Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Franklin Resources (BEN) delivered strong Q2 FY2026 results with revenue rising 8.7% YoY to $2.29B and operating income more than doubling (+122%) to $323.3M, reflecting significant margin expansion despite negative operating cash flow on a year-to-date basis.
Revenue
$2.29B
+8.69% YoY
EPS (Diluted)
$0.49
+88.46% YoY
Operating Income
$323.3M
+122.05% YoY
Source: SEC XBRL
Franklin Resources (BEN) reported Q2 FY2026 revenue of $2.29B, up 8.7% year over year. Operating margin was 14.1%, up 7.2 points from 6.9% a year earlier. BEN's fiscal Q2 FY2026 corresponds to calendar Q1 2026.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 0.72 | 0.68 | Beat +6.2% |
| Mar 2026This filing | 0.71 | 0.56 | Beat +27.7% |
| Dec 2025 | 0.70 | 0.56 | Beat +25.2% |
| Sep 2025 | 0.67 | 0.58 | Beat +15.0% |
Adjusted (non-GAAP) EPS of $0.71 versus the $0.56 analyst consensus — a +27.7% beat for Mar 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $0.49.
Compiled by AI from this SEC filing
Revenue increased 8.7% YoY from $2.11B to $2.29B in Q2 FY2026, suggesting improved assets under management levels and/or fee rates, likely supported by market appreciation and net flows into higher-fee strategies.
Source: 10-Q Income Statement Data
Operating margin nearly doubled from approximately 6.9% to 14.1% YoY, with operating income surging 122% to $323.3M, indicating significant operating leverage and/or meaningful cost discipline relative to revenue growth.
Source: 10-Q Income Statement Data
Net income grew 77.1% YoY to $268.2M, with basic and diluted EPS rising 88.5% to $0.49, reflecting both improved profitability and the impact of share repurchases reducing the share count.
Source: 10-Q Income Statement Data
On a fiscal year-to-date basis, operating cash flow was negative at -$282.7M (vs. -$195.3M prior year) and investing cash flow was -$1.68B, while financing activities generated $1.98B — suggesting the company raised capital to fund investments and acquisitions.
Source: 10-Q Cash Flow Statement Data
Total liabilities rose 16.0% YoY to $19.49B while stockholders' equity declined 1.8% to $12.12B, pushing the debt-to-equity ratio to approximately 1.61x, reflecting increased financial leverage that warrants monitoring.
Source: 10-Q Balance Sheet Data
Compiled by AI from this SEC filing · 3 high, 2 medium, 0 low
BEN generated negative operating cash flow of -$282.7M on a year-to-date basis, worsening from -$195.3M in the prior year period. Sustained negative operating cash flow in an asset management business could signal fee pressure, elevated compensation costs, or working capital challenges that may pressure future liquidity.
Source: 10-Q Cash Flow Statement Data
Total liabilities increased 16.0% YoY to $19.49B while equity declined slightly, resulting in a debt-to-equity ratio of approximately 1.61x. This elevated leverage reduces financial flexibility and increases vulnerability to market downturns or rising interest rates.
Source: 10-Q Balance Sheet Data
As an asset manager, BEN's revenue is directly tied to assets under management, which fluctuate with equity and fixed income market levels. A significant market downturn could reduce AUM, compress management fees, and reverse the revenue and margin gains seen in Q2 FY2026.
Source: 10-Q Income Statement Data
Year-to-date share repurchases surged 526.6% to $99.0M even as operating cash flow remained negative, suggesting buybacks are being funded through financing activities rather than organic cash generation, which may not be sustainable long-term.
Source: 10-Q Cash Flow Statement Data
ROA of 0.79% and ROE of 2.21% remain very low, indicating the company is generating minimal returns on its large asset and equity base. This could reflect integration costs from acquisitions or structural inefficiencies that may take time to resolve.
Source: 10-Q Key Ratios Data
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 2.29 $B | 2.11 $B | +8.69% |
Operating Income $M | 323.30 $M | 145.60 $M | +122.05% |
Net Income $M | 268.20 $M | 151.40 $M | +77.15% |
EPS (Basic) $ | 0.49 $ | 0.26 $ | +88.46% |
EPS (Diluted) $ | 0.49 $ | 0.26 $ | +88.46% |
Answers draw on this SEC filing and the data on this page
In Q3 FY2026, Franklin Resources (BEN) reported a 14.3% YoY revenue increase to $2.36B and an 85.8% rise in net income to $171.5M, supported by total AUM reaching $1.79T, despite a $100.0M regulatory settlement charge.
Franklin Resources (BEN) delivered strong Q1 FY2026 results with revenue up 3.4% YoY to $2.33B and net income surging 56.2% to $255.5M, though operating cash flow remained negative at -$255.1M.
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