Broadridge Financial Solutions (NYSE:BR) reported fiscal second-quarter 2026 results that management described as strong, supported by healthy capital markets activity, elevated event-driven revenues, and continued demand for its governance, capital markets, and wealth technology offerings.
Second-quarter results and updated outlook
Chief Executive Officer Tim Gokey said Broadridge delivered 8% recurring revenue growth on a constant-currency basis and adjusted earnings per share (EPS) of $1.59 in the quarter. Chief Financial Officer Ashima Ghei added that recurring revenues grew 9% reported (or 8% constant currency), including 7% organic growth.
Broadridge reaffirmed several elements of its fiscal 2026 guidance while raising its adjusted EPS outlook. Management said it is:
- Reaffirming recurring revenue growth (constant currency) to the higher end of 5% to 7%
- Reaffirming full-year adjusted operating income margin of 20% to 21%
- Reaffirming closed sales of $290 million to $330 million
- Raising adjusted EPS growth guidance to 9% to 12% (from 8% to 12%)
Gokey said the company remains on track to deliver on its three-year objectives through June, which he noted would be the fifth consecutive three-year period in which Broadridge meets its goals.
Governance growth driven by positions, shareholder engagement, and digital communications
In the governance segment (referred to as ICS), recurring revenues rose 9% (to $590 million). Ghei said results included a two-point benefit from acquisitions and a one-point headwind from lower interest rates, while also noting that the earnings impact of lower rates is “functionally hedged” by lower interest expense.
Gokey highlighted continued strong investor participation trends. He said total equity position growth was 17%, with 11% growth in revenue positions, driven by growth in managed accounts. Fund position growth strengthened to 15% in Q2 following a timing-impacted 2% in Q1; looking at the first half, fund position growth was 8%. Management said testing indicates low-teens equity position growth in the second half and mid- to high-single-digit fund position growth.
On shareholder engagement, Gokey said Broadridge expects more than 600 funds covering $4 trillion in assets to use its Voting Choice solution in the coming proxy season, up from 400 funds and $2 trillion last year and fewer than 100 funds two years ago. He also said Broadridge is rolling out an AI-native custom policy engine and vote implementation capabilities for institutional investors including J.P. Morgan and Wells Fargo, aimed at helping reduce reliance on proxy advisors. In response to an analyst question, Gokey characterized the broader shareholder engagement opportunity as a “multi-hundred million dollar market” and said it could add “as much as a point of growth” to the governance business over the next few years.
Broadridge also discussed efforts to digitize communications. Gokey said the company closed “a significant sale” to expand its Wealth InFocus platform to cover 1 million additional accounts. In the quarter, customer communications revenues rose 5%, which Ghei said was driven by double-digit growth in digital communications revenues as Broadridge executes its print-to-digital strategy, plus a contribution from the Signal acquisition.
Tokenization focus spans governance and capital markets
Management devoted significant time to tokenization, particularly around tokenized equities and Broadridge’s role in governance and servicing. Gokey said the company expects to integrate tokenized and digital assets into its proxy capabilities by the end of the year and then extend those capabilities to other servicing needs such as corporate actions and disclosures, as well as to digital wallets.
During the Q&A, Gokey pushed back on the idea that tokenization could disintermediate Broadridge, arguing that tokenized securities would still be subject to core regulatory principles including governance and that intermediaries such as broker-dealers and digital trading platforms would continue to have asset servicing obligations. He also noted issuer complexity could increase in a world where companies may have registered shares, beneficial shares, and tokenized shares across multiple tokenization models and networks.
In Capital Markets, recurring revenues grew 6% constant currency. Ghei said the quarter benefited from a balanced mix of sales, digital asset revenues, and higher trade volumes, offsetting a point of losses tied to a previously discussed business exit. Digital asset revenues were $7 million in the quarter, though management said those revenues are expected to “moderate significantly” in the second half due to scheduled changes in the Canton Network minting curve, contributing about one point to Capital Markets growth for fiscal 2026.
Gokey said volumes on Broadridge’s distributed ledger repo (DLR) platform continue to grow, citing $384 billion per day tokenized in December (or $9 trillion for the month), more than double June levels. He said the company is on track to launch a real-time repo capability in fiscal 2026 incorporating stablecoin, and also highlighted completing Société Générale’s first digital bond issuance in the U.S. during the quarter. Looking further out, Gokey said Broadridge plans to extend its tokenization platform to other asset classes, including deposits, in fiscal 2027, and to enable its primary trade processing engines to support digital assets alongside traditional assets by the end of fiscal 2026 across capital markets and wealth management.
Wealth growth and sales momentum
In wealth and investment management, recurring revenues grew 11%, driven by 6% organic growth and a 5% contribution from the SIS acquisition, which the company said it has now lapped. Gokey added that the wealth platform was recently named a leader in wealth management technology by IDC, which he said is contributing to a growing pipeline of platform opportunities.
Closed sales improved in Q2 after a slower Q1. Broadridge reported Q2 closed sales of $57 million, up 24% year over year. Year-to-date closed sales were $89 million versus $103 million last year, though management said pipeline creation rose more than 20% over the first half of fiscal 2025, supporting confidence in full-year closed sales guidance. Gokey said clients are engaging on tokenization, shareholder engagement, digital communications, and operational initiatives such as preparing for T+1 in Europe and 23×5 trading in the U.S.
Event-driven revenues, digital asset mark-to-market, and capital allocation
Ghei said Broadridge recorded $91 million of event-driven revenues in Q2, contributing to a record $204 million in the first half. While down $34 million from the prior year’s quarterly record, she said event-driven revenues remain elevated versus long-term averages, driven by healthy mutual fund proxy activity and higher corporate actions, including an M&A contest for a major media company. The company expects event-driven revenues to trend closer to the seven-year average of roughly $60 million per quarter in the second half.
Broadridge also recorded a $187 million non-cash mark-to-market gain related to digital asset holdings, reported in other non-operating income and excluded from adjusted EPS. Ghei said the value of digital asset holdings rose to $265 million at quarter end. Management said it will continue excluding quarter-to-quarter non-cash gains or losses in digital asset values from adjusted EPS due to volatility.
Free cash flow was $319 million in the first six months of fiscal 2026, up from $56 million in the prior-year period, and the company reiterated expectations for greater than 100% free cash flow conversion for the year.
On capital allocation, Ghei said Broadridge completed three tuck-in acquisitions in fiscal 2026 totaling $126 million, including the $70 million acquisition of Acolin on January 5. Gokey said Acolin expands services for funds in Europe across their lifecycle. The company also returned $367 million to shareholders via dividends and share repurchases in the first half. Separately, Broadridge contributed 342 million Canton Coins valued at $53 million for an approximately 8% stake in the Tharimmune Digital Asset Treasury. In Q&A, Gokey said Broadridge is “an operating company, not an investment company,” and that it is not seeking immediate liquidity from its coin holdings.
About Broadridge Financial Solutions (NYSE:BR)
Broadridge Financial Solutions is a global fintech company that provides technology-driven solutions and outsourcing services to the financial services industry. The firm’s core offerings center on investor communications, securities processing and post-trade services, and technology platforms that support capital markets and wealth management operations. Broadridge positions itself as a provider of mission-critical infrastructure that helps financial institutions manage regulatory requirements, investor engagement and operational complexity.
Products and services include proxy and shareholder communications, investor disclosure and digital communications, proxy voting and tabulation, clearing and settlement support, trade processing and reconciliation, and a range of software-as-a-service platforms for wealth and asset managers.
