Key Highlights

  • Funds under administration rose 20.3% to a record A$135.7 billion.
  • Net flows were A$15.4 billion, and total income rose 20.6% to A$391.1 million.
  • EBITDA rose 18.0% to A$192.9 million, excluding First Guardian costs.
  • A large compensation charge linked to the First Guardian matter was booked in the result.

What do you make of a Wealth platform that reported record Underlying Profit and market-share gains, yet also booked a large compensation charge for a failed Investment fund? That is the situation Netwealth Group presented in its FY26 result on 26 August 2026. The company (ASX:NWL) operates in this market. The Business is growing rapidly, but the First Guardian matter is a reminder that a platform's reputation and governance carry financial consequences.

What Netwealth does

Netwealth operates an investment platform used by financial advisers, accountants and their clients to hold and manage investments and superannuation. It earns Revenue mainly from fees linked to funds under administration (FUA) and from account-based fees and interest, so its income rises as client balances grow. It also offers managed accounts, a rapidly growing area in which professionally managed portfolios sit on the platform.

FY26 results

Unless stated, they exclude First Guardian costs.

Funds under administration: A$135.7 billion, up 20.3%, a record.

Net flows: A$15.4 billion.

Total income: A$391.1 million, up 20.6%.

EBITDA: A$192.9 million, up 18.0%, an EBITDA Margin of 49.1%.

Net profit after tax excluding First Guardian expenses: A$135.4 million, up 16.2%, a record.

Full-year dividend: 42.0 cents per share, up 9.1%, with a fully franked final Dividend of 21.0 cents.

Client accounts: 182,276, up 12.4%, and financial intermediaries up 5.9% to 4,205.

Managed accounts funds under management: A$34.6 billion, up 27.9%.

Chief executive Matt Heine described the year as one of continued share gains. Income growth slightly outpaced profit growth, and the FY27 margin target of about 47% compares with 49.1% in FY26, which suggests management expects costs, including investment, to rise faster than income.

The First Guardian matter

First Guardian was a managed investment fund that collapsed, and platforms that offered it have faced scrutiny. The Federal Court declared that Netwealth Superannuation Services and Netwealth Investments had contravened the Corporations Act by failing to obtain and assess sufficient information about the fund and to make adequate independent inquiries into its risks. Netwealth agreed to compensate affected members in full, with more than A$100 million paid to over 1,000 investors in January 2026.

Statutory profit was therefore lower than the A$135.4 million underlying figure. Netwealth said it had materially strengthened investment governance, including through a program it calls Reviewing Investment Standards and Excellence. Whether further regulatory action, claims or costs arise is not something the reviewed material answers.

Outlook and targets

It is also expanding into private wealth and broking, and has set a longer-term ambition, which it calls Dx30, to double platform FUA over four years. These are company targets, not forecasts from us, and net flows depend on adviser behaviour and market conditions. Because fees are linked to balances, investment market movements also directly affect revenue.

Competitive position

Netwealth competes in Australia's adviser platform market with larger incumbents such as the platforms owned by major banks and AMP, and with independent rivals including HUB24 and Praemium. Its pitch is a modern technology platform and encouraging adviser relationships, and Market Share of 9.7% suggests it is gaining ground, although that share figure is the company's own measurement. In managed accounts it faces competition on both product and fees, and large platforms can respond by cutting prices, which would pressure margins.

Risks and what to monitor

Regulatory and legal: further outcomes from the First Guardian matter, including proceedings, penalties or additional claims.

Market dependence: fee revenue falls if markets weaken, even with positive flows.

Competition: fee pressure from larger rivals and rival platforms with encouraging adviser relationships.

Margin: the planned reduction in EBITDA margin to about 47% as investment steps up.

Execution: delivery of private wealth and broking expansion and the Dx30 ambition.

Adviser industry changes: regulation affecting advice, or consolidation of adviser groups.

Upcoming developments

Investors will watch quarterly funds under administration updates, which give early evidence of net flows against the A$18 billion to A$20 billion target, along with the Annual General Meeting and the first-half FY27 result.

The takeaway

Netwealth's underlying business continues to grow faster than the market, supported by record flows and share gains. The First Guardian costs are a quantifiable cost, but their wider consequences for reputation and regulatory standing are harder to measure.