U.S. Global Investors assets under management climb during Q1 on gold strength

U.S. Global Investors (NASDAQ:GROW) reported a return to profitability in its fiscal third quarter as revenue and assets under management climbed, supported by strength in gold-focused investment strategies and growing investor interest in its defense and technology ETF offerings.

The San Antonio-based investment advisory firm posted net income of $2.7 million, or $0.23 per share, for the quarter ended March 31, 2026, compared with net losses in both the prior quarter and the same period a year earlier.

Total operating revenues rose to $2.8 million, up 10% from the previous quarter and 31% higher year over year.

Average assets under management (AAUM) reached $1.6 billion during the quarter, marking the company’s highest level since the quarter ended June 30, 2024.

U.S. Global Investors said the increase was driven primarily by continued gains in its gold and natural resources strategies, including the Gold and Precious Metals Fund (USERX), World Precious Minerals Fund (UNWPX), and the U.S. Global GO GOLD and Precious Metal Miners ETF (GOAU).

“During the first quarter of 2026, gold miners benefited from one of the strongest price environments in the industry’s history,” U.S. Global Investors CEO and chief investment officer Frank Holmes said.

He said that elevated gold prices are helping many mining companies produce strong free cash flow while improving their balance sheets, noting that an analysis of the NYSE Arca Gold Miners Index shows quarterly free cash flow per share has risen sharply since mid-2024.

“We believe this has helped renew investor interest in gold and precious metals strategies, contributing to the growth in our average assets under management during the quarter,” Holmes said.

The company also highlighted growth in its U.S. Global Technology and Aerospace & Defense ETF (WAR), which focuses on defense companies involved in artificial intelligence and advanced technologies. Assets under management in the ETF nearly doubled during the quarter to approximately $20 million.

“As government spending prioritizes a shift toward national security and AI, we believe WAR provides investors with targeted exposure to companies participating in this long-term transformation,” Holmes said.

U.S. Global Investors said investor sentiment toward airline and shipping industries has been affected by concerns around fuel costs and geopolitical tensions in the Middle East, though it continues to see long-term opportunities in both sectors.

The firm’s U.S. Global Jets ETF (JETS), which tracks the global airline industry, faced pressure from concerns over higher fuel prices and regional travel disruptions. However, the company noted that passenger demand has remained strong. Citing Airlines for America, U.S. Global Investors said US airlines were expected to carry a record 171 million passengers during the March-to-April spring travel period, representing a 4% increase from the prior year.

Meanwhile, the U.S. Global Sea to Sky Cargo ETF (SEA), which provides exposure to global shipping and air freight companies, benefited from improving freight activity. The company pointed to comments from shipping giant Maersk, which reported a 9.3% increase in ocean freight volumes in the first quarter compared with a year earlier.

“Even in an era of tariffs and geopolitical friction, goods still need to move,” Holmes highlighted. “We believe investors are underestimating the long-term importance of shipping and logistics in an increasingly digital and AI-driven world economy.”

Beyond operations, the company reported a shareholder yield of 9.96% as of March 31, 2026, more than double the yield on five-year and 10-year US Treasury bonds on the same trading day.

The company’s Board of Directors approved a monthly dividend of $0.0075 per share, beginning in April 2026 and continuing through June 2026.

U.S. Global Investors also maintains a share repurchase program authorized by the board, allowing for up to $5 million in annual buybacks. The program has been in place since December 2012 and is renewed annually. During the 12 months ended March 31, 2026, the company repurchased 776,299 shares, a 1% decline from the prior year but an 11% increase from the comparable period ended March 31, 2024.

The company said its liquidity position remains strong, with net working capital of approximately $36.2 million as of March 31, 2026. Cash and cash equivalents totaled about $24.6 million, up $23,000 from June 2025, providing what it described as sufficient flexibility to meet current obligations.