Lazard, Inc. (LAZ) Earnings Call Transcript & Summary

Good morning, everyone. My name is Mike Brown. I cover U.S. asset managers and brokers here at UBS. I'm excited to have Chris Hogbin here on stage today for his very first conference presentation as Lazard's new Asset Management CEO. For those that you do not -- don't know Chris, he was appointed CEO of the roughly $265 billion AUM franchise in September and started his role in December of last year. With 3 decades of global investment leadership, Chris brings deep experience overseeing the multi-asset investment platforms at scale and most recently serving as Global Head of Investments at AllianceBernstein. So Chris, thank you so much for joining us today. Thanks, Mike.

Thanks, Mike. Great to be here.

So Chris, just to start, I know a lot of folks would probably love to hear a little bit about what brought you to Lazard. You came from an excellent firm. So when you were considering the opportunity to join Lazard as CEO of Asset Management, what were some of the key aspects that attracted you to Lazard and then to the asset management business?

Sure. So after 20 years at AB, I thought I'd probably never leave. But what attracted me a few things. Look, first and foremost, just a really exciting vision that our Group CEO, Peter Orszag, set for the business, and you've read about that on Lazard 2030. But to have the energy, enthusiasm and competitiveness coming from the top was really appealing. Secondly, I looked at the business, and it's a business that's got some real strengths. I'm sure we'll kind of come to talk a little bit more about them. But it's got great strength in investments. It's got great strengths in distribution. But as I was looking at the business, it's a business where I realized there's still some things we can improve and particularly coming from the outside and seeing how other asset managers approach these things, realized it was a business I could have an impact on. And certainly, having spent 10 years as a consultant, 20 years in various investment and executive roles at AB in various locations around the world, I thought I had something to -- really something to offer in moving the business forward. So it was all of those things kind of coming together that made for a pretty compelling opportunity for me.

Great. Yes, it makes sense. So if we think about your kind of first 100 days in the role, you're about 2/3 of the way through that.

Thanks for reminding me.

Maybe talk a little bit about some of your top priorities as you start to really get your hands around the opportunity set here. What are some of the priorities to maybe refresh and reposition the franchise and maybe some of the initiatives that you think you could have kind of the most impact on?

Sure. So look, there's really 3 areas. The first is really to ensure that we deliver, okay? And as an asset manager, the most important thing we can deliver is investment performance for our clients. So as I look at the investment performance that we're delivering at the moment, as of the end of the year, about 2/3 of the AUM is outperforming its stated benchmark. And that's okay. It's improved sequentially through last year, but it's not where we need it to be or aspire for it to be. So we've got to really address that. So one of the first things I did was appoint a Chief Investment Officer for Lazard, a gentleman called Eric Van Nostrand. What that role -- let me be very clear, that role is not to set a top-down view for Lazard that the portfolio managers are all going to implement. What that role is, is to be a point to oversee the portfolio managers to engage with the portfolio managers, to challenge them on their positioning, to help them with their thinking. It's also to ensure that we're really bringing out the benefits of the breadth of the platform as broad as Lazard. I'm very confident that an emerging market analyst has insights that a developed markets analyst can benefit from. The fixed income PM is thinking things that an equity analyst can benefit from understanding. So the second part of Eric's role is really about kind of bringing together the investors and sort of finding easy forums for them to share the data, the analysis in front of them. And the third bit is to just ensure over time that we can continue to invest in our processes, our technology, our resources to ensure we can remain at the cutting edge. So it's around delivering investment performance. That's going to take time to come through. But I think in Eric, we have a very strong leader to oversee that. It's clearly around delivering for our clients. So it's ensuring that we continue to have great sales relationships with our key counterparties. So it's around delivering, right? The second part is around growing, okay? The most important way we can grow is by scaling what we already have. In Asset Management, the secret of success is having scale in individual products. Now the good news here is after many years of outflows last year, I do view as a year of transition in our business. while we have one very significant client relationship close, if you exclude that, last year, we had $8.5 billion of net inflows. And you saw just yesterday, we started the year with good momentum with just under $3 billion of net inflows in January. So we need to continue to lean into that to ensure that organic growth comes through. Beyond that organic growth, there's going to be opportunities to expand into new areas, right? And we'll need to be very focused around that and diligent and selective, but there'll be opportunities there. So it's around delivering, it's about growing. And then the third is about sort of capitalizing on that growth and ensuring that as we grow, we do so in a way that is profitable, okay? The margins for our business are not where we would like them to be. So as we grow, we need to do it without adding cost to the business so that we can have operating leverage come through as we deliver that growth. My priorities are really across those 3 buckets.

So maybe if we dive in a little bit deeper there and maybe you can kind of bucket the opportunities here a little bit. Maybe walk us through where you see the strategic mix of the business if you kind of bucket it by, say, one, protect and grow, maybe two, invest and enhance. And then three, where is maybe the true white space opportunities for Lazard Asset Management?

Sure. So in terms of protect and grow, we've got a lot of things that are working. And you see that in the net flow figures. So that's around our systematic equities, our global listed infrastructure, emerging markets, Japan. So we really need to kind of ensure that we continue to deliver there, and those things can continue to grow. The nice thing is there's actually kind of quite a lot of other things bubbling under with having a lot of interesting client conversations in the fixed income space increasingly and in other equity strategies. So there's a lot that's working and we need to kind of lean into. Look, in terms of investing, there are a couple of different parts to that. One is ensuring that we kind of continue to invest in the investment team so that we can innovate new products and nurture the ones that are newer. It's also about investing in products -- sorry, vehicles. So just over the last year, we went from 0 to $1 billion across 7 active ETFs in the U.S. So it's continuing to invest in areas like that. In terms of the white space, I sort of see 3 long-term kind of drivers or areas to explore. The first is clearly the traditional public markets space. If you look at our footprint of business today, it's about 3/4 equities, then some fixed income and multi-asset. But there's a lot of public market areas that we're not in, and I see opportunities to engage to either hire or acquire teams there. Look, the second is clearly private markets where we have a small footprint there. We've got a venture capital business in France with Elaia, but there's a lot that we don't do there. And then the third is the wealth area. We do have a wealth business today in France and the U.S. But clearly, a very big space around us there as well. So as I think about this year, it really is about the kind of delivering, but ultimately start to think about what are the longer-term growth vectors that we can lean into across those 3 areas of white space.

Okay. Great. So with the full acknowledgment that you are still quite new in the role and you have thinking about maybe the white space opportunities might not be the first order of business. But maybe just unpack that a little bit more. And when you think about kind of tackling that opportunity, is that something that you can do organically? Or does this require some M&A to do so or maybe it's some combo?

Yes. I mean, look, I think the first thing I'd say is we've -- as you look at the history of Lazard, you can see we've have managed to tackle a lot of those opportunities organically, whether that is developing our systematic equities capability, whether it's about the ETF build-out, et cetera, we've done all of that organically. Inorganic is clearly going to -- should be part of the mix, but one needs to be incredibly selective. If I think about -- I mean, think about just the public market space to start. If we decided a particular area or a particular capability was attractive to us, we need to go out and you start with a really broad funnel, all the firms and teams that are out there. Then you say which of those have got attractive performance, which of those performance streams are the result of a sort of robust repeatable process that we can kind of get confident will endure, where is there a good cultural fit? Where are they going to benefit from being at Lazard, where are we going to benefit from having them? And where can we get the economics to line up. So you go from a very broad funnel to a very narrow end of the funnel pretty quickly. To give you some kind of numbers around that, in my previous role at AB, I lifted out a team from AGI to do global and European growth equities. That search started with me reaching out to almost 100 teams to land one. So there's a lot of work that goes through that funnel. So that's how I think about it. You've got to be incredibly selective. So that's how I think of it in the public space. Look, in the private space, it's no shock to anybody in this room, valuations look expensive or high. And the history of a number of asset managers -- traditional asset managers who've moved into that space have been somewhat checkered. So I think, again, we need to think creatively about that space and would a partnership make more sense, et cetera. So a lot more work to do there. And then in the wealth channel, the successful models appear to be a good mix of organic and small inorganic lift-outs or team hires that could potentially help grow that business. So inorganic is going to -- should play a role, but it needs to be a very selective part. And these are sort of teams and small firms, they're not big game-changing acquisitions.

Maybe just a quick follow-up on the private asset side. I think that's something that has been talked about for maybe a number of years and the valuation disconnect there and kind of the elevated valuations in the space certainly makes sense as to maybe why we haven't seen anything. But when you think about the asset class opportunities out there, is there maybe a few that you think are kind of top priority for Lazard if you were able to find the right manager?

Yes, but I'm not going to say which ones. Look, I think for us, particularly when you think of it as a partnership as opposed to an individual acquisition, it's around saying, where do we have a set of strengths that we could marry with a private asset manager. So look, as you might imagine, a bunch of areas we're looking at, but none that I'm ready to talk about just yet.

Makes sense. So one thing that is clearly playing nicely into Lazard's hands at the moment is really the fact that the international markets for the first time in a decade actually outpaced the S&P 500 in 2025. So maybe talk a little bit about how institutional investor sentiment has been improving there? What are you starting to see? What are you noticing in some of your mandate wins and maybe the outlook for funding there? And do you expect that to continue to gain momentum in 2026?

Sure. So look, I spent the last month going around the world meeting asset owners. So let me try and summarize what I'm hearing. You are getting increasing -- an increasing set of asset owners who are looking at a couple of things. They're looking at how far the U.S. has run. They're looking at where valuations are. They're looking at geopolitical tensions. They're looking at opportunities elsewhere. And I think all of that kind of comes together to lead to a reevaluation of positioning and a sense that they're looking to diversify, right? And we're starting to see that in flows. If I think about our business today, about 2/3 of the assets that we manage are non-dollar denominated to give you a sense of our kind of international exposure. That comes from emerging market strategies. It comes from international and global. strategies. And that is where we're seeing a lot of client interest. If I look at where the flows came last year, if I look at our one but not yet funded pipeline of $13 billion, a lot of those are into those kind of international sort of services. So we're seeing a lot of interest there. The other area where we're starting to see a pickup in interest is strategies that perhaps have a little bit less tracking error in them. And in a way, you could almost think of it as the spectrum from pure active to pure passive. And along -- if you think of that as a spectrum, you can end up in a set of strategies that are still active but with lower tracking error. And a number of our systematic services are very well positioned to deliver that. So that's been another area of growth.

Great. Great. Okay. So yesterday, you alluded to this, the fact that you had almost $3 billion of net inflows in the month of January. So certainly a strong result for Lazard, I think, over 13% annualized growth. Maybe break down what came through in that mix? Was it kind of focused on any particular strategy or region? And maybe give us a view into those flows.

Sure. So it's terrifying when you annualize 1 month. So please don't bake that in just yet. But obviously, we're very pleased to see the strong flow picture. It's really a combination of the answer to a few previous questions. It is more into services like our systematic equities, like a number of our international services, our listed infrastructure service, our Japanese equity service. So there's a breadth to it, but the commonality to that is it's more international and global -- more international and global in nature. There are also services with very strong underlying investment performance. The interesting thing because we -- at the end of last year, sort of came out and said, look, we expect to be net flow positive for all of 2026, what gave us that confidence partly is the level of flows that we saw in that one but not funded pipeline, but it's more -- it comes from the breadth of where we're seeing the flows. So if I look back to 2025, the flows came across a wide set of products, and it came from a wide set of clients and a wide set of geographies. So if I cut our business between the U.S., Europe and Asia, all 3 regions were net flow positive last year. And it's that breadth across each of those 3 dimensions that gives us the heightened confidence in the flow picture for the year.

And the $13 billion won but not yet funded mandate pipeline, was -- did that come down now that $2.9 billion float in? Or was that kind of $13 billion number actually quoted after you kind of knew where the flows were going to...

So the $13 billion was as of our results date at the beginning of the year. I'm not going to get drawn into giving a day-by-day number because as you might imagine, if something funded yesterday, that number kind of comes down. What I will say is there's been a robust level of activity. So the number hasn't materially changed, and we're seeing a lot of interest. The distribution teams are very busy. The PM teams are very busy meeting clients, I am as well. So we've sort of seen the level of activity stay pretty stable through the last few months.

Okay. Great. Let's switch gears and talk to one of the other successes that's been playing out more recently, the active ETF side of the business. So you talked about the fact that you went from 0 products to 7 products. You're kind of at $1 billion of AUM in the space. Maybe talk a little bit about what's the next chapter for the active ETF business.

Yes. So look, the first thing about active ETFs, the success of them is really about whether you've got successful strategies in them, right? Are you a successful active manager? The ETF is a wrapper or a vehicle around that. So I think a lot of the success actually is due to the underlying success of the active management underneath. That said, Rob Forsyth, who we hired about a year ago to lead that initiative, I think, has done a phenomenal job in scaling the business out. The key thing in the active ETF business is to actually have a gain scale -- quickly get to scale in individual strategies because the platforms that you can list on will have AUM minimum. So you want to be able to kind of get quickly to $100 million, $300 million, $500 million, and then you can get on more and more platforms and you get that J-curve coming through in the growth. As we look forward, we'll continue to add active ETFs. In the U.S., there's this whole discussion around, look, should you have ETF share classes, et cetera, et cetera. We have the option -- now have the optionality to do that. Speaking to our distribution partners, they're not really terribly excited about that. So we'll keep that as optionality for now, but we'll continue to innovate new ETFs and convert some mutual funds. And we're starting to look at other geographies and most near term, Europe is in our crosshairs as to what we need to do there.

So maybe if we zoom out a little bit and we think about the active ETF space, and if we use the baseball analogy, where is the industry at in that journey? Are we still kind of early days? Or are we kind of middle innings?

That's a good question. I still feel we're fairly early innings in it. $1 billion is great from 0 at the beginning of last year, but it's still 0.5% of our global AUM. And I think that's representative across a number of the leading peers. So I think there is more room to go. And primarily, I believe, in the U.S., given the tax advantage of the vehicle, but we are starting to see increasing client demand for it. And ultimately, this is a business where we want to serve our clients where they want to be met -- or meet our clients where they want to be served, sorry. So we will follow that client demand.

Great. Great. But it is also a space that a lot of your big competitors have been kind of leaning into and trying to grow more and launch more products. So how do you make sure that you can continue to kind of stand out in that increasingly crowded field?

Yes. Look, I think ultimately, it comes down to a few things. First and foremost, it comes down to do we have the right investment strategies underneath them. And if you have great investment strategies underneath them, they tend to work better. And as you can see in the 7 that we've launched, it's a mix of some of our flagship strategies, so global listed infrastructure, emerging market equities, along with some newer things, emerging tech, et cetera. So first and foremost, it's that. Secondly, it's working -- making sure our distribution partners are working hand in glove -- sorry, our sales teams are working hand in glove with the distribution partners to make sure that we're supporting them and rolling them out.

Great. Great. So again, 2025 was kind of a bigger year for investment in the active ETF business. At this point, was a lot of the investment to kind of get that off of the ground, essentially kind of behind you? And so how do we think about maybe the incremental investment that you may need in that space?

Yes. I think the -- look, certainly, the cost in terms of bringing the team together, the technology required to launch it was in 2025. They'll be -- they will recur in 2026, but the incremental cost should be very low going forward as we launch additional ones.

So one of the common questions that we get about Lazard from the investment community is a focus on the margins, right? Lazard screens at a lower margin than the broader industry, and it's kind of continued to come down in recent years. And certainly, some investments have been part of the reason for that. But as you come in with a fresh perspective, how do you think about that opportunity to maybe close the gap to the industry average? And is there anything structural that will kind of limit your ability to get there?

Great question. I won't be drawn on the specific target, but I will say that the margins are not where we would like them to be. How do you improve the margin from here? And sorry, to directly answer your question, I don't see anything structural, right, that would prohibit us improving margins. The first thing that we want to do to drive margin is to grow and grow in our existing products because that's a very high incremental margin when we can do it. So first and foremost focus on that. Look, the second part is then to sort of work through and say, look, where can you take cost out. One of the observations, and this is true across a lot of asset managers is that we have a broad set of products and investment strategies. A small number of those drive a disproportionate amount of our revenue and profitability and then there's a long tail of other products. Many of those products will drive our future growth, but some of them won't, okay? So we really need to be fairly aggressive in looking at those smaller products where we've got less conviction in and look to move resources away from those or potentially rationalize them so we can focus on other areas. And that will help with the margin. We've done some of that, but I think we need to sort of step up the pace around that and that focus should help. We then just need to be incredibly disciplined -- and one of the important hires or appointments I made at the beginning of this year was we had a COO transition and Rosalie Berman became our new COO. Rosalie spent 20 years in operational leadership roles at Morgan Stanley and is really kind of taking a very fresh look at a lot of the processes and cost controls in our business. And I think that, that should bear some fruit as we look through the cost structure. There's no silver bullet in this where it's like the one thing we need to change, it is just about having very rigorous cost discipline. So having Rosalie there as COO sort of working with me and my leadership team is going to be critical to making sure that we do deliver that operating margin as the -- operating leverage as our revenue growth comes through.

Maybe a follow-up on that point, Chris, when you talk about some of these strategies that perhaps you may identify as having kind of an inability to scale to a level that makes the ROI makes sense. What does the time frame look like in terms of addressing that opportunity? Is that something that's a kind of multiyear run? Is that something that's kind of more of a 2026 event?

I think it has to be ongoing, right? I don't think you ever want to be done looking at your portfolio and kind of figuring out what's there. But as Eric settles in as CIO, as I settle in as CEO, we'll have time to address it. So I think we need to kind of -- maybe there's a -- we accelerated a little bit this year and next, and then it becomes more sort of business as usual going forward. And to be clear, we're talking about the kind of tail. So a lot of these are strategies that are sub-$100 million, right? They're not kind of -- so you may not see it in an AUM line, but you'd see it just as in the headlines as strategies rationalize.

Got it. And just to follow up on my question about the kind of structural element of the margin differential. The reason I ask that is you certainly are quite a global asset management franchise. And so when you look at the breadth of the global business, is there any opportunities to maybe rationalize some elements of the expense base or maybe said the other way, to get some more growth out of your business such that you can get better operating leverage on the revenue side?

So look, I think the global footprint is a feature, not a bug of the Lazard model on the investment side and the distribution side. We do -- and look, as you might imagine, as you start to look at fresh at the operating model that supports that, for sure, there'll be some opportunities for us to think about, look, how do we manage that. For example, when we have a global capability, let me choose an example, RFP responding, right? So we have a team of folks who sit responding to RFPs coming in from institutional clients. That's generally centralized. A little bit is offshored already. But then in each region, you have a local person who's just adapting it a little bit, et cetera. Is that the right model for writing RFPs? Is that -- is that going to move the needle on its own in terms of our margin? No. But as you go through every process and think about where should you be global versus local, what's the right balance to get right, there will be opportunities. And certainly, with me coming in a fresh, Rosalie coming in a fresh and a brand-new group CFO, and he and I are very focused on this. I think we'll uncover opportunity.

Maybe just double-click a little bit into the distribution and sales force. Again, go only been a couple of months, but as you had a chance to kind of get your hands around the strength of the business and maybe identify some opportunities there based on your prior experience, what have you kind of observed thus far? Maybe where could the incremental investment dollars be spent there?

Yes. I mean, look, the first thing I'd say is I've been really impressed by the distribution teams at Lazard. And I think there's some wonderful proof points if you look at the level of gross sales last year, a record $55 billion, the net flows and the level of current business activity. So I'm working with a great team. I think that the incremental dollar really does have to be about how do we get more people on the front line. If you look particularly in the intermediary business, the wirehouses, the RIAs, the broker-dealers, third-party distribution around the world. To win in that business, you've got to have great products, but you've also really got to work with those partners to support them in the field. That's an investment we've been making in the U.S. over the last couple of years, but I see high ROI and adding additional heads there. We've got to figure out how do you find that. So that's around kind of getting the operating system or operating model right in the backbone to free that up. But I think there's a real advantage to doing that with hopefully fairly quick payoffs.

One area that I think has been a little bit overlooked for the asset management business has been the expansion with the intermediaries and kind of the wealth management space more broadly. That's been a good vector of growth for you. Can you maybe just give us an update on the investments there and maybe where you see the opportunity set in that channel specifically and how you can really unlock it more?

Yes, sure. So I mean, just to kind of level set, the intermediary part of our business is around -- is just under half, just under half of our business, and it's been growing nicely. How do you win there? I mean, look, I feel like a broken record saying this. First of all, you've got to have the right products, right? With good investment performance. Second, you've got to have the right vehicles, increasingly in the U.S., that's around having active ETFs. It's around having SMA capabilities. You've got to have the right support model, and that is about having people in the field as well as for the home offices. So we've been through a process in the U.S. of channelizing our field teams to service the intermediaries so that they're better aligned with our major partners. The other part of this, and I've been meeting with each of our big intermediary partners over the last couple of weeks is how do we partner with them. And a large part of that is around sort of thought leadership. And one of the things that they are constantly kind of looking for, I think it's a real opportunity for us is how can we provide thought leadership to them, both the home offices and the field teams to help them better serve their own clients, right? And one of the areas that kind of keeps cropping up, and I think it's a real interesting part of Lazard is a unit that started on the FA side of our business, but we now leverage as geopolitical advisory business. Now this is a group of government officials, CIA folks, military folks, et cetera, et cetera, who can kind of bring pretty interesting perspectives very quickly around geopolitical events. And for sure, there's quite a lot of those going on at the moment. And that's the sort of capability that we can bring to bear with some of these big intermediary partners, whether that's speaking at events, whether it's kind of providing information quickly so that their advisers can service their clients. So there's things like that, that as we think about the broad partnership, it's not just as simple as product and sales support. There's a lot of other things that we can do around the edges.

That brings up a really compelling point here. Certainly something that comes up in investor conversations is really that the opportunity with asset management and financial advisory together, you just made a really good point there and something that you can kind of leverage more on your side of the business. But from us on the outside, it's always a little bit hard to see maybe the benefits of the 2 together and the power of the combined businesses. So again, it's been early days, but is there anything else you're really excited about having in that connection given that is something kind of newer to you?

Yes. I mean, look, I think, first of all, it's just a very -- there's a very powerful brand across the 2 businesses, both reinforce. I do think that kind of power to -- we talk about the kind of power to convene. And I think the geopolitical advisory is a nice example of that around content to kind of provide the right context for decisions. That's very powerful on the FA side. It's very powerful on the asset management side, both to our investors and to clients. I think there's a bunch of investments that we can make across the firm. I think AI is a really good example of that. where we can leverage a lot of the investments that are being made on both sides of the business. And then look, I think there are some real clear synergies that can over time be exploited. I don't want to overplay it right now, but we do have a wealth business. As our FA advisers are in wealth creation events with clients, is that an opportunity to bring our wealth management business and create a win-win on both sides of it. So there are things like that, that I think there's opportunities to -- it's why we're not really doing that today, but over time, there could be some.

Great. I'm going to pause there and just see if there's any questions in the room or if anybody wants to submit any questions, you can do so through the app or through the web, and I'd be happy to read them off. Okay. Great. So if any come in, just go ahead and raise your hand. The wealth business, I wanted to maybe dive into that just a little bit more. It's not something that we hear a lot about from Lazard again, given it's kind of smaller relative size. If this is a strategy that you do ultimately kind of invest in and grow more, what could that look like? How would you ramp that business? Maybe talk about France versus the U.S. and where you see the opportunity maybe in the U.S. based on what you've learned in France?

Yes. So look, the businesses that we have today are a little bit different, both sides of the Atlantic. So in France, we have a close architectural wealth business. along with a private bank. And it's a nice business. It's nicely profitable, and it grows -- kind of grows nicely. I do think there's opportunity there given the strength of the investment offering and the client servicing to continue to scale that in France. And clearly, over time, there might be opportunities to expand that geographically. All the caveats I said earlier about being very selective in any acquisitions, but you could also do that organically as well. So that's a part of our business that's attractive. The attractiveness of it beyond the margin, et cetera, is the persistence of those revenue streams. If you kind of go through our overall business, it's like retail money is the shortest duration, Institutional is longer and then private wealth tends to be even longer than that. In the U.S., it's a slightly different business. We acquired a business called Truvvo 4 years ago --5 years ago, 4 years ago. And that's more of a high net worth family office kind of offering that does sort of asset allocation manager research selection. It's a really interesting investment capability. And I think there's opportunity again to scale that. Over time, as I step back and look, it's really early days, so don't overweight these comments. But as I look at wealth businesses that are scaled, they've generally done it through a combination of organic growth as well as some very limited sort of add-ins, whether that's sort of team lift-outs or small acquisitions. So we're doing some work to educate ourselves and figure out what the right path forward is.

Okay. Great. AI, you brought it up. And I guess I'd love to maybe unpack that a little bit more as you think about your business and you think about the opportunities here. How could you use AI more in terms of the investment process? And then if you think about, again, maybe coming back to the margins or the expense side, where is there maybe some opportunities on the efficiency side as well?

Yes. So look, I -- you won't be surprised, I'm quite excited about the opportunity for AI. Critically, we hired a terrific guy at the end of last year called Anthony Nicastro to be the AI lead for the asset management business. And really, we're trying to focus on 4 areas. The first is our investment process -- investment research process; the second, our client experience. The third is kind of efficiency automation. And the fourth is kind of risk governance sort of oversight. There are a lot of processes underlying what we do, and it's just having that second or third set of eyes and can AI play a role there. Look, in the investment process to specifically answer your question, a lot of -- and I'm sure that everyone in the audience can understand this, a lot of the analyst time is spent actually compiling data from various sources, attending things, getting information together, et cetera. Then a bit of time spent analyzing it and frustratingly little time spent thinking what the implication is. And actually, what we really want to do is turn that on its head so that we've got more time to actually think and generate alpha. So I think that's where AI will really change and frankly improve the jobs of the analysts. I think as you go through the investment kind of process, it can actually have a pretty interesting implications for the portfolio construction, risk management, et cetera, and we're leaning in heavily to that. On the client side, we spent a lot of time writing client commentaries, sharing information with clients. And now that can -- 90% of that can be automated. The first, second draft can be written, meeting prep notes, et cetera, et cetera. So it's about making the sales teams more efficient so that more of their time is spent being in front of clients. So super excited about the potential for it. And again, it goes back to that notion of deliver, grow and capitalize. And if we can use AI properly, that growth will kind of come through at a more attractive incremental margin.

Great. Okay. We're approaching the end of the session, but I just want to give you an opportunity. Is there maybe anything we haven't covered today that you thought would be kind of an important message for investors to hear?

Look, I mean, it's been a great set of questions. So thank you. I mean, just in closing, I get it that there's some skepticism about the asset management business. But the reason I came to Lazard is I really see some real strength here. I feel very confident in the ability to improve the perimeter of what we have by delivering, growing it and capitalizing on that through profitable growth and then ultimately, some very exciting long-term growth vectors. So I feel very confident that this should be -- can be a compelling part of the buy case on Lazard and certainly can be a major contributor towards the Lazard 2030 ambitions that we set out.

Great. Well, Chris, best of luck, and thank you so much for joining us here in Florida.

Thank you very much.