GlobeNewswire Inc | Jul 30, 2021 07:00AM EDT

July 30, 2021

NEW YORK, July 30, 2021 (GLOBE NEWSWIRE) -- WisdomTree Investments, Inc. (NASDAQ: WETF) today reported financial results for the second quarter of 2021.

$17.6 million net income ($16.81 million net income, as adjusted), see Non-GAAP Financial Measurements for additional information.

$73.9 billion of ending AUM, an increase of 6.3% arising from market appreciation and net inflows.

$0.9 billion of net inflows, driven by inflows into our emerging markets equity, international developed market equity, U.S. equity and fixed income products.

0.41% average global advisory fee, a decrease of 1 basis point due to AUM mix shift.

$77.6 million of operating revenues, an increase of 6.6% due to higher average AUM, partly offset by a lower average global advisory fee.

79.1% gross margin1, a 0.4 point increase from the previous quarter.

30.5% operating income margin, a 5.0 point increase primarily due to higher revenues.

$150.0 million issuance of convertible senior notes due 2026, bearing interest at a rate of 3.25% and issued with a conversion price of $11.04 per share. We used a portion of the proceeds to repurchase our common stock and intend to use the remainder of the net proceeds for working capital and other general corporate purposes, which may include debt retirement, organic and inorganic growth initiatives and common stock repurchases.

$31.9 million repurchase of 4.6 million shares of our common stock, principally in connection with the issuance of the convertible notes.

$0.03 quarterly dividenddeclared, payable on August 25, 2021 to stockholders of record as of the close of business on August 11, 2021.

Update from Jonathan Steinberg, WisdomTree CEO?Many businesses across the financial services ecosystem are struggling tobalance legacy business models and the conflicts that arise with fast movingtechnological advancements - not WisdomTree. Our solid operating and financialresults in the second quarter demonstrate continued growth and strong executionacross our business today, along with exciting progress on our long-termstrategic initiatives,all while showing the efficiency and scalability of ourbusiness.

?We continue to strengthen our position in areas of growing interest such asliquid alternatives, ESG and model portfolios. We are also quicklyestablishing expertise around digital assets, delivering the insights from ourpioneering work in regulated cryptocurrency exposures and our broader visionfor the applications of blockchain technology in the form of investor-facingresearch and events.

?The focus and flexibility of our remote first business model have enabledWisdomTree to attract and retain world-class talent, drive strong operatingresults, and engage with our clients across different modalities with anever-expanding set of resources.?

Update from Jarrett Lilien, WisdomTree COO and President?This was a strong quarter for WisdomTree, extending a string of strongquarters, and we are continuing to build momentum as we execute on our keygrowth initiatives.

?We are producing balance and quality in the mix of our global flows. In theU.S., we are seeing strength in our Large Blend, Emerging Markets and Chinafunds. In Europe, our UCITs ETFs and Thematic funds are standouts, and we arealso experiencing growth in industrial metals, copper, silver and even gold,while there continues to be volatility in the gold market.

?We are investing in our future growth with 11 new fund launches and a numberof well-received product enhancements completed in the first half of the year.We also launched ESG model portfolios and +Crypto models this past quarter andcontinue to be optimistic about the impact of models on our flows.

?We are executing well on all fronts, building momentum and are excited toenter the second half of the year building on these strong results.?

OPERATING AND FINANCIAL HIGHLIGHTS

Three Months Ended June 30, Mar. 31, Dec.31, Sept. 30, June 30, 2021 2021 2020 2020 2020ConsolidatedOperating Highlights ($ in billions):AUM $ 73.9 $ 69.5 $ 67.4 $ 60.7 $ 57.7 Net inflows/ $ 0.9 $ 1.3 $ 0.9 $ (0.5 ) $ 0.1 (outflows)Average AUM $ 73.7 $ 69.6 $ 64.1 $ 61.2 $ 55.7 Average advisory fee 0.41 % 0.42 % 0.41 % 0.42 % 0.41 % ConsolidatedFinancial Highlights ($ in millions, except per shareamounts):Operating revenues $ 77.6 $ 72.8 $ 67.1 $ 64.6 $ 58.1 Net income/(loss) $ 17.6 $ 15.1 $ (13.5 ) $ (0.3 ) $ (13.3 )Diluted earnings/ $ 0.11 $ 0.09 $ (0.10 ) $ (0.01 ) $ (0.09 )(loss) per shareOperating income 30.5 % 25.5 % 19.2 % 22.8 % 20.3 %marginAs Adjusted (Non-GAAP ^1):Gross margin 79.1 % 78.7 % 75.6 % 76.5 % 75.1 %Net income, as $ 16.8 $ 12.5 $ 9.2 $ 11.0 $ 8.5 adjustedDiluted earnings per $ 0.10 $ 0.08 $ 0.06 $ 0.07 $ 0.05 share, as adjusted

RECENT BUSINESS DEVELOPMENTS

Company News

* In May 2021, Bryan Edmiston was appointed as Chief Financial Officer, effective June 1, 2021. * In June 2021, we completed a private offering of $150.0 million in aggregate principal amount of 3.25% Convertible Senior Notes due 2026. * In June 2021, we appointed Stockholm-based Bjrn Sandberg as Director of Nordic Sales for WisdomTree Europe.

Product News

* In May 2021, we launched the WisdomTree Alternative Income Fund (HYIN) on the CBOE; we launched the WisdomTree Efficient Core family of ETFs on the NYSE, which includes the International Efficient Core Fund (NTSI), the Emerging Markets Efficient Core Fund (NTSE) and the renamed U.S. Efficient Core Fund (NTSX); we launched +Crypto Model Portfolios for advisors in collaboration with OnRamp Invest which features Gemini integration; and the WisdomTree S&P 500 VIX Short-Term Futures 2.25x Daily Leveraged (VIXL) underwent a change of index as part of volatility proofing measures across the European product range. * In June 2021, we launched the WisdomTree BioRevolution Fund (WDNA) on the CBOE, leveraging data and thematic insights from Dr. Jamie Metzl, one of the world?s leading technology futurists; we launched the WisdomTree U.S. Growth & Momentum Fund (WGRO) on the Nasdaq stock exchange; and we listed the WisdomTree Bitcoin ETP (BTCW) and WisdomTree Ethereum ETP (ETHW) on Euronext exchanges in Paris and Amsterdam. * In July 2021, we listed the WisdomTree Enhanced Commodity ex-Agriculture UCITS ETF ? EUR Hedged (EXAG) on Brse Xetra.

WISDOMTREE INVESTMENTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (Unaudited)

Three Months Ended Six Months Ended June30, Mar. 31, Dec.31, Sept.30, June30, June30, June30, 2021 2021 2020 2020 2020 2021 2020Operating Revenues:Advisory fees $ 75,997 $ 71,616 $ 66,105 $ 63,919 $ 57,208 $ 147,613 $ 120,158 Other income 1,606 1,214 954 721 918 2,820 1,842 Total revenues 77,603 72,830 67,059 64,640 58,126 150,433 122,000 Operating Expenses:Compensation 20,331 22,627 20,827 19,098 17,455 42,958 34,750 and benefitsFundmanagement and 16,195 15,521 16,350 15,219 14,461 31,716 28,946 administrationMarketing and 3,594 3,006 3,715 2,996 1,949 6,600 4,417 advertisingSales andbusiness 2,159 2,145 2,595 2,386 2,181 4,304 5,598 developmentContractual 4,314 4,270 4,449 4,539 4,063 8,584 7,823 gold paymentsProfessional 1,921 2,013 1,322 950 1,357 3,934 2,630 feesOccupancy,communications 1,266 1,475 1,622 1,611 1,643 2,741 3,194 and equipmentDepreciationand 256 252 261 253 251 508 507 amortizationThird-partydistribution 2,130 1,343 1,291 1,233 1,340 3,473 2,695 feesAcquisitionand ? ? ? ? 33 ? 416 disposition-related costsOther 1,752 1,571 1,720 1,611 1,596 3,323 3,593 Totaloperating 53,918 54,223 54,152 49,896 46,329 108,141 94,569 expensesOperating 23,685 18,607 12,907 14,744 11,797 42,292 27,431 incomeOther Income/ (Expenses):Interest (2,567 ) (2,296 ) (2,694 ) (2,511 ) (2,044 ) (4,863 ) (4,463 )expenseGain/(loss) onrevaluation ofdeferred 497 2,832 (22,385 ) (8,870 ) (23,358 ) 3,329 (25,566 )consideration? goldpaymentsInterest 225 231 351 111 119 456 282 incomeImpairments ? (303 ) ? (3,080 ) ? (303 ) (19,672 )Loss onextinguishment ? ? ? ? (2,387 ) ? (2,387 )of debtOther gainsand losses, 49 (5,893 ) 524 744 1,819 (5,844 ) (688 )netIncome/(loss)before income 21,889 13,178 (11,297 ) 1,138 (14,054 ) 35,067 (25,063 )taxesIncome taxexpense/ 4,259 (1,969 ) 2,200 1,408 (804 ) 2,290 (3,175 )(benefit)Net income/ $ 17,630 $ 15,147 $ (13,497 ) $ (270 ) $ (13,250 ) $ 32,777 $ (21,888 )(loss)Earnings/ ($0.10) ($0.01)(loss) per $ 0.11^2 $ 0.09^2 ^2 ^2 ($0.09 ) $ 0.20^2 ($0.15)^2 share ? basicEarnings/(loss) per $ 0.11 $ 0.09 ($0.10) ($0.01) ($0.09 ) $ 0.20 ($0.15)^2 share ? ^2 ^2dilutedWeightedaverage common 145,542 145,649 145,096 145,564 151,623 145,652 152,071 shares ? basicWeightedaverage common 164,855 161,831 145,096 145,564 151,623 163,062 152,071 shares ?diluted As Adjusted (Non-GAAP^1)Income before $ 21,253 $ 15,583 $ 11,504 $ 13,242 $ 10,911 income taxesIncome tax $ 4,458 $ 3,079 $ 2,281 $ 2,205 $ 2,417 expenseNet income $ 16,795 $ 12,504 $ 9,223 $ 11,037 $ 8,494 Earnings pershare ? $ 0.10 $ 0.08 $ 0.06 $ 0.07 $ 0.05 diluted

QUARTERLY HIGHLIGHTS

Operating Revenues

-- Operating revenues increased 6.6% and 33.5% from the first quarter of 2021 and second quarter of 2020, respectively, due to higher average global AUM arising from market appreciation and net inflows. -- Our average global advisory fee was 0.41%, 0.42% and 0.41% during the second quarter of 2021, the first quarter of 2021 and the second quarter of 2020, respectively.

Operating Expenses

-- Operating expenses decreased 0.6% from the first quarter of 2021 primarily due to lower compensation arising from reduced stock-based compensation and prior quarter seasonal payroll taxes, partly offset by higher third-party distribution fees, marketing expenses and fund management and administration costs. -- Operating expenses increased 16.4% from the second quarter of 2020 primarily due to higher incentive compensation and headcount, fund management and administration costs, marketing expenses, third-party distribution fees and professional fees.

Other Income/(Expenses)

-- Interest expense increased 11.8% from the first quarter of 2021 primarily due to the issuance of $150.0 million convertible senior notes due 2026. Interest expense increased 25.6% from the second quarter of 2020 primarily due to a higher level of debt outstanding and a higher effective interest rate. -- We recognized a non-cash gain on revaluation of deferred consideration of $0.5 million during the second quarter of 2021. The gain was due to a flattening of the forward-looking gold curve. The magnitude of any gain or loss recognized is highly correlated to the magnitude of the change in the forward-looking price of gold.

Income Taxes

-- Our effective income tax rate for the second quarter of 19.5% resulted in income tax expense of $4.3 million. Our tax rate differs from the federal statutory rate of 21% primarily due to a lower tax rate on foreign earnings. -- Our adjusted effective income tax rate was 21.0%1.

SIX MONTH HIGHLIGHTS

-- Operating revenues increased 23.3% as compared to 2020 due to higher average AUM. -- Operating expenses increased 14.4% as compared to 2020 largely due to higher incentive compensation accruals and headcount, fund management and administration costs, marketing expenses, professional fees, third party distribution fees and contractual gold payments. These increases were partly offset by lower sales and business development expenses and occupancy expenses. -- Significant items reported in other income/(expenses) in 2021 include a non-cash gain on revaluation of deferred consideration of $3.3 million; a non-cash charge of $5.2 million arising from the release of tax-related indemnification assets upon the expiration of the statute of limitations (an equal and offsetting benefit was recognized in income tax expense); and a gain of $0.4 million recognized on our investment in Securrency, Inc. due to its recent capital raise. -- Our effective income tax rate for 2021 of 6.5% resulted in income tax expense of $2.3 million. Our tax rate differs from the federal statutory rate of 21% primarily due to a tax benefit of $5.2 million recognized in connection with the release of the tax-related indemnification asset described above, a lower tax rate on foreign earnings and a non-taxable gain on revaluation of deferred consideration. These items were partly offset by tax shortfalls associated with the vesting and exercise of stock-based compensation awards and state and local taxes.

CONFERENCE CALL

WisdomTree will discuss its results and operational highlights during a conference call on Friday, July 30, 2021 at 9:00 a.m. ET. The call-in number is (877)303-7209.Anyone outside the U.S. or Canada should call (970)315-0420.The slides used during the presentation will be available at http://ir.wisdomtree.com. For those unable to join the conference call at the scheduled time, an audio replay will be available on http://ir.wisdomtree.com.

ABOUT WISDOMTREE

WisdomTree Investments, Inc., through its subsidiaries in the U.S. and Europe (collectively, WisdomTree), is an ETF and ETP sponsor and asset manager headquartered in New York.WisdomTree offers products covering equity, commodity, fixed income, leveraged and inverse, currency, cryptocurrency and alternative strategies. WisdomTree currently has approximately $74.3 billion in assets under management globally.

WisdomTree is the marketing name for WisdomTree Investments, Inc. and its subsidiaries worldwide.

_________________1See Non-GAAP Financial Measurements.2Earnings/(loss) per share (EPS) is calculated pursuant to the two-class method as it results in a lower EPS amount as compared to the treasury stock method.

Contact Information:

Corporate CommunicationsJessica Zaloom+1.917.267.3735jzaloom@wisdomtree.com

WisdomTree Investments, Inc.Key Operating Statistics (Unaudited)

Three Months Ended June 30, Mar. 31, Dec. 31, Sept. 30, June 30, 2021 2021 2020 2020 2020GLOBAL ETPs ($ in millions) Beginning of $ 69,537 $ 67,392 $ 60,710 $ 57,666 $ 50,347 period assetsInflows/ ) (outflows) 931 1,279 881 (477 126Market appreciation/ 3,484 866 5,801 3,567 7,489 (depreciation)Fund closures ) ) ) (4 ? ? (46 (296End of period $ 73,948 $ 69,537 $ 67,392 $ 60,710 $ 57,666 assetsAverage assetsduring the $ 73,658 $ 69,589 $ 64,106 $ 61,200 $ 55,746 periodAverage advisory fee during the 0.41 % 0.42 % 0.41 % 0.42 % 0.41 %periodRevenue days 91 90 92 92 91Number of ETFs ? end of the 318 313 309 305 311 period U.S. LISTED ETFs ($ in millions) Beginning of $ 42,163 $ 38,517 $ 33,310 $ 31,362 $ 28,920 period assetsInflows/ (1,474 )(outflows) 1,130 1,343 919 575Market appreciation/ 1,836 2,303 4,288 1,373 4,030 (depreciation)Fund closures ) ? ? ? ? (114End of period $ 45,129 $ 42,163 $ 38,517 $ 33,310 $ 31,362 assetsAverage assetsduring the $ 44,183 $ 40,706 $ 35,926 $ 33,002 $ 30,651 periodAverage advisory fee during the 0.40 % 0.40 % 0.40 % 0.41 % 0.41 %periodNumber of ETFs ? end of the 73 68 67 67 67 period EUROPEAN LISTEDETPs ($ in millions) Beginning of $ 27,374 $ 28,875 $ 27,400 $ 26,304 $ 21,427 period assetsInflows/ ) ) ) ) (outflows) (199 (64 (38 (1,052 1,600Market appreciation/ 1,648 (1,437 ) 1,513 2,194 3,459 (depreciation)Fund closures ) ) ) (4 ? ? (46 (182End of period $ 28,819 $ 27,374 $ 28,875 $ 27,400 $ 26,304 assetsAverage assetsduring the $ 29,475 $ 28,883 $ 28,135 $ 28,198 $ 25,095 periodAverage advisory fee during the 0.43 % 0.44 % 0.42 % 0.42 % 0.41 %periodNumber of ETPs ? end of the 245 245 242 238 244 period PRODUCTCATEGORIES ($ in millions) Commodity & CurrencyBeginning of $ 23,657 $ 25,879 $ 25,176 $ 24,246 $ 19,818 period assetsInflows/ ) ) ) (1,112 ) (outflows) (318 (660 (296 1,308Market appreciation/ 1,433 (1,562 ) 999 2,042 3,120 (depreciation)End of period $ 24,772 $ 23,657 $ 25,879 $ 25,176 $ 24,246 assetsAverage assetsduring the $ 25,577 $ 25,296 $ 25,598 $ 25,949 $ 23,048 period U.S. Equity Beginning of $ 20,019 $ 18,367 $ 15,612 $ 13,997 $ 12,151 period assetsInflows/ )(outflows) 199 218 395 897 (241Market appreciation/ 1,076 1,434 2,360 718 2,087 (depreciation)End of period $ 21,294 $ 20,019 $ 18,367 $ 15,612 $ 13,997 assetsAverage assetsduring the $ 20,989 $ 19,320 $ 17,070 $ 15,159 $ 13,324 period Emerging Market EquityBeginning of $ 10,477 $ 8,539 $ 5,979 $ 5,413 $ 4,600 period assetsInflows/ )(outflows) 529 1,662 1,399 257 (25Market appreciation/ 511 276 1,161 309 838 (depreciation)End of period $ 11,517 $ 10,477 $ 8,539 $ 5,979 $ 5,413 assetsAverage assetsduring the $ 11,010 $ 9,875 $ 7,250 $ 5,917 $ 5,131 period

Three Months Ended June 30, Mar. 31, Dec. 31, Sept. 30, June 30, 2021 2021 2020 2020 2020 InternationalDeveloped Market EquityBeginning of period $ 9,991 $ 9,414 $ 8,621 $ 8,839 $ 8,659 assetsInflows/(outflows) 397 17 (191 ) (587 ) (965 )Market appreciation/ 405 560 984 369 1,145 (depreciation)End of period assets $ 10,793 $ 9,991 $ 9,414 $ 8,621 $ 8,839 Average assets $ 10,529 $ 9,796 $ 8,931 $ 8,835 $ 8,780 during the period Fixed Income Beginning of period $ 3,261 $ 3,324 $ 3,630 $ 3,530 $ 3,527 assetsInflows/(outflows) 168 10 (330 ) 76 (53 )Market appreciation/ 28 (73 ) 24 24 56 (depreciation)End of period assets $ 3,457 $ 3,261 $ 3,324 $ 3,630 $ 3,530 Average assets $ 3,354 $ 3,253 $ 3,472 $ 3,605 $ 3,523 during the period Leveraged & Inverse Beginning of period $ 1,521 $ 1,478 $ 1,425 $ 1,345 $ 896 assetsInflows/(outflows) (2 ) (5 ) (125 ) (9 ) 311 Market appreciation/ 173 48 178 89 138 (depreciation)End of period assets $ 1,692 $ 1,521 $ 1,478 $ 1,425 $ 1,345 Average assets $ 1,666 $ 1,555 $ 1,430 $ 1,476 $ 1,164 during the period Cryptocurrency Beginning of period $ 377 $ 168 $ 33 $ 15 $ 5 assetsInflows/(outflows) 8 36 48 15 8 Market appreciation/ (156 ) 173 87 3 2 (depreciation)End of period assets $ 229 $ 377 $ 168 $ 33 $ 15 Average assets $ 300 $ 264 $ 79 $ 27 $ 11 during the period Alternatives Beginning of period $ 227 $ 214 $ 229 $ 225 $ 244 assetsInflows/(outflows) (44 ) ? (26 ) (4 ) (29 )Market appreciation/ 11 13 11 8 10 (depreciation)End of period assets $ 194 $ 227 $ 214 $ 229 $ 225 Average assets $ 228 $ 223 $ 224 $ 226 $ 226 during the period Closed ETPs Beginning of period $ 7 $ 9 $ 5 $ 56 $ 447 assetsInflows/(outflows) (6 ) 1 7 (10 ) (188 )Market appreciation/ 3 (3 ) (3 ) 5 93 (depreciation)Fund closures (4 ) ? ? (46 ) (296 )End of period assets $ ? $ 7 $ 9 $ 5 $ 56 Average assets $ 5 $ 7 $ 7 $ 6 $ 538 during the period Headcount 227 227 217 211 214

Note: Previously issued statistics may be restated due to fund closures and trade adjustments Source: WisdomTree

WISDOMTREE INVESTMENTS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except per share amounts)

June30, Dec.31, 2021 2020 (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 167,635 $ 73,425 Securities owned, at fair value 58,806 34,895 Accounts receivable 34,800 29,455 Income taxes receivable 948 ? Prepaid expenses 6,327 3,827 Other current assets 288 259 Total current assets 268,804 141,861 Fixed assets, net 7,247 7,579 Securities held-to-maturity 370 451 Deferred tax assets, net 5,628 8,063 Investments 14,238 8,112 Right of use assets ? operating leases 16,213 16,327 Goodwill 85,856 85,856 Intangible assets 601,247 601,247 Other noncurrent assets 348 180 Total assets $ 999,951 $ 869,676 LIABILITIES AND STOCKHOLDERS? EQUITY LIABILITIES Current liabilities: Fund management and administration payable $ 18,592 $ 19,564 Compensation and benefits payable 15,447 22,803 Deferred consideration ? gold payments 16,101 17,374 Operating lease liabilities 3,326 3,135 Income taxes payable ? 916 Accounts payable and other liabilities 11,318 10,207 Total current liabilities 64,784 73,999 Convertible notes 317,336 166,646 Deferred consideration ? gold payments 210,605 212,763 Operating lease liabilities 16,920 17,434 Total liabilities 609,645 470,842 Preferred stock ? Series A Non-Voting Convertible,par value $0.01; 14.750 shares authorized, issued and 132,569 132,569 outstanding STOCKHOLDERS? EQUITY Common stock, par value $0.01; 250,000 shares authorized:Issued and outstanding: 145,114 and 148,716 at June 1,451 1,487 30, 2021 and December31, 2020, respectivelyAdditional paid-in capital 285,002 317,075 Accumulated other comprehensive income 1,155 1,102 Accumulated deficit (29,871 ) (53,399 )Total stockholders? equity 257,737 266,265 Total liabilities and stockholders? equity $ 999,951 $ 869,676

WISDOMTREE INVESTMENTS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited)

Six Months Ended June 30, June 30, 2021 2020Cash flows from operating activities: Net income/(loss) $ 32,777 $ (21,888 )Adjustments to reconcile net income/(loss) to net cash (used in)/provided by operating activities:Advisory fees received in gold, other precious (39,341 ) (29,135 )metals and cryptocurrenciesContractual gold payments 8,584 7,823 Stock-based compensation 5,264 6,159 Deferred income taxes 3,367 832 (Gain)/loss on revaluation of deferred consideration (3,329 ) 25,566 ? gold paymentsAmortization of right of use asset 1,340 1,588 Amortization of issuance costs - convertible notes 899 115 Depreciation and amortization 508 507 Impairments 303 19,672 Gain on sale ? Canadian ETF business ? (2,877 )Loss on extinguishment of debt ? 2,387 Amortization of issuance costs - former credit ? 1,328 facilityOther (372 ) (83 )Changes in operating assets and liabilities: Securities owned, at fair value (23,911 ) 4,209 Accounts receivable (2,622 ) 4,461 Prepaid expenses (2,497 ) (2,016 )Gold, other precious metals and cryptocurrencies 27,959 20,882 Other assets (202 ) (702 )Fund management and administration payable (896 ) 1,677 Compensation and benefits payable (7,396 ) (18,431 )Income taxes receivable/payable (1,852 ) (1,046 )Securities sold, but not yet purchased, at fair ? (582 )valueOperating lease liabilities (1,658 ) (1,845 )Accounts payable and other liabilities 858 781 Net cash (used in)/provided by operating activities (2,217 ) 19,382 Cash flows from investing activities: Purchase of investments (5,750 ) ? Purchase of fixed assets (173 ) (224 )Proceeds from held-to-maturity securities maturing 77 16,365 or called prior to maturityProceeds from the sale of the Company?s financial ? 8,155 interests in AdvisorEngine IncProceeds from sale of Canadian ETF business, net ? 2,774 Net cash (used in)/provided by investing activities (5,846 ) 27,070 Cash flows from financing activities: Shares repurchased (34,506 ) (26,444 )Dividends paid (9,865 ) (10,270 )Convertible notes issuance costs (4,297 ) (4,611 )Repayment of debt ? (179,000 )Proceeds from the issuance of convertible notes 150,000 150,000 Proceeds from exercise of stock options 815 240 Net cash provided by/(used in) financing activities 102,147 (70,085 )Increase/(decrease) in cash flows due to changes in 126 (1,084 )foreign exchange rateIncrease/(decrease) in cash and cash equivalents 94,210 (24,717 )Cash and cash equivalents ? beginning of year 73,425 74,972 Cash and cash equivalents ? end of period $ 167,635 $ 50,255 Supplemental disclosure of cash flow information: Cash paid for taxes $ 5,846 $ 2,200 Cash paid for interest $ 3,719 $ 3,390

Non-GAAP Financial Measurements

In an effort to provide additional information regarding our results as determined by GAAP, we also disclose certain non-GAAP information which we believe provides useful and meaningful information. Our management reviews these non-GAAP financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-GAAP measurements so as to share this perspective of management. Non-GAAP measurements do not have any standardized meaning, do not replace nor are superior to GAAP financial measurements and are unlikely to be comparable to similar measures presented by other companies. These non-GAAP financial measurements should be considered in the context with our GAAP results. The non-GAAP financial measurements contained in this press release include:

Adjusted income before income taxes, income tax expense, net income and diluted earnings per share. We disclose adjusted income before income taxes, income tax expense, net income and diluted earnings per share as non-GAAP financial measurements in order to report our results exclusive of items that are non-recurring or not core to our operating business. We believe presenting these non-GAAP financial measures provides investors with a consistent way to analyze our performance. These non-GAAP financial measures exclude the following:

-- Unrealized gains or losses on the revaluation of deferred consideration: Deferred consideration is an obligation we assumed in connection with the ETFS acquisition that is carried at fair value. This item represents the present value of an obligation to pay fixed ounces of gold into perpetuity and is measured using forward-looking gold prices. Changes in the forward-looking price of gold and changes in the discount rate used to compute the present value of the annual payment obligations may have a material impact on the carrying value of the deferred consideration and our reported financial results. We exclude this item when calculating our non-GAAP financial measurements as it is not core to our operating business. The item is not adjusted for income taxes as the obligation was assumed by a wholly-owned subsidiary of ours that is based in Jersey, a jurisdiction where we are subject to a zero percent tax rate. -- Tax shortfalls and windfalls upon vesting and exercise of stock-based compensation awards: GAAP requires the recognition of tax windfalls and shortfalls within income tax expense. These items arise upon the vesting and exercise of stock-based compensation awards and the magnitude is directly correlated to the number of awards vesting/exercised as well as the difference between the price of our stock on the date the award was granted and the date the award vested or was exercised. We exclude these items when calculating our non-GAAP financial measurements as they introduce volatility in earnings and are not core to our operating business. -- Other items: Unrealized gains recognized on our investment in Securrency, impairment charges, interest expense from the amortization of discount arising from the bifurcation of the conversion option embedded in the convertible notes (prior to January 1, 2021, the effective date of Accounting Standards Update 2020-06, Debt Debt with Conversion and Other Options, Cash Conversion), a loss on extinguishment of debt, the release of a deferred tax asset valuation allowance recognized on interest carryforwards arising from our debt previously outstanding in the United Kingdom, a gain arising from an adjustment to the estimated fair value of consideration received from the exit of our investment in AdvisorEngine and disposition-related costs are excluded when calculating our non-GAAP financial measurements.

Adjusted effective income tax rate. We disclose our adjusted effective income tax rate as a non-GAAP financial measurement in order to report our effective income tax rate exclusive of items that are non-recurring or not core to our operating business. We believe reporting our adjusted effective income tax rate provides investors with a consistent way to analyze our income taxes. Our adjusted effective income tax rate is calculated by dividing adjusted income tax expense by adjusted income before income taxes. See above for information regarding the items that are excluded.

Gross margin and gross margin percentage. We disclose our gross margin and gross margin percentage as non-GAAP financial measurements because we believe they provide investors with a consistent way to analyze the amount we retain after paying third-party service providers to operate our ETPs. These measures also assist us in analyzing the profitability of our products. We define gross margin as total operating revenues less fund management and administration expenses. Gross margin percentage is calculated as gross margin divided by total operating revenues.

WISDOMTREE INVESTMENTS, INC. AND SUBSIDIARIESGAAP to NON-GAAP RECONCILIATION (CONSOLIDATED)(in thousands)(Unaudited)

Three Months EndedAdjusted Net Income June 30, Mar. 31, Dec. 31, Sept. 30, June 30,and Diluted 2021 2021 2020 2020 2020Earnings per Share:Net income/(loss), $ 17,630 $ 15,147 $ (13,497 ) $ (270 ) $ (13,250 )as reportedDeduct/Add back:(Gain)/loss onrevaluation of (497 ) (2,832 ) 22,385 8,870 23,358 deferredconsiderationDeduct: Unrealizedgain recognized onour investment in (105 ) (179 ) ? ? ? Securrency, net ofincome taxesDeduct/Add back:Tax (windfalls)/shortfalls uponvesting and (233 ) 123 21 50 119 exercise ofstock-basedcompensation awardsAdd back:Impairments, net of ? 245 ? 2,326 ? income taxes (whereapplicable)Add back: Interestexpense from theamortization ofdiscount arisingfrom the ? ? 314 286 42 bifurcation of theconversion optionembedded in theconvertible notes,net of income taxesDeduct: Gainarising from anadjustment to theestimated fairvalue of ? ? ? (225 ) (868 )considerationreceived from theexit of ourinvestment inAdvisorEngineAdd back: Loss onextinguishment of ? ? ? ? 1,910 debt, net of incometaxesDeduct: Release ofa deferred taxasset valuationallowancerecognized oninterest ? ? ? ? (2,842 )carryforwardsarising from debtpreviouslyoutstanding in theUnited KingdomAdd back:Acquisition anddisposition-related ? ? ? ? 25 costs, net ofincome taxesAdjusted net income $ 16,795 $ 12,504 $ 9,223 $ 11,037 $ 8,494 Weighted averagecommon shares - 164,855 161,831 161,138 160,876 166,634 dilutedAdjusted earnings $ 0.10 $ 0.08 $ 0.06 $ 0.07 $ 0.05 per share - diluted Three Months EndedGross Margin and June 30, Mar. 31, Dec. 31, Sept. 30, June 30,Gross Margin 2021 2021 2020 2020 2020Percentage:Operating revenues $ 77,603 $ 72,830 $ 67,059 $ 64,640 $ 58,126 Less: Fundmanagement and (16,195 ) (15,521 ) (16,350 ) (15,219 ) (14,461 )administrationGross margin $ 61,408 $ 57,309 $ 50,709 $ 49,421 $ 43,665 Gross margin 79.1 % 78.7 % 75.6 % 76.5 % 75.1 %percentage

Three Months EndedAdjusted Income June 30, Mar. 31, Dec. 31, Sept. 30, June 30,Before Income 2021 2021 2020 2020 2020Taxes:Income/(loss) $ 21,889 $ 13,178 $ (11,297 ) $ 1,138 $ (14,054 )before income taxesDeduct/Add back:(Gain)/loss onrevaluation of (497 ) (2,832 ) 22,385 8,870 23,358 deferredconsiderationDeduct: Unrealizedgain recognized onour investment in (139 ) (237 ) ? ? ? Securrency, beforeincome taxesAdd back: Lossrecognized uponreduction of a ? 5,171 ? ? ? tax-relatedindemnificationassetAdd back:Impairments, before ? 303 ? 3,080 ? income taxesAdd back: Interestexpense from theamortization ofdiscount arisingfrom the ? ? 416 379 55 bifurcation of theconversion optionembedded in theconvertible notes,before income taxesDeduct: Gainarising from anadjustment to theestimated fairvalue of ? ? ? (225 ) (868 )considerationreceived from theexit of ourinvestment inAdvisorEngineAdd back: Loss onextinguishment of ? ? ? ? 2,387 debt, before incometaxesAdd back:Acquisition anddisposition-related ? ? ? ? 33 costs, beforeincome taxesAdjusted income $ 21,253 $ 15,583 $ 11,504 $ 13,242 $ 10,911 before income taxes

Three Months Ended Adjusted Income TaxExpense and June 30, Mar. 31, Dec. 31, Sept. 30, June 30,Adjusted Effective 2021 2021 2020 2020 2020Income Tax Rate: Adjusted incomebefore income taxes $ 21,253 $ 15,583 $ 11,504 $ 13,242 $ 10,911 (above)Income tax expense/ $ 4,259 $ (1,969 ) $ 2,200 $ 1,408 $ (804 )(benefit)Add back/(deduct):Tax windfalls/(shortfalls) uponvesting and 233 (123 ) (21 ) (50 ) (119 )exercise ofstock-basedcompensation awardsDeduct: Tax expenseon unrealized gainrecognized on our (34 ) (58 ) ? ? ? investment inSecurrencyAdd back: Taxbenefit arisingfrom reduction of a ? 5,171 ? ? ? tax-relatedindemnificationassetAdd back: Taxbenefit arising ? 58 ? 754 ? from impairmentsAdd back: Taxbenefit arisingfrom theamortization ofdiscount associated ? ? 102 93 13 with thebifurcation of theconversion optionembedded in theconvertible notesAdd back: Taxbenefit arisingfrom loss on ? ? ? ? 477 extinguishment ofdebtAdd back: Releaseof a deferred taxasset valuationallowancerecognized oninterest ? ? ? ? 2,842 carryforwardsarising from debtpreviouslyoutstanding in theUnited KingdomAdd back: Taxbenefit arisingfrom acquisition ? ? ? ? 8 anddisposition-relatedcostsAdjusted income tax $ 4,458 $ 3,079 $ 2,281 $ 2,205 $ 2,417 expenseAdjusted effective 21.0 % 19.8 % 19.8 % 16.7 % 22.2 %income tax rate

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements that are based on our managements beliefs and assumptions and on information currently available to our management. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as may, will, should, expects, intends, plans, anticipates, believes, estimates, predicts, potential, continue or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, the risks described below. If one or more of these or other risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance. You should read this press release completely and with the understanding that our actual future results may be materially different from any future results expressed or implied by these forward-looking statements.

In particular, forward-looking statements in this press release may include statements about

-- the ultimate duration of the COVID-19 pandemic and its short-term and long-term impact on our business and the global economy; -- anticipated trends, conditions and investor sentiment in the global markets and ETPs; -- anticipated levels of inflows into and outflows out of our ETPs; -- our ability to deliver favorable rates of return to investors; -- competition in our business; -- our ability to develop new products and services; -- our ability to maintain current vendors or find new vendors to provide services to us at favorable costs; -- our ability to successfully operate and expand our business in non-U.S. markets; and -- the effect of laws and regulations that apply to our business.

Our business is subject to many risks and uncertainties, including without limitation:

-- adverse market developments arising from the COVID-19 pandemic could negatively impact our assets under management, resulting in a decline in our revenues and other potential operational challenges; -- declining prices of securities, gold and other precious metals and other commodities can adversely affect our business by reducing the market value of the assets we manage or causing WisdomTree ETP investors to sell their fund shares and trigger redemptions; -- fluctuations in the amount and mix of our AUM, whether caused by disruptions in the financial markets or otherwise, including but not limited to a pandemic event such as COVID-19, may negatively impact revenues and operating margins, and may impede our ability to refinance our debt upon maturity or, increase the cost of borrowing upon a refinancing; -- competitive pressures could reduce revenues and profit margins; -- we derive a substantial portion of our revenues from a limited number of products, and as a result, our operating results are particularly exposed to investor sentiment toward investing in the products strategies and our ability to maintain the AUM of these products, as well as the performance of these products and market-specific and political and economic risk; -- a significant portion of our AUM is held in products with exposure to U.S. and international developed markets and we therefore have exposure to domestic and foreign market conditions and are subject to currency exchange rate risks; -- withdrawals or broad changes in investments in our ETPs by investors with significant positions may negatively impact revenues and operating margins; -- over the last few years, we have expanded our business internationally. This expansion subjects us to increased operational, regulatory, financial and other risks; -- many of our ETPs have a limited track record, and poor investment performance could cause our revenues to decline; and -- we depend on third parties to provide many critical services to operate our business and our ETPs. The failure of key vendors to adequately provide such services could materially affect our operating business and harm WisdomTree ETP investors.

Other factors, such as general economic conditions, including currency exchange rate fluctuations, also may have an effect on the results of our operations. For a more complete description of the risks noted above and other risks that could cause our actual results to differ from our current expectations, see Risk Factors in our Annual Report on Form 10-K for the year ended December31, 2020.

The forward-looking statements in this press release represent our views as of the date of this press release.We anticipate that subsequent events and developments may cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law.Therefore, these forward-looking statements do not represent our views as of any date other than the date of this press release.