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Compensation and Benefits | 9 Months Ended
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Sep. 30, 2025
Share-Based Payment Arrangement [Abstract] |
Compensation and Benefits | Note 10. Compensation and Benefits Total compensation and benefits consist of the following:
| For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Salaries, incentive compensation and benefits (1) | $ | 136,049 |  |  | $ | 128,604 |  |  | $ | 406,561 |  |  | $ | 387,067 |
Long-term cash incentive compensation expense | 20,469 |  |  | 12,941 |  |  | 56,675 |  |  | 35,088 |
Restricted share-based award compensation expense | 6,724 |  |  | 7,489 |  |  | 21,043 |  |  | 23,549 |
Long-term incentive compensation expense | 27,193 |  |  | 20,430 |  |  | 77,718 |  |  | 58,637 |
Total compensation and benefits | $ | 163,242 |  |  | $ | 149,034 |  |  | $ | 484,279 |  |  | $ | 445,704 |
(1) Excluding long-term incentive compensation expense
Incentive compensation Cash incentive compensation paid to members of Artisan’s investment teams and members of its distribution team is generally based on formulas that are tied directly to revenues. The majority of this incentive compensation is earned on a quarterly basis and paid in the quarter following the quarter in which it was earned with the exception of fourth quarter incentive compensation which is earned and paid in the fourth quarter of the year. Cash incentive compensation paid to most other employees is determined based on individual performance and Artisan’s overall results during the applicable year and is generally paid on an annual basis. Long-term incentive compensation awards consist of both APAM restricted share-based awards and long-term cash awards, which are referred to as franchise capital awards. These awards are described in more detail below. Restricted share-based awards APAM has granted a combination of restricted stock awards, restricted stock units and performance share units (collectively referred to as “restricted share-based awards” or “awards”) of Class A common stock to employees. Standard Restricted Shares. Standard restricted shares are generally subject to a pro rata five-year service vesting condition. Career Shares. Career shares are generally subject to both (i) a pro rata five-year service vesting condition and (ii) a qualifying retirement (as defined in the award agreement) condition. Franchise Shares. Like career shares, franchise shares are generally subject to both (i) a pro rata five-year service vesting condition and (ii) a qualifying retirement condition. In addition, franchise shares, which are only granted to investment team members, are subject to a Franchise Protection Clause, which provides that the number of shares that ultimately vest depends on whether certain conditions relating to client cash flows are met. If such conditions are not met, compensation cost related to unvested shares will be reversed. Performance Share Units (PSUs). PSUs are generally subject to (i) a three-year service vesting condition, (ii) certain performance conditions related to the Company’s adjusted operating margin and total shareholder return compared to a peer group during a three-year performance period, and (iii) for one-half of the PSUs eligible to vest at the end of the performance period, a qualifying retirement condition. The number of shares of Class A common stock that are ultimately issued in connection with each PSU award depends upon the outcome of the performance, market and qualified retirement conditions. For the portion of a PSU award with a “performance condition” under ASC 718, expense was recognized over the service period if it was probable that the performance condition would be achieved. As of September 30, 2025, all outstanding PSUs had met the required performance conditions, but remain outstanding subject to meeting a qualifying retirement vesting condition. For certain awards granted in 2024 and 2025, the pro rata five-year service vesting condition is not applicable if the grantee has a qualified retirement after meeting an age plus number of years of service with the Company condition. Compensation expense is recognized based on the estimated grant date fair value on a straight-line basis over the requisite service period of the award. The initial requisite service period is generally five years for restricted stock awards and restricted stock units, and three years for PSUs. If an employee is eligible to fully vest in an award upon a qualified retirement, the requisite service period is equal to the employee’s required retirement notice period, which is generally 12 or 18 months. The fair value of each award is equal to the market price of the Company’s common stock on the grant date, except for PSUs with a “market condition” performance metric under ASC 718, which had a grant-date fair value based on a Monte Carlo valuation model. Unvested restricted share-based awards are subject to forfeiture. Grantees are generally entitled to dividends or dividend equivalents on unvested and vested awards. 5,509,877 shares of Class A common stock were reserved and available for issuance under the Artisan Partners Asset Management Inc. 2023 Omnibus Incentive Compensation Plan (the “Plan”) at September 30, 2025. During the nine months ended September 30, 2025, Artisan granted 429,511 restricted stock awards and 6,702 restricted stock units. The following tables summarize the restricted share-based award activity for the nine months ended September 30, 2025:
| Weighted-Average Grant Date Fair Value |  | Restricted Stock Awards and Restricted Stock Units
Unvested at January 1, 2025 | $ | 39.26 |  |  | 5,276,480 |
Granted | 44.14 |  |  | 436,213 |
Forfeited | 48.40 |  |  | (12,289) |
Vested | 39.30 |  |  | (530,138) |
Unvested at September 30, 2025 | $ | 39.65 |  |  | 5,170,266 |
| Weighted-Average Grant Date Fair Value |  | Performance Share Units
Unvested at January 1, 2025 | $ | 37.86 |  |  | 176,192 |
Granted | — |  |  | — |
Forfeited | — |  |  | — |
Adjustment for performance results achieved (1) | 29.40 |  |  | 47,970 |
Vested (1) | 35.67 |  |  | (71,955) |
Unvested at September 30, 2025 (2) | $ | 38.90 |  |  | 152,207 |
(1) During the nine months ended September 30, 2025, the 95,940 PSUs granted in 2022 met the requisite three-year performance conditions for the potential delivery of 143,910 shares (47,970 additional shares for results achieved). 71,955 shares of Class A common stock underlying one-half of the total PSUs were delivered in the nine months ended September 30, 2025, while the remaining 71,955 units remain subject to the qualified retirement provision.
(2)At September 30, 2025, all 152,207 outstanding PSUs have met the required performance conditions for vesting, but remain outstanding subject to a qualifying retirement vesting condition.
The unrecognized compensation expense for the unvested restricted stock awards and restricted stock units as of September 30, 2025 was $50.4 million with a weighted average recognition period of 2.6 years remaining. The unrecognized compensation expense for the unvested PSUs as of September 30, 2025 was $0.5 million with a weighted average recognition period of 1.1 years remaining. During the nine months ended September 30, 2025, the Company withheld a total of 208,156 restricted shares and paid a total of $9.0 million as a result of net share settlements to satisfy employee tax withholding obligations. These net share settlements had the effect of shares repurchased and retired by the Company, as they reduced the number of shares outstanding. Long-term cash awards (franchise capital awards) During the nine months ended September 30, 2025, Artisan granted $46.8 million of franchise capital awards to investment team members in lieu of certain additional restricted share-based awards. The franchise capital awards are subject to the same long-term vesting and forfeiture provisions as restricted share-based awards, as described above. Prior to vesting, franchise capital awards are generally allocated to one or more of the investment strategies managed by the award recipient’s investment team. During the vesting period, the value of the awards will increase or decrease based on the investment returns of the strategies to which the awards are allocated. Compensation expense, including the appreciation or depreciation related to investment returns, is recognized on a straight-line basis over the required service period, which is generally five years. If an employee is eligible to fully vest in an award upon a qualified retirement, the requisite service period for that award is equal to the employee’s required retirement notice period, which is generally 12 or 18 months. As the awards will generally be paid out in cash upon vesting, the fair value of unvested awards is recorded as a liability based on the percentage of the service requirement that has been completed. The liability is recorded within accrued long-term incentive compensation in the Company’s unaudited condensed consolidated statements of financial condition. The Company hedges its economic exposure to the change in value of franchise capital awards due to market movements by investing the cash reserved for the awards in the underlying investments. The franchise capital award liability and the underlying investment holdings are marked to market each quarter. The change in value of the award liability is recognized as a compensation expense on a straight-line basis over the required service period. The change in value of the underlying investment holdings is recognized in non-operating income (expense) in the period of change. While there is a timing difference between the recognition of the compensation expense and the offsetting investment gain or loss, the compensation expense and investment income will net to zero at the end of the multi-year vesting period for all awards that ultimately vest. The change in value of the investments had the following impact on the unaudited consolidated statements of operations:
|  | For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
Statement of Operations Section | Statement of Operations Line Item | 2025 |  | 2024 |  | 2025 |  | 2024
Operating expenses (benefit) | Compensation and benefits | $ | 7,277 |  |  | $ | 4,596 |  |  | $ | 19,714 |  |  | $ | 9,187 |
Non-operating income (expense) | Net investment gain (loss) of nonconsolidated investment products | 9,407 |  |  | 8,800 |  |  | 27,403 |  |  | 17,828 |
Non-operating income (expense) | Net investment gain (loss) of consolidated investment products | 645 |  |  | 848 |  |  | 3,625 |  |  | 1,970 |
The unrecognized compensation expense for the unvested franchise capital awards as of September 30, 2025 was $134.6 million with a weighted average recognition period of 2.3 years remaining.

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- Definition The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 715 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/715/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 712 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/712/tableOfContent Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 710 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/710/tableOfContent Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/718/tableOfContent + Details
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