Welcome to Invesco's Second Quarter Earnings Conference Call. All participants will be on a listen-only mode until the question-and-answer session. At that time, to ask a question, press star one. This call will last one hour. To To allow more participants to ask questions, one question and a follow-up can be submitted per participant. As a reminder, today's call is being recorded. Now I turn today's call over to Mr. Greg Ketron, Invesco's Head of Investor Relations. Thank you. You may begin. Thanks, operator, and to all of you joining us on Invesco's quarterly earnings call. In addition to today's press release, we have provided a presentation that covers the topics we plan to address. The press release and presentation are available on our website, invesco.com. This information can be found by going to the investor relations section of the website. Our presentation today will include forward-looking statements and certain non-GAAP financial measures. Please review the disclosures on slide two of the presentation regarding these statements and measures, as well as the appendix for the appropriate reconciliations to GAAP. Finally, Invesco is not responsible for and does not edit nor guarantee the accuracy of our earnings teleconference transcripts provided by third parties. The only authorized webcasts are located on our website. Andrew Schlossberg, President and CEO, and Allison Dukes, Chief Financial Officer, will present our results this morning, and then we'll open up the call for questions. I'll now turn the call over to Andrew. Thanks, Greg, and good morning to everyone. I'm pleased to be speaking with you today. During the Q2, we had several bright spots of performance and growing business momentum against a continued complex market, economic, and geopolitical backdrop. Leveraging our vast client network, our broad product suite, and improving investment results, we continue to drive higher demand for our capabilities. For the period, we garnered $16.7 billion of net long-term flows, which is a 6% annualized organic growth rate, marking our best quarter in over two years. Importantly, we were in net positive long-term inflows in each of our three regions across active and passive strategies and in both our institutional and retail channels. We ended the quarter with over $1.7 trillion in AUM, which was up 12% from the prior year, reaching a record high for Invesco. We generated positive operating leverage with revenues up over 3% from the Q1 and we expanded our operating margin by over 270 basis points to 30.9%. This resulted in adjusted operating income growth in the Q2 that was in double digits on both the sequential quarter and year-over-year basis. As mentioned, the market environment remained choppy in the quarter, and while we saw some broadening and increasing demand for risk assets, general uncertainty and continued higher interest rates have impacted client investment behavior and our business results. Notably, after an up and down April and May, most major equity indices rallied towards the end of the Q2. U.S. markets continued to lead the way, with the NASDAQ gaining 8%, followed by the S&P 500 increasing 4%. However, the theme of narrow market returns continued, with the S&P 500 Equal Weight Index, by contrast, declining by 3% in the quarter. Equity returns outside the U.S. were mixed, with the MSCI Emerging Markets up 4%, Asia up 2%, and Europe down 1%. Improvement in China's equity markets, which were up 6% in the quarter, were a welcome bright spot. On the fixed income side of the markets, the Bloomberg Global Aggregate Index declined by 1% in the quarter, while most other major bond indices were relatively flat. All of that said, we have plenty of reasons to be optimistic that with increasing market and interest rate clarity, a broadening of participation will continue to take hold, and investor appetite for more duration, risk-on, and global-oriented assets will increase. So moving on to slide 3 of the presentation, we continue to believe that our advantageous market position and clarity of strategic focus provides us with the tools to deliver enhanced operating performance and returns for our shareholders. Specifically, we have built a strong global footprint with scaled businesses in the U.S. and other key developed markets and a significant and unique Asia-Pacific profile, which includes hard-to-replicate and a leading 20-year-old joint venture in China and 30 years of longevity in the growing Japanese market. We have also developed a diverse yet focused range of active investment strategies. This includes both public and private market strengths and a multi-asset profile that empowers Invesco to meet a range of client demands, provides us diversification to perform in various market cycles, and allows us to adjust as secular changes continue to develop. One of those secular trends is the continued client appetite for ETFs. Here again, we are extremely well-positioned with a scaled and growing suite of capabilities. Our focus is on innovation and providing access to passive, factor, and active strategies. Our ETF franchise continues to gain market share globally while accelerating its profitability and its overall contribution to the firm. Finally, a hallmark of Invesco is our leading distribution platform. It's an area of particular strength in the U.S. wealth management market, which is the world's largest asset channel and an area with significant growth potential, particularly given the democratization of certain asset classes like private markets. Our strategic focuses, which you can see in the middle of slide three, are predicated on prioritizing the intersection of market size and secular change, with Invesco's unique position to drive growth in the highest opportunity regions, channels, and asset classes. As you'd expect, our top priority is investment performance, which is key to winning market share regardless of overall client demand—o f highest order is continuing to enhance the quality of our active equity strategies and thereby driving greater retention and net flows into this important segment. We have tightened elements of risk management, and the relationship between investments, products, and distribution has never been stronger. Our investment teams have started to put up much better performance numbers, which I'll highlight momentarily. An additional area of focus is on profitable organic growth. A significant driver of this is through our focus on high-demand, scalable investment capabilities and delivery vehicles. In this regard, we are continuing to work to improve the operating leverage and profitability of our fixed income and multi-asset capabilities on the asset side of things and ETFs and SMAs on the vehicle side. Furthermore, we have a focus on private markets. We have a very strong institutional footprint, which has been historically focused on real estate and private and alternative credit. We are now taking steps to bring those capabilities into the faster-growing wealth management space while continuing to tap into ongoing demand in institutional markets globally. More tactically, we're focused on taking next-generation technology and deploying it through our platform at the enterprise, distribution, and investment levels. And finally, we are improving the financial flexibility of the firm, strengthening the balance sheet, and generating operating leverage as we continue to deliver better returns for our shareholders. These are the outcomes that we're seeking to achieve through the key performance indicators that are outlined on the right-hand side of slide three. They are also the themes at the forefront of today's discussion on Q2 results. So flipping forward to slide four. Against the backdrop of the aforementioned market conditions and Invesco's strategic priorities and strengths that I just outlined, you can see on this slide the key flow drivers across our investment capabilities. Our strong organic flow growth in the Q2 continued to be led by our global ETF franchise. During the period, we continued to gain market share in this segment, recording $12.8 billion in net long-term inflows, which represented a 13% annual organic growth rate. This was our highest growth ETF quarter in over two years, and we ended the period with a record high of $415 billion in long-term ETF AUM. Growth this quarter was led by our equity innovation suite, our factor-based equities, and our fixed income BulletShares franchise. The QQQM is our fastest-growing ETF and is now the third largest fund on our platform. This innovative product leverages our QQQ popularity, but we earn a direct fee instead of the marketing benefits we receive on the QQQ Trust, which equates to around $200 million annually. We also saw strong growth from APAC this quarter with over $5 billion of net inflows, and we recently broke through the $100 billion mark of ETF AUM in that region. Additionally, we continue to innovate to meet client needs. Invesco is one of the few global asset managers capable of servicing clients who want customizable cross-regional ETFs for exacting exposures, such as the recently launched sustainable energy ETF, which garnered $1.6 billion in assets at its launch in June. The continued advantage of ETFs is evident in both passive and active formats and across all channels, creating even more opportunity for expansion in this space. Shifting to fixed income, we continue to believe that as investors gain greater clarity on inflation and central bank interest rate policy, they're going to move out of cash and extend their duration profiles of their fixed income allocations into a wider range of strategies. Though this anticipated shift may be more protracted than originally expected, we continue to see some green shoots. During the Q2, client demand accelerated, and we garnered $1.6 billion in net long-term inflows into our active fundamental fixed income strategies, which is in addition to the $2 billion of fixed income ETF flows achieved. Active inflows were driven in part by municipal bond strategies delivered through our mutual fund and our SMA platforms. We rank in the top five overall in munis and number two for high-yield munis. We're also well-positioned in SMAs with over 50 strategies placed on more than 80 broker-dealers and RIA platforms. Our retail SMA offering has rapidly expanded to over $25 billion and has had an annual organic growth rate of 28%, making it one of the fastest-growing in the industry. We're also positioned with fixed income strategies in our institutional channels globally, and this quarter, we had solid net inflows driven by investment-grade strategies sourced in the Asian region. We remain well-positioned across the risk and duration fixed income asset classes and have plenty of reasons to be optimistic about our ability to capture flows as we continue to generate investment performance. Moving on to private markets, here we also maintained momentum in the Q2, recording net long-term inflows of $2.6 billion driven by the strength in our credit strategies, notably bank loans and CLOs. We also saw modest positive flows into direct lending, as well as continued inflows into INCREF, which is our non-exchange-traded REIT focused on private real estate debt. This fund has maintained good momentum in the U.S. wealth management advisory space since its launch last year. It's important to note that our global real estate team has over $5 billion of dry powder to capitalize on opportunities emerging from the market dislocation of the last several quarters. Picking up on Asia-Pacific managed assets, we generated exceptionally strong net long-term inflows of $6.7 billion in assets managed in this region. This was led by our China JV, where our net long-term inflows of $8.5 billion in the Q2 surpassed the full year of 2022 and 2023 flows combined. These flows were driven by our strong-performing fixed income and balance strategies, where demand returned from investors seeking higher-returning fixed income products given the low-rate environment in China. We anticipate that this dynamic will continue to play out in the coming quarters given the evolving economic environment in the market. We also launched four new equity products this quarter in China, which added $200 million of flow during the period. Additionally, as part of a collaboration between our China JV and global ETF team, we launched in June Europe's first ETF link to the ChiNext 50 Index, which is a fund with unique access to long-term growth potential in China. The ETF market in China has seen rapid growth recently, and we are uniquely positioned to gain share and be an early mover and innovator in this space. Picking up on multi-asset-related capabilities, as noted, we saw modest net outflows attributable to lower-fee quantitative strategies. And finally, the relative pressure on active fundamental equity flows did continue. However, as I pointed out previously, we have seen moderation, namely in the global, international, and emerging market segments. Net outflows in these strategies have slowed during the past several quarters to $1-$2 billion in aggregate, which is markedly lower than the 2022 quarterly peak outflows, where we saw $6 billion. A continued bright spot in our active fundamental equity capabilities has been our global equity and income strategy, which is among the top-selling active retail funds in the growing Japanese market. This fund delivered an incremental $1.2 billion of net inflows in the Q2, and its rapid rise in AUM has placed it in our top 10 active equity funds at Invesco. Overall, we're confident that the high-quality active equity management will continue to be an area of significant portfolio allocations, and it's a reason that we are so acutely focused on investment quality and performance in this area. Moving on to slide five, this chart provides an alternative aggregation of our AUM and our flows to provide you with additional context on our results. From a geographic perspective, you can see that we delivered solid net long-term inflows across all three regions, with particular strength in Asia-Pacific, where we had over $10 billion sourced from clients in these markets. Strong growth in China was augmented by continued momentum in Japan, where we have seen institutional demand for fixed income, most notably investment grade, as well as the continued retail demand for the aforementioned global equity and income strategy. It's important to note that this view of the Asia-Pacific region is a more holistic measure of the scale of our business than the previous slide. The AUM and flow numbers not only include the products that we manage in the region, but also the breadth of Invesco's other products managed globally that are sold into the Asia-Pacific market. An additional key takeaway from slide five is depicted in the chart at the bottom center of the page. Here you can see the significant improvement in return to positive net flows in our overall active investment strategies. This cuts across all asset classes, public and private markets. Furthermore, you'll note the graph on the bottom right of the page, the positive flows and strong improvement seen in our institutional channel. This is driven by demand pickup across both public and private credit. So moving forward to slide 6 for an update on investment results. As I have reiterated several times this morning, investment performance is a top priority of our firm. This slide shows our overall results relative to benchmark and peers, as well as our performance and key capabilities, where information is readily comparable and more meaningful to driving results. Investment performance was solid in the Q2. On a one-, three-, and five-year basis, overall performance improved incrementally from last quarter with 70%, 65%, and 76% respectively of our AUM beating its benchmark. Additionally, on a one-year basis, we have improved, and we now have nearly 70% of our AUM in the top half of peers and 45% in the top quartile of peers. At the asset class level, we continue to have excellent fixed income performance across nearly all capabilities and time horizons, supporting our strong conviction in our ability to attract flows as investors deploy money into these strategies. Specifically, 92% of our fundamental fixed income capabilities are beating their benchmark, with 83% of our AUM in the top half of peers on a five-year basis. We're acutely focused on improving fundamental equity performance and have been making progress here as well. Half of our funds are now performing above benchmark on a one-year basis, with 52% beating peers on a one- and five-year basis. So hopefully, the overall additional context and the more detailed disclosures that we have shared today and last quarter have further clarified our results, outlined the significant opportunities that we have before us, and provided more clarity on our approach to capitalize on them over time. So with that, I'm going to turn the call over to Allison to discuss our financial results for the quarter, and I look forward to your questions. All right. Thank you, Andrew. Good morning, everyone. I'm going to begin on slide seven with our Q2 financial results. Total assets under management at the end of the Q2 were over $1.7 trillion, $53 billion, or 3.2% higher than last quarter end, and a record high for Invesco. Higher markets account for $27 billion of the increase, while net long-term inflows drove a $16.7 billion increase in AUM during the quarter. Of the $27 billion increase due to higher markets, $24 billion was driven by ETFs, including $21 billion by the QQQ. As Andrew noted, net long-term inflows were strong at $16.7 billion, which represented an organic growth rate of nearly 6%. We had long-term net inflows across most of our investment capabilities. ETF inflows, excluding the QQQ, were $12.8 billion in the Q2. APAC generated $6.7 billion in net inflows. Private markets drove $2.6 billion in net inflows, and fundamental fixed income had $1.6 billion in net inflows. Partially offsetting this was $6.3 billion in fundamental equity net outflows during the quarter. Average assets under management grew $56 billion, or 3.5% quarter-over-quarter, to $1.67 trillion. Net revenues, adjusted operating income, and adjusted operating margin improved from the Q1, and I'll cover the drivers of those improvements shortly. Adjusted diluted earnings per share was $0.43 for the Q2 versus a prior quarter EPS of $0.33. We further strengthened the balance sheet during the Q2 by paying down the credit facility from $368 million drawn at the end of the Q to zero drawn at the end of the Q2. We ended the quarter with net debt of nearly zero and were on track to remain at net debt of zero or better in the second half of this year. As a result, we do expect to resume share buybacks in the Q3. Moving to slide eight, as we've discussed in prior calls, secular shifts in client demand have altered our asset mix and net revenue yields as our broad set of capabilities has allowed us to capture evolving client product preferences, and this has been increasingly captured in our results. Our portfolio is better diversified today than four years ago, and our concentration risk in higher-fee fundamental equities and multi-asset products has been reduced. These dynamics should portend well for future revenue growth and marginal profitability improvement. The firm is better positioned to navigate various market cycles, events, and shifting client demand. One other element to note on this slide are the current net revenue yield trends. The ranges by capability are representative of where the net revenue yields have ranged over the past five quarters, and we note the net revenue yield drivers and where in the range the yields have trended more recently. This should provide you better visibility on where current net revenue yields are running by capability. Turning to slide nine, net revenue of $1.1 billion in the Q2 was $33 million higher than the Q1, a 3% increase and nearly unchanged from the Q2 of last year. The increase from last quarter was largely in line with the 3.5% increase in average AUM quarter-over-quarter. Investment management fees were $27 million higher than last quarter, driven by higher average AUM and partially offset by the aforementioned AUM mix shift. Performance fees were $16 million higher than the Q1 due to seasonality, as we typically see an increase in performance fees in the Q2 as compared to the Q1. The increase in performance fees was primarily driven by private real estate and our China JV business. Total adjusted operating expenses in the second quarter were $750 million, a decrease of $7 million, or 1% from the Q1. Compensation expense was $1 million lower than the prior quarter. The benefit from lower seasonal-related compensation expenses in the Q2 was offset by higher compensation related to higher revenues in the Q2, including higher performance fee-related comp. G&A was $7 million lower than the prior quarter, as costs associated with our Alpha platform implementation increased from $7 million in the Q1 to $12 million in the Q2, which was more than offset by lower professional-related fees in the Q2 Going forward, we continue to expect Alpha-related one-time implementation costs to be approximately $10 million per quarter for the remainder of 2024, with some fluctuation quarter to quarter. We'll continue to update our progress on the implementation and related costs as we progress through the implementation. On a year-over-year basis, total adjusted operating expenses were $12 million lower, adjusting for $27 million related to executive retirements and organizational change-related expenses in the second quarter of last year, largely driven by lower G&A expenses. Quarter-over-quarter, positive operating leverage was 400 basis points, driving a $39 million, or 13% increase in operating income, and a 270 basis point improvement in our operating margin to 30.9%. The effective tax rate was 22.1% in the Q2. We estimate our non-GAAP effective tax rate to be between 23%-25% for the Q3 of 2024. The actual effective tax rate can vary due to the impact of non-recurring items on pre-tax income and discrete tax items. Now, I'll finish on slide 10. We continue to make progress on building balance sheet strength in the Q2. At the end of the Q1, we had $368 million drawn on our credit facility as we redeemed the $600 million in senior notes that matured on January 30th, and the Q1 is a seasonally high cash usage quarter. We ended the Q1 with net debt of $362 million. During the Q2, we paid down the credit facility to zero and improved our net debt position to nearly zero. Both results were ahead of our expectations. These actions resulted in an improvement in our leverage ratios and we're now down to a leverage ratio, excluding preferred stock, of 0.28 times, a significant improvement over the past several years. Given these results, we expect to maintain or improve our net debt position going forward. We're also in position to begin a more regular stock buyback program in the Q3. Initially, we expect to buy back around $25 million per quarter, depending on market conditions. We expect our total payout ratio to move into the 50%-60% range, which we will continually evaluate. To conclude, the resiliency and strength of our firm's net flow performance is evident again this quarter, and we continue to make progress on simplifying the organization and building a stronger balance sheet while also continuing to invest in areas of growth. We remain committed to driving profitable growth, a high level of financial performance, and enhancing return of capital to shareholders. And with that, we'll open up the call to Q&A if the operator would like to open it up. Sure. At this time, if you'd like to ask a question, please press star then one. You will be announced prior to asking your question. Please pick up your handset when asking your question. To withdraw your request, please press star two. One moment for our first question. Okay. Our first question comes from Glenn Schorr with Evercore, and your line is open. Hi. Thank you. Just a couple of qualifiers. The fee rate came down. The fee rate range came down on ETFs and multi-asset. I just want to make sure that first bullet says basically that that's a result of ongoing mix shift and not some actual fee adjustments, correct? That is correct, Glenn. We continue to see within both of those capability categories just continued mix across the product spectrum there, no real fee adjustments. Okay. Cool. Then maybe just a little bit more color. You made two forward-leaning comments that were interesting. One was related to the green shoots for fixed income. I don't know if that was related to RFPs picking up, and the other one was on the APAC flows in China specifically, and you said you think this dynamic continues to play out. So I wonder if you could expand on those two comments. Thank you. Yeah. Maybe I'll start. Glenn, thanks for the questions. On the fixed income side, it's partially RFP volume, it's partially flow volume, it's partially demand that we're hearing towards longer duration assets, moving away from some of the short-term fixed income, and that's happening on both the retail and the institutional side of things. I don't know if you want to add anything on fixed income. I'll come back to. And then on Asia and China in particular, yeah, we're seeing very, very strong demand. Right now, it's been principally in the fixed income and fixed income plus, which is essentially balanced, a little less on the equity side, but the flows have been quite strong, and we think some of the developments in China on the economic side and some of the market reform are portending well for client activity in China. Thanks, Andrew. Thank you. Now, next question comes from Brennan Hawken with UBS. Your line is open. Good morning. Thanks for taking my questions. I wanted to drill into the distribution and servicing fee dynamic. It seems as though this has been a trend towards maybe on a net basis, a bigger and bigger headwind from net distribution. Is this similar to what we're seeing on the fee rate side, where it has to do with mix shift and away from products that have some distribution revenue components and maybe such as ETFs, less of that benefit and therefore somewhat sustainable? Good question. Good morning, Brennan. I would say maybe somewhat, but the way I would think about it, and just keep in mind last quarter we had a real anomaly as it related to the proxy costs that you saw coming through both service and distribution fee revenue and then offset on the third-party side. And so I feel like you almost have to throw out last quarter a little bit, but as you look at the relationship across a series of quarters, I think it's important to focus on the relationship between service and distribution fees and third-party distribution contra revenue because there's such a pass-through between those two elements. And then looking at that as a percentage of management fees, it runs relatively consistent in that 13%-14% range, which I think we're finding to be a better relationship than just third-party as a percentage of management fees. But I do think there is some element of that mix shift in there to focus on as you think about that relationship going forward. Okay. Thanks for that, Allison. And how should we be thinking about the lower professional-related fees in G&A? I believe you said that's what drove G&A to be a bit lower here this quarter. Is that sustainable? Could you maybe give us a little color in thinking about that as a potential tailwind going forward? I don't think I would think of it as a tailwind so much as those types of expenses are going to vary quarter to quarter as you have everything from legal consulting, outsource costs, implementation costs of various projects. We've been trying to provide transparency into the Alpha implementation, but that is, of course, not the only thing we're ever working on as we think about just our overall platform and systems. So I wouldn't think of it as a tailwind, but I do, you should expect a little bit of variability in that line item quarter to quarter. Travels in there, entertainment, client entertainment, all of it. Okay. So just basically lumpy. Thanks for taking my questions. Sure. Thank you. Now, next question comes from Bill Katz with TD Cowen. Your line is open. Thank you very much. I was wondering if you could unpack, excuse me, your comments around sort of diving a little bit more into retail democratization beyond maybe Invesco Real Estate. What else are you working on, and are there any incremental distribution relationships that may be on the horizon? Yeah. Thanks, Bill. It's Andrew. I'll start. The most recent has been in real estate debt. And so that credit fund or that real estate credit fund was launched about a year ago. It's been added to two major wealth management platforms over that period of time, which is quite fast, along with the several dozen of other related platforms for RIAs and the like. So between the real estate equity and the real estate debt funds, those are the two principal things we're focused on. We also have some alternative credit strategies in the market. But the progress on real estate debt and the demand from clients, not just here in the U.S. and in the wealth channels, but around the world, has been quite strong. Okay. Just as a follow-up, coming back to capital return, thank you for the updated guidance. So as you think about strategically from here, is it now more of a capital return story as you normalize and grow earnings, or is there an eye on potentially increasing M&A to maybe bulk up incremental growth, particularly into alternative assets to try and understand how we should think about the durability of that capital return? Sure. I'd say our comments there are really consistent with our past comments. It's not one or the other, but we want to be well-positioned so that we can be opportunistic for both. Given some of the balance sheet challenges of prior years, it's been hard to be opportunistic. Now we're in a position where we want to really stay focused on returning capital to shareholders and remaining open to where we may have the opportunity to fill in some capabilities consistent with past conversations around that. Getting the balance sheet back to a good, healthy place gives us the opportunity to return more capital to shareholders consistent with earnings improvement, and we're going to stay focused on earnings improvement. We're going to look for opportunities to reinvest in ourselves to drive that organic growth. I think we've demonstrated we certainly have the ability to do that with the breadth of our organic growth over the last five years, but we remain open-minded and thoughtful as we see any opportunities to fill in gaps that exist on the platform today. We want to build cash and return capital to shareholders, both and. Excellent. Thank you. Thank you. Now, next question comes from Craig Siegenthaler with Bank of America. Your line is open. Thanks. Good morning, everyone. We wanted to come back to the 6% organic growth rate in the quarter. Given these sizable ETF inflows versus net redemptions in fundamental equities, how did organic revenue growth trend relative to the 6%? How is the organic revenue growth trending relative to the 6%? I just want to make sure I'm understanding your question. Yeah, Allison. So on an organic revenue basis, and it's tough for us to do it because we just have by kind of major asset class, we don't have the underlying funds, but I wanted your perspective in kind of how the organic revenue growth was trending relative to the 6% AUM organic growth. I see. So what I would try to do, I'd point you back to the disclosures on Friday where we've tried to really narrow and give you more and more detail and as much precision as we can to help guide exactly that. We narrowed the net revenue yield ranges that you'll see there, and in the commentary on the far right, tried to give you even further direction around where we're trending in that. So there's a fair amount of precision relative to AUM. I think in any given quarter, obviously our focus is to drive that organic revenue growth, and that's what we've been highly focused on. It has been challenging in recent years given the pressure on fundamental equities and the trade on the ETF side, as you note. I would say it's trending better. It trends almost neutral at this point in a lot of different ways, but I think you can start to track it, and you should be able to start to track it much more closely with these new disclosures. Yeah. I would only add that some of the headwinds that we've been facing over the last couple of years, a couple of them are starting to abate a bit. In particular, the flows out in Asia, in particular China, and flows into alternative credit like bank loan are net positive towards what you were asking and Allison was describing. Thank you. Just for my follow-up, it's on the State Street Alpha implementation. So when will Alpha integration expenses start to go down? I think you have that $10 million target, but I wanted to understand when they would start to go down, and when do you think they'll be totally gone? So I think the best way to answer that question as it relates to implementation is just project timing overall, and we have been, we will continue to be in implementation mode through 2025 and really through 2026. We expect to transition our AUM onto the Alpha platform in a series of waves, and those waves are going to begin in the Q4 of this year, and then they'll run through 2025. So that implementation is really we're in this testing phase. We're in the learning phase. We're really working through planning for these various waves. And I think implementation will run through at least 2025, and then we will be working on decommissioning, testing, and running parallel through 2026 on the other side of that. Thank you, Allison. Thank you. Now, next question comes from Patrick Davitt with Autonomous Research. Your line is open. Hey. Good morning, everyone. I want to move back to the fee rate trajectory. Obviously, a little bit better in the quarter, but I imagine the April drawdown was probably a bit of a drag on it. So, could you speak to the monthly cadence through June and maybe how you feel about the 3Q run rate given how you exited 2Q? Thank you. Yeah. I think I focus less on the intra-quarter monthly and maybe more a little bit on the exit rate, probably to get at your question because within the month, within the weeks, within the days, it can vary so much as markets fluctuate so much. And I think hopefully also you've seen in the additional disclosures in the back just further detail around the various market indices that really impact us. Given our global footprint, we have such a diversified set of exposures that you can't really manage which market's moving in what direction on any given day. So I would point to the exit rate, which the exit rate for the Q2 was around 25.2 basis points, so a touch lower than the average net revenue yield for the quarter. Of course, even in the first few weeks of July, we continue to see puts and takes and all of that. So it's very difficult to predict exactly where it would end up. I continue to come back to we're focused on driving revenue. We're focused on driving organic revenue, and net revenue yield is simply a function. It's math of where the flows are coming from. The organic flow rate of 6% is something we're quite proud of, and I think a testament to the breadth of our platform and how aligned it is with client demand. I think what we've all seen in the markets over the last very short period of time, in the last week or two, some broadening out, which I think is something we've all been looking forward to for a long time. And one of the reasons why we continue to try to outline the diversity of our range of assets and investment capabilities. And if that prolongs, that should be a net positive for us. Makes sense. Thanks. And then a broader question. It's obviously nice to see the big recovery in China flows, but the political rhetoric is obviously getting pretty heated with China, and it seems both parties. It'll be a pretty popular punching bag. So I know it's tough to game these things out for sure, but what assurances do you have or could you give that the JV would be safe for a broader trade war between the U.S. and China? Thanks. Yeah. It's a complex one, obviously, to answer. One thing I'll remind you about on our China JV is that it's a domestic-to-domestic business. So all of the assets we manage are for individual investors in that market, and all the assets are managed in that market. And so it's a really focused business, and our partner there is the relationship's very strong and very resilient. I don't know if you'd add anything else. Yeah. I think I'd just underscore that by saying the flows and the performance of the JV are entirely dependent on the performance of the Chinese domestic economy. So to the extent the trade war is challenging for the domestic economy there, that would put pressure on overall AUM through both flows and market performance there. But that likewise probably would put some pressure on our investments in the United States as well. So think about it less as a political football and more highly dependent on the strength of the Chinese economy. Thank you. Thank you. Now, next question comes from Alex Blostein with Goldman Sachs. Your line is open. Hi. Good morning. Thanks for the question. I was hoping we could dig into the strategy around investment ETF business a little more broadly. So you guys continue to see really good growth there, and that's been consistent, and it's nice to see it broaden out a little bit. But to your point earlier, the fee rate continues to sort of shift lower here. So as you look further out, can you maybe walk us through areas where you're seeing sort of the best opportunity for Invesco to broaden your ETF for gaining growth even more and perhaps talk a little bit about some of the existing and new initiatives that could maybe stabilize and improve the fee rate as you look further out? Yeah. Thanks for the question. Yeah, the growth has broadened out. I think we have something like 10 ETFs just in the U.S. that have had more than $1 billion of inflows in the past six months year to date. The business is starting to broaden out. Some of the key growth strategies that we have, obviously, as the market starts to adopt active ETFs, especially here in the U.S. market, that's a key area of focus. We were one of the early movers in active ETFs. We have a little over $10 billion in that space, but more importantly, we have around $30 billion of assets that are affiliated with our investment teams playing some role in that investment strategy. We think that's going to continue to grow as the vehicle remains popular, but more than passive gets put into those vehicles either through fundamental or quantitative techniques or both. The other element of growth for us is beyond the United States. We talked a little bit about our expansion and our growth in Europe, which is now over $100 billion in AUM. You can see the demand starting to grow throughout Asia, China, Japan in particular. Geographically, we feel like there's early days in some of those markets outside of the U.S. And then our lineup, which has been historically heavy on equities, one of the areas of greatest growth has been in the fixed income space. And we continue to think that passive fixed income alongside fundamental is going to be a pretty significant area of growth going forward. And then as alternative strategies and in particular commodities continue to or find favor back in the market and things like alternative credit and bank loans continue to grow in demand, we're very well placed in those spaces. So the growth's been good. I think the growth can continue to be as strong and just more diverse as we go ahead. Great. Thanks for that. The last thing I'll just say on that's flows, but on profitability, the ETF business continues to scale well, and the profit margin expansion from that business and its contribution continues to go from strength to strength. So we have a very scaled platform that does deliver accretive profitability. Great. Thanks, Andrew. That's helpful. Allison, one for you just to round out the G&A discussion. A couple of puts and takes as you highlighted earlier in the quarter, but zooming out, kind of what are the expectations for maybe G&A for the full year? And as Alpha continues to kind of linger through 2025, any sort of early thoughts on G&A outlook for 2025 as well? Thanks. Sure. I think I'd go back to our guidance for the year, which was we said all things being equal back on December 31st with AUM at December 31st, that overall expenses would be in the $3 billion range. Obviously, we've done quite a bit better in terms of AUM since that guidance, and you can see that impact overall on comp expense in particular, given the Alpha guidance of around $10 million ± in terms of implementation costs each quarter. All else being relatively consistent and equal and not a lot of puts and takes other than back to Brennan's question. I mean, things are a bit lumpy quarter to quarter, and I just can't predict the lumpiness. I'd come back to comp to revenue, and I know I'm answering more than just G&A, but we manage expenses in totality. Comp to revenue is trending above 42% for the year. I think it'll be closer to 43% for the year. The rest, I would say, relatively consistent absent some lumpiness that I can't predict quarter to quarter. So not entirely precise, but about as precise as I can get, and I wish I knew with real precision as well, but I think that gives you a reasonable expectation for the year. Got it. Yep. That's helpful. Thank you. Thank you. Now, next question comes from Dan Fannon with Jefferies. Your line is open. Thanks. Good morning. Andrew, I wanted to follow up on one of your comments from, I guess, it was slide 3 where you talked about profitable organic growth. I mean, that seems like something you would always be focused on. So curious if there's anything more behind that in terms of what maybe you're looking to exit certain RFPs or businesses, or is it just more prospectively like what business you're looking to take on versus maybe what you might have done before? Yeah. I think that a couple of the areas that I called out, and I'd emphasize further, and thanks for the question. Picking up on what I just said about ETFs, the ETF vehicle and the SMA vehicle, as we're growing in size, they scale well. So our focus on profitability there is continuing to utilize technology more, continuing to drive the expense base or at least hold the expense base flat as we continue to grow and see flows and revenues generated from those vehicle choices. And then in fixed income and in multi-asset, about a year ago, we brought together multiple investment teams in those two respective areas. We believe as those capabilities continue to be in demand from clients, similar to the vehicles that I just described, they scale well. We feel like we have a pretty complete product range and a pretty complete set of investment capabilities that we can just hopefully layer on assets and revenues to expand profitability. That's what we mean by that specific area. That's helpful. Then just as a follow-up, we're hoping to get an update on the MassMutual relationship in terms of what them helping you seed and build your alternative franchise and then also tapping into your product set into their broader distribution force if there's been any update there. Yeah. I mean, it continues to be a really strong relationship that we value tremendously. As we've mentioned in the past, it continues to be a significant focus for both us and them: growing out the private market set of capabilities. And currently, through their general account and otherwise, they have 3-4 times the amount of capital invested in our strategies than we hold on our balance sheet. And that's been a really important part of the seeding and co-investing of some of the strategies that I talked about before that are starting to grow in the wealth management platforms, in particular in real assets. In terms of we continue to progress and grow through the traditional insurance channels and offer our products and capabilities. We're one of the leading providers on MassMutual's platform, and that just continues to be an ongoing focus of ours. And that's across the complete set of investment capabilities, but in particular, things like our model portfolios and ETFs where we see there's growing demand and significant opportunity for Invesco. Yeah. I mean, they continue to be great partners investing across a variety of capabilities from our real estate to our CLO capabilities in particular, and just strong partners as we evaluate future product launches. And as Andrew noted, they've really amplified our ability to leverage our own balance sheet to get products to market faster. Great. Thank you. And to utilize that capital for other sources and needs as well. Okay. We have time for one more question. Our last question comes from Ken Worthington with JPMorgan. Your line is open. Great. Thank you for taking the question and squeezing me in. You saw a nice recovery in institutional flows. Can you size the institutional pipeline? I think you used to give one not funded. And tell us a little bit about the major buckets like factor and solutions that haven't come up in conversation thus far. Sure. I'd say the institutional pipeline, it's pretty consistent with last quarter. It stays around this kind of $14-$15 billion range. I think what we continue to find is the pipeline is an okay but not excellent measure of what we can expect just given the breadth of our flows that come in outside of the pipeline. So you saw the strength and flows over the last quarter or so, and the pipeline's been relatively consistent over the last few quarters. It seems to be about 30% of our flows that come from the pipeline. Fee rate continues to be on the high side there as well. As we've said for a long time, it ranges in the 25-35 basis point range, and we continue to see it really on the relatively high side. So I'd say no real change one way or the other. It continues also to be well diversified across regions, and we see, I think, really the strength of our institutional flows coming from a variety of regions as well. And the only thing I'd add is, as we've said on previous calls, yeah, I think things had slowed down by about this for the industry by about a quarter or two on fundings. I think some of the progress we're seeing is that maybe that pace is picking up a little bit. The strengths in particular on public and private credit. And as Allison said, it's really cross-regional, but I'd say Asia and Europe in particular seem to have picked up at a greater pace. Gross sales really picked up in the quarter relative to the prior five quarters. Redemptions are a little bit better, but the strength was really driven by these gross sales. Awesome. Thank you very much for the caller. Thanks, Ken. Yeah. Operator, we do have time for another question. Okay. Now, next question comes from Michael Cyprys with Morgan Stanley. Your line is open. Great. Thanks so much for squeezing me in. Just a question on Japan. I was hoping you could elaborate on your footprint and business in Japan today. Hoping you could talk a little bit about how that business has grown. And then looking out, maybe you could talk about your outlook and how you see the opportunity evolving in that marketplace just given the shift in the market out of deflation and some of the recent regulatory changes to expand the NISA tax-exempt accounts. Where and what sort of products and strategies do you expect to see growth evolving in that marketplace and also the opportunity for ETFs as well? Thank you. Yeah. It's a great question. Thanks for that. Let me start. Our profile is, as I mentioned, we've been there for a long time. It's about 30 years old. We have around $60 billion of assets managed for Japanese investors. It's a mix of insurance, institutional, and retail wealth platforms. The greatest area of growth in the last little while has been in retail where we've actually, we were talking before about this Global Equity Income Strategy. So it's been a good long-term business for us that's really accelerated in the last year or so. And for some of the reasons that you described, we remain really optimistic about the reforms and changes that are happening there, not just NISA, but the overall markets, inflation starting to come into play, more excitement that we've seen up close and personal from investors getting re-educated and re-interested into the equity markets. ETFs is going to be an area of increased demand, and we're starting to further build out our position there in ETFs. But it's traditionally been a fixed income market for us and an equity market as well. Private markets are also starting to pick up, so it's really across the piece. And we have a really, really developed position and brand and reputation there. Great. Thank you so much. Hey, Operator, we do have time for one more question. Okay. Now, next question. And our last question comes from Brian Bedell with Deutsche Bank. Your line is open. Oh, great. Thanks. Thanks very much for squeezing me in. Just coming back, maybe, Andrew, to a comment you made earlier in the presentation about the focus on performance and the fundamental equities. Clearly, that's the most accretive area from a net revenue yield perspective. Can you talk about how you're leveraging the improved performance and the sales process across the franchise for fundamental equities and any conviction around getting back to sort of flow neutral, maybe aside from the developing market fund? And then on the active ETF side, realize that's still very small, but if there's any potential to grow that relative to mutual funds, might that actually improve the ETF fee rate of the 14-16 basis points if you have any traction there? Yeah. Let me start on the back end of the question, and then I'll go to the front. Yeah. We definitely see demand picking up in the active ETF space. Right now, it's been largely into active fixed income. And we launched some new strategies that were options-oriented strategies on equities, but that's driving off of more passive benchmarks. I think in time, fundamental active strategies or some combination of fundamental and quantitative active strategies are going to find their way into the active ETF space, and we're very much in the development stage of that right now. And so I think that's something to watch over the next couple of years. In the more short run on improving our net flow rate, it is going to get driven in the first instance by improved investment performance. And we are starting to see that in particular in the domestic equity categories, U.S., as well as other developed markets around the world. But it's also going to need to come with some more demand from clients. And that we really haven't fully seen yet redevelop in the U.S. wealth market. Every day, we're focused on it. Our sales team's working closely with our product design teams and our investment teams, both on the retention side where there's performance improvement that we need to be in front of clients with, but also growing the gross sales rate in the marketplace. So look, I think the performance is improving, and that's a significant step in the right direction that we expect going forward. I would just add to that. I mean, we're focused on outperforming industry as best we can there. Industry expectations, given the secular challenges and the shifts we continue to see from active to passive, the industry expectations are not for strong inflows when it comes to fundamental equity. That said, we're looking to outperform in every aspect. And so as Andrew noted, we're highly focused on investment performance and where we can narrow those outflows and turn it into something neutral. Of course, we would ideally love to be in inflows, but we're going to focus on taking every inch we can there and really the building blocks to return that to a more stable position. In the meantime, I think we've been able to demonstrate the incredible strength across every other capability that we have, and that's really what's delivering that profitable growth. We're optimistic. I mean, our expectation is we can continue to create the operating margin improvement from here, and we remain focused on every element of that. As I said before, I think the broadening out of the markets potentially into value markets, small, mid-cap, non-U.S., I mean, we have very strong investment performance in those areas. So with some pockets of demand returning, we're cautiously optimistic. That's great, color. Thank you very much. Okay. In closing, I really want to mention that hopefully it came through that we're well positioned to help clients navigate the impact of evolving market dynamics and subsequent changes that are happening in their portfolios. As market sentiment improves, this should really translate to even greater scale, performance, and improved profitability. Given the work we've done to strengthen our ability to anticipate, understand, and meet the evolving client needs, I can say I'm very excited for the future of Invesco. I want to thank everybody for joining the call today, and please continue to reach out to our investor relations team for any additional questions. We appreciate your interest in Invesco and look forward to speaking with everybody again soon. Thank you. That concludes today's conference. You may all disconnect at this time.