Abacus Global Management, Inc. 2026 Q2 Earnings Call

Please go ahead. Thank you, operator, thank you everyone for joining Abacus Global Management's second quarter earnings call.

Here with me today are Jay Jackson, Chairman and Chief Executive Officer, Elena Plesco, Chief Investment Officer, and William McCauley, Chief Financial and Chief Operating Officer. This afternoon at 4:15 P.M. Eastern Time, Abacus Global Management released our second quarter 2026 results. This afternoon's call will allow participants to ask questions about our results. Before we begin, Abacus Global Management refers participants on this call to the investor webpage ir.abacusgm.com for the press release, investor information, and filings with the SEC for a discussion of the risks that can affect the business.

Abacus Global Management more specifically refers participants to the presentation furnished today on Form 8-K with the Securities and Exchange Commission, reminds listeners that some of the comments today may contain forward-looking statements, as such, will be subject to risks and uncertainties, which, if they materialize, could materially affect results. For more information on the risks, uncertainties, and assumptions relating to forward-looking statements, please refer to Abacus Global Management's public filings. During the call, we will reference certain non-GAAP financial measures. Although we believe these measures provide useful supplemental information about our financial performance, they are not recognized measures and do not have standardized meanings under U.S. generally accepted accounting principles, or GAAP. Please see our public filings for additional information regarding our non-GAAP financial measures, including references to comparable GAAP measures.

With that, I'd now like to turn the call over to Jay Jackson, Abacus Global Management's Chairman and Chief Executive Officer.

Thank you, David. Thanks to everyone for joining us. We are thrilled to see so many of you in person at the NYSE last month for our Investor Day, where we shared our vision for Abacus Global Management. We'd encourage everyone to listen to the replay available on our IR website. For those that weren't able to join, our message from Investor Day was clear. We have high conviction that traditional asset management will be revolutionized and improved via personalized longevity data. More importantly, we firmly believe Abacus is uniquely positioned as the leading data and technology platform to enable that revolution. Start with the number that is reshaping our entire industry, $124 trillion.

Over the next three decades, that is what will pass from baby boomers to their children and grandchildren, the largest wealth transfer in history, nearly every dollar of it is being planned today on a guess. Every financial plan assumes an answer to one question: how long will the money need to last? Almost none of them actually have one. They reach for a population average on the single most important input of all, but nobody is average. The opportunity is to replace that guess with a personalized lifespan, that is exactly what LifeARC does. Turning an individual's medical, genetic, medication, and biometric data into a portfolio built around the life they actually live. This is possible because we have a 20-year head start built on exactly that data, which positions Abacus to be the intelligence layer for lifespan-linked finance.

The clearest way to frame that is a company you all know. Amazon built AWS to run its own marketplace, it became one of its most important profit engines. Our origination platform is our commerce engine, LifeARC is our AWS. The growth is already showing up in our results. Through the first half of 2026, we raised $544.2 million in inflows into our longevity funds, surpassing our $500 million target for the period and comparing to approximately $604 million for all of 2025. Separately, we are in the very early days of putting LifeARC to work for others, this is where the wealth transfer opportunity comes to life. Our partnership with Manning & Napier will let their advisors apply personalized lifespan modeling across the $18 billion they manage for 3,400 clients.

Manning & Napier is not the exception, it is the playbook, that playbook points to something bigger. When we talk about Abacus, we are not a traditional asset manager. We are building the infrastructure for lifespan-linked finance. Our mission is to own the data, products, and distribution rails that let advisors build portfolios around each individual's specific lifespan drivers, so the next generation invest those $124 trillion around real lifespans rather than generic averages. That's the opportunity we're building toward, this quarter gave us real evidence we're on the right path. Bill will take you through the specifics of the quarter in a moment, but I want to pull out two highlights I'm especially excited about. First, we received SEC effectiveness for and launched the ABX Longevity Growth and Income Fund, ticker ABXGX, our first registered interval fund dedicated to the longevity asset class.

For the first time, individual investors and their advisors can access this asset class through a registered vehicle, and it's a direct realization of the strategy we laid out at Investor Day. Second, in building on that same drive to open up the asset class is asset tokenization. Let me be clear about what this is and what it isn't. For Abacus, this is not a crypto strategy. It's a financial infrastructure. We're building an immutable on-chain record of each policy's chain of title, liens, and cash flow rights, which makes the secondary life insurance market more transparent, more transferable, and more investable. This is a market that has historically been opaque and hard to transact, and putting it on-chain begins to change that.

We've already started tokenizing in-force policies, and we see this as infrastructure that builds on the strength of our origination platform as we continue to grow our recurring fee-based revenue. Those milestones show the kind of progress we're making. Turning to the nearer term, we feel very good about the trajectory of the business as we move through the balance of the year. Alongside our results, we're providing guidance for the third quarter. The momentum we built in the first half across our origination platform and disciplined monetization gives us real confidence in where we're headed. With that, I'll turn it over to Bill to take you through the quarter in detail.

Thank you, Jay. Today, I'll start by detailing our strong operating results for the quarter across our origination platform, fund management, profitability, and continued scaling of our operating cash flow. Next, I will detail our outlook for 2026 from here, including our expectations for the third quarter, and close out with an update on the Manning & Napier integration. To begin, as Jay noted, Abacus continued its momentum from the first quarter with close to $200 million in capital deployed in Q2, which brought our year-to-date capital deployed to $362 million. While maintaining discipline, our platform continued to accelerate the number of policies under review. In Q2, we have been able to review 9,314 qualified policies as compared to 8,786 qualified policies in Q1, with total policies reviewed year to date, including non-qualified, reaching over 50,000.

A milestone we've been able to achieve by augmenting both top of the funnel leads and our review time of each case with artificial intelligence. As we look to the second half of 2026, we expect inbound policies under review to continue to grow as we further penetrate and leverage distribution channels, including Manning & Napier. Let me review our financial results for the quarter. Abacus grew revenue by 30% over last year to $73 million. Our growth was driven by Abacus Life Solutions, which grew 38.3% to $65.4 million year-over-year. This growth was partially offset by lower asset management fees, primarily due to a decline in AUM and our ETF strategies, driven by both market conditions and outflows. Those declines have been offset by robust inflows into our longevity funds, totaling $256 million for the quarter.

As Jay noted, we continue to see significant potential to capitalize on the power of LifeARC and remain confident that both asset management and technology service fee revenue will make up a growing portion of our revenue base in the future. To that point, technology service fees year-to-date are approaching $1 million, which is in line with the continued build-out and adoption of that business. Moving to our expenses, total operating expense totaled $42.5 million for the quarter. The year-over-year increase is largely driven by increases in strategic business expenses and other personnel costs from acquisitions and growth as we are ramping the asset management, wealth management, and technology sides of the platform. Moving to profitability, our adjusted net income, which excludes non-cash stock compensation, non-recurring expenses related to business acquisitions, and special projects, totaled $27.1 million or $0.28 per diluted share.