the amortized cost bases of the Company's investments. The Company does not intend to sell the investments and it is not likely that the Company will be required to sell the investments before recovery of their amortized cost bases. These net unrealized losses are reported as a separate component of Accumulated other comprehensive loss on the accompanying Consolidated Balance Sheets.

The following tables provide the scheduled maturities of the Company's available-for-sale debt securities:


	At September 30, 2024
	Cost		Fair Value
Within one year	$	—	$	—
After one year through five years	4,648		4,269
After 5 years through 10 years	17,732		16,478
After 10 years	120,338		114,724
	$	142,718	$	135,471


	At December 31, 2023
	Cost		Fair Value
Within one year	$	—	$	—
After one year through five years	5,679		5,035
After 5 years through 10 years	31,162		28,084
After 10 years	90,840		85,633
	$	127,681	$	118,752

There were no material realized gains or losses from available-for-sale debt securities during the nine months ended September 30, 2024 and 2023, respectively.

There were gross realized gains of $1,651 and gross realized losses of $1,416 from mutual funds and equities during the nine months ended September 30, 2024. There were no material realized gains or losses from mutual funds and equities during the nine months ended September 30, 2023. Gains and losses from mutual funds and equities are reflected in Net gain (loss) from investments on the accompanying Consolidated Statements of Operations.

Investments in Affiliated Funds

The Company has an investment in funds sponsored by LSV. The Company records this investment on the accompanying Consolidated Balance Sheets at fair value. Unrealized gains and losses from the change in fair value of these funds are recognized in Net gain (loss) from investments on the accompanying Consolidated Statements of Operations.

The funds had a fair value of $8,410 and $7,316 at September 30, 2024 and December 31, 2023, respectively. The Company recognized unrealized gains of $673 and $66 during the three months ended September 30, 2024 and 2023, respectively, from the change in fair value of the funds. The Company recognized unrealized gains of $1,094 and $472 during the nine months ended September 30, 2024 and 2023, respectively, from the change in fair value of the funds.

Securities Owned

The Company’s broker-dealer subsidiary, SIDCO, has investments in U.S. government agency securities with maturity dates less than one year. These investments are reflected as Securities owned on the accompanying Consolidated Balance Sheets. Due to specialized accounting practices applicable to investments by broker-dealers, the securities are reported at fair value and changes in fair value are recorded in current period earnings. The securities had a fair value of $30,289 and $31,334 at September 30, 2024 and December 31, 2023, respectively. There were no material net gains or losses related to the securities during the three and nine months ended September 30, 2024 and 2023.

Note 6. Line of Credit

The Company has a five-year $325,000 Credit Agreement (the Credit Facility) with Wells Fargo Bank, N.A., and a syndicate of other lenders. The Credit Facility is scheduled to expire in April 2026, at which time any aggregate principal amount of loans outstanding becomes payable in full. Any borrowings made under the Credit Facility will accrue interest at rates that, at the Company's option, are based on a base rate (the Base Rate) plus a premium that can range from 0.25% to 1.00% or the Adjusted Term Secured Overnight Financing Rate (SOFR) plus a premium that can range from 1.25% to 2.00% depending on the Company’s Leverage Ratio (a ratio of consolidated indebtedness to consolidated EBITDA for the four preceding fiscal quarters, all as defined in the related agreement). The Base Rate is defined as the highest of a) the Prime Rate, b) the Federal Funds Rate plus 0.50% and c) the Adjusted Term SOFR for a one-month tenor in effect on such day plus 1.00%.

The Company also pays quarterly commitment fees based on the unused portion of the Credit Facility. The quarterly fees for the Credit Facility can range from 0.15% of the amount of the unused portion to 0.30%, depending on the Company’s Leverage Ratio. Certain wholly-owned subsidiaries of the Company have guaranteed the obligations of the Company under the agreement. The aggregate amount of the Credit Facility may be increased by an additional $100,000 under certain conditions set forth in the agreement. The Company may issue up to $15,000 in letters of credit under the terms of the Credit Facility. The Company pays a periodic commission fee of 1.25% plus an issuance fee of 0.20% of the aggregate face amount of the outstanding letters of credit issued under the Credit Facility.

The Credit Facility contains covenants with restrictions on the ability of the Company to do transactions with affiliates other than wholly-owned subsidiaries or to incur liens or certain types of indebtedness as defined in the agreement. In the event of a default under the Credit Facility, the Company would also be restricted from paying dividends on, or repurchasing, its common stock without the approval of the lenders. Upon the occurrence of certain financial or economic events, significant corporate events, or certain other events of default constituting an event of default under the Credit Facility, all loans outstanding may be declared immediately due and payable and all commitments under the agreement may be terminated.

The Company was in compliance with all covenants of the Credit Facility during the nine months ended September 30, 2024. As of October 22, 2024, the Company had outstanding letters of credit of $4,866 under the Credit Facility. The amount of the Credit Facility that is available for general corporate purposes as of October 22, 2024 was $320,134.

Note 7. Shareholders’ Equity

Stock-Based Compensation

On April 2, 2024, the Company’s Board of Directors approved the 2024 Omnibus Equity Compensation Plan (the 2024 Plan), which was later approved by the shareholders of the Company on May 29, 2024. The 2024 Plan became effective upon receipt of the shareholders' approval on May 29, 2024 and is the successor equity compensation plan to the 2014 Equity Compensation Plan (the 2014 Plan) which was merged with and into the 2024 Plan. The 2024 Plan provides for the grant of stock options, stock units, stock awards, stock appreciation rights and other stock-based awards. No further grants will be made under the 2014 Plan, and shares with respect to all grants outstanding under the 2014 Plan will be issued or transferred under the 2024 Plan. Permitted grantees under the 2024 Plan include employees, non-employee

directors and consultants who perform services for the Company. The plan is administered by the Compensation Committee of the Board of Directors of the Company. There were no grants of stock options, stock units, stock awards, stock appreciation rights or other stock-based awards made under the 2024 Plan as of June 30, 2024.

The Company has non-qualified stock options and restricted stock units (RSUs) outstanding under its equity compensation plans. The Company recognized stock-based compensation expense in its Consolidated Financial Statements in the three and nine months ended September 30, 2024 and 2023, respectively, as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Stock-based compensation expense	$	13,696	$	7,979	$	37,224	$	23,458
Less: Deferred tax benefit	(2,616)		(1,438)		(7,201)		(4,278)
Stock-based compensation expense, net of tax	$	11,080	$	6,541	$	30,023	$	19,180

The vesting of the Company's RSUs are time-based and are not based on the achievement of performance targets. The majority of the Company's RSUs will vest on the third anniversary of the issuance date. All outstanding stock options have performance-based vesting provisions specific to each option grant that tie the vesting of the applicable stock options to the Company’s financial performance. The Company’s stock options vest at a rate of 50% when a specified financial vesting target is achieved, and the remaining 50% when a second, higher specified financial vesting target is achieved. Options vest as a result of achievement of the financial vesting targets. Options granted in December 2017 and thereafter include a service condition which requires a minimum two or four year waiting period from the grant date along with the attainment of the applicable financial vesting target. The targets are measured annually on December 31. The amount of stock-based compensation expense recognized in the period is based upon management’s estimate of when the financial vesting targets may be achieved. Any change in management’s estimate could result in the remaining amount of stock-based compensation expense to be accelerated, spread out over a longer period, or reversed. This may cause volatility in the recognition of stock-based compensation expense in future periods and could materially affect the Company’s earnings.

The Company revised its estimate of when some vesting targets are expected to be achieved. This change in management's estimate resulted in an increase of $3,098 in stock-based compensation expense during the nine months ended September 30, 2024.

As of September 30, 2024, there was approximately $85,239 of unrecognized compensation cost remaining related to unvested employee stock options and restricted stock units that management expects will vest and is being amortized.

The Company issues new common shares associated with the exercise of stock options. The total intrinsic value of options exercised during the nine months ended September 30, 2024 was $24,053. The total options exercisable as of September 30, 2024 had an intrinsic value of $71,076. The total intrinsic value for options exercisable is calculated as the difference between the market value of the Company’s common stock as of September 30, 2024 and the weighted average exercise price of the options. The market value of the Company’s common stock as of September 30, 2024 was $69.19 as reported by the Nasdaq Stock Market, LLC. The weighted average exercise price of the options exercisable as of September 30, 2024 was $55.98. Total options that were outstanding as of September 30, 2024 were 15,343,000. Total options that were exercisable as of September 30, 2024 were 5,298,000.

Common Stock Buyback

The Company’s Board of Directors, under multiple authorizations, has authorized the repurchase of common stock on the open market or through private transactions. The Company purchased 3,730,000 shares at a total cost of $252,978 during the nine months ended September 30, 2024, which reduced the total shares outstanding of common stock. The cost of stock purchases during the period includes the cost of excise taxes applicable to stock repurchases and certain transactions that settled in the following quarter. As of September 30, 2024, the Company had approximately $29,100 of authorization remaining for the purchase of common stock under the program. On October 22, 2024, the Company's Board of Directors approved an increase in the stock repurchase program by an additional $400,000, increasing the available authorization to approximately $429,100.

The Company immediately retires its common stock when purchased. Upon retirement, the Company reduces Capital in excess of par value for the average capital per share outstanding and the remainder is charged against Retained earnings. If the Company reduces its Retained earnings to zero, any subsequent purchases of common stock will be charged entirely to Capital in excess of par value.

Cash Dividend

On May 29, 2024, the Board of Directors declared a cash dividend of $0.46 per share on the Company's common stock, which was paid on June 18, 2024, to shareholders of record on June 10, 2024. Cash dividends declared during the nine months ended September 30, 2024 and 2023 were $60,285 and $57,177, respectively.

Note 8. Accumulated Other Comprehensive Loss

The components of Accumulated other comprehensive loss, net of tax, are as follows:


	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Investments		Accumulated Other Comprehensive Loss
Balance, January 1, 2024	$	(30,157)	$	(6,875)	$	(37,032)

Other comprehensive income before reclassifications	9,071		1,546		10,617
Amounts reclassified from accumulated other comprehensive loss	—		(251)		(251)
Net current-period other comprehensive income	9,071		1,295		10,366

Balance, September 30, 2024	$	(21,086)	$	(5,580)	$	(26,666)

Note 9. Business Segment Information

The Company’s reportable business segments are:

Private Banks – Provides outsourced investment processing and investment management platforms to banks and trust institutions, independent wealth advisers, and financial advisors worldwide;

Investment Advisors – Provides investment management and investment processing platforms to affluent investors through a network of independent registered investment advisors, financial planners and other investment professionals in the United States;

Institutional Investors – Provides Outsourced Chief Investment Officer solutions, including investment management and administrative outsourcing platforms to retirement plan sponsors, healthcare systems, higher education and other not-for-profit organizations worldwide;

Investment Managers – Provides investment operations outsourcing platforms to fund companies, banking institutions, traditional and non-traditional investment managers worldwide; and

Investments in New Businesses – Focuses on providing investment management solutions to ultra-high-net-worth families residing in the United States, hosted technology services to family offices and financial institutions; developing network and data protection services; entering new markets; and conducting other research and development activities.

The information in the following tables is derived from internal financial reporting used for corporate management purposes. There are no inter-segment revenues for the three and nine months ended September 30, 2024 and 2023. Assets are not allocated to segments for internal reporting purposes. The accounting policies of the reportable business segments are the same as those described in Note 1 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

During the first quarter 2024 and made effective January 1, 2024, the Company made a determination to reorganize some of its business segments based on how its current Chief Operating Decision Maker (CODM) manages its businesses, including with respect to resource allocation and performance assessment. As a result, one of the Company's client relationships formerly reported in the Private Banks segment will be reported in the Investment Managers segment and the Company’s family office services business, formerly reported in the Investment Managers segment, will be reported in the Investments in New Businesses segment. The business segment financial presentation was reclassified in 2024 to conform to this reorganization. Prior year amounts have been reclassified to conform to current year presentation.

The following tables highlight certain financial information about each of the business segments for the three months ended September 30, 2024 and 2023:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Three Months Ended September 30, 2024
Revenues	$	138,734	$	126,836	$	71,626	$	184,607	$	15,593	$	537,396
Expenses	115,097		70,152		37,851		114,118		18,440		355,658
Operating profit (loss)	$	23,637	$	56,684	$	33,775	$	70,489	$	(2,847)	$	181,738


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Three Months Ended September 30, 2023
Revenues	$	119,664	$	110,461	$	70,479	$	162,982	$	13,173	$	476,759
Expenses	111,207		64,280		39,953		103,585		18,265		337,290
Operating profit (loss)	$	8,457	$	46,181	$	30,526	$	59,397	$	(5,092)	$	139,469

A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the three months ended September 30, 2024 and 2023 is as follows:


	2024		2023
Total operating profit from segments	$	181,738	$	139,469
Corporate overhead expenses	(37,906)		(30,997)
Income from operations	$	143,832	$	108,472

The following tables provide additional information for the three months ended September 30, 2024 and 2023 pertaining to the business segments:


	Capital Expenditures (1)				Depreciation
	2024		2023		2024		2023
Private Banks	$	2,764	$	7,580	$	2,620	$	5,565
Investment Advisors	1,092		3,545		2,254		540
Institutional Investors	740		390		614		338
Investment Managers	7,196		2,804		1,659		2,227
Investments in New Businesses	124		262		186		280
Total from business segments	$	11,916	$	14,581	$	7,333	$	8,950
Corporate overhead	222		307		1,008		247
	$	12,138	$	14,888	$	8,341	$	9,197

(1) Capital expenditures include additions to property and equipment and capitalized software.


	Amortization
	2024		2023
Private Banks	$	5,147	$	4,852
Investment Advisors	2,169		1,933
Institutional Investors	1,851		1,834
Investment Managers	80		209
Investments in New Businesses	1,096		895
Total from business segments	$	10,343	$	9,723
Corporate overhead	70		74
	$	10,413	$	9,797

The following tables highlight certain financial information about each of business segment for the nine months ended September 30, 2024 and 2023:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Nine Months Ended September 30, 2024
Revenues	$	401,272	$	370,141	$	214,911	$	537,128	$	44,509	$	1,567,961
Expenses	339,961		206,063		116,386		334,955		55,403		1,052,768
Operating profit (loss)	$	61,311	$	164,078	$	98,525	$	202,173	$	(10,894)	$	515,193


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
	For the Nine Months Ended September 30, 2023
Revenues	$	372,980	$	326,579	$	219,914	$	476,683	$	38,779	$	1,434,935
Expenses	337,834		192,004		126,337		308,483		52,919		1,017,577
Operating profit (loss)	$	35,146	$	134,575	$	93,577	$	168,200	$	(14,140)	$	417,358

A reconciliation of the total operating profit reported for the business segments to income from operations in the Consolidated Statements of Operations for the nine months ended September 30, 2024 and 2023:


	2024		2023
Total operating profit from segments	$	515,193	$	417,358
Corporate overhead expenses	(108,996)		(94,518)
Income from operations	$	406,197	$	322,840

The following tables provide additional information for the nine months ended September 30, 2024 and 2023:


	Capital Expenditures (2)				Depreciation
	2024		2023		2024		2023
Private Banks	$	13,782	$	24,652	$	8,356	$	16,370
Investment Advisors	6,244		11,499		6,625		1,557
Institutional Investors	2,589		1,495		1,816		922
Investment Managers	21,260		9,962		4,874		6,268
Investments in New Businesses	713		806		528		735
Total from business segments	$	44,588	$	48,414	$	22,199	$	25,852
Corporate Overhead	1,029		1,284		2,898		657
	$	45,617	$	49,698	$	25,097	$	26,509

(2) Capital expenditures include additions to property and equipment and capitalized software.


	Amortization
	2024		2023
Private Banks	$	15,347	$	14,216
Investment Advisors	6,439		5,698
Institutional Investors	5,619		5,486
Investment Managers	161		566
Investments in New Businesses	3,461		2,685
Total from business segments	$	31,027	$	28,651
Corporate Overhead	257		200
	$	31,284	$	28,851

Note 10. Income Taxes

The gross liability for unrecognized tax benefits at September 30, 2024 and December 31, 2023 was $17,766 and $15,532, respectively, exclusive of interest and penalties, of which $17,604 and $14,878 would affect the effective tax rate if the Company were to recognize the tax benefit.

The Company classifies interest and penalties on unrecognized tax benefits as income tax expense. As of September 30, 2024 and December 31, 2023, the combined amount of accrued interest and penalties related to tax positions taken on tax returns was $2,232 and $1,385, respectively.


	September 30, 2024		December 31, 2023
Gross liability for unrecognized tax benefits, exclusive of interest and penalties	$	17,766	$	15,532
Interest and penalties on unrecognized benefits	2,232		1,385
Total gross uncertain tax positions	$	19,998	$	16,917
Amount included in Current liabilities	$	3,713	$	3,837
Amount included in Other long-term liabilities	16,285		13,080
	$	19,998	$	16,917

The effective income tax rate for the three and nine months ended September 30, 2024 and 2023 differs from the federal income tax statutory rate due to the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Statutory rate	21.0	%	21.0	%	21.0	%	21.0	%
State taxes, net of federal tax benefit	2.9		2.8		2.9		2.8
Foreign tax expense and tax rate differential	0.1		(0.1)		0.1		(0.1)
Tax benefit from stock option exercises	(0.1)		(0.6)		(0.4)		(0.3)



Other, net	(0.4)		(0.6)		(0.2)		(0.2)
	23.5	%	22.5	%	23.4	%	23.2	%

The Company files income tax returns in the United States on a consolidated basis and in many U.S. state and foreign jurisdictions. The Company is subject to examination of income tax returns by the Internal Revenue Service (IRS) and other domestic and foreign tax authorities. The Company is no longer subject to U.S. federal income tax examination for years before 2020 and is no longer subject to state, local or foreign income tax examinations by authorities for years before 2018.

The Company estimates it will recognize $3,713 of gross unrecognized tax benefits. This amount is expected to be paid within one year or to be removed at the expiration of the statute of limitations and resolution of income tax audits and is netted against the current payable account. These unrecognized tax benefits are related to tax positions taken on certain federal, state, and foreign tax returns. However, the timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. While it is reasonably possible that some issues under examination could be resolved in the next twelve months, based upon the current facts and circumstances, the Company cannot reasonably estimate the timing of such resolution or the total range of potential changes as it relates to the current unrecognized tax benefits that are recorded as part of the Company’s financial statements.

The Organization for Economic Co-operation and Development (OECD) has a framework to implement a global minimum corporate tax of 15% for companies with global revenues and profits above certain thresholds (referred to as Pillar Two). Certain aspects of Pillar Two are effective January 1, 2024 and other aspects are effective January 1, 2025. While it is uncertain whether the U.S. will enact legislation to adopt Pillar Two, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement Pillar Two. The Company has determined Pillar Two will not have a material impact on the Company's effective tax rate, consolidated results of operation, financial position, or cash flows.

Note 11. Commitments and Contingencies

In the ordinary course of business, the Company from time to time enters into contracts containing indemnification obligations of the Company. These obligations may require the Company to make payments to another party upon the

occurrence of certain events including the failure by the Company to meet its performance obligations under the contract. These contractual indemnification provisions are often standard contractual terms of the nature customarily found in the type of contracts entered into by the Company. In many cases, there are no stated or notional amounts included in the indemnification provisions. There are no amounts recognized on the Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023 related to these indemnifications.

Rubicon Wealth Management

Prior to the relationship termination described in the following sentence, SEI Private Trust Company (SPTC), a wholly-owned operating subsidiary of SEI, held custody accounts for the end-clients of Rubicon Wealth Management LLC, an SPTC investment advisor client (Rubicon). On May 1, 2024, SPTC terminated its client relationship with Rubicon in light of the events associated with the Allegation (as defined below), and notified Rubicon clients with accounts at SPTC that they were required to transfer their accounts to other custodians.

Beginning on July 10, 2024, nine of Rubicon’s clients that had custodial accounts at SPTC filed state civil actions for fraud in the Court of Common Pleas of Montgomery County, Pennsylvania against Rubicon, its founder, Scott Mason, Mr. Mason’s wife, Lynne Mason, and Orchard Park Real Estate Holdings LLC (Orchard Park), a business owned by the Masons. The fraud allegation (the Allegation) is based on the claim that Mr. Mason used Rubicon client funds to invest in Orchard Park, an entity allegedly formed and controlled by Mr. Mason, and that all such invested funds were subsequently withdrawn from Orchard Park by the Masons and were used for their own, extensive personal expenses. It has been reported that the Securities and Exchange Commission and the Federal Bureau of Investigation are currently investigating Mr. Mason and his wife. The Company is also aware of at least two other cases filed in other jurisdictions against Rubicon and/or the Masons and Orchard Park, and there may be additional cases filed against Rubicon and/or the Masons of which the Company is unaware.

As of October 17, 2024, eight separate, but related, suits have been filed against SPTC in its capacity as custodian for the Rubicon accounts of the plaintiffs. These actions were also filed in the Court of Common Pleas of Montgomery County, Pennsylvania and are: Star Sitron vs. SEI Private Trust Company, Case No. 2024-17132 (Sitron); Charles Murray vs. SEI Private Trust Company, Case No. 2024-18391 (Murray); James A. Byrne & Sharon Byrne vs. SEI Private Trust Company, Case No. 2024-20612; Melody Pettinelli & Melody Pettinelli as Trustee of the Donald Pettinelli Trust dated 11/7/1996 vs. SEI Private Trust Company, Case. 2024-21377; Norman Love vs. SEI Private Trust Company, Case No. 2024-21361; Stephen Red & Carla Red vs. SEI Private Trust Company, Case No. 2024-21902; Edward A. Tettemer & Lyn K. Tettemer vs. SEI Private Trust Company, Case No. 2024-21827; and Jonathan Klein & Sara Klein vs. SEI Private Trust Company, Case No. 2024- 23294 (collectively, the Rubicon Actions). Based on the complaints that have thus far been filed in the Rubicon Actions, these actions appear to be based generally on similar theories that include alleged breach of contract, breach of fiduciary duty, negligence, and breach of state consumer protection laws by SPTC in connection with certain transfers of Plaintiffs’ assets from SPTC custodial accounts to Orchard Park bank accounts. SPTC has been served with complaints in two of the Rubicon Actions, Sitron and Murray. In the remaining six Rubicon Actions, the plaintiffs have commenced suit but have not filed their formal complaints. The Sitron and Murray cases are both in the early stages, with initial motion practice and discovery now occurring.

On August 8, 2024, SPTC filed preliminary objections to the plaintiff’s complaint in Sitron, which remain pending. On September 12, 2024 the Sitron court issued an initial case management order requiring, among other things, fact discovery to be completed within approximately 18 months and dispositive motions to be filed within 21 months from the commencement of the action. On October 16, 2024, SPTC filed preliminary objections to the plaintiff’s claims in Murray, which also remain pending. On October 7, 2024, the Murray court issued an initial case management order requiring, among other things, fact discovery to be completed within nine months and dispositive motions to be filed within 12 months of commencement of the action.

While the Rubicon Actions are in their infancy and the ultimate outcomes of these litigations remain uncertain, SEI and SPTC intend to defend each of the Rubicon Actions. Currently, SPTC estimates that the aggregate amount of Rubicon client assets transferred at the direction of Mr. Mason from SPTC custodial accounts to Orchard Park bank accounts is approximately $15,000. In the event that SPTC is unsuccessful in its defense of the Rubicon Actions, SEI does not currently believe that the losses associated with such unsuccessful defense would exceed the approximately $15,000 of Rubicon client assets that Mr. Mason directed to be transferred to Orchard Park.

United Kingdom Financial Conduct Authority Supervisory Review of SEI Investments (Europe) Limited

On July 31, 2024, SEI Investments (Europe) Limited (SIEL), an indirectly, wholly-owned operating subsidiary of SEI, received a final requirement notice from the Financial Conduct Authority of the United Kingdom (the FCA) under section 166(3)(a) of the Financial Services and Markets Act 2000 (FSMA), requiring SIEL to engage a “Skilled Person” to undertake a two-stage review of SIEL’s governance arrangements and control environment. In the first stage, the Skilled Person will provide SIEL and the FCA with a report setting out the Skilled Person’s view of the effectiveness of the control

environment and governance arrangements with respect to key risks, as well as the Skilled Person’s recommendations where necessary to address any identified weaknesses (the Section 166 Report). In the second stage, the Skilled Person will provide an independent view of the quality and completeness of the remediation carried out by SIEL to address any findings from the initial stage and any self-identified weaknesses, including a view on SIEL’s compliance with relevant regulations.

The appointment of a Skilled Person is one of the regulatory tools used by the FCA to supervise and monitor firms it regulates. A Skilled Person is an independent third party expert with the relevant knowledge and experience to undertake a review as described above. The FCA may use the Section 166 Report and any associated information or documents provided by the Skilled Person in connection with the exercise of any of its statutory functions including its supervisory and enforcement powers.

In August 2024, SIEL, with the approval of FCA, appointed the firm of Grant Thornton to act as the Skilled Person. The first stage of the Section 166 Report is expected to be completed in early December 2024. Grant Thornton has begun its fact-finding process. SIEL looks forward to receiving the views of the Skilled Person in the Section 166 Report and is committed to working with the FCA and Grant Thornton to implement any recommendations for its control environment or governance arrangements, as appropriate. Until SIEL receives the Section 166 Report, neither SIEL nor SEI is reasonably able to provide an estimate of the costs or consequences that may be associated with the Section 166 requirement notice.

Other Matters

The Company and certain of its subsidiaries are party to various other examinations, investigations, actions and claims arising in the normal course of business that the Company does not believe are material. The Company believes that the ultimate resolution of these matters will not have a material adverse effect on the Company's financial position or the manner in which the Company conducts its business. Currently, the Company does not believe the amount of losses associated with these matters can be estimated. While the Company does not believe that the amount of such losses will, when liquidated or estimable, be material to its financial position, the assumptions may be incorrect and any such loss could have a material adverse effect on the Company's results of operations or the manner in which the Company conducts its business in the period(s) during which the underlying matters are resolved.

Note 12. Goodwill and Intangible Assets

The changes in the carrying amount of the Company's goodwill by segment are as follows:


	Institutional Investors		Investment Managers		Investments in New Businesses		Total

Balance, December 31, 2023	$	61,884	$	56,990	$	18,459	$	137,333
Measurement period adjustments	25		—		—		25
Reclassification due to segment reorganization	—		(1,711)		1,711		—
Foreign currency translation adjustments	730		(3)		—		727
Balance, September 30, 2024	$	62,639	$	55,276	$	20,170	$	138,085

The reclassification of the Company's goodwill by segment during the nine months ended September 30, 2024 reflects the relative fair value allocation of the goodwill related to the businesses that were reclassified into the new segment (See Note 9).

In November 2023, the Company's wholly-owned operating subsidiary in the United Kingdom, SIEL, acquired all of the outstanding equity of XPS Pensions (Nexus) Limited, principal employer and scheme funder of the National Pensions Trust (NPT), from its parent company, XPS Pensions Group PLC (XPS). The total purchase price for XPS Pensions (Nexus) Limited included a contingent consideration payable to the sellers subject to the achievement of certain post-closing performance measurements determined during intervals occurring within two years immediately following the closing date. During the nine months ended September 30, 2024, the Company made an adjustment of $1,547 which reduced the fair value of the contingent consideration. The fair value adjustment to the contingent consideration is reflected in Facilities, supplies and other costs on the Consolidated Statement of Operations. As of September 30, 2024, the fair value of the contingent consideration of $2,611 is included in Other long-term liabilities on the accompanying Balance Sheet.

The Company recognized $10,066 and $9,178 of amortization expense related to acquired intangible assets during the nine months ended September 30, 2024 and 2023, respectively.

Note 13. Revenues from Contracts with Customers

The Company’s principal sources of revenues are: (1) asset management, administration and distribution fees primarily earned based upon a contractual percentage of net assets under management or administration; and (2) information processing and software servicing fees that are either recurring and primarily earned based upon the number of trust accounts being serviced or a percentage of the market value of the clients' assets processed on the Company's platforms, or non-recurring and based upon project-oriented contractual agreements related to client implementations.

Disaggregation of Revenue

The following tables provide additional information pertaining to our revenues disaggregated by major product line and primary geographic market based on the location of the use of the products or services for each of the business segments for the three months ended September 30, 2024 and 2023:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Three Months Ended September 30, 2024
Investment management fees from pooled investment products	$	34,899	$	59,707	$	11,854	$	(191)	$	508	$	106,777
Investment management fees from investment management agreements	1,133		49,864		54,296		—		4,729		110,022
Investment operations fees	570		10,670		—		176,687		1,121		189,048
Investment processing fees - PaaS	75,283		1,449		260		1,267		7		78,266
Investment processing fees - SaaS	21,296		—		2,004		—		5,237		28,537
Professional services fees	4,806		—		—		631		1,050		6,487
Account fees and other	747		5,146		3,212		6,213		2,941		18,259
Total revenues	$	138,734	$	126,836	$	71,626	$	184,607	$	15,593	$	537,396

Primary Geographic Markets:
United States	$	90,549	$	126,836	$	58,870	$	166,415	$	15,593	$	458,263
United Kingdom	32,062		—		9,438		—		—		41,500
Canada	10,368		—		1,498		—		—		11,866
Ireland	5,755		—		1,820		10,229		—		17,804
Luxembourg	—		—		—		7,963		—		7,963

Total revenues	$	138,734	$	126,836	$	71,626	$	184,607	$	15,593	$	537,396


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Three Months Ended September 30, 2023
Investment management fees from pooled investment products	$	32,119	$	60,046	$	11,858	$	87	$	351	$	104,461
Investment management fees from investment management agreements	900		45,175		54,317		—		4,240		104,632
Investment operations fees	336		2		—		155,251		1,467		157,056
Investment processing fees - PaaS	59,563		1,271		198		1,086		13		62,131
Investment processing fees - SaaS	21,865		—		2,291		18		4,357		28,531
Professional services fees	4,109		—		—		582		218		4,909
Account fees and other	772		3,967		1,815		5,958		2,527		15,039
Total revenues	$	119,664	$	110,461	$	70,479	$	162,982	$	13,173	$	476,759

Primary Geographic Markets:
United States	$	76,501	$	110,461	$	58,992	$	147,057	$	13,173	$	406,184
United Kingdom	28,789		—		8,442		—		—		37,231
Canada	10,060		—		1,431		—		—		11,491
Ireland	4,314		—		1,614		9,711		—		15,639
Luxembourg	—		—		—		6,214		—		6,214

Total revenues	$	119,664	$	110,461	$	70,479	$	162,982	$	13,173	$	476,759

The following tables provide additional information pertaining to our revenues disaggregated by major product line and primary geographic market based on the location of the use of the products or services for each of the Company’s business segments for the nine months ended September 30, 2024 and 2023:


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Nine Months Ended September 30, 2024
Investment management fees from pooled investment products	$	99,913	$	176,368	$	36,185	$	273	$	1,323	$	314,062
Investment management fees from investment management agreements	3,229		144,203		162,046		—		13,663		323,141
Investment operations fees	1,650		30,397		—		511,203		3,561		546,811
Investment processing fees - PaaS	214,001		4,109		1,081		3,772		26		222,989
Investment processing fees - SaaS	66,065		—		6,335		19		15,459		87,878
Professional services fees	14,042		—		—		2,749		2,337		19,128
Account fees and other	2,372		15,064		9,264		19,112		8,140		53,952
Total revenues	$	401,272	$	370,141	$	214,911	$	537,128	$	44,509	$	1,567,961

Primary Geographic Markets:
United States	$	262,886	$	370,141	$	177,134	$	484,785	$	44,509	$	1,339,455
United Kingdom	93,264		—		28,305		—		—		121,569
Canada	30,234		—		4,384		—		—		34,618
Ireland	14,888		—		5,088		30,600		—		50,576
Luxembourg	—		—		—		21,743		—		21,743

Total revenues	$	401,272	$	370,141	$	214,911	$	537,128	$	44,509	$	1,567,961


	Private Banks		Investment Advisors		Institutional Investors		Investment Managers		Investments In New Businesses		Total
Major Product Lines:	For the Nine Months Ended September 30, 2023
Investment management fees from pooled investment products	$	96,431	$	181,754	$	36,299	$	318	$	1,041	$	315,843
Investment management fees from investment management agreements	2,211		129,000		169,874		—		12,482		313,567
Investment operations fees	1,019		4		—		452,297		4,327		457,647
Investment processing fees - PaaS	182,305		3,786		696		3,174		33		189,994
Investment processing fees - SaaS	66,596		—		7,733		54		12,949		87,332
Professional services fees (1)	21,873		—		—		3,202		752		25,827
Account fees and other	2,545		12,035		5,312		17,638		7,195		44,725
Total revenues	$	372,980	$	326,579	$	219,914	$	476,683	$	38,779	$	1,434,935

Primary Geographic Markets:
United States	$	244,614	$	326,579	$	184,354	$	431,538	$	38,779	$	1,225,864
United Kingdom	84,581		—		26,233		—		—		110,814
Canada	30,297		—		4,247		—		—		34,544
Ireland	13,488		—		5,080		27,714		—		46,282
Luxembourg	—		—		—		17,431		—		17,431

Total revenues	$	372,980	$	326,579	$	219,914	$	476,683	$	38,779	$	1,434,935

(1) Professional services fees of the Private Banks segment includes a one-time early contractual buyout fee of $10,457 recorded during the nine months ended September 30, 2023 from an investment processing client acquired by an existing client.

Investment management fees from pooled investment products - Revenues associated with clients' assets invested in Company-sponsored pooled investment products. Contractual fees are stated as a percentage of the market value of assets under management and collected on a monthly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment management fees from investment management agreements - Revenues based on assets of clients of the Institutional Investors segment primarily invested in Company-sponsored products. Each client is charged an investment management fee that is stated as a percentage of the market value of all assets under management. The client is billed directly on a quarterly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Revenues associated with the separately managed account program offered through registered investment advisors located throughout the United States. The contractual fee is stated as a percentage of the market value of all assets invested in the separately managed account and collected on a quarterly basis. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment operations fees - Revenues earned from accounting and administrative services, distribution support services and regulatory and compliance services to investment management firms and family offices. The Company contracts directly with the investment management firm or family office. The contractual fees are stated as a percentage of net assets under administration and billed when asset valuations are finalized. Also includes income from client cash balances held in the FDIC-insured accounts through the SEI Integrated Cash program. Revenues are recognized in Asset management, administration and distribution fees on the accompanying Consolidated Statements of Operations.

Investment processing fees - Platform as a Service - Revenues associated with clients that outsource their entire investment operation and back-office processing functions. Through the use of the Company's proprietary platforms, the Company assumes all back-office investment processing services including investment processing, custody and safekeeping of assets, income collections, securities settlement and other related trust activities. The contractual fee is based on a monthly fee plus additional fees determined on a per-account or per-transaction basis. Contractual fees can also be stated as a percentage of the value of assets processed on the Company's platforms each month as long as the fee is in excess of a monthly contractual minimum. The client is billed directly on a monthly basis. Revenues are

recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.

Revenues associated with clients of the mutual fund trading solution are fees recognized for shareholder services and related services through the use of the Company's proprietary platform or through third-party vendor agreements. Contractual fees are stated as a percentage of the value of total assets or positions processed on the Company's platform or subject to third-party vendor agreements each month. Fees are billed and collected on a monthly and quarterly basis. These revenues were previously classified under Account fees and other in 2023 and have been reclassified to conform to the current year presentation.

Investment processing fees - Software as a Service - Revenues associated with clients of the Private Banks segment for application software services. Clients retain responsibility for all investment operations, client administration and other back-office trust operations. The contractual fee is based on a monthly fee plus additional fees determined on a per-account or per-transaction basis. The client is billed directly on a monthly basis.

Revenues associated with clients of the Investments in New Businesses segment processed on the Archway PlatformSM are fees for hosted technology services to family offices and financial institutions. The Archway Platform is an integrated technology platform used for investment, operations, accounting and client reporting by these institutions. The contractual fee is based on a monthly subscription fee to access the Archway Platform along with additional fees on a per transaction basis.

Revenues associated with clients of the Institutional Investors segment processed on the SEI NovusSM portfolio intelligence tool are fees for data management, performance measurement, reporting, and risk analytics. The contractual fee is based on a fixed fee to access SEI Novus and includes fees for integration of historical fund data and custom reporting.

All revenues from investment processing fees are recognized in Information processing and software servicing fees on the accompanying Consolidated Statements of Operations.

Professional services fees - Revenues associated with the business services migration for investment processing clients of the Private Banks segment and investment operations clients of the Investment Managers segment. In addition, Professional services include other services such as business transformation consulting. Typically fees are stated as a contractual fixed fee. The client is billed directly and fees are collected according to the terms of the agreement.

Account fees and other - Revenues associated with custody account servicing, account terminations, reimbursements received for out-of-pocket expenses, and other fees for the provision of ancillary services.

Note 14. Sale of Property

On July 8, 2024, the Company sold a condominium located in New York, New York. The Company recognized a net pre-tax gain of $8,151 after associated costs and expenses during the third quarter 2024 as a result of the sale. The gain from the sale is reflected in Other income on the accompanying Consolidated Statement of Operations.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

(In thousands, except asset balances and per share data)

This discussion reviews and analyzes the consolidated financial condition, the consolidated results of operations and other key factors that may affect future performance. This discussion should be read in conjunction with the Consolidated Financial Statements, the Notes to the Consolidated Financial Statements and the Annual Report on Form 10-K for the year ended December 31, 2023.

Overview

Consolidated Summary

SEI delivers technology and investment solutions that connect the financial services industry. With capabilities across investment processing, operations, and asset management, SEI works with corporations, financial institutions and professionals, and ultra-high-net-worth families to help drive growth, make confident decisions, and protect futures. Investment processing fees are earned as either monthly fees for contracted services or as a percentage of the market value of our clients' assets processed on our platforms. Investment operations and investment management fees are earned as a percentage of assets under management, administration or advised assets. As of September 30, 2024, through our subsidiaries and partnerships in which we have a significant interest, we manage, advise or administer $1.6 trillion in hedge, private equity, mutual fund and pooled or separately managed assets.

Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023 were:


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Revenues	$	537,396	$	476,759	13%	$	1,567,961	$	1,434,935	9%
Expenses	393,564		368,287		7%	1,161,764		1,112,095		4%
Income from operations	143,832		108,472		33%	406,197		322,840		26%
Net gain (loss) from investments	427		(206)		(307)%	3,349		1,053		218%
Interest income, net of interest expense	13,438		11,009		22%	35,531		29,057		22%
Other income	8,151		—		NM	8,151		—		NM
Equity in earnings from unconsolidated affiliate	36,513		29,927		22%	102,375		91,517		12%
Income before income taxes	202,361		149,202		36%	555,603		444,467		25%
Income taxes	47,461		33,541		42%	130,183		102,940		26%
Net income	154,900		115,661		34%	425,420		341,527		25%
Diluted earnings per common share	$	1.19	$	0.87	37%	$	3.23	$	2.54	27%

The following items had a significant impact on our financial results for the three and nine months ended September 30, 2024 and 2023:

•Revenue from Assets under management, administration, and distribution fees increased in the first nine months of 2024 primarily from higher assets under administration due to cross sales to existing alternative investment clients of the Investment Managers segment as well as new sales within the segment. Average assets under administration increased $132.4 billion, or 15%, to $998.4 billion during the first nine months of 2024, as compared to $866.0 billion during the first nine months of 2023.

•Revenue from Asset management, administration and distribution fees also increased from market appreciation and positive cash flows into separately managed account programs and Strategist programs of the Investment Advisors segment. This was partially offset by negative cash flows from SEI fund programs and fee reductions in separately managed account programs. Revenue growth was also partially offset by client losses in the Institutional Investors segment. Average assets under management in equity and fixed income programs, excluding LSV, increased $8.8 billion, or 5%, to $177.9 billion in the first nine months of 2024 as compared to $169.1 billion during the first nine months of 2023.

•Fees from the SEI Integrated Cash Program of the Investment Advisors segment launched in December 2023 were $10.7 million during the third quarter of 2024 and $30.4 million during the first nine months of 2024.

•Revenue from Information processing and software servicing fees increased in the first nine months of 2024 primarily from new client conversions and growth from existing SEI Wealth PlatformSM (SWP) clients. A one-time early contractual buyout fee of $10.5 million recorded during the second quarter of 2023 from an investment

processing client of the Private Banks segment acquired by an existing client partially offset the increase in revenues.

•Earnings from LSV increased to $102.4 million in the first nine months of 2024 as compared to $91.5 million in the first nine months of 2023 due to market appreciation and higher performance fees. Negative cash flows from existing clients and client losses partially offset the increase in earnings from LSV.

•Operating expenses increased from higher personnel costs due to business growth, primarily in the Investment Managers segment, stock-based compensation, and the impact of inflation on wages and services. Cost containment measures related to consulting and other vendor costs partially offset the increase in operating expenses in the first nine months of 2024.

•Capitalized software development costs were $18.4 million in the first nine months of 2024, of which $10.5 million was for continued enhancements to SWP. Capitalized software development costs also include $5.0 million of software development costs in the first nine months of 2024 for a new platform for the Investment Managers segment.

•Amortization expense related to SWP was $20.5 million in the first nine months of 2024 as compared to $19.0 million in the first nine months of 2023.

•Interest and dividend income was $36.0 million in the first nine months of 2024 as compared to $29.5 million in the first nine months of 2023. The increase in interest and dividend income was due to an overall increase in interest rates and higher invested cash balances.

•In July 2024, SEI sold a condominium located in New York, New York and recognized a net pre-tax gain of $8.2 million, or $0.05 diluted earnings per share, after associated costs and expenses. The gain from the sale is included in Other income on the accompanying Consolidated Statement of Operations.

•Effective tax rates were 23.5% during the third quarter 2024 and 22.5% during the third quarter 2023. During the first nine months of 2024 and 2023, effective tax rates were 23.4% and 23.2%, respectively.

•SEI repurchased 3.7 million shares of its common stock for $253.0 million in the first nine months of 2024.

Ending Asset Balances

(In millions)


	As of September 30,				Percent Change
	2024		2023
Private Banks:
Equity and fixed-income programs	$	26,565	$	23,039	15%
Collective trust fund programs	5		6		(17)%
Liquidity funds	2,948		3,636		(19)%
Total assets under management	$	29,518	$	26,681	11%
Client assets under administration	8,349		4,399		90%
Total assets	$	37,867	$	31,080	22%
Investment Advisors:
Equity and fixed-income programs	$	78,361	$	66,911	17%
Liquidity funds	2,790		5,175		(46)%
Total Platform assets under management	$	81,151	$	72,086	13%
Platform-only assets	24,501		16,232		51%
Platform-only assets-deposit program	2,447		—		NM
Total Platform assets	$	108,099	$	88,318	22%
Institutional Investors:
Equity and fixed-income programs	$	79,252	$	72,387	9%
Collective trust fund programs	1		4		(75)%
Liquidity funds	1,829		2,119		(14)%
Total assets under management	$	81,082	$	74,510	9%
Client assets under advisement	8,038		4,085		97%
Total assets	$	89,120	$	78,595	13%
Investment Managers:
Collective trust fund programs (A)	$	204,429	$	146,991	39%
Liquidity funds	233		180		29%

Total assets under management	$	204,662	$	147,171	39%
Client assets under administration (E)	1,022,515		871,385		17%
Total assets	$	1,227,177	$	1,018,556	20%
Investments in New Businesses:
Equity and fixed-income programs	$	2,825	$	2,017	40%
Liquidity funds	246		202		22%
Total assets under management	$	3,071	$	2,219	38%
Client assets under advisement	2,021		1,070		89%
Client assets under administration (E)	15,110		14,997		1%
Total assets	$	20,202	$	18,286	10%
LSV:
Equity and fixed-income programs (B)	$	93,855	$	83,684	12%


Total:
Equity and fixed-income programs (C)	$	280,858	$	248,038	13%
Collective trust fund programs	204,435		147,001		39%
Liquidity funds	8,046		11,312		(29)%
Total assets under management	$	493,339	$	406,351	21%
Client assets under advisement	10,059		5,155		95%
Client assets under administration (D)	1,045,974		890,781		17%
Platform-only assets	26,948		16,232		66%
Total assets	$	1,576,320	$	1,318,519	20%

(A)Collective trust fund program assets are included in assets under management since SEI is the trustee. Fees earned on this product are less than fees earned on customized asset management programs.

(B) Equity and fixed-income programs include $1.6 billion of assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee (as of September 30, 2024).

(C) Equity and fixed-income programs include $6.4 billion of assets invested in various asset allocation funds at September 30, 2024.

(D) In addition to the assets presented, SEI also administers an additional $8.5 billion in Funds of Funds assets on which SEI does not earn an administration fee (as of September 30, 2024).

(E) Due to the reorganization of business segments, client assets under administration were reclassified from Investment Managers to Investments in New Businesses (See Note 9 to the Consolidated Financial Statements).

Average Asset Balances

(In millions)


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Private Banks:
Equity and fixed-income programs	$	25,823	$	23,920	8%	$	25,092	$	23,748	6%
Collective trust fund programs	5		6		(17)%	5		7		(29)%
Liquidity funds	2,858		3,585		(20)%	3,165		3,446		(8)%
Total assets under management	$	28,686	$	27,511	4%	$	28,262	$	27,201	4%
Client assets under administration	8,074		4,221		91%	7,904		4,273		85%
Total assets	$	36,760	$	31,732	16%	$	36,166	$	31,474	15%
Investment Advisors:
Equity and fixed-income programs	$	76,111	$	69,309	10%	$	74,198	$	68,419	8%
Liquidity funds	4,264		4,990		(15)%	4,420		4,931		(10)%
Total Platform assets under management	$	80,375	$	74,299	8%	$	78,618	$	73,350	7%
Platform-only assets	23,194		16,544		40%	21,096		15,635		35%
Platform-only assets-deposit program	1,176		—		NM	970		—		NM
Total Platform assets	$	104,745	$	90,843	15%	$	100,684	$	88,985	13%
Institutional Investors:
Equity and fixed-income programs	$	77,473	$	75,023	3%	$	76,363	$	74,847	2%
Collective trust fund programs	1		4		(75)%	1		4		(75)%
Liquidity funds	2,046		1,611		27%	1,917		1,621		18%
Total assets under management	$	79,520	$	76,638	4%	$	78,281	$	76,472	2%
Client assets under advisement	7,925		4,294		85%	7,310		4,436		65%
Total assets	$	87,445	$	80,932	8%	$	85,591	$	80,908	6%
Investment Managers:
Collective trust fund programs (A)	$	198,839	$	150,379	32%	$	181,820	$	147,612	23%
Liquidity funds	245		237		3%	226		280		(19)%

Total assets under management	$	199,084	$	150,616	32%	$	182,046	$	147,892	23%
Client assets under administration (E)	1,005,111		873,821		15%	975,574		845,633		15%
Total assets	$	1,204,195	$	1,024,437	18%	$	1,157,620	$	993,525	17%
Investments in New Businesses:
Equity and fixed-income programs	$	2,432	$	2,096	16%	$	2,289	$	2,048	12%
Liquidity funds	546		211		159%	410		207		98%
Total assets under management	$	2,978	$	2,307	29%	$	2,699	$	2,255	20%
Client assets under advisement	1,885		1,101		71%	1,698		1,091		56%
Client assets under administration (E)	14,973		15,682		(5)%	14,944		16,103		(7)%
Total assets	$	19,836	$	19,090	4%	$	19,341	$	19,449	(1)%
LSV:
Equity and fixed-income programs (B)	$	93,195	$	86,671	8%	$	91,584	$	86,050	6%


Total:
Equity and fixed-income programs (C)	$	275,034	$	257,019	7%	$	269,526	$	255,112	6%
Collective trust fund programs	198,845		150,389		32%	181,826		147,623		23%
Liquidity funds	9,959		10,634		(6)%	10,138		10,485		(3)%
Total assets under management	$	483,838	$	418,042	16%	$	461,490	$	413,220	12%
Client assets under advisement	9,810		5,395		82%	9,008		5,527		63%
Client assets under administration (D)	1,028,158		893,724		15%	998,422		866,009		15%
Platform-only assets	24,370		16,544		47%	22,066		15,635		41%
Total assets	$	1,546,176	$	1,333,705	16%	$	1,490,986	$	1,300,391	15%

(A) Collective trust fund program average assets are included in assets under management since SEI is the trustee. Fees earned on this product are less than fees earned on customized asset management programs.

(B) Equity and fixed-income programs include assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee. The average value of these assets for the three months ended September 30, 2024 was $1.7 billion.

(C) Equity and fixed-income programs include $6.3 billion of average assets invested in various asset allocation funds for the three months ended September 30, 2024.

(D) In addition to the assets presented, SEI also administers an additional $8.5 billion of average assets in Funds of Funds assets for the three months ended September 30, 2024 on which SEI does not earn an administration fee.

In the preceding tables, assets under management are total assets of our clients or their customers invested in our equity and fixed-income investment programs, collective trust fund programs, and liquidity funds for which we provide asset management services through our subsidiaries and partnerships in which we have a significant interest. Advised assets include assets for which we provide advisory services through a subsidiary to the accounts but do not manage the underlying assets. Assets under administration include total assets of our clients or their customers for which we provide administrative services, including client fund balances for which we provide administration and/or distribution services through our subsidiaries and partnerships in which we have a significant interest. Platform-only assets-deposit program include assets of our clients in the SEI Integrated Cash program for which we provide custody services through our federal thrift subsidiary. The assets presented in the preceding tables do not include assets processed on SWP and are not included in the accompanying Consolidated Balance Sheets because we do not own them.

Business Segments

Revenues, Expenses and Operating Profit (Loss) for our business segments for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023 were as follows:


	Three Months Ended September 30,						Percent Change	Nine Months Ended September 30,						Percent Change
	2024			2023				2024			2023
Private Banks:
Revenues	$	138,734		$	119,664		16%	$	401,272		$	372,980		8%
Expenses	115,097			111,207			3%	339,961			337,834			1%
Operating Profit	$	23,637		$	8,457		179%	$	61,311		$	35,146		74%
Operating Margin	17		%	7		%		15		%	9		%
Investment Advisors:
Revenues	$	126,836		$	110,461		15%	$	370,141		$	326,579		13%
Expenses	70,152			64,280			9%	206,063			192,004			7%
Operating Profit	$	56,684		$	46,181		23%	$	164,078		$	134,575		22%
Operating Margin	45		%	42		%		44		%	41		%
Institutional Investors:
Revenues	$	71,626		$	70,479		2%	$	214,911		$	219,914		(2)%
Expenses	37,851			39,953			(5)%	116,386			126,337			(8)%
Operating Profit	$	33,775		$	30,526		11%	$	98,525		$	93,577		5%
Operating Margin	47		%	43		%		46		%	43		%
Investment Managers:
Revenues	$	184,607		$	162,982		13%	$	537,128		$	476,683		13%
Expenses	114,118			103,585			10%	334,955			308,483			9%
Operating Profit	$	70,489		$	59,397		19%	$	202,173		$	168,200		20%
Operating Margin	38		%	36		%		38		%	35		%
Investments in New Businesses:
Revenues	$	15,593		$	13,173		18%	$	44,509		$	38,779		15%
Expenses	18,440			18,265			1%	55,403			52,919			5%
Operating Loss	$	(2,847)		$	(5,092)		NM	$	(10,894)		$	(14,140)		NM

For additional information pertaining to our business segments, see Note 9 to the Consolidated Financial Statements.

Private Banks


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Revenues:
Information processing and software servicing fees	$	102,043	$	85,939	19%	$	296,213	$	273,133	8%
Asset management, administration & distribution fees	36,691		33,725		9%	105,059		99,847		5%
Total revenues	$	138,734	$	119,664	16%	$	401,272	$	372,980	8%

Revenues increased $19.1 million, or 16%, in the three month period and increased $28.3 million, or 8%, in the nine month period ended September 30, 2024 and were primarily affected by:

•Increased investment processing fees from new SWP client conversions and growth from existing SWP clients due to market appreciation and increased transaction volumes;

•Increased investment management fees from existing international clients due to market appreciation; and

•Increased investment processing fees earned on our mutual fund trading solution; partially offset by

•One-time early termination fees of $10.5 million from an investment processing client during the second quarter 2023; and

•Lower investment processing fees from the recontracting of existing clients and a client loss.

Operating margins increased to 17% compared to 7% in the three month period and increased to 15% compared to 9% in the nine month period. Operating income increased by $15.2 million, or 179%, in the three month period and increased by $26.2 million, or 74%, in the nine month period and was primarily affected by:

•An increase in revenues as mentioned above; and

•Decreased costs, mainly non-capitalized consulting and other vendor costs from cost containment measures; partially offset by

•Increased amortization expense related to SWP; and

•Increased personnel and stock-based compensation costs.

Investment Advisors


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Revenues:
Investment management fees-SEI fund programs	$	59,707	$	60,046	(1)%	$	176,368	$	181,754	(3)%
Separately managed account fees	49,864		45,175		10%	144,203		129,000		12%
Other fees	17,265		5,240		229%	49,570		15,825		213%
Total revenues	$	126,836	$	110,461	15%	$	370,141	$	326,579	13%

Revenues increased $16.4 million, or 15%, in the three month period and increased $43.6 million, or 13%, in the nine month period ended September 30, 2024 and were primarily affected by:

•Increased fees from separately managed account programs and Strategist programs due to growth from existing clients and market appreciation; and

•New fee revenue of $10.7 million during the third quarter 2024 and $30.4 million during the first nine months of 2024 from the SEI Integrated Cash Program launched in December 2023; partially offset by

•Decreased investment management fees from SEI fund programs resulting from the continued shift out of SEI fund programs into separately managed accounts and other investment products; and

•Fee reductions in our separately managed account programs.

Operating margin increased to 45% compared to 42% in the three month period and increased to 44% compared to 41% in the nine month period. Operating income increased $10.5 million, or 23%, in the three month period and increased $29.5 million, or 22%, in the nine month period and was primarily affected by:

•An increase in revenues as mentioned above; and

•Decreased non-capitalized consulting costs; partially offset by

•Increased direct expenses associated with the increase in separately managed account fees; and

•Increased personnel and stock-based compensation costs.

Institutional Investors

Revenues increased $1.1 million, or 2%, in the three month period and decreased $5.0 million, or 2%, in the nine month period ended September 30, 2024 and were primarily affected by:

•Decreased investment management fees from client losses; partially offset by

•Increased investment management fees from existing clients due to higher assets under management due to market appreciation; and

•Added revenues from the acquisition of XPS Pensions (Nexus) Limited.

Operating margin increased to 47% compared to 43% in the three month period and increased to 46% compared to 43% in the nine month period. Operating income increased $3.2 million, or 11%, in the three month period and increased $4.9 million, or 5%, in the nine month period and was primarily affected by:

•Decreased direct expenses associated with investment management fees;

•Decreased personnel costs; and

•A one-time operational charge of $4.5 million related to a client reimbursement during the second quarter 2023; partially offset by

•A decrease in revenues as mentioned above; and

•Increased personnel, professional fees, amortization and other costs related to the acquisition of XPS Pensions (Nexus) Limited.

Investment Managers

Revenues increased $21.6 million, or 13%, in the three month period and increased $60.4 million, or 13%, in the nine month period ended September 30, 2024 and were primarily affected by:

•Increased revenues from additional services provided to our largest alternative fund clients; and

•Positive cash flows into alternative and traditional funds from new and existing clients; partially offset by

•Client losses and fund closures.

Operating margin increased to 38% compared to 36% in the three month period and increased to 38% compared to 35% in the nine month period. Operating income increased $11.1 million, or 19%, in the three month period and increased $34.0 million, or 20%, in the nine month period and was primarily affected by:

•An increase in revenues as mentioned above; and

•Decreased non-capitalized investment spending, mainly consulting costs; partially offset by

•Increased costs associated with new business, primarily personnel and stock-based compensation costs and third-party vendor costs; and

•Costs to enhance, support and maintain technologies and investment service capabilities.

Investments in New Businesses


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Revenues:
SEI Family Office Services	$	8,990	$	8,116	11%	$	26,068	$	23,828	9%
SEI Private Wealth Management	5,267		4,658		13%	15,175		13,695		11%
Other	1,336		399		235%	3,266		1,256		160%
Total revenues	$	15,593	$	13,173	18%	$	44,509	$	38,779	15%

Revenues increased $2.4 million, or 18%, in the three month period and increased $5.7 million, or 15%, in the nine month period ended September 30, 2024 and were primarily affected by:

•Increased revenues from hosted technology offerings through SEI Family Office Services due to increased non-recurring implementation fees and new business; and

•Increased revenues from SEI Private Wealth Management through higher assets under advisement due to market appreciation and new business.

Other

Corporate overhead expenses

Corporate overhead expenses primarily consist of general and administrative expenses and other costs not directly attributable to a reportable business segment. Corporate overhead expenses were $37.9 million and $31.0 million in the three months ended September 30, 2024 and 2023, respectively, and $109.0 million and $94.5 million in the nine months ended September 30, 2024, respectively. The increase in corporate overhead expenses is primarily due to severance costs, stock-based compensation costs and investments in upgrading and enhancing various technologies utilized by corporate overhead units. Additionally, personnel costs increased from enhancements to further build our compliance infrastructure.

Other income and expense

Other income and expense items on the accompanying Consolidated Statements of Operations consist of:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net gain (loss) from investments	$	427	$	(206)	$	3,349	$	1,053
Interest and dividend income	13,579		11,125		35,950		29,453
Interest expense	(141)		(116)		(419)		(396)
Equity in earnings of unconsolidated affiliate	36,513		29,927		102,375		91,517
Other income	8,151		—		8,151		—
Total other income and expense items, net	$	58,529	$	40,730	$	149,406	$	121,627

Net gain (loss) from investments

Net gain from investments in the three and nine months ended September 30, 2024 were primarily due to unrealized mark-to-market gains recorded in current earnings associated with LSV-sponsored investment funds and Company-sponsored investment funds from market appreciation (See Note 5).

Interest and dividend income

Interest and dividend income is earned based upon the amount of cash that is invested daily. The increase in interest and dividend income in the three and nine months ended September 30, 2024 was due to an overall increase in interest rates.

Other income

Other income is related to a net gain of $8.2 million recognized from the sale of property located in New York, New York during July 2024 (See Note 14 to the Consolidated Financial Statements).

Equity in earnings of unconsolidated affiliate

Equity in earnings of unconsolidated affiliate reflects our ownership interest in LSV. As of September 30, 2024, our total partnership interest in LSV was 38.6%. The table below presents the revenues and net income of LSV and the proportionate share in LSV's earnings.


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Revenues of LSV	$	122,412	$	102,183	20%	$	343,581	$	309,211	11%
Net income of LSV	94,634		77,566		22%	265,335		237,119		12%

SEI's proportionate share in earnings of LSV	$	36,513	$	29,927	22%	$	102,375	$	91,517	12%

The increase in earnings from LSV in the three and nine months ended September 30, 2024 was primarily due to higher assets under management from market appreciation and higher performance fees. Negative cash flows from existing clients and client losses partially offset the increase in earnings from LSV. Average assets under management by LSV increased $5.5 billion to $91.6 billion during the nine months ended September 30, 2024 as compared to $86.1 billion during the nine months ended September 30, 2023, an increase of 6%.

Amortization

Amortization expense on the accompanying Consolidated Statements of Operations consists of:


	Three Months Ended September 30,				Percent Change	Nine Months Ended September 30,				Percent Change
	2024		2023			2024		2023
Capitalized software development costs	$	7,069	$	6,658	6%	$	20,961	$	19,470	8%
Intangible assets acquired through acquisitions and asset purchases	3,276		3,065		7%	10,066		9,178		10%
Other	68		74		(8)%	257		203		27%
Total amortization expense	$	10,413	$	9,797	6%	$	31,284	$	28,851	8%

Capitalized software development costs

The increase in amortization expense related to capitalized software development costs during the three and nine months ended September 30, 2024 was primarily due to significant enhancements to SWP (See Note 1 to the Consolidated Financial Statements).

Income Taxes

The effective income tax rates for the three and nine months ended September 30, 2024 and 2023 differ from the federal income tax statutory rate due to the following:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Statutory rate	21.0	%	21.0	%	21.0	%	21.0	%
State taxes, net of federal tax benefit	2.9		2.8		2.9		2.8
Foreign tax expense and tax rate differential	0.1		(0.1)		0.1		(0.1)
Tax benefit from stock option exercises	(0.1)		(0.6)		(0.4)		(0.3)


Other, net	(0.4)		(0.6)		(0.2)		(0.2)
	23.5	%	22.5	%	23.4	%	23.2	%

Stock-Based Compensation

We recognized $37.2 million and $23.5 million in stock-based compensation expense during the nine months ended September 30, 2024 and 2023, respectively. The increase in expense was primarily due to new equity awards granted during the fourth quarter 2023. The amount of stock-based compensation expense recognized is primarily based upon management's estimate of when the financial vesting targets of outstanding stock options may be achieved. Any change in the estimate could result in the amount of stock-based compensation expense to be accelerated, spread out over a longer period, or reversed. This may cause volatility in the recognition of stock-based compensation expense in future periods and could materially affect earnings (See Note 7 to the Consolidated Financial Statements).

We revised our estimate of when some vesting targets are expected to be achieved. This change in estimate resulted in an increase of $3.1 million in stock-based compensation expense during the nine months ended September 30, 2024. We expect to recognize approximately $31.9 million in stock-based compensation expense during the remainder of 2024.

Fair Value Measurements

The fair value of financial assets and liabilities, except for the investment funds sponsored by LSV, is determined in accordance with the fair value hierarchy. The fair value of the investment funds sponsored by LSV is measured using the net asset value per share (NAV) as a practical expedient. The fair value of all other financial assets are determined using Level 1 or Level 2 inputs and consist mainly of investments in equity or fixed-income mutual funds that are quoted daily and Government National Mortgage Association (GNMA) and other U.S. government agency securities that are single issuer pools that are valued based on current market data of similar assets. Level 3 financial liabilities at September 30, 2024 and December 31, 2023 consist entirely of the estimated fair value of the contingent consideration resulting from an acquisition (See Note 12 to the Consolidated Financial Statements).

Regulatory Matters

Like many firms operating within the financial services industry, we are experiencing a complex and changing regulatory environment across our markets. Our current scale and reach as a provider to the financial services industry, the introduction and implementation of new solutions for our financial services industry clients, the increased regulatory oversight of the financial services industry generally, new laws and regulations affecting the financial services industry and ever-changing regulatory interpretations of existing laws and regulations, and a greater propensity of regulators to pursue enforcement actions and other sanctions against regulated entities, have made this an increasingly challenging and costly regulatory environment in which to operate.

SEI and some of our regulated subsidiaries have undergone or been scheduled to undergo a range of periodic or thematic reviews, examinations or investigations by numerous regulatory authorities around the world, including the Office of the Comptroller of the Currency, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Financial Conduct Authority of the United Kingdom (FCA), the Central Bank of Ireland and others. These regulatory activities typically result in the identification of matters or practices to be addressed by us or our subsidiaries and, in certain circumstances, the regulatory authorities require remediation activities or pursue enforcement proceedings against us or our subsidiaries. From time to time, the regulators in different jurisdictions will elevate their level of scrutiny of our operations as our business expands or is deemed critical to the operations of the relevant financial markets. As described under the caption “Regulatory Considerations” in our Annual Report on Form 10-K, the range of possible sanctions that are available to regulatory authorities include limitations on our ability to engage in business for specified periods of time, the revocation of registration, censures and fines. The direct and indirect costs of responding to these regulatory activities and of complying with new or modified regulations, as well as the potential financial costs and potential reputational impact against us of any enforcement proceedings that might result, is uncertain but could have a material adverse impact on our operating results or financial position.

Liquidity and Capital Resources


	Nine Months Ended September 30,
	2024		2023
Net cash provided by operating activities	$	427,074	$	345,982
Net cash used in investing activities	(57,185)		(48,237)
Net cash used in financing activities	(310,392)		(294,886)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	6,941		(1,474)
Net increase in cash, cash equivalents and restricted cash	66,438		1,385
Cash, cash equivalents and restricted cash, beginning of period	834,998		853,359
Cash, cash equivalents and restricted cash, end of period	$	901,436	$	854,744

Our credit facility provides for borrowings up to $325.0 million and is scheduled to expire in April 2026 (See Note 6 to the Consolidated Financial Statements). As of October 22, 2024, we had outstanding letters of credit of $4.9 million which reduced the amount available under the credit facility. These letters of credit were primarily issued for the expansion of the corporate headquarters and are due to expire in late 2024. As of October 22, 2024, the amount of the credit facility available for corporate purposes was $320.1 million.

The availability of the credit facility is subject to compliance with certain covenants set forth in the agreement. The credit facility contains covenants which restrict our ability to engage in transactions with affiliates other than wholly-owned subsidiaries or to incur liens or certain types of indebtedness as defined in the agreement. In the event of a default under

the credit facility, we would also be restricted from paying dividends on, or repurchasing our common stock. Currently, our ability to borrow from the credit facility is not limited by any covenant of the agreement (See Note 6 to the Consolidated Financial Statements).

The majority of excess cash reserves are primarily placed in accounts located in the United States that invest entirely in SEI-sponsored money market mutual funds denominated in the U.S. dollar. We also utilize demand deposit accounts or money market accounts at several large, well-established financial institutions located in the United States. The institutions we utilize have not indicated any stability issues regarding the ability to honor current or future deposit obligations to their customers. Accounts used to manage these excess cash reserves do not impose any restrictions or limitations that would prevent us from being able to access such cash amounts immediately. As of October 22, 2024, the amount of cash and cash equivalents considered free and immediately accessible for other general corporate purposes was $520.6 million.

Cash and cash equivalents include accounts managed by subsidiaries that are used in their operations or to cover specific business and regulatory requirements. The availability of this cash for other purposes beyond the operations of these subsidiaries may be limited. We therefore do not include accounts of foreign subsidiaries in the calculation of free and immediately accessible cash for other general corporate purposes. A portion of the undistributed earnings of foreign subsidiaries are deemed repatriated. Any subsequent transfer of available cash related to the repatriated earnings of foreign subsidiaries could significantly increase free and immediately accessible cash.

Cash flows from operations increased $81.1 million in the first nine months of 2024 compared to the first nine months of 2023 primarily from the increase in net income. The negative impact from the change in working capital accounts, primarily due to increased client receivables, partially offset the increase in cash flows from operations.

Net cash used in investing activities includes:

•Purchases, sales and maturities of marketable securities. Purchases, sales and maturities of marketable securities in the first nine months of 2024 and 2023 were as follows:


	Nine Months Ended September 30,
	2024		2023
Purchases	$	(134,665)	$	(83,968)
Sales and maturities	121,347		90,245
Net investing activities from marketable securities	$	(13,318)	$	6,277

See Note 5 to the Consolidated Financial Statements for more information related to marketable securities.

•The capitalization of costs incurred in developing computer software. We capitalized $18.4 million of software development costs in the first nine months of 2024 as compared to $26.6 million in the first nine months of 2023. Software development costs are principally related to significant enhancements for the expanded functionality of the SEI Wealth Platform and a new platform for the Investment Managers segment.

•Capital expenditures. Capital expenditures in the first nine months of 2024 were $27.2 million as compared to $23.1 million in the first nine months of 2023. Expenditures in 2024 and 2023 include capital outlays for purchased software and equipment for data center operations. We continue to evaluate improvements to our information technology infrastructure which, if implemented, will result in additional expenditures for purchased software and equipment for data center operations.

•Proceeds from fixed asset dispositions. We received proceeds of $9.9 million after associated costs and expenses from the sale of property located in New York, New York in the third quarter 2024.

•Other investing activities. In February 2024, we made a strategic investment of $10.0 million in an innovation platform for wealth management.

Net cash used in financing activities includes:

•The repurchase of common stock. Our Board of Directors has authorized the repurchase of common stock through multiple authorizations. Currently, there is no expiration date for the common stock repurchase program. We had total capital outlays of $252.9 million during the first nine months of 2024 and $236.9 million during the first nine months of 2023 for the repurchase of common stock.

•Proceeds from the issuance of common stock. We received $62.8 million and $65.7 million in proceeds from the issuance of common stock during the first nine months of 2024 and 2023, respectively. These proceeds were primarily from stock option exercise activity.

•Dividend payments. Cash dividends paid were $120.3 million in the first nine months of 2024 as compared to $114.8 million in the first nine months of 2023.

Cash Requirements

Cash requirements and liquidity needs are primarily funded through cash flow from operations and our capacity for additional borrowing. At September 30, 2024, unused sources of liquidity consisted of cash and cash equivalents and the amount available under our credit facility.

We are obligated to make payments in connection with the credit facility, operating leases, maintenance contracts and other commitments. We believe our operating cash flow, available borrowing capacity, and existing cash and cash equivalents will provide adequate funds for these obligations and ongoing operations. We currently anticipate that our available funds and cash flow from operations will be sufficient to meet our operational cash needs and fund our stock repurchase program for at least the next 12 months and for the foreseeable future.

Forward-Looking Information and Risk Factors

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information contained in this discussion is or may be considered forward-looking. Forward-looking statements relate to future operations, strategies, financial results or other developments. Forward-looking statements are based upon estimates and assumptions that involve certain risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.

Among the risks and uncertainties which may affect our future operations, strategies, financial results or other developments are those risks described in our latest Annual Report on Form 10-K in Part I, Item 1A. These risks include the following:

•changes in capital markets and significant changes in the value of financial instruments that may affect our revenues and earnings;

•product development risk;

•risk of failure by a third-party service provider;

•pricing pressure from increased competition, disruptive technology and poor investment performance;

•the affect on our earnings and cashflows from the performance of LSV Asset Management;

•consolidation within our target markets;

•external factors affecting the fiduciary management market;

•software defects, development delays or installation difficulties, which would harm our business and reputation and expose us to potential liability;

•data and cyber security risks;

•risk of the disclosure and misuse of personal data;

•risk of outages, data losses, and disruptions of services;

•intellectual property risks;

•third-party service providers in our operations;

•poor investment performance of our investment products or a client preference for products other than those which we offer or for products that generate lower fees;

•investment advisory contracts which may be terminated or may not be renewed on favorable terms;

•the effect of governmental regulation;

•our ability to meet competing and/or conflicting regulatory requirements of the different jurisdictions;

•our ability to address conflicts of interest appropriately;

•fiduciary or other legal liability for client losses from our investment management operations;

•the results of commercial disputes, litigation and regulatory examinations and investigations;

•effective business strategies;

•our ability to capture the expected value from acquisitions, divestitures, joint ventures, minority investments or strategic alliances;

•increased costs and regulatory risks from the growth of our business;

•operational risks associated with the processing of investment transactions;

•disruptions of operations of other participants in the global financial system;

•our ability to hire and retain qualified employees;

•the competence and integrity of our employees and third-parties;

•our ability to receive dividends or other payments in needed amounts from our subsidiaries;

•changes in, or interpretation of, accounting principles or tax rules and regulations;

•fluctuations in foreign currency exchange rates;

•fluctuations in interest rates affecting the value of our fixed-income investment securities;

•financial and non-financial covenants which may restrict our ability to manage liquidity needs;

•stockholder activism efforts;

•retention of executive officers and senior management personnel;

•the effectiveness of our business, risk management and business continuity strategies, models and processes;

•unforeseen or catastrophic events, including the emergence of pandemic, extreme weather events or other natural disasters;

•geopolitical unrest and other events;

•climate change concerns and incidents; and

•environmental, social, and governance (ESG) matters.

We conduct operations through many regulated wholly-owned subsidiaries. These subsidiaries include:

•SEI Investments Distribution Co., or SIDCO, a broker-dealer registered with the SEC under the Securities Exchange Act of 1934 and a member of the Financial Industry Regulatory Authority, Inc., or FINRA;

•SEI Investments Management Corporation, or SIMC, an investment advisor registered with the SEC under the Investment Advisers Act of 1940 and with the Commodity Futures Trading Commission, or CFTC, under the Commodity Exchange Act;

•SEI Private Trust Company, or SPTC, a limited purpose federal thrift chartered and regulated by the Office of the Comptroller of the Currency;

•SEI Trust Company, or STC, a Pennsylvania trust company, regulated by the Pennsylvania Department of Banking and Securities;

•SEI Institutional Transfer Agent, Inc., or SITA, a transfer agent registered with the SEC under the Securities Exchange Act of 1934;

•SEI Investments (Europe) Limited, or SIEL, an investment manager and financial institution subject to regulation by the Financial Conduct Authority of the United Kingdom;

•SEI Investments Canada Company, or SEI Canada, an investment fund manager that has various other capacities that is regulated by the Ontario Securities Commission and various provincial authorities;

•SEI Investments Global, Limited, or SIGL, a management company for Undertakings for Collective Investment in Transferable Securities, or UCITS, and for Alternative Investment Funds, or AIFs, that is regulated primarily by the Central Bank of Ireland, or CBI;

•SEI Investments - Global Fund Services, Ltd., or GFSL, an authorized provider of administration services for Irish and non-Irish collective investment schemes that is regulated by the CBI;

•SEI Investments - Depositary and Custodial Services (Ireland) Limited, or D&C, an authorized provider of depositary and custodial services that is regulated by the CBI;

•SEI Investments - Luxembourg S.A., or SEI Lux, a professional of the specialized financial sector subject to regulation by the Commission de Surveillance du Secteur Financier of the Grand Duchy of Luxembourg;

•SEI Investments Global (Cayman), Ltd., a full mutual fund administrator that is regulated by the Cayman Island Monetary Authority; and

•SEI Investments (South Africa) (PTY) Limited, a Private Company that is a licensed Financial Service Provider regulated by the Financial Sector Conduct Authority.

In addition to the regulatory authorities listed above, our subsidiaries are subject to the jurisdiction of regulatory authorities in other foreign countries. In addition to our wholly-owned subsidiaries, we also own a minority interest of approximately 38.6% in LSV, which is also an investment advisor registered with the SEC.

The Company, its regulated subsidiaries, their regulated services and solutions and their customers are all subject to extensive legislation, regulation, and supervision that recently has been subject to, and continues to experience,

significant change and increased regulatory activity. These changes and regulatory activities could have a material adverse effect on us and our clients.

The various governmental agencies and self-regulatory authorities that regulate or supervise the Company and its subsidiaries have broad administrative powers. In the event of a failure to comply with laws, regulations, and requirements of these agencies and authorities, the possible business process changes required or sanctions that may be imposed include the suspension of individual employees, limitations on our ability to engage in business for specified periods of time, the revocation of applicable registration as a broker-dealer, investment advisor or other regulated entity, and, as the case may be, censures and fines. Additionally, certain securities and banking laws applicable to us and our subsidiaries provide for certain private rights of action that could give rise to civil litigation. Any litigation could have significant financial and non-financial consequences including monetary judgments and the requirement to take action or limit activities that could ultimately affect our business.

Governmental scrutiny from regulators, legislative bodies, and law enforcement agencies with respect to matters relating to our regulated subsidiaries and their activities, services and solutions, our business practices, our past actions and other matters has increased dramatically in the past several years. Responding to these examinations, investigations, actions, and lawsuits, regardless of the ultimate outcome of the proceeding, is time consuming and expensive and can divert the time and effort of our senior management from our business. Penalties, fines and changes to business processes sought by regulatory authorities have increased substantially over the last several years, and certain regulators have been more likely in recent years to commence enforcement actions or to advance or support legislation targeted at the financial services industry. We continue to be subject to inquiries from examinations and investigations by supervisory and enforcement divisions of regulatory authorities and expect this to continue in the future. We believe this is also the case with many of our regulated clients. Governmental scrutiny and legal and enforcement proceedings can also have a negative impact on our reputation, our relationship with clients and prospective clients, and on the morale and performance of our employees, which could adversely affect our businesses and results of operations.

We are subject to U.S. and foreign anti-money laundering and financial transparency laws that require implementation of regulations applicable to financial services companies, including standards for verifying client identification and monitoring client transactions and detecting and reporting suspicious activities. We offer investment and banking solutions that also are subject to regulation by the federal and state securities and banking authorities, as well as foreign regulatory authorities, where applicable. Existing or future regulations that affect these solutions could lead to a reduction in sales of these solutions or require modifications of these solutions.

We must comply with economic sanctions and embargo programs administered by the Office of Foreign Assets Control (OFAC) and similar national and multinational bodies and governmental agencies outside the United States, as well as anti-corruption and anti-money laundering laws and regulations throughout the world. We can incur higher costs and face greater compliance risks in structuring and operating our businesses to comply with these requirements. Furthermore, a violation of a sanction or embargo program or anti-corruption or anti-money laundering laws and regulations could subject us and our subsidiaries, and individual employees, to regulatory enforcement actions as well as significant civil and criminal penalties.

Our businesses are also subject to privacy and data protection information security legal requirements concerning the use and protection of certain personal information. These include those adopted pursuant to the Gramm-Leach-Bliley Act and the Fair and Accurate Credit Transactions Act of 2003 in the United States, the General Data Protection Regulation (GDPR) in the EU, Canada’s Personal Information Protection and Electronic Documents Act, the Cayman Islands' Data Protection Law, and various other laws. Privacy and data security legislation is a priority issue in many states and localities in the United States, as well as foreign jurisdictions outside of the EU. For example, California enacted the California Consumer Privacy Act (CCPA) which broadly regulates the sale of the consumer information of California residents and grants California residents certain rights to, among other things, access and delete data about them in certain circumstances. Other states are considering similar proposals. Such attempts by the states to regulate have the potential to create a patchwork of differing and/or conflicting state regulations. Ensuring compliance under ever-evolving privacy legislation, such as GDPR and CCPA, is an ongoing commitment, which involves substantial costs.

Compliance with existing and future regulations and responding to and complying with recent increased regulatory activity affecting broker-dealers, investment advisors, investment companies, financial institutions, and their service providers could have a significant impact on us. We periodically undergo regulatory examinations and respond to regulatory inquiries and document requests. In addition, recent and continuing legislative activity in the United States and in other jurisdictions (including the European Union and the United Kingdom) have made and continue to make extensive changes to the laws regulating financial services firms. As a result of these examinations, inquiries, and requests, as a result of increased civil litigation activity, and as a result of these new laws and regulations, we engage legal counsel and other subject matter experts, review our compliance procedures, solution and service offerings, and business operations, and

make changes as we deem necessary or as may be required by the applicable authority. These additional activities and required changes may result in increased expense or may reduce revenues.

Our bank clients are subject to supervision by federal, state, and foreign banking and financial services authorities concerning the manner in which such clients purchase and receive our products and services. Our plan sponsor clients and our subsidiaries providing services to those clients are subject to supervision by the Department of Labor and compliance with employee benefit regulations. Investment advisor and broker-dealer clients are regulated by the SEC, state securities authorities, or FINRA. Existing or future regulations applicable to our clients may affect our clients’ purchase of our products and services.

In addition, see the discussion of governmental regulations in Item 1A “Risk Factors” in our latest Annual Report on Form 10-K for a description of the risks that the current regulatory regimes and proposed regulatory changes may present for our business.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Information required by this item is set forth under the captions "Our revenues and earnings are affected by changes in capital markets and significant changes in the value of financial instruments" and "Changes in interest rates may affect the value of our fixed-income investment securities" in Item 1A Risk Factors and under the caption "Sensitivity of our revenues and earnings to capital market fluctuations" in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023. There have been no material changes to this information as it is disclosed in our Annual Report on Form 10-K for 2023.

Item 4. Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report are effective in ensuring that information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. A controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

(b) Change in Internal Control over Financial Reporting

No change in our internal control over financial reporting occurred during the quarter ended September 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

We and certain of our subsidiaries are a party to or have property subject to litigation and other proceedings, examinations and investigations that arise in the ordinary course of our business that we do not believe are material. These types of matters could result in fines, penalties, cost reimbursements or contributions, compensatory or treble damages or non-monetary sanctions or relief. We believe the probability is remote that the outcome of any of these matters will have a material adverse effect on SEI as a whole, notwithstanding that the unfavorable resolution of any matter may have a material effect on our net earnings in any particular interim reporting period. We cannot predict the outcome of legal or other proceedings with certainty. These matters include the proceedings summarized in “Note 11. Commitments and Contingencies” included in our Notes to Consolidated Financial Statements.

Item 1A. Risk Factors.

Information regarding risk factors appears in Part I – Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. There have been no material changes in the risk factors from those disclosed in the Annual Report on Form 10-K for 2023.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(e) Our Board of Directors has authorized the repurchase of up to $5.828 billion worth of our common stock through multiple authorizations through September 30, 2024. Currently, there is no expiration date for the common stock repurchase program. On October 22, 2024, our Board of Directors approved an increase in the stock repurchase program by an additional $400.0 million, increasing the available authorization to approximately $429.1 million.

Information regarding the repurchase of common stock during the three months ended September 30, 2024 is as follows:


Period	Total Number of Shares Purchased	Average Price Paid per Share (1)		Total Number of Shares Purchased as Part of Publicly Announced Program	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
July 2024	125,000	$	67.28	125,000	$	106,504,000
August 2024	623,000	66.02		623,000	65,359,000
September 2024	525,000	67.64		525,000	29,100,000
Total	1,273,000	$	66.81	1,273,000

(1) Average price paid per share does not include excise tax on stock repurchases.

Item 5. Other Information.

During the three months ended September 30, 2024, none of our officers or directors adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any "non-Rule 10b5-1 trading arrangement" (as defined in Item 408 (c) of Regulation S-K).

Item 6. Exhibits.

The following is a list of exhibits filed as part of the Form 10-Q.


10.1			Employment Agreement, dated June 6, 2024, between Michael Lane and the Registrant.

31.1			Rule 13a-15(e)/15d-15(e) Certification of Principal Executive Officer.

31.2			Rule 13a-15(e)/15d-15(e) Certification of Principal Financial Officer.

32			Section 1350 Certifications.

101.INS			XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH			XBRL Taxonomy Extension Schema Document

101.CAL			XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF			XBRL Taxonomy Extension Definition Linkbase Document

101.LAB			XBRL Taxonomy Extension Label Linkbase Document

101.PRE			XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SEI INVESTMENTS COMPANY

Date:

October 25, 2024

By:

/s/ Sean J. Denham

Sean J. Denham

Chief Financial Officer